The TEN reasons

E-commerce provides many new ways for business and consumers to communicate and conduct business. However, there are a number of reasons for the success and failures of e-commerce.

Why is e-commerce so successful?

Being able to conduct business 24x7x365. Time restrictions are nonexistent. Even on holidays or weekends, one can still purchase their products online.

Access the global market place. The internet enables a business concern or individual to reach the global market. The global opportunity via traditional communication is incomparable with the one via internet because users are not charged with communicating overseas.

Opportunity to look for cheaper products. E-commerce gives customers the opportunity to compare the pricing of the products with other sellers. Customers can avoid buying from sellers who intentionally sell their products at a higher price.

Research and feedback is possible. Customers are able to do a research on the products that they are buying. They can also give feedbacks on the products that they bought.

Products are sold at cheaper price. Direct cost-of-sale is lower than traditional means because there is no human interaction during online purchases.

Money saver. It is the cheapest means of doing a business. From the seller’s point of view, E-commerce helps to cut down the cost of marketing the product. Sellers can setup websites or email their loyal customers on existing or new products sold.

Customers’ needs and behavior. Sellers will be able to know the needs and wants of the customers by keeping track on the websites that they browsed. In that way, sellers can look out for products that have good responses from the customers. By doing so, they can bring in more of such products.

Compare and contrast. Customers can easily compare different products at the same time without having to travel from one place to another. This helps to save a lot of time.

Allowing self service at own time. Customers can look for products any time during the entire day when they are free, even as late as midnight. They are not obliged to visit the physical shops if they are too busy with their work. Adults with children can also shop for products online peacefully instead of having to worry about having to bring their young children out.

Time saved. Delivery time and cost can be saved by buyers when they purchase digital goods and services such as e-books and games. Buyers do not have to wait for the physical goods to be delivered to their home.

The possible reasons for the failures of E-commerce

Lack of trust. Internet has still not touched the lives of a great number of people. Many people still do not like the idea of using internet for financial transaction.

Perishable goods. Not suitable for perishable commodities like food items. Though refrigerated transports can be used, goods sold online are usually durable and non-perishable.

Faulty goods. It can be troublesome to return or refund products that are faulty and there are many things to consider when you return it. Who is going to pay the return postage as well as will the refund be paid are two major problems that will arise.

Fraud sites. Anyone can start a business easily. Some may be bad sites which scam customers’ money.

Hackers everywhere. Many hackers always look for opportunities to attack e-commerce site, service and payment gateways.

Product quality. There is no guarantee on product quality because you can only see the product base on the pictures uploaded online. You will not be able to feel it before buying. Moreover, pictures and physical object may be quite different.

Poor laws. Cyber laws are not properly enacted and the existing ones are not clearly defined. Thus, nobody really knows the rules of starting a business online are.

Search engine. In a traditional store, the location of your store will not change unless you move away. However, the location of your business online will not always be the same. It depends on the search engine’s search results.

Huge transactions. The number of transactions allowed for each customers vary from websites to websites. However, many websites allow only one transaction at a time. If one intends to buy many of the same products, he would have to make many transactions.

Data entry errors. This is one of the major drawbacks of e-commerce. If the seller type in the wrong price on the website, he will have to face the consequences of wiping out the profit of all the goods sold.