Electronic commerce has increasingly become a necessary component of business in the emerging global economy. Electronic commerce is any form of business transaction interacts electronically to exchange the products and services rather than physical exchange. “E-commerce is the use of electronic communications and digital information processing technology in business transactions to create, transform, and redefine relationships for value creation between or among organizations, and between organizations and individuals” (Andam, 2003). The presentation of group highlights the Electronic commerce in International Marketing and how internet impacted in International Business. In this report our studies indicated further findings on models of E-Commerce and the impact of internet on target market. Generally most of the studies found out that the use of Internet in International Marketing has a positive impact on the organization’s marketing performance.
Impact of Internet in International Marketing
The internet and its associated technology has provided an economical and efficient way for organizations to create an additional e-commerce activities to market their products and services over the past several years (Smith, 2005). Internet affects the activities of marketing channels in three different ways, such as 1. Communication channels, its principal functions are to inform customers or buyers about availability and characteristics of supplier’s products/services and facilitate buyers to communicate with sellers; 2. Transaction channels, whose primary function is to facilitate financial exchanges between buyers and sellers and 3.Distribution channels, its main function is to facilitate physical exchanges (Thomas, 2008). Brock (2001) found in his study of German small technology-based firms that the Internet had a positive impact on attitudinal, resource-related, information-related and network-related aspects of internationalisation, thereby facilitating the process.
The effect of the internet on the international businesses is making it easier for companies to participate in foreign markets, globally rollout new products, making easier for companies to offer globally standardized products or services, is more often used by companies for customer-related activities than for production-related activities, is not being used much by companies to develop a globally uniform marketing mix and is being used somewhat by companies in selling and customer-related activities to help with the strategy of making globally coordinated competitive moves ().
The Internet has given rise to a new economics of information, with the “blowing up” of the trade-off between the richness of information involved in a transaction and the number of people that it could reach (Wurster, 2000).
There are lot of advantages when an organization uses internet for their business. Internet can increase the sales and it can decrease the costs. Because the web advertisements reaches an amount of customers all over the world. A business can reduce its costs by using electronic commerce in its sales support and order-taking processes, twenty four hours online shopping, lower transaction cost, larger purchases for transaction, People can shop in different ways (Prashantham, 2003).
Also organization has some disadvantages when they use internet for their business. Such as hidden costs, vulnerability to technical crash, cost of staying in business, lack of security, invasion of privacy, low service levels and legal issues.
Models of E-commerce
There are different types of e-commerce (). Such as
B2B model is the buyers, sellers, and transactions involve only organizations. It covers a broad spectrum of applications that enable an enterprise to form electronic relationships with its distributors, resellers, suppliers, customers, and other partners. This is the type of e-commerce that deals with relationships between and among businesses. B2C model, here transactions take place between consumers and business houses. Here individuals are also involved in the online business transactions.
C 2 B model, here individuals who use the Internet to sell products or services to organizations and /or seek sellers to bid on products or services they need. These transactions involve reverse auctions, which empower the consumer to drive transactions. C 2 C model which is used by consumers to sell their product/services directly to other consumers. This type of e-commerce is characterized by the growth of electronic marketplaces and online auctions. M-commerce (mobile commerce) is the buying and selling of goods and services through wireless technology. The advantage of this model than others is delivery over wireless devices becomes faster, more secure, and scalable.
According to Yip and Dempster the impact of the Internet on performance was positive, but moderate, and the greatest positive effect was on brand awareness and brand image. “The use of the Internet technologies to link customers, suppliers, business partners, and employees using at least one of the following: (a) e-commerce Web sites that offer sales transactions, (b) customer-service Web sites, (c) Intranets” (Wu et al,2001).
Overall, the authors concluded that the Internet does help companies to globalize and to implement successful global strategies that allow them to be both global and local at the same time. The Internet helps companies to globalize and to implement successful global strategies that allow them to be both global and local at the same time. Internet marketing has a positive impact on the firm’s marketing performance (Yip and Dempster 2005).
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