The Rise of Online Shopping - Coursework Example

The Rise of Online Shopping Innovation and technological changes have had significant effects in the way people purchase goods and services in the contemporary world. Introduction of the computer and internet as tools of conducting business has resulted in the introduction of online shopping as the most convenient way for customers to purchase what they need and for the business community to reach a wider market for the goods and services they offer. For online shopping to occur, a client in front of a computer or using a phone orders a selected product by clicking in the webstore or sending an e-mail to the online trader. People no longer have to travel or look for the best offers for the goods and services they desire, one has to just open a website of a company offering the option of online shopping and whatever is needed can be transported to the indicated address after processing the necessary payments. However, many providers of online shopping require that a potential client takes part in a preliminary registration on the website as part of the process of virtual purchasing. The customer is then in a position to study the offers present, followed by the selection of the preferred product and placing them into basket designed to keep the selected products from the rest. Service also provides customers with a chance to refresh or cancel the content of the basket when the customer decides to change or remove the product previously selected. The customer must also provide the convenient way for the selected product to be transported to the customer’s address in addition to other special conditions that the customer requires such as special wrapping. The online trader then acknowledges reception of the order through sending an electronic confirmation to the consumer before making the necessary arrangements to have the order delivered to the customer. Therefore online shopping has created customer satisfaction due to easier access to goods and services while also having a positive business effects for the traders that has resulted in the change of social and cultural perspectives. Customer Satisfaction with Online Shopping One of the advantages with shopping online is that people get to save time as they do not have to go to a physical store to select the goods they need to buy. Saving time is much more important especially during the festive season when the stores are characterized by long queue of shoppers. For online shoppers one does not have to stand in a queue and wait to be served as the website in most cases is able to handle multiple customers operating from different computers. Therefore, online shopping provides a more convenient way for customers who do not want to stay in queues (Holl, 2013). Due to the use of World Wide Web in online shopping, one is able to access any online market in the world which enables a customer to compare prices for goods and services from any place. The customer is able to access certain goods and services not produced in the home country or those of higher quality or low prices from other countries by placing an order from where the customer is located. Therefore, online shopping increase the variety of goods and services that a customer can get access to thereby increasing the chances of customer satisfaction and reduces the reliance on a small market that offers low quality or highly priced goods and services (Holl, 2013). Part of the advantage of being able to access goods and services from all over the world that comes with online shopping is being able to get the ordered products delivered to any country the customer is located. The customer gets the ordered product shipped to the address indicated with a more convenient price which does not represent a significant increase compared to those provided by the local stores. Online shopping business have transportation infrastructure that covers land, water and air depending on the kind of transport that is convenient for the ordered product where bulky or light in weight, big or small and perishable or with long shelf life (Holl, 2013). Additionally, online shopping has made it possible for customers to receive the latest products before everyone else can access them from the market. Many companies post their new products that have been introduced into the market on their online shopping website before such products can reach the conventional markets. Such moves enable those who do online shopping to get first access to new fashions before others get them. Therefore, online shoppers are always in the forefront when it comes to fashion and trying out new products. Being able to access goods and services before others does makes online shoppers trend setters in their society as others learns about new fashions from them (Holl, 2013; Jarvis, Lawson, Smith and Yull, 2005). However, even as online shoppers are seen as enjoy a number of benefits that those who depend on the physical stores cannot enjoy, there are also some disadvantages that any online shopper should be aware of and be prepared to handle whenever they occur. One such disadvantage that online shoppers face is the lack of options for physical examination of the product one wants before completing a transaction. Online customers have to be contented with the uploaded pictures and descriptions of the product that the shopper intends to purchase. In case the shopper is not satisfied with what is presented on the website, the last resort is only conducting the customer service of the business offering online shopping before or after shopping. Therefore, online shopping does not offer a chance for the shopper to have a physical experience of how the product is through feeling the texture, smelling and so on before the product is transported to the customer’s location (Jarvis, Lawson, Smith and Yull, 2005). Some online shoppers have had the wrong product delivered to them due to mix ups that occur during packaging or transportation. Given that the shopper has to wait for the requested product while at home, there are no verification methods to ensure the right product is delivered to the customer. When such confusion takes place, the shopper is forced to wait for more days for the wrong product to be transported back and then the right one packaged and sent again. Such incontinences increases the time taken for a shopper to enjoy what was ordered. This situation is even worse when the product was needed urgently or was to be used during a specific date which makes the right product useless when it is delivered to the customer (Jarvis, Lawson, Smith and Yull, 2005). Although a shopper avoids the queues that characterise physical stores and marts, online shoppers have to also wait for some time before the order is delivered to them. This puts online shoppers at a disadvantage as one cannot buy and start using the product immediately. Given the time taken for confirmation of the order, verification of a customer’s credit cards and the address for delivery in addition to the time taken from when the product leaves the trader’s storage facility to when it gets to the customers door, online shopping takes longer than purchasing from physical stores and marts (Jarvis, Lawson, Smith and Yull, 2005). For online shoppers, there is always a risk that one might fall victim to online fraudsters who pose as genuine business people. Online shoppers have to be careful when sending money to ensure they are not duped into sending money to these criminals something they would avoid when they visit a store (Jarvis, Lawson, Smith and Yull, 2005). Business Effects of Online Shopping When one has a business idea that can generate income, it takes a minimum start-up time to setup an online business company given the few steps involved. After identify the need in the market, one need to write a copy that sells by creating a simple selling process that covers activities that will happen from the moment the shopper arrives to when they make a purchase the next step for a potential online business entrepreneur is to design and build an attractive website which should be followed with making use of search engines that will drive potential customers to the new site. This simple steps are all entrepreneur needs to create a successful online business as long as they establish expert reputation and use tools such as e-mail marketing to turn visitors to the website customers (Moon, n.d). Online retail businesses offer the most appropriate form of business for entrepreneurs with minimal capital to invest up front given that the costs associated with setting up a physical store is avoided in online business model as an entrepreneur can operate from home. Further, online business does not involve payment of rent for those who do not own a store. However, the entrepreneur might need to pay for specialized storage facility when dealing in perishable goods like foodstuff and flowers. Online business also requires fewer amounts of finances for advertisement compared to physical stores as the owner of online shopping business will only depend on increasing the number of traffic to the business website (Jarvis, Lawson, Smith and Yull, 2005). Owning an online business removes the need to create more branches whenever the company expands to new markets within or outside the country. Online business owners expand their business by improving their presence in the online media and not opening more offices and branches. An avenue for this type of business owners to reach more markets includes advertisement in social media such as Facebook, twitter, MySpace among others. Such methods further cuts costs of operation for the business and therefore results in higher profits for the owners. Therefore, the business headquarters serves all the markets and customers adequately without requiring physical presence of the business in these areas. Creating an online business presents the owner with the freedom to live and run the business from anywhere not necessarily near the point of operation. Further, the owner can travel while running online business without compromising business operations. All one needs is a computer and internet to be able to supervise business operations that include taking orders, processing payment and making arrangement for the purchased product to be shipped to the customer (Jarvis, Lawson, Smith and Yull, 2005). Business owners are currently taking advantage of the ‘click and collect’ concept to increase sales given the widespread consumer acceptance. This concept of shopping online allows customers to select a product, make an order and process payment but then visit the nearest pick up point designed by business enterprises. This concept has enabled online business owners cut the cost associated with transportation and reduce chances of packing the wrong order (Wallop, 2013). By choosing to do business online, business owners contribute to environmental conservations. Online business companies limit the amount of paper and office waste output that characterise conventional workplaces as they use online, digital methods for communication amongst members of staff, suppliers and with customers. Additionally, paperless technology have been used by online businesses to produce contracts and invoices where tools such as adobe software that help in making e-contracts. Digital marketing is also an environmental friendly method used by online companies to pass new information to their customers or attract new customers instead of using posters and bill boards. The potential benefits of owning online business are threatened by several factors that make it hard to run online business. Among the disadvantages of investing in online business is the lack of trust and security towards the business by potential customers (Gellman & Dixon, 2011). This problem reduces the number of customers for online businesses as a section of potential customers would rather purchase an expensive or low quality product from the store than online. Consequently, online businesses that do not convince apprehensive customers who have reservations about security of their money end up losing revenue as such potential customers will not make an order (Singh, 2011). Online businesses lose customers from regions that cannot access internet, countries that have a policy that restrict internet content in addition to places that does not have the necessary transport facility for the product to be shipped to the customers. This reduces market for their products and therefore income for the business (Holden, Belew, Elad, Gulbrandsen & Rich, 2008). Online businesses are also faced by stiff competition from those that do not offer such services. Trust is part of the problem as well as lack of credit cards that are essential in making financial transactions. Further, unrealisable internet connectivity also poses a challenge to business owners and their customers. However, continued technological advancement has led to improved confidence level among potential customers as more information has been made available to them. Internet access has also increased as many people continue to buy phones that are internet enabled (Holden, Belew, Elad, Gulbrandsen & Rich, 2008). Social and Cultural Effects of Online Shopping Online shopping has had a profound impact in the social and cultural spheres of life for those who participate in it as availability of wireless internet accessed through phone has led to removal of limitations of time and space leading to the integration of computing into the individual’s surroundings. This generation of consumers depend on the internet facilitate everything they want to do or have and are therefore always connected to the internet wherever they are for there needs to be satisfied. This trend has made it mandatory for manufacturers to always include online shoppers in their production for them to increase sales (Bankinter Foundation of Innovation, 2011). Online shopping has led to a change in consumer behaviour due to internet technology as they are now able to compare prices in addition to checking product reviews on-line before buying. These information has now been important when making purchase decision that ranges from buying from another trader whose product is cheaper, requesting assistant to match another offer, to deciding not to buy the product altogether. These features of accessing goods and services has given customers more control over what they purchase due to the opportunity to check product features, performance and ratings. Consumers are now able to generate content in addition to being in a position to network with other buyers on-line to give their opinion of products available in the online store (Bankinter Foundation of Innovation, 2011). Social forums that have been formed over the internet are essential entry points for potential customers looking for information about what they want to purchase. Customers are now able to use online services for all purchases that they intend to make where information about such things as new neighbourhood before buying a home, how electronic devices work and which restaurant offers the best service are available to them (Bankinter Foundation of Innovation, 2011). Businesses have also benefitted from the increased levels of shopping done through the internet. These organizations have been able to adjust to consumer demands by making it possible for customers to present their first-hand experiences of the purchased products. This is a feedback mechanism that online businesses can access at the click of a mouse and be informed about customer ratings of the products purchased. Online businesses have also been able to use the increased level of customer traceability and connectedness to improve personalization of the products available for different market niches. Consequently, it has become easier for the producers to customize their products according to the needs of particular market segments. (Pride & Ferrell, 2011) Online shopping is an important tool in the transfer of social and cultural norms throughout the world. Consumers access items such as food, clothing and other devices that are used in foreign societies and cultures easily without travelling to such places. Therefore online shopping is an important tool that helps in synchronization of global culture given that it has been able to connect manufactures and their targeted markets regardless of distance (Jin & Lin, 2011). Online shopping has same negative effects on the culture of some societies given that it can transmit some of the goods and services that are not favoured in by some people. Such negative effects can be seen in the type of clothing that is not culturally accepted in some cultures. Further, online shopping might encourage impulse buying as some people cannot budget for what they need and what they can do without. Given that the product is always a click away, individuals who visit the internet for other reasons may see an item they like which makes them tempted to make a purchase that was not planned for (Chen, 2008). Online shopping stores have product suggestion tools such as recommendation agents and online chat that attracts the attention of a potential consumer which further increases the chances for impulsive buying. According to a Rackspace study, approximately 17 per cent of those sampled for the study reported that mobile devices have increased their impulse purchases where reasons for this increase according to 71 per cent of those who reported higher impulsive buying is that the process involved in making a purchase is very simple while the technology involved is also easy to use (Moth, 2012). Online shopping has further contributed to individualistic tendencies among shoppers as it makes it possible for a person to access products without personally interacting with others. People can now access all information they need from the internet and are less reliant on those around them to give information about aspects of the commodities they intend to buy. Every aspect of the transaction for online shopping can be done through a phone or computer with the buyer only meeting the person sent to deliver a product at the door. Such practices as the online forums have destroyed the social structure as people do not need to meet for book clubs and such venues where knowledge about life can be shared (Preece, 2000). From the foregoing, it is clear that online shopping has revolutionized the manner in which businesses operate while consumers have also gained more power in the decision of what they need thereby transforming their socio-cultural perspectives. Customers who have taken advantage of this facility have been able to enjoy a range of benefits that ranges from saving time, increased variety of goods and services at their disposal, a delivery process that ships the ordered item from anywhere in the world to their doorstep at a convenient price, to having access to newly introduced product before they hit the market. However, even as online shopping presents customers with some advantages not enjoyed by those who visit the store and marts, there are still some disadvantages associated with purchasing from an online trader. Such disadvantages include; inability to examine the physical condition of goods, possibility of wrong shipment to a customer, the time taken for the product to be delivered is long while there are also some security issues that cannot be guaranteed by online shopping. Business enterprises that operate online services for their customers also enjoy a number of advantages such as requiring minimum start-up time to commence operation, require less capital, flexibility in operating the business, being environmental friendly, and low cost of operation. But some of the disadvantages might also include lack of customer trust and security, competition from forms of businesses and lack of connectivity in some cases. However, these drawbacks have not slowed down the growth of online shopping as it has continued to thrive over the years due to improved technology and perception of potential customers or are improving their confidence in online shopping. Therefore, online shopping should be seen as a concept of doing business and accessing goods and services that is going to change the global social and cultural beliefs. References Bankinter Foundation of Innovation. 2011. The Internet of Things: In a Connected World of Smart Objects. Madrid: Bankinter Foundation of Innovation. Chen, T. (2008) Online impulse buying and product involvement, Communications of the IBIMA, 5, 74-81. Holden, G., Belew, S., Elad, J., Gulbrandsen, D., & Rich, J. R. (2008) Wiley Pathways E-Business. New Jersey: John Wiley & Sons, Inc. Holl, S. G. (2013) Online Shopping Tactics. Clinton Gilkie. Jarvis, A., Lawson, J., Smith, A. and Yull, S. (2005) Edexcel AS GCE Applied ICT Double Award. Oxford: Heinemann. Jin, D., & Lin, S. 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(2013) Click and collect – the new way to go shopping, The Telegraph [Online], Available at: http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/9785532/Click-and-collect-the-new-way-to-go-shopping.html Gellman, R., & Dixon, P. (2011). Online Privacy: A Reference Handbook. Connecticut: ABC-CLIO. Read More