Fundamentals of E-Business
This section covers the Fundamentals of E-Business domain: the vocabulary, models and controls that the exam uses to test whether you understand how digital networks change business. Expect scenario questions that ask you to classify a transaction, choose a revenue model, trace a value-chain step, or identify the payment, security or legal issue in an online sale.
Core rules and concepts
- E-business is broader than e-commerce. E-commerce is the buying and selling transaction; e-business also includes digitised internal and partner processes such as e-procurement, supply-chain management, CRM, ERP and intranets.
- Transaction types: B2B (business to business), B2C (business to consumer), C2C (consumer to consumer through a platform), C2B (consumer supplies value to a business) and intra-business (inside one firm).
- A business model explains how value is created and delivered; a revenue model explains how money is captured. Common revenue models are direct sales, subscription, transaction commission, advertising, affiliate referral and freemium.
- A digital value chain runs from attract (search, social, content) to convert (catalogue, checkout) to fulfil (payment gateway, logistics) to retain (CRM, support). TLS/HTTPS, authentication and PCI DSS protect payment data; national IT law, such as India's Information Technology Act, 2000, can give legal recognition to electronic records and signatures.
Worked example
A bakery sells cakes only through its own website, accepts card payment online and uses a courier. It is B2C e-commerce: the buyer is an individual consumer. It becomes fuller e-business only if ordering, payment, stock alerts and customer records are integrated. If the site only displays a menu and the order is completed by phone, the website is a marketing channel, not a complete online transaction. Its revenue model is direct product sales, not advertising.
Traps
Do not label every website an e-business; do not confuse B2B with selling through a wholesaler; do not treat a payment gateway as the same as a merchant account; and do not assume HTTPS alone makes a site secure or legally compliant.