Advantages and Disadvantages of Operating on the Internet - Essay Example

Student Name: Tutor: Title: E-commerce Course: E-commerce Introduction The urge of business to do business on the internet is strong for many companies. Internet sales and marketing has been on the rise since the advent of the internet and the use of the World Wide Web. Many businesses use the internet for marketing and others use it for selling despite marketing. Everything will always have a brighter side and a dark side and anyone has to consider both before venturing into it (O’Brien & Marakas, 2011). Online or internet business is not an exception. Whereas online business is a niche that most companies would want to explore, it is crucial for them to understand the risks and competitive advantage involved in order to make an informed decision. Prior to venturing online a business has to understand the disadvantages and advantages of doing business online. Electronic presence may or may not work for some businesses and it depends on how it is deployed. Advantages and disadvantages of operating on the Internet Using the internet employees and business owners can connect to customers more easily than ever before. As compared to visiting or calling the store to get information about services or products, customers can email the stores or access as much information online as possible. Businesses can use social media to promote relationship marketing and create awareness about the product (O’Brien & Marakas, 2011). Social media have promoted the means of businesses connecting with their customers. Twitter, Facebook and Google hangout can be used in connecting with customers. A lot of information can be accessed through the internet hence providing customers with a wide range of varieties to choose from. Doing business online is faster and sales can be done regardless of the location of the customer as long as he can foot the freight charges. Possessing a website that permits customers the opportunity to shop online can help to improve the financial bottom line of the business (Dayle, 2001). Customers prefer doing their shopping online since it is convenient and comfortable and they do not have to visit the stores in person. Customers can be provided with information about new arrival of products in stores or change of prices. The internet gives a business a global audience as compared to having few billboards and ads in the local media. Customers around the world can access information about the business and order products if they are impressed. The business can use the internet presence to increase its customer base. The company can use its presence online to increase its customer base by reaching out to more people who can be turned into loyal customers. The World Wide Web operates for everyday for twenty four hours and sales can be made anytime regardless of the customers’ location (Lamont, 2001). Customers do not have to wait for stores to open before they place their orders. Automation can allow placing of orders regardless of the time. It is also cheap to market products online if the business website is designed in a proper way that is attractive and provides sufficient information about the business and its products. On the other hand, there are several disadvantages that have to be mulled over by managers who want to their businesses to have online presence or transact business online. There are many laws that interfere with online businesses. Doing business online subjects the business to laws and regulations of other countries where clients can access the business website. The business on the internet is subject to privacy laws and regulations of the United States and overseas, tax laws and worldwide copy right laws that normally depend on the location of the company (O’Brien & Marakas, 2011). Without proper and thorough legal consultation, a business can find itself facing multiple lawsuits for breaching the numerous laws regarding online business and access of certain materials particularly for minors. In some circumstances there is luck of trust on the part of the customers. Customers appear to be worry about doing business online or ordering products online. Customers also tread carefully since they imagine that they will lose their personal information and money if security of companies is compromised online. Consequently some potential customers will always feel uncomfortable about conducting transactions online (Eisingerich & Kretschmer, 2008). Cybercrimes have been on the rise and absence of proper laws to convict perpetrators has exposed online traders to danger while compromising personal information of unsuspecting clients who are later implicated in crimes they do not know using their credit cards. Business ideas and strategies are at the risk of being duplicated online. Millions of people around the world have access to the internet and it is important to have a competitive edge. Hackers can steal business information or strategies and sell them to competitors or use it set up similar businesses (Graham, 2008). Consequently business ideas are at the risk of copy-cutting. It is expensive to have a copyright or a patent that protect website ideas and people will always try to duplicate what another business is doing. The appearance of the website or marketing of products can be copied by competitors. Inability to properly protect business ideas can be of a great disadvantage to the business. Electronic presence does it make sense for certain industries Electronic presence of a business is very important and should not be a preserve of certain industries. A wider customer base can be reached and there are reduced costs of marketing and advertising. Launch products can reach a wider customer base. A business can maintain physical stores while having a website to cater for customers who prefer online shopping. A business can also use the Website for advertising, promotion and marketing only at a reduced cost. Online presence provides information about the activities that the business is engaged on despite the industry (Lamont, 2001). Online presence cannot be a preserve of certain industries. It can be used to provide information about the business in order to lure potential customers to visit the stores or the sites. A business can trace strategies of competitors and know what to do better. Electronic presence has many advantages to businesses and with proper use it can lead to prosperity and tremendous growth. Challenges implementing an e-commerce strategy Many businesses do not have information technology department and therefore they will rely on outside expertise when it comes to implementation of an e-commerce strategy. An outside expert may not understand the needs of the business from the insider perspective. A hired expert can sell the secret and strategies of the company to competitors. A business has also to understand international laws and regulation governing online transaction to avoid running into trouble. Different laws from one country to another exposes the business to vulnerability of breach of conduct and hence imminent law suits (Eisingerich & Kretschmer, 2008). Establishing ones presence online is not easy and the business has to consult widely before implementing an e-commerce strategy. Despite the challenges businesses have every reason to incorporate e-commerce strategy in their businesses. Securing a website copyright is challenge and a business has to be careful while going online. Conclusion Businesses in many sectors of the economy use the internet to reach customers, promoting products and even widen their customer base. Despite the risks and challenges involves in internet or online business, this mode of doing business is fast-spreading. The presence of a business online is very important since it provides vital information about the business and its products to anyone who wants to access it. Any business can transact its business online and it should not be a preserve of certain sectors. There are challenges that a business can face while implementing an e-commerce strategy. A business has to assess all risks before doing business online. There should be an effort to understand online laws and regulations to avoid multiple suits. References Dayle, S. (2001). The E-business Book: A Step-by-Step Guide to E-commerce and Beyond, Princeton: Bloomberg Press. Eisingerich, A.B., & Kretschmer, T. (2008). In E-Commerce, More is More, Harvard Business Review 86: 20–21. Graham, M. (2008). Warped Geographies of Development: The Internet and Theories of Economic Development, Geography Compass 2 (3): 771 Lamont, D. (2001). Conquering the Wireless World: The Age of m-Commerce, United Kingdom: Capstone Publishing Inc. O’Brien, A. J. & Marakas, M. G. (2011). Management Information Systems, 10e. New York: NY Read More