I still can remember that day. It was a rainy one in 2000, and I found it very hard to get out of the bed. Still in my pajamas, I opened a notebook and put it on my lap. I was already pretty familiar with “the net of nets” (I have been on-line since 1995), and I was just browsing the web. Suddenly, I found a book I was looking for in local bookstores for quite a while! I didn’t hesitate: I put it in the cart immediately, filled in delivery address and clicked “Order”. I had just made my very first on-line order and I hadn’t even had to get out of my bed.
It is obvious – Internet changed the way people work, amuse themselves, use information, and it affected the way they buy, too. Buying on-line is commonly as easy as it was in my little story. Since that day, I’ve bought many books, CDs, DVDs, computer accessories, software, a digital camera, and I even subscribed to a magazine – from my room. On-line shopping, virtual buying or internet ordering – it can be named many ways; it always refers to the same. The letter “e” has hit the world recently, and commerce can’t stand behind. Please, welcome e-commerce.
Yet for internet geeks – buying refrigerators (to always keep their cola in the right temperature) or sending flowers on-line (how easy it is to pamper your darling nowadays) is long since as common as dialing a friend for other people is. E-commerce was formed in late 1990’s, and Amazon.com, founded in 1996, was one of the first virtual stores. It has been a mere 8 years since it was born, yet even in Slovakia, tens of thousands people have already bought something using keyboard and mouse.
Virtual shops are big leap for customers and their shopping comfort. There is not any “real” shop that would give discounts up to 40% on everything. There is not any shop made of stone, that would be able to have a supply of millions of most various books, software, apparels, CDs, air-tickets, DVDs, PC games, garden equipment, shoes… almost everything can be found on sellers’ web pages. (To lighten this up – I haven’t found an on-line shop yet, where I could buy a stone from the Moon… but somebody is offering one at eBay! :-).
Nevertheless, those who have already bought something on-line, may had experienced also other side of the coin. Obvious drawback of this new way of purchasing products is that (in most cases) one cannot touch product before ordering it. One will never know whether the digital camera is not too difficult to operate, or whether the color and cut of the desired jeans looks the same in reality as it does on the monitor. There is also possibility that goods will arrive damaged, or will not arrive at all. These aspects add to some anxiety during virtual shopping.
Few months after my first on-line order, I co-founded an internet bookstore martinus.sk; today, it is one of the biggest internet shops in Slovakia. That is how I got to know e-business also from the other side.
Since entry to the e-commerce market is extremely simple, the competition is likewise extremely fierce. There is no need to build an expensive network of outlets and staff plenty of people; the only costs are development of the web application, a few people to maintain it and an advertising campaign to penetrate the market very fast. Moreover, if the newcomer is financially strong enough to do it very effectively, massively and with almost dumping prices, even shops that had been there for ages will perceive huge outflow of customers – especially in Slovakia, where the price is still something that matters the most.
Nevertheless, there are other “enemies” of merchants, too, and suppliers are one of those. In virtual stores, premature exult at one’s wished book being available, and then a customer service department of the store informing that it actually is not available anymore, may result in big disappointment and may endanger retailer’s credibility. The issue is even more serious, when we take a fact in account that in real world, another bookstore may be miles away. On the Internet, it is only one click away.
According to Forrester Research, in 2004 Internet sales in United States of America will total $3.2 trillion, Western Europe will be worth $1.5 trillion, Latin America $82 billion, and Internet sales in Eastern Europe, the Middle East, and Africa will be worth a combined total of $68.6 billion. All summed, it is about 8.6% of worldwide sales of goods and services. In many areas, thanks to Internet, things are possible that were never possible before – for all eBay.com could be mentioned, where millions of people are able to bid for goods in real time. Shopping for certain merchandise became easier than ever before, even though in some areas and products, there is still long way to go. Despite these facts and all of its advantages, e-commerce will probably never completely overtake “real” commerce, as the older generations remember it. If one wants basic groceries, he will probably go to a tiny shop at his neighborhood – not for saving time or money, but for mere joy of chewing a previous day events over with the seller he knows personally. Nor he will abnegate an opportunity to try what it will do, if he presses the gas pedal of the car he wants to buy fully. She will want to touch the piano before she takes it home, and she will not do without putting that “cool” T-shirt on to see how perfectly it fits her, before she spends $20 for it.
But lots of other businesses should be alerted.
E-Commerce Facts (CISCO) - www.cisco.com/warp/public/779/govtaffs/factsNStats/ecommercenew.html
Amazon.com - www.amazon.com
eBay - www.ebay.com