E-Commerce: An Upcoming Trend in Business - Essay Example

E-commerce: An upcoming trend in business Introduction The electronic commerce is an upcoming trend in the business that has been observed in the last few years. The shift in the trend of business houses in adopting the practices of e-commerce has been largely due to the shift in the lifestyle trend of the customers in line with the globalization of the economies around the world. The rise in employment, fastness of livelihood and the rise in demand of the customers have led to innovative steps taken by the companies in meeting the market demands. The companies like Amazon.com Inc., e-Bay Inc. has experienced rapid growth of sales and revenues due to the changing trends towards e-commerce that is prevalent in the business markets. The thesis statement that has been addressed in this paper is given as follows. “E-commerce is the upcoming trend in business and is important from the perspective of changing demands of the market”. The examples of Amazon and e-bay as cited above are perfect from the point of view of e-commerce in the business scenario. The examples cited in the context of e-commerce are perfect as these companies have set up system for selling of goods and services to the customers through the use of electronic media like the online networks with the use of computer and world-wide web. The e-commerce trend that has been coming up in the market has been largely due to successful implementation of these companies in the areas of online marketing, online transactions, management of supply chain, data interface with the customers through the electronic medium, analysis of big data, etc. It is generally believed that the e-commerce as an upcoming trend in the business deals with the sales activities of the business through the use of electronic medium. However, the upcoming trend in the business shows that the analysis of data through electronic means, financial transactions by the customers and the tracking of customers’ requests, orders, delivery and complaints are dealt by the comprehensive system of e-commerce. Apart from setting up the official websites, the companies have set up online catalogues and have also used the online communication channels as tools for promotion and selling of products and services. The e-commerce trend in the business also includes sharing of data between the business houses through the adoption of online platforms. The security of data and information of the customers and the companies are important in the context of upcoming trend of e-commerce in the industry. However, the companies adopting the trend of e-commerce in their business are also required to follow the government regulations in operating their business through e-commerce. The rise in the activities of e-commerce has led to the increase in competition over the pricing of products. The increase in the activities of e-commerce has also impacted the sales and revenues, profitability and the attainment of economies of scale of the companies. The background for the growth of e-commerce, the upcoming trends in the business, the impacts on the business and the customers have been revealed with the help of this research. Background The upcoming trend of e-commerce in the business could be understood from the fact that the online retail industry of UK is expected to achieve sales revenues amounting to 87 million pounds by the end of 2013. The online sales of the retail sector are expected to grow by 12% on a year-after-year basis. The growth trend is likely to continue in the domain of e-commerce in the worldwide business and the companies all over the world is going to undergo this change in 2014 in order to address the changing demands of the markets and the customers. These companies have been quick to identify the trends of globalization in the world economies. The economic reforms adopted by the countries have led to the opening up of various emerging markets that have allowed them to experience rapid growth in short span of time (Chaffey 56). The business houses have taken the opportunities to invest in the overseas markets, emerging markets in order to expand their business. The markets all over the world, like Brazil, China, India, Kazakhstan and many other economies have focused on setting up favorable infrastructure in the domestic markets. The favorablelaws set up by the government have been aimed at encouraging foreign direct investments of the investors in their economies. The opportunities to expand in these markets with the availability of high quality human resource, capital funding, available energy resources have led the companies to set up business establishments and production factories in these economies. This has led to the increase in employment opportunities of the people in the community. The availability of the employment opportunities in the market has led to the rise in the level of income of the people. The transformation of the markets all over the world has thus led to the increase in the purchasing power of the middle class families. The increasing in purchasing power of the customers has led to the change in outlook and they started to lead a fast-pace life with changes in the occupational style. The availability of more funds in the hands of customers led to the increase in demand of the products and services sold in the market. The circular flows of money were made to good use in the growth of the demand driven economies. The business houses took advantage of the rise in market demands and the changes in lifestyle and livelihood of the customers. The companies identified those changes in the approach of the customers while engaging into shopping activities. It was observed that the customers have started to bank on the online mode of shopping more than the physical mode of shopping. In-spite of visiting the physical store for buying the products, the customers started to purchase the desired products through the online channels like the internet, electronic web platforms, online applications and media tools, etc. This provided the users with the advantage of saving crucial time while purchasing products and services (Tassabehji 74). The customers could use the electronic platforms to purchase electronic items, mobiles, books, apparels and any other product that is intended for purchase. Apart from saving the time required for purchasing of the goods and services, the online mode of purchase offered flexibility to the customers of looking at a wide variety of options on the products as well as the substitute products. The differences in the quality of the products and the prices fixed by the manufacturers could be compared. The customers were also able to compare the various options as well as take into consideration the comparative features of the products and services. The customers could also view the feedbacks provided by the existing users of the products or service. All these features have provided comparative advantage to the customers due to whom they resorted more towards the use of electronic medium for decision making and purchase of the products and the services. In order to attain sustainability of the business of the existing establishments, the companies started to identify the changing trends in the business and the behavior of the customers. The opportunities for expansion to the overseas and emerging markets by the companies also required consideration of the changing trends of the customers (Botha, Bothma and Geldenhuys 87). After identifying the changing demands in the worldwide markets, the business houses started to incorporate strategic plan to address these changes. This has led to the advent of e-commerce through which the companies were able to provide the customers the required online platform for buying, selling, financial transactions, feedback, etc. The growth of e-commerce is an upcoming trend in the business that has been widely accepted by the customers in the markets across the globe and has been fruitful for the companies in being able to continue the growth of their business. Body paragraph: Analysis and findings The upcoming trend of e-commerce in the business has been analyzed and the following insights have been obtained on the several trends in the business. The growth of e-commerce has led to the increase in the B2B business transactions. The customers who are the end users of the products and the services sold by the company lies have shown increasing demand for the items which include, apparel, grocery, electronic products, books, sports items and every other material required for use. The business houses have undertaken research to find new ways of supplying the products and services in order to cater to the increasing online demand of the customers. In order to ensure successful operation of the business through the e-commerce platforms, the companies have started to procure raw materials as well as end products from other companies through the medium of worldwide web. This has led to the increase in transactions and exchange of products and services between the business houses. Thus B2B commerce has increased in the course of business activities through e-commerce. It is evident that the companies that are not ready to undergo the process of transformation to align with the e-commerce mode of business are likely to fail in achieving sustainability of business (Alghamdi 84). The trend of e-commerce in the business has increased the activities of analysis of big volumes of data by the companies. These companies have been collecting the huge volumes of data over the years on the various factors like the products preferred by the customers, the variation of sales at different times during the years, the classification of the customers based on their age, gender, etc.; the feedback of the customers on the products and services of the company, etc. This large scale of data which were left idle with the companies over the years were made to good use through the process of analysis and determining important trends in the business and worldwide markets. The companies started to hire statisticians and economists to undertake analysis and research on the business activities that helped them to identify important trends and develop strategic plan of selling products and services through e-commerce. Tesco is an example in the worldwide business that uses the strategic of data analysis and application of important findings through the e-commerce platforms (Kenneth 36). The multichannel shopping is another trend in activities of e-commerce in the worldwide business. The companies have found that the customers have started to use various electronic devices like the smartphones, tablets, mobile applications, etc.The customers have started to use any of these channels as per their convenience and are not confined to only physical mode of shopping. Thus the companies have set up their online transaction portals that are compatible to be run in these electronic devices like the smartphones, mobiles, tablets, laptops, etc. The customers have also preferred in some cases to purchase products from the physical stores and then get updates about the transaction through the online services of the companies which may be electronic messages, electronic updates, etc. The advent of e-commerce in business has led to implementation of online applications and services in order to provide the customers with satisfactory ways of online shopping (Bajaj and Nag 39). The growing trend of e-commerce in the business has observed companies make use of the online channels to a large extent for promotion and sales of their products and services. Since the word of mouth spreads rapidly through the online channels, the companies have become extremely aware of the brand reputation and the feedback from the customers. The online channels used in the e-commerce mode of business are it used for providing assistance to the customers for resolution of their queries as well as grievances. This has made rapid improvements in supporting the customers post purchase transaction which has added to the convenience of the customers and at the same time has helped the companies to increase the brand loyalty. Several companies like Amazon, e-bay has set up online chat service with their representatives who are readily available to interact with the customers at any point of time (Warkentin 46). The data and information available from online channel provides insight to the companies in judging the demands of the people in a certain market. It provides the idea on the mandatory features that should be incorporated in the product in order to penetrate a new market. The e-commerce mode of business is also an opportunity for new businesses to launch their products and services in the same platform without much barrier to entry into the market. The online portals such as “Kickstarter” allow the new businesses to promote and sell their products and services to the customers and compete with the big players in the industry. Due to the opportunities provided by the e-commerce mode of business, the prospects of healthy competition among the sellers in the markets are likely to develop in near future. The pricing of the products would be judged on the basis of the quality and brand for taking decisions on purchase transactions (Barnes andHunt 28). The trend of e-commerce has enabled companies to provide advanced user experience to the customers who visit their websites or chose to transact for purchasing products and service through online portals, websites, etc. It has been found that the customers may get repelled due to the offering of repetitive products in the physical stores by the companies which are neither innovative nor generate interest among the customers. The business of e-commerce have offered the companies to innovate their product offerings through exclusive design of their websites and improved means of transaction for the purpose of purchase. The images, videos and innovative captions to demonstrate comparative advantage in the usage of its products would help the companies to increase the acceptability of the customers (May 95). The convenience and comfort provided by the companies through advanced electronic applications would help in meeting the demands of the customers to their utmost satisfaction. The companies have set up systems of customer relationship management in the course of their business operations through e-commerce. The applications have enabled the companies to track their orders and deliveries to the customers at each and every stage. This approach has allowed the companies to take into consideration the customer responses on the satisfaction levels. The queries and the grievances of the customers could also be tracked with the help of customer relationship software. The time of delivery of the product is also tracked by the customer relationship management system. This leads to increase in efficiency of the supply chain. The operations of the company through e-commerce have led to the decrease in the delivery time of the products to the customers (Krafft and Mantrala 90). The turn-around time in case of customer requests have also improved. All these factors have led to increasing satisfaction levels of the customers which has increased the sales and services of the companies. The sales and revenues, profitability and turnover of the companies have increased and sustainability in business has been achieved through e-commerce. Conclusion Global business environment is becoming highly competitive as several leading multinational or domestic organizations are trying to capitalize on the potential business opportunities that have been developed due to globalization and technological advancement. Adoption and implementation of advanced technology in the business operation process is becoming an upcoming trend in the global business environment. Example of e-bay and Amazon has been considered in this study in order to determine that the e-commerce is becoming the upcoming trend in the global business practices and its importance from the perspective of changing market demand. Now-a-days, people around the globe try to consume products with limited consumption efforts through online purchasing processes. Day-by-day, people are getting busy in their daily life due to immense stress and pressure in workplace. Therefore, they always try to avoid the time consuming consumption process. Demand for online marketing and purchasing activities are significantly increasing among the target customers. On the other hand, demand for e-commerce business process and strategies are significantly increasing among the leading organizations. Now-a-days, people can consume products and services quite easily through the e-commerce websites. It helps the customers to save valuable consumption time and consumption cost. E-bay can be considered as one of the leading online marketing platforms through which several organizations can sell their products and services to people. In addition to this, the study has provided the example of Amazon. It also can be considered as one of the leading e-commerce organizations. The organization is popular due to selling of books to people through online. Organizations can reduce or cut down business operation cost through the adoption of e-commerce strategy in the business operation process. In addition to this, the organization can reach to the more number of customers in an efficient way. Now-a-days, people demand high quality products and high quality service in low price. E-commerce business organizations can offer products and services in low price as it helps to reduce several business operation cost. Running of e-commerce business can be considered as more profitable comparing to a brick and mortal business. UK online retail industry is becoming highly competitive as several leading organizations within this industry are trying to sell products through online. Tesco can be considered as one of the leading organizations within the UK retail industry that has adopted effective online business operation strategy. In addition to this, several organizations used to market and sell its products through e-bay. It has become one of the one of the leading e-commerce business organizations in global market place. Slowly and gradually, several organizations around the globe are trying to take the advantage of this growing demand of online business and marketing activities. It is important for an organization to consider and develop niche marketing strategy in the business operation process in order to attract untapped market in global market places. On the other hand, implementation of differentiation strategy can help an organization to gain potential competitive advantage. Therefore, adoption and implementation of e-commerce strategy in the business operation process can help several organizations to meet the upcoming market trend as it can help to offer products and services according to the future market demand. Work Cited Alghamdi, Abdulhadi. The Law of E-Commerce: E-Contracts, E-Business. Bloomington: AuthorHouse, 2011. Print. Bajaj, Kamlesh. and Debjani, Nag. E-Commerce. New Delhi: Tata McGraw-Hill Education, 2005. Print. Barnes,Stuart. andBrian, Hunt. E-Commerce and V-Business. New York: Taylor & Francis, 2013. Print. Botha, Bothma andPieter, Geldenhuys. Managing E-commerce in Business. New Delhi: Juta and Company Ltd, 2008. Print. Chaffey, Dave. E-Business and E-Commerce Management. New Delhi: Pearson Education India, 2008. Print. Kenneth, Laudon. E-Commerce: Business, Technology, Society, 4/e. New Delhi: Pearson Education India, 2011. Print. May, Paul. The Business of Ecommerce: From Corporate Strategy to Technology. Cambridge: Cambridge University Press, 2000. Print. Tassabehji, Rana. Applying E-Commerce in Business.London: SAGE, 2003. Print. Warkentin, Merrill. Business to Business Electronic Commerce: Challenges and Solutions. Hershey: Idea Group Inc (IGI), 2003. Print. Krafft, Manfred. and Murali, Mantrala. Retailing in the 21st Century: Current and Future Trends. Berlin: Springer, 2009. Print. Read More