This week’s lesson revolved around the topic of doing business on the Internet. I learnt about the many “P”s that are required for businesses to be successful as well as the 7 S that companies should possess. The many “P”s that are crucial to establishing one’s business include the product, place, price, people (suppliers and workers), partners, and pay- all of which are necessary in order for businesses (both large and small scale) to run smoothly. On top of that, it is important to plan out marketing schemes and have appropriate system in place whereby people assume different roles and responsibilities to increase overall efficiency. The seven “S”s are namely strategy, structure, system, style, staff, skills, and above all shared values. All of these are undoubtedly applicable not just to businesses with a traditional structure, but also (or in fact, more so) to E-Businesses as well.
E-Business refers primarily to the digital enablement of transactions and processes within a firm, and while it is always used interchangeably with the term E-Commerce, there is a need to distinguish between the former from the latter. As mentioned, e-business does not include commercial transactions involving an exchange of value across organizational boundaries, whereas e-commerce does. Essentially, E-Business is the function of deploying technology to maximize customer value (within an organization_ while E-Commerce is the function of creating exchange (i.e. buying and selling) over digital media. And this is what I have discovered only after the two Com 125 lessons as well as many attempts at trying to comprehend the differences between these two.
Moving on, I have decided to focus the rest of this blog post on E-Commerce after reading up on it a bit. Through this week’s lessons, we were taught that there were various key reasons an increasing number of people are turning to the internet for E-Commerce purposes- to expand market reach, issue of visibility, enhanced responsiveness, new services, strengthening of business relationships, and cost reduction. As expected, the onset of the internet and subsequently the WWW (World Wide Web) made endless online activities possible. Today, the internet business is rampant as many turn to online e-commerce in hope of reaching a wider audience, leveling the playing field between small and larger sized companies to a certain extent, getting instant feedback and responding accordingly, and so on. Knowing all these however, perhaps the more interesting questions are, what contributes to the success of certain e-commerce and why others on another hand, failed?
To begin with, there are numerous reasons why some e-commerce failed while others reaped remarkable success. Firstly, factors which contribute to successful e-commerce are as follow:
1. Attractiveness of the website- It represents the interface of the company/business, and thus having an attention-grabbing site is the first crucial step in deciding whether people are drawn to the business itself and hence the products/ services it is selling. This complements the generic marketing model in which awareness is chiefly valued.
2. Accessibility- The e-commerce website has to be accessible in all browsers and operating system so that it will be available for all internet users to visit and make purchasers. Without access to a site, naturally it will not be possible for commercial transactions to take place.
3. Easy navigation and operation- Simplicity is key. This makes it easy and convenient for consumers to carry out their online shopping at a more comfortable and efficient pace. While design of the site should be appealing, it should also be easy to navigate around to prevent unnecessary frustration for online users. This includes the checkout function of the shopping process in which the process is simplified and reduced to as few steps as possible.
4. Credibility- Internet users have to be confident in the websites that they intend to buy a product or service from; hence it is important for e-commerce sites to gain the trust of consumers. This can be done by including authentic verification of associations like PayPal, etc. Most importantly, customers have to be assured that their privacy will be respected.
5. Customization and personalization- Products and services should be designed clearly and specifically to fit the customers’ needs. This also aids in creating brand loyalty.
6. Good marketing strategy- E-Commerce should have a clear niche area in which customers know what their main area of service is known for e.g. bestselling items, etc. There must be competitive prices and the knowledge and awareness of potential competitors. E-Commerce businesses also need to have a target audience in mind, the diversity and variety of products and/or services, a future goal for the business as a whole, and methods to go about reaching more people to increase the business.
7. Latest updates and discounts and promotions- It is necessary for e-commerce sites to provide constant updates as well as incorporate their marketing strategies from time to time to attract more buyers and potential customers e.g. members’ incentives, seasonal promotions, etc.
8. Publicity and utilization of search engines- Established word-of-mouth and social validation are important factors in building a desirable reputation which will pay off in the long run. This is because an increasing amount of people are relying on customer reviews, recommendation from friends via social media, and the use of search engine (e.g. Google) to narrow down on the product they have in mind, thus e-commerce have a higher chance of succeeding if publicity is well taken care of.
9. Outstanding customer care and support- Businesses comprise largely of the customers themselves, and more often than not they are the ones who determine whether a business succeeds or fails. Increasing customer satisfaction by providing quality service and efficient responses to their concerns will put the e-commerce site in a better light. This also helps in building and maintaining customer relations and hence loyalty.
10. Competency- Above all, e-commerce involves digitally enabled commercial transactions between and among organization and individuals. Thus, the people running it must have considerable expertise and ability not only to manage the interface of the business (website), but also the internal as well as external processes that take place between the organization and the consumers.
Similarly, many e-commerce fail when online entrepreneurs fail to take certain things into consideration before committing to their online businesses. The more central causes for these failures include:
1. Lack of marketing- As mentioned above, it is necessary for online entrepreneurs to have a goal and direction in mind, before coming up with a marketing strategy and plan for the e-commerce to succeed. Otherwise, there will be no advancement to talk about, not to mention attaining success.
2. Inability to fulfill promises made to customers- One of the things that annoy customers more is failure on the seller’s side to fulfill their demands even though satisfaction was previously guaranteed. Such unpleasant experiences undeniably lead to loss of confidence and desire on the part of consumers to go back to the same e-commerce.
3. Obsolete- When the site is not regularly maintained and information or products offered are no longer kept up to date, the e-commerce loses its competitive edge and becomes obsolete.
4. Breach of privacy- As mentioned above, when credibility of the e-commerce is compromised, customers will tend to leave.
5. Complex or unsatisfying checkout procedures- As a consumer of various e-commerce sites, I personally find it time consuming and mentally frustrating when the purchasing process (especially that of checkout procedure) is long and complicated! This definitely explains why one favors some e-commerce sites over others.
6. Serious recurring technical issues on the site- Similarly, everyone appreciates user-friendly and problem-free websites that are easy and efficient to operate. Nobody likes it when technical issues constantly arise on a particular e-commerce site.
7. No clear business strategy or product niche- Many e-commerce fail to stay true to their expertise and this result in the inability for them to do what they do best i.e. when they lose focus, they lose having a distinct objective for their business.
8. Limited information available about the products- It is important that users have “consumer power” to distinguish one product from another, and the lack of information of the products on an e-commerce side does not permit them from doing so.
9. Poor e-commerce management- Starting an e-commerce without a full proof plan is highly discouraged because often this spells trouble for the management thereof. There are many aspects of e-commerce that have to be taken care of (e.g. customer relations, orders and supplies, marketing strategies, etc), and thus without expertise and a clear direction, the e-commerce is bound to fail.
10. Poor customer service- As mentioned above, customers are key to deciding the prospect of the business that one is doing. Inability to satisfy the customer and constant disappointments will definitely take a toll on the e-commerce reputation and cause it to go downhill.
The reasons for success and failure of certain e-commerce listed above are perhaps only the few key points out of abundant ones that are not mentioned here, and it is imperative for people to be aware of it. Precisely because there is a thin line between success and failure, the very same deciding factors of the success of e-commerce can also lead to the failure should one fail to keep up with the times and changing demands in the market.
E-Marketing or electronic marketing basically refers to the application of marketing principles and techniques via electronic media and more specifically the Internet. eMarketing is the process of marketing a brand using the Internet. It includes both direct response marketing and indirect marketing elements and uses a range of technologies to help connect businesses to their customers. Thus, it comprises of all the activities that takes place in a business via the worldwide web (WWW) with the aim of attracting new business, retaining current ones and at the same time, developing its brand identity.
The success of e-marketing is mostly determined by the marketing strategy it deploys. The Internet mainly enhances collaborative marketing strategies by equipping the companies to fulfill their primary goals. “In collaborative marketing, companies support prospective customers in understanding and evaluating alternatives, in order to facilitate their purchase of optimal products. Their goal is to inform, educate, and develop trust, and eventually a relationship that yields repeat purchases and long term loyalty.” And the existence of the World Wide Web (WWW) complements collaborative marketing very well, allowing for both one-to-one marketing and one-to-many communications to take place between companies and online users.
Of course, it is imperative that the concept of “localization” is incorporated into e-marketing strategies in order for it to be a success. As a result of interconnectedness made possible by the Internet, people all around the world are coming together. However, it is a fact that they come from different cultures and speak diverse languages, and this calls for the need of online translations and specific settings catered to different regions.
Next, just like how e-commerce emphasizes personalization, e-marketing is made more successful through this very trait as well. At the root of marketing lies the skill to build relationships and manage ties in the most natural way possible and e-marketing is no exception. The key is to make clients feel like an honored "guest" at your website. Below is an article I’ve come across while doing some research and it talks about this aspect in detail. I found it to be really apt in how it describes marketing as a personal matter, so maybe it will be able to shed some light on how personalization leads to the success of e-marketing for the rest of you too!
Personalization: The Key To Success In E-Marketing, http://www.channelpartnersonline.com/articles/2002/04/personalization-the-key-to-success-in-e-marketing.aspx
Another fundamental strategy is to invest in search engine optimization, such as Google and Yahoo, so that one’s website will be prominent to internet users when a related keyword is typed in. This increases the traffic of the website, and potentially increases the likelihood of business transactions taking place. Additionally, on the website itself, it pays to refine the navigation function to make the search more advanced and detailed, so that consumers can narrow it down to what they exactly want.
INTERNET SECURITY, PRIVACY AND LEGAL ISSUES FOR E-BUSINESS
Electronic payment systems are all designed to keep automatic records in order to store, access and trace customers’ data with regards to their purchases and transactions. For this reason, there exists the risk of violations in privacy. Privacy remains to be one of the biggest challenges of doing e-business on the WWW. “The reality is that every time one purchases goods using a credit card, subscribes to a magazine, or accesses a server, that information finds its way into a database somewhere. All payment details of a consumer can be easily aggregated and essentially condensed to a single dossier. This dossier would reflect what items were bought, where, and
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