The Impact of E-Commerce Among Customers and Sellers

02 Aug 2023

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Introduction

Information Technology has considerably improved from year to year. This improvement makes Information Technology a necessary component in businesses and commerce. Today, many businesses and commences have used Information Technologies in their system to sell their products to customers, making IT a crucial component of their system. These information technologies also use the internet for their working process. E-business and e-commerce are examples of the use of IT in business and commerce. 

E-commerce has been used by many people to shop online because it is simple and easy to use for purchasing their needs without the need to travel to the physical store. Customers also save a lot of time because instead of walking to each store in a mall and looking for the item they want, they can scroll or search on an e-commerce app for the things they want. E-commerce is also becoming more popular during the pandemic of COVID-19. During this time, people are forced to stay indoors to avoid getting infected by the virus, making many physical stores close down and go bankrupt because there is not enough income from the customers. Due to many people staying at home, online activity and interaction increased, making electronic application becoming more popular, including e-commerce.

How E-commerce works

E-commerce works by using the internet to interact from the customers to the seller. Because of the use of the internet, customers can access e-commerce online and order the things they want from their own devices. After ordering the items by checking out from the e-commerce application, the order will be sent to the seller, which then will be processed and delivered back to the customers in a package. When the package is received, the customer can then write a review of the sent product on the website or application of the e-commerce. The review of the product helps other customers to know if the products are worth buying or not.

Types of E-commerce

Electronic commerce (e-commerce) and electronic business (e-business) are similar but have different definitions. E-commerce is a process of buying, selling, transferring, or exchanging information via a computer network or the internet. E-business, on the other hand, is servicing customers, collaborating with business partners, and performing transactions within an organization, but no transactions with other organizations. There are four main types of e-commerce, which are:

Business-to-customer (B2C) is a transaction between businesses and their customers.
Business-to-business (B2B) is a transaction among businesses.
Customer-to-customer (C2C) is a transaction between people who are not necessarily working together.
Business-to-employee (B2E) is a transaction between a business and its employee.

There is also e-government which let you interact with the government. There are three types of e-government, which are:

Government to Citizens (G2C) is an interaction between the government to the citizens.
Government to Business (G2B) is an interaction between the government to businesses.
Government to Government (G2G) is an interaction between the government and the government from another country.

Benefit of E-commerce

There are many benefits of using e-commerce. First, it is very convenient to use for customers. E-commerce can be accessed by customers anywhere at anytime online. Second, it can save a lot of time than buying at a physical store. In e-commerce, customers can find their needs by searching in the search bar which saves a lot of time than going shopping in a physical store where you need to go to the store and look around to find the things the customer needs. Third, customers can find and compare the price of the things they need from different sellers easily. Last, there are reviews for products purchased by customers. The reviews are written by customers who purchased the product. They write a review to give feedback to the seller about the product and also to tell other customers about the product they want to buy.

Negative Impact and Problems of E-commerce

Out of the many advantages of e-commerce, there are still disadvantages of e-commerce. First, physical stores are becoming less popular, making many stores go bankrupt. This is caused by customers who are becoming more and more comfortable with online shopping as their main method of shopping. Second, the risk of fraud is increased when doing online shopping in e-commerce. Customers can be tricked by the seller by misleading them about the product, making the product from the page of the e-commerce and the product when received by the customer not the same. Last, is the need for the internet to do online shopping in e-commerce. Because e-commerce is an online shop, the internet is very crucial for the operation of e-commerce. Without the internet, online e-commerce cannot function properly for the seller and the customers.

The most impactful problem caused by e-commerce is the competition between physical and online stores. The more popular e-commerce has become, the less popular physical store can be. Although physical stores have benefits on their own such as being able to see the actual product sold, they are still unable to compete with online shops. Because of this, more and more stores adapt to the situation by moving to online shops to continue thriving. If physical stores continue to close down, there will be no more of it and there will be only online stores left. Avoiding the closing down of the physical stores means a solution must be found so physical stores can survive.

New Solution for E-Commerce and Physical Stores

Today, many people and company tried to solve the problem of the tight rivalry between e-commerce and physical stores. Their main mission is to keep using e-commerce for shopping, but also not make physical stores close down. One company from China, Alibaba has solved the problem by inventing a new concept of shopping called “New Retail”. According to the information from Alibaba.com (2020), New Retail is a hybrid method between online, and offline shopping, making the two not need to compete. Currently, they implement this concept in physical stores by using kiosks, and digital mirrors to try make-up virtually. If customers are interested to buy the products, they can check out at the kiosk and avoid the long queue lines for paying, and if the items are not in stock, they can still be purchased at the kiosk and wait for the item to be delivered directly to their home. This concept speeds up the process of shopping offline and also speeds up item data collection for the seller.

Summary

Electronic commerce has become very popular among people from around the world. People choose e-commerce because it is easy to use and can save a lot of time compared to shopping at a physical store. However, e-commerce is slowly making physical stores close down due to people getting more and more comfortable with using e-commerce. For that reason, a solution must be found to solve the problem of e-commerce and physical stores, and one of the solutions is Alibaba’s New Retail concept. Applying this concept will help physical stores to keep opening and selling their items, eliminating the competition between online and offline shopping. For that instance, more people should start applying the New Retail concept in their shops to stay afloat in the business.

Reference to make this article:

Felix Putra Pratama