What are the most significant trends facing e-commerce? | My Paper Hub
Electronic Commerce refers to the sale and purchase of goods and services or
facilitation of trade through computer networks or electronic channels such as
online social networks and the internet. E-Commerce was conceived in the 1960’s
through an Electronic Data Interchange (EDI) introduced on Value-added networks
(VANs). The medium has since grown with
the arrival of popular online sellers in the 1990s through 2000s and increased
availability of internet access. The famous Amazon commenced operations as a
book shipping business in 1995 in Jeff Bezos's garage. EBay, a platform that
allows consumers to sell to each other online, began online auctions in 1995
and went mainstream thanks to the 1997 Beanie Babies frenzy (Arline, 2015).
Electric commerce allows consumers to exchange goods and services
electronically without barriers of distance or time. E-commerce has rapidly
expanded over the last five years and is expected to continue at this rate or
even accelerate. Soon enough, the boundaries existing between “conventional”
and “electronic” commerce will become substantially blurred as more businesses
are moving huge portions of their operations onto the Internet. As a matter of
fact, e-commerce is one of the most pertinent aspects of the internet to
emerge. It covers a range of various types of businesses, from business
exchanges involving trading goods and services between corporations, through
music sites and auctions to consumer based retail sites ("What is
Ecommerce?", 2014). This paper will discuss the most significant trends
that face e-commerce and a major challenge or market opportunity that it faces.
on technologies like electronic funds transfer, mobile commerce, inventory
management systems, internet marketing, supply chain marketing, EDI, and
automated data collection systems. The contemporary e-commerce typically uses
the World Wide Web for at least one part of the life cycle of the transaction
albeit it may utilize other technologies like e-mail. Electronic commerce
businesses employ some of the following aspects or even all of them;
• Online financial exchanges for trading
purposes or currency exchanges
• Business-to-business (B2B) selling and
buying electronic data interchange
• Online shopping websites that exercise
direct retail sales to consumers
• Business-to-business electronic data
• Gathering and making use of demographic
data via social media and web contacts
• Participating in pretail for launching new
goods and services
• Engaging in online marketplaces that
process third party consumer to consumer or business to consumer sales
• Marketing to established and prospective
customers by fax or e-mail i.e. newsletters
Just like any
other consumer-based purchasing market or digital technology, e-commerce has
slowly evolved over the years. Mobile commerce has grown rapidly to become its
own market as mobile devices became more and more popular. Social media has
also become a vital driver of e-commerce with the rise of interactive sites
like Pinterest, Facebook, and Twitter among others. According to Paymill,
Facebook had driven 85 percent of social media-originating sales on Shopify (an
e-commerce platform) as of 2014. 2014 was a year of milestones for electronic
commerce since worldwide sales hit a very high record of $1.3 trillion. Alibaba
even claimed the title for the largest global IPO ever.
overwhelming majority of U.S shoppers among others worldwide buying products
online, 2015 was expected to be better with the global sales growing by 6.4
percent. 2016 was projected to be far much better. E-commerce companies decided
to concentrate on improving the overall customer experience and minimize
friction where necessary so as to support and drive more sales. With this in
mind, here are some of the most significant trends facing the e-commerce
industry in the modern era;
• Focusing on video
Cisco, videos will account for 69 percent of consumer Internet traffic by 2017.
Videos are a perfect way to deliver high-quality content, and they also benefit
e-commerce by driving conversions and leading to higher average orders. Last
year the focus was specifically on mobile videos. In 2014, 25 percent of all
e-commerce video plays came from mobile devices, up from 2013’s 19 percent. As
of 2015, the shift towards videos was already generating a high return on
investment (ROI) for the advertising industry, particularly among consumer
packaged goods brands. As shoppers seek responsive layouts and grow more
responsive to visual presentation, videos will become a significant asset to
facilitate improved webrooming and convey product details, not just demos. As
mobile become the prevalent platform for online shopping, e-commerce retailers
who know the benefits of videos will focus more on exploiting it across
multiple channels (Verleur, 2015).
• Bringing Apple Pay online
Apple launched its brick-and-mortar payments
system in 2014 to much fanfare. Although Apple pay has been known to be
strictly an in-store payment solution, there has been a speculation that it
could be availed for e-commerce merchants. Apple has already started partnering
with online service providers like Uber, Lyft, and Airbnb. If Apple pay were to
fully enter the e-commerce space at scale, it would be a game changer for the
industry. This means a lot to e-commerce merchants as it; reduces costs like
fees for credit card processing, takes advantage of the potential opportunity
to team up with Apple for marketing promotions and facilitates easier payments.
• Implementing more responsive design
Studies show that
66 percent of the time that is spent on e-commerce sites is typically done
across mobile devices. Moreover, 61percent of customers or users leave a site
if it’s not mobile friendly. However, the rate of change in response is
enormous. This explains why optimizing the user experience for tablets and
smartphones (multiple devices with different screens) is more of a priority
now. Responsive design option is prepared to grow rapidly. The benefits include
higher conversion rates, improved customer satisfaction and increased site
• Combining content and commerce
and commerce creates vibrant lifestyle-oriented destinations that keep shoppers
coming back. It also doubles as a tool for branding and SEO. Birchbox is a good
example of an e-commerce site that successfully creates high-quality content to
generate repeat business. Etsy is also another excellent platform that combines
content and commerce for the same objective by featuring DIY projects and
profiling artists while using social media platforms for promotions.
The power of web
enablement in business is that geographical boundaries disappear for an
enterprise. Therefore, an e-commerce initiative can easily turn out to be a
global e-commerce initiative. Nonetheless, before conducting global E-business,
web-enabled businesses must take into consideration an array of international
economic, social, legal issues, and technological issues. The economic
dimension, for instance, covers the cost justification of projects or the high
cost of developing an electronic commerce system, number of sellers and buyers
to access via the internet, the question of skill shortage and issues to do
with infrastructure upgrade (Bingi, Mir, & Khamalah, 2000). Developing
countries like Kenya are also significantly affected by the economic crisis
that hits developed countries like the United States among other economic
giants that boost the global economy. The cost of internet connectivity in
Kenya (which is a fast-growing economy) among other third world countries is
not affordable to everyone which discourages penetration of internet beyond
urban areas (Kinuthia & Akinnusi, 2014).
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