Contemporary Retailing Issue - Growth of online shopping - Essay Writing Help Answer

Essay Writing Help

Assignment Task

Topic. Growth of online shopping

The evolution of online retailing has transformed from a highly price sensitive market centred on a few product types to a broad range of goods and services across varying price points. This increase in sophistication will coincide with expansion of the internet's content and capabilities, making execution and personalisation two top priorities for retailers looking to stand out.

Growth of online shopping

Introduction

The advancement of technology in the global market in the last two decades has played a pivotal role in the growth of online shopping or e-shopping. E-business has become a popular medium where buyers and sellers are performing their transactions. Customers are able to use web browsers to buy goods and services directly over the internet (Ha & Stoel, 2012). The evolution of online retailing has transformed from a highly price sensitive market centered on a few product types to a broad range of goods and services across varying price points. This increase in sophistication will coincide with expansion of the internet's content and capabilities, making execution and personalization the top priorities for retailers looking to stand out.

In this form of retail, goods and services are offered or displayed in the e-shops, e-web-stores, web-stores, internet shops or other forms of virtual stores instead of the traditional physical stores where customers would go and shop for different goods and services (Fisher & Chu, 2009). In other words, e-retailing is supplementing and complementing the experiences of physical stores which have been used for many centuries. This paper critically analyses how execution and personalization have become important factors in the online retail market with the increased sophistication of the industry.

Online Retailing

With the increased users of the internet globally, consumers are nowadays turning to online platforms in order to search for information for goods and services that they need in order to make informed purchase decisions. Unlike past where customers could only use the internet to search retail information of a few specific goods and services, nowadays they are using web browsers to seek information of any type of goods and services offered in the market (Sniehotta, 2009). As a result, online retailers are forced to develop and update their online listings, engaging their customers in online conservation and encouraging reviews among other strategies in order to increase their sales.

The online retailing is becoming more sophisticated with almost all the businesses, large and small, turning to the internet to search for millions of customers who spend at least one hour day on the online platforms (Wei-yu & Li, 2010). This means that the online market is evolving everyday with the entrance of new firms and changing technology that is expanding the capabilities and contents that retailers can offer to their customers. The changing trend in the online business has increased competition among the retailers forcing them to adopt better strategies in order to gain a competitive edge in the market (Bonera, 2011). Businesses are focusing on how they can take advantage of the new opportunities that are offered by the expanding internet capabilities in order to attract and retain more online customers. The outstanding retailers are focusing on attracting and persuading potential buyers to make a favorable purchase decision while at the same time ensuring their loyalty and satisfaction (Wei-yu & Li, 2010). They understand online purchase behavior of the customers which is defined by the degree of a particular buyer to access, shop, and browse and transact purchases more than one time.

A successful execution of the online retailing strategy requires businesses to understand the access point where customers visit to seek information about the goods and services they are intending to buy. The Technology Acceptance Model (TAM) argues that the willingness of users to utilize a given technology depends with the perceived ease of use and perceived usefulness (Fathema, Shannon & Ross, 2015). People will prefer to use technologies that are perceived to be easy to use and that contain useful information depending with the needs of the user (Fathema & Sutton, 2013).

Successful retailers are able to ensure that their stores are easily accessible, informative and safe for potential customers to perform their transactions. Online transactions require a high level of trust in order for customers to be willing to purchase their goods and products without physically seeing the retailer or the seller. This is because of increased cases of fraud that are associated with online transactions where customers pay for goods and services, yet they are not delivered as ordered. The Consumer Trust Internet Shopping (CTIS) model contends that many online customers are not willing to make their purchases over the internet if they lack trust with the method (Fisher & Chu, 2009). According to this model, consumer trust is the major factor that determines whether they will engage in online transaction given the rising cases of identity theft of financial and personal details of the online shoppers.

Online customers require trustworthiness of the internet merchant, the internet shopping medium and the contextual environment. Therefore, successful online retailers are utilizing new internet capabilities to assure and improve their potential customers’ confidence and trust, security and privacy when they are interacting with them through their websites, blogs, social media pages and other virtual platforms where their goods are displayed and sold. Security and privacy concerns are very crucial when customers are determining whether to use a particular online service or not (Fisher & Chu, 2009). They are sensitive with personal information and their money, which they pay through online platforms and the service provider must guarantee them their security concerns. The online service providers achieve this goal by ensuring all their systems and processes are tamper-proof and nobody can hack them or access them without authority of the company (Fisher & Chu, 2009). The online retailers must also ensure that they will deliver the ordered goods as required on the agreed date, time and place. Companies using online retail should ensure that they have clear transaction policies, transaction privacy and safety in order in order to increase the level of trust and confidence among their customers (Fisher & Chu, 2009).

The online retailers are also focusing on how they can personalize or customize the services they are offering to their existing and potential customers in order to give them new experiences while they are shopping for goods and services over the internet. Personalization is based on the argument that needs of the online customers are different and they cannot be generalized (Anuntaakalakul, 2008). Every customer is unique depending with his or her preferences, social status, purchasing power, location, and the intended user among other personal considerations (Wei-yu & Li, 2010).

The online retailers must ensure easy and wide access of their services, products and information in order to provide convenience to their customers. Convenience also goes together with enjoyable online services. Customers would prefer a web page or platform that is enjoyable to visit or that will satisfy their emotional needs (Ha & Stoel, 2012). This is part of customization since the online retailers must ensure they offer their products, information and services in platforms that are enjoyable for individual customers. Many potential customers would not prefer to visit boring or unattractive internet pages or websites while they are seeking information to make purchase decisions. Business with unappealing or unattractive websites will record low number of visitors no matter the value of information they carry concerning a particular good or service. Businesses must customize their web pages with the emotional likes or the preferences of the individual customers they are targeting (Hooda & Aggarwal, 2012). For example, if a company is targeting the youth segment with its products, it must portray its information with attractive images, clips and illustrations that attract young people emotionally. Therefore, successful online retailers ensure that their online stores consider personality traits and customer demographics in order to improve their experiences as they interact with the information provided over the internet (Anuntaakalakul, 2008).

The demographic characteristics of the customers are important because their computer knowledge differs (Bae & Lee, 2011). Some customers may have knowledge on how they can transact via the internet and understand related issues that come with technological complexity while others may lack this knowledge. According to the Theory of Planned Behavior (TPB) the action of the customers will highly depend with the attitude they have toward a particular buying method (Van der Linden, 2011). For example, if they believe that online buying is more convenient to them, their action towards online shopping and buying will be positive. Therefore, it is important for online retailers to consider the computer literacy level of their customers when they are executing their strategy to a particular group of people. Failure to do so will limit the ability of the potential customers to access their goods, services and other valuable information they may be seeking to make purchasing decisions (Hernández, Jiménez & Martín, 2011).

Conclusion

This study shows that there is a need for online retailers to know how to retain, attract and satisfy their customers in order to reap the benefits and opportunities offered by e-commerce. Given almost every business is establishing or has already established its presence in the online market, retailers need to know how they can gain competitive advantages by adopting the necessary strategies. First, executing the appropriate online strategies such as ensuring their e-stores are easily accessible, offering competitive prices, informative and safe for potential customers to perform their transactions will be very important in achieving a competitive edge in the market. Secondly, online retailers need to focus on how they can personalize or customize the services they are offering to their existing and potential customers. This is through adopting techniques that will enable them to communicate with individual customers after understanding their specific needs. They need to design their online stores in order to suit their market segments by using the emerging internet capabilities in order to increase the number of customers who are visiting their web pages where they are advertising and selling their products and services. The application of these and other strategies will differentiate between successful and unsuccessful online retailers.