Management of E-Commerce - Literature review Example

MANAGEMENT OF E-COMMERCE By Location Management of E-commerce E-commerce is a term used in reference to any type of business transaction that involve transferring information through the internet. E-commerce allows customers to buy goods and services without having to worry about the barrier of time or distance. E-commerce can take place in the form of either B2B orB2C. A B2B transaction is one that takes place between a business organization and another business organization. A B2C is a transaction that takes place between a business organization and their customers. For an electronic data exchange to take place both parties need to set up data links between them. For e-commerce to effectively take place, applications such as e-mail, File Transfer Protocol, Electronic Data Interchange (EDI), online catalogues and shopping carts, and Web services (Schmidt, DöBler & Schenk 2000, p. 121). There are a number of opportunities that a retailer might have as a result of using e-commerce. For instance, e-commerce can help a retailer to expand their operation to the national and international markets with minimal required capital. A business organization can also take advantage of e-commerce and use it in enhancing their brand image. E-commerce avails multiple ways through which a retailer can communicate to their customers, making it easier for them to convince them while at the same time knowing what their customers expect from them (Qin 2007, p. 139). Through e-commerce a business organization has a chance of offering better customer service to their customers. When a retailer chooses to use e-commerce they gain search engine visibility. This implies that such a retailer can be able to reach out to more potential customers. A retailer that operates through e-commerce can operate at a lower cost. As a result of the lower cost of production, a business organization can be able to offer lower prices, thus an advantage in price competition. A retailer can also be able to operate 24 hours in a day because their customers will be able to reach them at any time of the day or night.Retailers who deal in niche products can also find it easier to locate their customers if they have online visibility. In the recent past it has been observed that paperwork has been becoming more cumbersome for retailers (Meier, Gosselin& Stormer 2009, p. 222). However, this is not the case for companies that have chosen to use e-commerce. With the use of e-commerce there is less need for paperwork, thus making the operation faster and easier. Another common characteristic of rattlers that use e-commerce is that they have simpler processes. Simpler process means that they are able to 9oparate efficiently in a short period of time. A retailer can also enhance their productivity through the use of e-commerce. This is because e-commerce supports the “pull” form of supply management. In this type of supply management, a business process begins when a request is received from a customer. Therefore, a business organization can be able to use the just-in-time form of production(Epstein 2004, p. 231). This kind of operation can help a retailer in reducing wastage by stocking only products that they know will be sold in the right quantity. Having a stagnant stock can be costly to a retailer, especially because they hold capital that would have been spent on other products that are more demanding. Despite the fact that adoption of e-commerce comes with opportunities, it also comes with a number of challenges. Just having adopted e-commerce does not imply that a retailer will automatically have online customers. A retailer will have to work hard to win the trust of their customers. Given the fact that there has been an increase in cybercrimes it takes proper designing, development, and implementation for a retailer to be able to convince their customers that their online system is safe (Alpert et al 2003, p. 378). Site factors such as ease of navigation, clean layout, and clear description of products or services are some of the factors that a business organization should consider when developing an online system. Another challenge usually comes during the integration of mobile into an online system. Researches have revealed that mobile shopping account for about 25% of online shopping. However, for an online system to support mobile transactions, it has to be optimized for the same. This kind of optimization will take some designing time and also some financial resources. Furthermore, an online system that has been optimized for mobile transaction faces more security risks as compared to those that are not optimized for mobile operations (Daugherty, Li & Biocca 2005, p. 475). Such a situation always gives managers a dilemma when deciding on whether or not they should adopt mobile transactions. Websites usually have tariff limits. For every retailer there is always a certain period that they experienced a sudden and unexpected increase in website tariff. If in any case the increased website tariff exceeds the tariff limit for the site, then their online system might go off (Manzoor 2010, p. 201). This is usually very embarrassing and sometimes can lead to loss of customers because they will lose trust in the company’s system. As customers are increasingly using online store to buy products their expectations on how easy using the sites should be always changing every day. It might be said that business organization should make sure that their customers have a pleasant experience when they visit their online system. However, it should be noted that in some cases, the experience that customers have when they visit retailer online systems might not be pleasant. As a result of such an experience, a retailer might loss customer. For instance, when a retailer’s servers are down customers might have a bad experience leading to a negative attitude towards the system.As customers look for the products that they want online there are always some pop-up adverts that usually appear. These pop-up adverts have no benefit to a retailers. Given the fact that these pop-up adverts are increasing every day, it can be said that online customers are increasingly having bad experiences when undertaking online shopping (Reynolds 2000, p. 422). The only positive thing about the pop-ups is that not only one website is affected. As much as eCommerce has many advantages, it does not enable retailers to offer personalized attention. If a customer visits a physical store, they will be able to attend to by the attendants and the store. In fact, as time goes by the attendants might get used in the preferences of a customer. Another advantage of vesting the physical store is that having a face-to-face encounter with a store’s personnel is more assuring than having online conversations, this is a kind of assurance that business organizations cannot offer their customers through their online presence (Jansen & Molina 2006, p. 1082). If a product turns out to be non-satisfactory to a customer, there is always returns which means that the retailer should either replace or refund. However, it should be noted that by the time a retailer is making a refund or replacement they had already incurred extra expenditure through shipping. Given the fact that shipping is not charged in most cases, a company will have recorded losses in a case of return and refund. This is a kind of problem that is less probable for a transaction that takes place at the physical store (Turban & King 2003, p. 187). This is because, the customers usually confirm the satisfaction of a product at the store before they pay for them. In a transaction that takes place at the physical store, there is rarely any shipping costs incurred. Ecommerce can be effective in responding to current customer behaviour. The modern consumers have the tendency of seeking hyper efficiency. People are seeking easier and more convenient ways of solving their problems. As a result they have always opted for the easiest ways through which they can get the best quality of product available in the market. Through online presence, a business organization can make sure that they are able to create consumer communities that enable them to share information about the experience that they had with specific brands. This helps them in knowing which product they can buy. A retailer can use their online presence to know what their customers think about their products. They will also have a chance of knowing things that their customers wish were done in a different way. With such information a business manager can know the ways in which they can change their operations to match consumer behaviour (Bhusry 2005, p. 201). Another emerging trend among consumers all over the world is recreational shopping. These are the people who go from one store to another but only shop when a compelling offer comes by. Online shopping can be used to make it easier for such shoppers to exist. With online shopping, such customers can navigate through a retailer’s catalogue and seek the product that best suits their desires. The good thing about eCommerce is that it does not have any time restriction. Even a person who has a busy day can go searching for products that they want at night at the comfort of their living room. As a result, it can be observed that such consumers will get more chances of getting exactly what they want. There is also a trend of impatience among customers globally. These are the customers who have no time for queues or any other time consuming process involved in physical buying such as going to the shop. People have always wished that there is a way through which they can get their desired products without having to make a trip to the store. For instance, a customer might want to shop for an evening meal, but have allot to do during the working hours. Such lifestyle is necessitated by the global economic changes that demand that people have to work for longer hours. With eCommerce, a retailer can be able to attend to such customers by making it possible for them to get their desired products without having to go to the physical stores. Given the opportunities that are brought about by investment in e-commerce, it is clearly evident that retailers should invest in e-commerce. The challenges discussed herein should be taken into consideration if in any case the process is to be a success. Given the various changes in consumer behaviour such as the need for hyper efficiency, recreational shopping, and impatience buying, a business organization can take advantage of ecommerce, thus respond to these changes. Bibliography Alpert, SR, Karat, J, Karat, CM, Brodie, C &Vergo, JG 2003, “User attitudes regarding a user-adaptive eCommerce web site” User Modeling and User-Adapted Interaction, 13(4), 373-396. Bhusry, M 2005, E-commerce,Firewall Media, New Delhi. Daugherty, T, Li, H &Biocca, F 2005, “Experiential ecommerce: A summary of research investigating the impact of virtual experience on consumer learning” Online Consumer Psychology: Understanding and Influencing Consumer Behavior in the Virtual World, 457, 489. Epstein, MJ 2004, Implementing e-commerce strategies: a guide to corporate success after the Dot.com bust, Praeger, Westport, Conn. Jansen, BJ & Molina, PR 2006, “The effectiveness of Web search engines for retrieving relevant ecommerce links” Information Processing & Management, 42 (4), 1075-1098. Manzoor, A 2010, E-commerce: an introduction,LAP Lambert Acad. Publ, Saarbrücken. Meier, A, Gosselin, E & Stormer, H 2009, eBusiness&eCommerce: managing the digital value chain, Springer Science & Business Media. Qin, Z 2007, Introduction to E-commerce, Springer Berlin, Berlin. Reynolds, J 2000, “eCommerce: a critical review” International Journal of Retail & Distribution Management, 28(10), 417-444. Schmidt, ID, DöBler, T & Schenk, M 2000, E-commerce: a platform for integrated marketing ; case study on U.S. retailing,Lit, Münster [u.a.]. Turban, E & King, D 2003, Introduction to e-commerce, Prentice Hall, Upper Saddle River, NJ [u.a.]. Read More