The Growth And Evolution Of E-commerce: A Historical Essay.

Answer two questions

1.In 2000 David Weymouth, Barclays Bank Chief Information Officer made the following comment:

‘There is no merit in becoming a dot-com business. Within five years successful businesses will have embraced and deployed at real-scale across the whole enterprise, the processes and technologies that we now know as dot-com’. To what extent has he been proved right and why?

2.‘The intangible benefits of e-business and e-commerce adoption are just as important to organisations as the tangible benefits’. Discuss. 

3.Discuss ways in which the concept of customer orientation can be translated into e-commerce site design.

4.Adopting an online presence gives an organisation a range of options to vary the marketing mix. Use examples to discuss these new options.

5.How can location-based services be integrated with social media? What are the advantages to organisations and consumers of doing this? 

6.a.Describe the standards involved when a web page is served from a web server to a user’s web browser.

b. What is the difference between static web content and a dynamically created web page? 

7.Use examples to explain how each of the macro-environment variables may directly drive the content and services provided by a web site.

The Emergence of E-commerce: From Physical Retail Stores to the Internet

1.E-commerce, also known as dot-com business, is the type of business that is conducted through the use of the internet. In other words, the business operations that are entirely based on the electronic media are collectively known as e-commerce. Although e-commerce is a common term nowadays, a few years back, this was quite a new term (DaSilva & Trkman, 2014). Before the invention of e-commerce system, the businesses were conducted only through physical retail stores that required physical presence of the customer in the store and exchange of cash money for purchase. However, as internet developed, business organizations started to think about spreading the business over more area using internet services. Following this idea, initially, the organizations used the internet for promotion purposes in form of advertisements (Effah, 2014). However, with the further development and evolution of technology, the ideas changed. Now, the organizations started using the internet as a direct medium for business. They gave up advertisements regarding certain sales of products. The customers who were interested needed to contact the company about the sale and then visit the retail store for buying the product. However, this system had an issue – high expenses. The company had to spend a lot of funds for setting up the internet connection and the communication medium for contacting with the interested customer (Haltiwanger, Hathaway & Miranda, 2014). However, the final income was the same as the previous system. Moreover, the customer had to visit the retail store ultimately to receive the product and pay the required price. Again, this system only lengthened the overall transaction time.

During this turmoil regarding the contemporary e-commerce system, in 2000, the then Chief Information Officer of Barclays Bank, David Weymouth commented that, “There is no merit in becoming a dot-com business. Within five years successful businesses will have embraced and deployed at real-scale across the whole enterprise, the processes and technologies that we now know as dot-com.” His statement was more or less accurate as was evident in the later years.

After the situation of e-commerce discussed above, the organizations started thinking about a new way of utilizing internet for promoting and spreading the business. The existing system was not providing any benefits to the organization. In this time, American company Amazon made a breakthrough in the field of e-commerce (Aiken et al., 2014). In their new system, there were no needs for physical retail stores and the direct presence of the customers in the stores. On the other hand, the customers only had to order the chosen products through the internet only and Amazon sent their sales agents to deliver the products directly to the customer’s addresses (Ovans, 2015). There were two benefits from this system. Firstly, the costs of setting up retail stores and decorations were not required anymore and secondly, the operations needed much lesser time as the customers did not need to visit the store to buy the items. Moreover, due to lesser operation costs, Amazon also reduced the overall cost prices of the products in order to attract more customers. Following Amazon’s example, few other companies also wanted to participate in the e-commerce system for expanding their overall businesses (Cottrell et al., 2015). At this time, David Weymouth made the above-mentioned comment.

Success and Failure of Early E-commerce

Now, in this context, in the initial years of advanced e-commerce, owing to the significant success of Amazon, many business organizations chose to operate e-commerce in their existing business system. However, most of them were massive failures. The main reasons for the failures were as follows.

Technical Setup – E-commerce demands extremely high level of technical setup. Firstly, at that time, technology was not developed as much as today. Secondly, the companies were not totally aware of the technical requirements. They only went with the flow to implement e-commerce without upgrading their technical setups (Preissl, Bouwman & Steinfield, 2013). As a result, most of the systems failed in the implementation phase and the others failed due to lack expert management and maintenance. Most of these companies also went bankrupt and ultimately ran out of business.

Lack of E-Commerce Knowledge – E-commerce is not something that can be easily implemented in a short time. It requires in-depth requirement analysis, proper planning, suitable technical setup and sufficient tech support for operations management and maintenance. In order to fulfill all these factors, in-depth knowledge of e-commerce is necessary. However, the companies only tried to copy Amazon’s success and implemented e-commerce (Althaus, 2014). Due to lack of planning and sufficient resources, the implementations failed miserably. The companies only understood the use of internet in e-commerce but they had no idea regarding the necessary requirements, resources and implementation plans. Hence, either they failed to implement e-commerce or they failed to keep up with the advancing dynamic market.

Customer Dissatisfaction – In the initial days, the customers also were not aware of the benefits of e-commerce system. They were accustomed with the existing market system. Hence, when e-commerce was introduced, the customers resented the use of such commerce system. Moreover, most of the people at that time did not have stable or any internet connection or even any computer for that matter (Johnstone et al., 2015). Hence, most of the customers did not have access to e-commerce system. As a result, the companies could not gain sufficient customer base through e-commerce as expected.

All these factors were the major reasons for the failure of the e-commerce projects of different business organizations. However, David Weymouth made a slightly different prediction. He said that in spite of all the hassle regarding this new business system, e-commerce will easily flourish within the next few years (Arora, 2016). Although this statement was not valid for the initial years, in the next few years, there has been really a massive growth of e-commerce worldwide. There were several reasons behind the massive growth of e-commerce. These reasons were as follows.

Factors behind the Massive Growth of E-commerce in Recent Years

Technology Revolution – In the last two decades, there has been a massive boom in the growth of technology. Along with it, the internet services received huge upgrades and new softwares were developed to prevent cyber threats faced by the internet users. 40 kbps lines of the initial years were replaced by 4-5 Mbps speed internet lines (Gwilym et al., 2015). Along with massive upgrade in the internet speed, the costs were also reduced significantly, encouraging more people to use internet services. Again, with the inception of smartphones, people had more and easy access to the internet. These factors significantly influenced the growth of e-commerce in various parts of the world.

Evolution of Technical Experts – With the evolution of technology, the technical experts also underwent significant growth. The failures of the previous systems let them learn to identify the issues and find solutions to the problems (Ritala, Golnam & Wegmann, 2014). As a result, these technical experts were more efficient in managing and maintaining a proper information system needed to support the e-commerce business. This helped the organizations to maintain a stable e-commerce system.

Customer Base – In the initial years, most of the customers were not interested in e-commerce either due to lack of knowledge regarding the benefits of e-commerce or due to lack of internet connection. However, as time changed, more and more people saw the benefits of e-commerce and gradually got interested in it. Moreover, most of the customers were amazed with direct home delivery of products for which, they did not have to visit retails to buy (Arora, 2016). They could simply order a product anytime anywhere and the products were delivered to their footsteps. This factor massively boosted the customer interest in e-commerce. Again, the low prices of products sold through e-commerce sites also interested the customers to avoid retail stores and use e-commerce services.

Smartphones and Mobile Apps – In the last few years, e-commerce received even more boosts from the inception of smartphones and development of mobile apps dedicated for e-commerce purposes. Initially, the customers had to use internet connection in their computers in order to access the e-commerce sites and order any products (Johnstone et al., 2015). However, recently, the e-commerce organizations developed dedicated mobile apps for e-commerce purposes. Due to this, there was no need of using computers for buying products. Instead, the customers could just use his smartphone to browse the e-commerce site and order any product. This had greatly influenced the growth and spread of e-commerce throughout the world.

The Role of Technology in Enabling E-commerce

Now, returning to the actual argument, David Weymouth’s words were actually not valid for the initial years of development. However, he had vision for the future and rightly predicted that there would soon be a massive boom of dot-com business (e-commerce). At his time, most of the organizations thought that e-commerce was a product of merit and only exclusive for large organizations with significant merit. Weymouth argued that the development of technology will enable the small and medium sized organizations to organize e-commerce system. Although many organizations have failed to e-commerce system, many small and medium organizations also grew significantly, thus validating Weymouth’s statement.

5.Location based services are those that are provided to a customer by tracking his location through his GPS-enabled smartphone. These services include emergency services, location alert services, weather forecast report, map services and others. Not only the apps locate the user, the user can also locate nearby transit services, store locations and roads to a particular place. With the development and evolution of technology, the smartphones are also being upgraded where GPS location service is an integral part now (Schwartz & Halegoua, 2015). In other words, all smartphones now come with GPS locator services and the location based services can easily be activated by allowing GPS locator and having an active internet connection. With the integration of e-commerce and social media, location based services are also trying to integrate with both in order to benefit both the social media users and the e-commerce organizations (Bao et al., 2015). However, the overall integration is not easy by any means – it should go through a transition phase that will consist of different developments and upgrades. The transition processes are as follows.

Selection of a Suitable Medium – With increasing popularity of social media websites, many new web content developers are coming out with new social medium websites. However, other than some, most of these websites are payware or frauds and only deal with taking money from users in exchange of services (Hasan, Zhan & Ukkusuri, 2013). Even after paying huge sums, the services are not guaranteed. As a result, the users loose a huge amount of money without any service. Again, these websites have very few users, hence, integration with location based services will not be profitable. Furthermore, the fraud sites can use the location based services to track the location of a user and do some harm or unethical activity against that particular user. Hence, selection of social media website is to be done carefully in order to avoid unnecessary harassment of the users and customers.

Location-Based Services: A Boon for Customers and Businesses

Features – The main method of attracting maximum amount of customers is developing features, as many as possible. If one organization provides only a basic service without any feature variety, the customers will not be interested to avail their services (Jurgens, 2013). On the other hand, the company’s services that have a huge number of features will easily attract the customers. Here, feature can also mean different types of services with a variety of options and payment methods.

Visual Layout – Visual layout is also an important feature that attracts customers. While integrating with social media, location based services can come out with attractive visual layout. The users will automatically click the advertisement if the visual layout is something interesting. However, some services nowadays use “click-bait” technique to attract customers (Gao et al., 2013). Click-bait is a technique in which the service operators provide services of one type but put on a different description or picture of a different or opposite topic altogether to attract maximum customers. However, this technique is not recommended as once the users realize it is a click-bait, they will never visit the same website again. This will ultimately result in loss of more customers (Xu et al., 2016). The companies should stick to providing correct and accurate descriptions while also improving the visual design layout.

Promotions and Advertisements – The main targets of business organizations for using any external media is advertisement that will help the company to gain more customers and an extended area of service. Social media is definitely a huge platform for advertisements, especially for the location based services. Location based services are relatively new and many people still do not understand the benefits of these services. Using advertisements in social media will solve the problem and the companies can easily reach more customers (Jiang & Miao, 2015). Again, the companies can further increase customer base by promotions using social media. They can provide some offers like if the user books a service through social media, he will receive certain discounts. This will benefit the company, user as well as the service provider of the social medium.

These are the ways that can be used for integrating location based services with social medium. However, there are a number of risks as well. These risks must be mitigated in order to reap maximum benefits from the integration. Some of the major risks are listed below.

Cyber Security – With the constant development of technology, the dark side of technology is also getting upgraded. Unethical hackers are able to use advanced hacking tools for stealing data and information as well as money from a user’s account. In this regard, location based services further benefit their purposes as they can now easily track a user’s location and personal information (Zickuhr, 2013). Social media has always been infested with hackers who use users’ personal information and use them for unethical purposes. If the location based services are integrated with social media, the hackers will easily track a user and cause financial harm.

Bullying and Harassment – War of words and opinions are extremely common in social media. However, some of these wars become too personal and some people seek revenge by planning to hurt the opposing user physically. Using the location based services, these users can easily track the opposing user and harm him physically.

Child Trafficking – One of the main risks with location based services is child trafficking. Integration with social media will further worsen the situation. For instance, nowadays, some people check in to a social media site along with a “selfie” while delivering his/her child to school (McGee, Caverlee & Cheng, 2013). At this instant, some unethical user can view this post and spread the picture of the child among some of his group members. Using exact location and the picture of the child, they can easily steal the child and use him/her for trafficking.

Considering all these factors, the integration should be slow and careful. All the risks should be identified and it is to be seen that these risks are mitigated before integrating social media and location based services. Only then, the integration will be successful and generate a continuous flow of business for the website as well as the location based service.

The integration of social media and location based services will provide a number of benefits to the organizations and customers. These are discussed below.

There are a number of organization benefits from the integration. These are as follows.

Advertisements - Location based services are relatively new and many people still do not understand the benefits of these services. Using advertisements in social media will solve the problem and the companies can easily reach more customers.

Promotions – As previously discussed, location based services can provide promotions to customers for booking services through social media. This will massively boost the customer base of the company as there are millions of social media users worldwide.

Opportunity to Connect with Consumers – The evolution of smartphones and GPS locating feature in them have given a massive opportunity to the small and medium sized organizations for connecting to consumers. It has been seen that in particular location based service event, 30% of consumers checked in with the help of social media. In the following week, the check in percentage rose to 60 (Ogden, 2014). Clearly, the check in through social media has boosted the attendance at the event. Again, the companies can provide easy solutions to ticket systems and instead send some codes to the customer’s smartphone who can just scan at the event place. This way, the company will be able to maintain a constant base of certain advanced customers.

Feedback System – All the companies are under continuous development and they release new services and features every so often. However, there was initially no way to know whether the customers were happy with the changes or they wanted further modifications. Social media gives this platform to the location based services to start a customer feedback system (Stefanidis, Crooks & Radzikowski, 2013). The customers can use the social media to provide feedbacks to the company. The company will receive and analyze these feedbacks and modify their services accordingly.

In addition to the benefits of the companies, the customers can also gain certain benefits from the integration. These benefits are listed below.

Advanced News – Using the social media, the customers can know advanced news regarding some upcoming services from the company. As a result, they can easily avail their services as soon as the new features are out.

Feedback and Complaints – The customers can use the social media to submit feedbacks regarding certain services of the company. These feedbacks may contain ideas for service improvement or even new services that the consumers expect from the company (Larivière et al., 2013). Again, the social media can be used as a forum for submitting complaints in case the customers are not satisfied with the company. Once a complaint is submitted, the company can track the location of the user and identify the service failure that caused dissatisfaction of the customer.

Mutual Sharing of Experiences – Location based services along with social media can also allow the users to share their experiences with the company with other users of the same platform. As a result, new customers can get tips and reviews of the services and can avail the services of the company in case they need it.

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