Last Updated on May 23, 2023
If you have ever had the pleasure of ordering new shoes, a dress, a laptop, a phone, food or anything at all over the internet, then you have participated in e-commerce. The same goes for anyone that has ever sold anything over the internet. It is all part of e-commerce.
The first-ever online sale took place on August 11, 1994, when a guy sold a CD by the band Sting to a friend using his website NetMarket. This is the first instance of a consumer purchasing a product from a business over the Internet, or “e-commerce” as it is currently known.
Since then, e-commerce has progressed to make it easier to find and buy things through online shops and marketplaces. Independent freelancers, small enterprises, and huge organizations have all benefited from e-commerce because it allows them to offer their products and services on a larger scale than traditional offline shopping.
What is E-commerce?
E-commerce basically refers to any type of online business transaction. Online shopping, which is defined as the buying and selling of items over the internet on any device, is the most well-known example of e-commerce. E-commerce, on the other hand, encompasses a wide range of activities, including online auctions, payment gateways, online ticketing, and internet banking.
What are the benefits of E-commerce to a business?
There is a reason e-commerce has seen such explosive growth over the years since its inception. More and more businesses are learning to take advantage of how important the internet has become in everyday life.
Unlike a physical store’s ability to serve a limited geographical area, the market for an online store, or any other sort of e-commerce business for that matter, is the entire world! One of the most significant advantages of trading online is the ability to move from a local customer base to a worldwide market at no additional expense. Online purchases accounted for 19.6 % of worldwide retail sales in 2021, and this figure is expected to rise year after year.
Speed of access
It can be very annoying when crowds can slow shoppers in a physical store. The thought of a queue or even the road traffic one has to go through to get to your store can discourage a potential customer from patronizing. However, e-commerce sites function quickly and easily as long as the e-commerce site is online and the customer has a good enough internet connection. Product and shopping cart pages load in a matter of seconds. It only takes a few clicks and less than five minutes to complete an e-commerce purchase.
Lower cost of operation
The operating costs of eCommerce enterprises are much cheaper. The largest eCommerce costs are warehouse and product storage, as there is no need to engage sales staff or operate a physical shop. Those who run a dropshipping firm have even less of an initial commitment. Merchants can provide better deals and discounts to their clients since they are able to save on operational costs.
Wider customer base
You can now sell to a wider range of customers thanks to the expansion of eCommerce. Selling online can be done through a variety of channels, including a website, a mobile app, marketplaces such as Amazon and eBay, and social media platforms such as Facebook Marketplace and Instagram Shoppable Ads.
You may now reach out to potential customers without having to wait for them to come into your store.
Things like timezone differences, closing time, public holidays or even a global pandemic have got nothing on a business with an e-commerce site. Aside from downtime or scheduled maintenance, e-commerce sites are accessible 24 hours a day, seven days a week, allowing visitors to browse and shop whenever they choose. Brick-and-mortar stores are typically open for a set number of hours and may even close on specific days.
Customers at a physical store may have difficulty determining which aisle a product is located in. Visitors to an e-commerce site can browse product category pages and utilize the site search feature to quickly locate a product.
Using electronic technologies to speed up ordering, shipping, and payment operations, eCommerce businesses can also automate their bookkeeping processes. The site metrics make it much easier to keep track of sales, inventory, revenue and expenditure. It saves business owners the stress of dealing with all that paperwork. Businesses are saving billions in operational and inventory expenditures as a result of it.
Personalized customer service
According to an Epsilon poll, 80% of customers are more likely to buy from a company that offers individualized service, and 90% find personalized messaging appealing. Those that are interested in personalisation are more likely to be the most valuable clients for the brand. These findings demonstrate how providing personalized customer service can help a company’s revenues and reputation grow faster.
Discounts/promotions, loyalty programs, tailored messages, and recommendations are all examples of personalisation.
Scaling up or expanding a physical store necessitates additional floor space (and the associated costs!), personnel, and shelf space. In contrast, one of the less obvious benefits of e-commerce for firms is how easy it is to expand an online store.
You only need more product, a few digital modifications, and potentially more storage space, which is much less expensive than storefront space. Being online also negates the need to create a new store in a different area because you’re already connected to a worldwide market.
E-commerce businesses can stay agile and adapt their marketing efforts to give a better-tailored experience and attract more new consumers with access to a plethora of customer data and the ability to keep an eye on client buying behaviours as well as changing the industry trends. Consider this: you have the opportunity to address thousands of your clients by their first name; that is already something.
Personalization and product recommendations
Visitors’ browsing, search, and purchase histories can be tracked on e-commerce sites. They can utilize this information to provide meaningful and personalized product recommendations, as well as get vital market intelligence. “Frequently bought together” and “Customers who viewed this item also viewed” sections of Amazon product pages are two examples.
Work from anywhere
Running an eCommerce business often means you don’t have to sit in an office from 9 to 5 every day or endure a daily commute. All you need is a laptop and a reliable internet connection to run your business from anywhere in the globe.
Overall, launching an internet business is less hazardous, requires fewer resources, and can be up and running in a significantly shorter length of time for entrepreneurs. Nonetheless, managing an eCommerce business entails all of the aspects of running any business – effort, planning, and a learning curve.
And, while selling online is unquestionably the way to go, brick-and-mortar stores aren’t going away anytime soon. If you own a store, you can use eCommerce to implement a hybrid strategy, allowing your clients to purchase both online and in person. When done right, the hybrid strategy can be just as profitable for your company.
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