E-commerce in India-issues and challenges

The development and mastery of digital computing and communications technology is at the heart of the newly emerging global digital economy we call e-commerce. E-commerce is a recent phenomenon of the late 1990's. For economists, the early years of e-commerce raised the realistic prospect of perfect market; where price, cost and quality information is equally distributed, many suppliers compete against one another and customers have access to all relevant market information worldwide. Prior to the development of e-commerce, the process of marketing and selling goods was a mass-marketing and sales force-driven process. Consumers were viewed as passive targets of advertising and branding blitzes intended to influence their long-term product perceptions and immediate purchasing behavior. Selling was conducted in well-insulated channels. Consumers were trapped by geographical and social boundaries. Information about prices and costs were hidden from the consumer creating information asymmetry for the firm. E-commerce technologies made it possible for the merchants to know much more about consumers and to be able to use this information more effectively. The internet and e-commerce have been so successful and powerful that they directly involve the social, cultural and political life of entire nations and cultures. This paper is an exploratory study on evolution of e-commerce in India. The article explores the economic and social impact of e-commerce in Indian economy.