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The Online Virtual Shopping Marketing Essay

Info: 1524 words (6 pages) Essay
Published: 1st Jan 2015 in Marketing

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Since the development of the Internet, especially in recent times, most of our daily activities are conducted over the internet and goods and services are bought at the click of a mouse. Increasingly, consumers are choosing to make purchases using the Internet and skipping the trip to the store. A modern consumer may purchase a CD player, a couch, groceries, e-books, movies, tickets, software or even a new car at 4.00am without having to leave his or her house, deal with traffic and salespeople, or even change out of her pajamas. Furthermore, a consumer is no longer restricted to products available in one store, one town, or even one country because the Internet transcends boundaries and is literally accessible from anywhere in the world.

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The Internet essentially is a global network of connections and has become the world’s fastest growing commercial market place. It has developed into a significant and accepted business standard through which consumers and businesses come together in the buying and selling process. Most firms and businesses today have incorporated the concept of e-commerce at some level of their operations and this includes some traditional companies who have now integrated the internet into their businesses. As such, many physical retail stores have expanded their market through the Internet, by having both a virtual store and a physical store, guaranteeing them the best of both worlds. High-volume websites, such as Yahoo!, Amazon.com and eBay, also offer hosting services for online stores, to all retailers for their products and services. These stores are presented as part of an integrated navigation framework. These collections of online stores are sometimes known as virtual shopping malls or online marketplaces. These online marketplaces provide a one stop shop for consumers to shop at their convenience for all the goods that they need.

According to a Forrester Research, “Understanding Online Shopper Behaviors, US 2011, May 17, 2011”, E-commerce Business to Consumer (B2C) product sales totaled $142.5 billion, representing about 8% of retail product sales in the United States. The $26 billion worth of clothes sold online represented about 13% of the domestic market, and with 72% of women looking online for clothing, it has become one of the most popular cross-shopping categories. Forrester Research estimates that the United States online retail industry will be worth $279 billion in 2015. see “Forrester: Online Retail Industry In The US Will Be Worth $279 Billion In 2015, TechCrunch. February 28, 2011.

Online shopping has become a very popular way of purchasing goods for consumers. All that is required for the consumer is a computer, internet access and a method of payment. The main attractions in shopping for goods on the internet include the opportunity to search for various goods and services, compare the prices offered by various shops, read reviews made by customers who have purchased the same goods or service, order and pay for them and have them delivered, all from the comfort of one’s home. Other attractions include the “cooling-off” period which applies to most online purchases, discounts, promotions and freedom from being pressurised by a salesperson into buying expensive (sometimes unwanted) extended warranties. In other words, customers are attracted to online shopping not only because of the high level of convenience, but also because of the broader selection, competitive pricing, and greater access to information. In comparison with conventional retail shopping, the information environment of virtual/online shopping is improved by providing additional product information such as relative products and services, a choice of alternatives and attributes of each alternative, as well as the reviews and comments by those who have bought or used those goods. This equips the buyer with more information to make a more informed decision.

The Nielsen Company conducted a survey, in March 2010 which polled more than 27,000 Internet users in 55 markets from the Asia-Pacific, Europe, Middle East, North America and South America to look at questions such as “How do consumers shop online?”, “What do they intend to buy?”, “How do they use various online shopping web pages?”, and the impact of social media and other factors that come into play when consumers are trying to decide how to spend their money on which product or service. According to that research, reviews on electronics (57%) such as DVD players, cell phones or PlayStations and so on, reviews on cars (45%), and reviews on software (37%) play an important role and have influence on consumers who tend to make purchases and buy these goods online.

In addition to online reviews, peer recommendations on the online shopping pages or social networks play a key role for online shoppers while researching future purchases of electronics, cars and travel or concert bookings. See Bonsoni.com on July 10, 2011 (2011-07-10). “Research shows word of mouth drives online sales”. Bonsoni.com. On the other hand, according to “Nielsen Global Online Shopping Report”. Blog.nielsen.com. 2010-06-29, 40% of online shoppers indicate that they would not even buy electronics without consulting online reviews first.

However, despite the convenience and ease offered by online shopping, there is always the potential for abuse. Arguably the anonymity afforded by the internet has done much to damage the level of trust consumers are willing to place in it, g iven that the internet has no boundaries, and a consumer can access goods and services from any part of the world. According to Proffessor Ian Lloyd in Lloyd I.J. “Information Technology law” (2008) fifith edition Oxford, pg 483, “The Global Top level Domain name .com gives no indication where a business is located and even where the name uses a country code such as .de or .uk, there is no guarantee that the undertaking is established in that country. It is relatively common practice, based in part upon security concerns to keep web servers geographically separate from the physical undertaking. Therefore a website may, for example have an address in German (.de) (or in Hong Kong (.hk), but its owner however might be a United Kingdom-registered company.

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Furthermore, one of the differences between distance buying and the traditional forms of buying is that there are no face to face interactions between the contracting parties and the goods are not inspected physically by the consumer. Consequently, consumers may find that the goods are faulty on delivery, a wrong order or that the goods are not the correct specifications. Consumers are therefore concerned with the ease with which they can return an item for the correct one or for a refund.┬áTo improve confidence, business often attempt to adopt online shopping techniques which are user-centred. They describe goods with photos, texts and multimedia files, provide background information, advice, or how-to guides designed to help consumers decide which product to buy and provide link to supplemental product information, such as instructions, safety procedures, demonstrations, or manufacturer specifications. Also they provide for ease of return and refunds by providing information to customers on how to return goods for refund or exchange. Some customers on their own part now refer to “show rooming” before purchasing online. By this, customers first inspect the goods in the shops before purchasing them online. Furthermore, most laws on E-commerce make provision for the protection of the consumer in online contracts.

Other problems that undermine consumers confidence in online shopping includes Fraud and security concerns. These include identity theft, phishing, denial of Service attacks etc. The perpetrators get hold of consumer’s credit card information and use it to commit fraud. To combat this, most online businesses adopt encryption on their websites as well as other security measures to prevent fraudsters from getting hold of customers information. The use of Paypal accounts are also useful in securing against fraud on the Internet. Other disadvantages of online shopping include lack of full cost disclosure and Data protection.

In conclusion, the trend of shopping online has come to stay. Online shops are open 24 hours of the day and can be accessed from anywhere where there is an internet connection. The ease and convenience of shopping online will always lure more consumers to it. However, consumers must be alert and aware of the risks involved and take extra care when shopping online. Due to the openness and competitiveness of the online market, most business will always strive to maintain the highest standard of security as well as a user centred website to boost their business.

 

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