The Positive Effects of this New Business Channel

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Various organisations and people have given different definitions to ecommerce. OKI Technical Review (2000) has defined e-commerce as “the technology, processing, and operations, which occur when business transactions are done automatically over networks, using IT.” (, 2000). At the same time, the World Trade Organisation (1999) defined e-commerce as “the production, distribution, marketing, sale or delivery of goods and services by electronic means” (, 2002). E-commerce has been characterised as one of the biggest revolutions regarding the electronic business, which at the same time expresses not just the enthusiasm but also the spotlight for a fast growing market.

According to a survey undertaken by the US Ministry of International Trade and Industry (1999 and 2003), the scale of the market concerning e-commerce in the USA and Japan has risen from 1998 to 2003, with the transactions between businesses and consumers reaching 650 million Yen in Japan and 22500 million Yen in the USA for 1998 while this figure increase to the amount of 31600 (Japan) and 213200 Yen (USA) for year 2003 (, 2003). It is evident that there has been a radical change of the buying behaviour of people, who mainly use e-commerce for travel, automobiles, buying PC’s and for the provision of services in general (, 2003).

One can, therefore, argue that e-commerce has proven to have a great impact upon the buying behaviour process of people by formulating trends in certain market areas, as in the case of travel which has risen 110% from 1998 to 2003 (, 2003). Grant, X. Elaine (2002) stated that by the end of 2002 approximately 600 million people shopped through the Internet, spending over US$1 trillion (p. 2). Last but not least, Forrester Research, Inc. (2003) reported that by 2004 e-commerce economic transactions are estimated to reach US$6,8 trillion (page 6). The same research predicts that by 2004 the number of e-commerce sales is going to increase up to 8.6% (Forrester Report, 2003, p. 1).

Therefore, statistics clearly show that supply capabilities and the growing competition between companies on a global basis have led to this change regarding the business environment where now there exists a direct contact between organisations and customers (, 2003). Based on the above and the fact that widespread Internet has rapidly developed e-commerce as a fast growing means for businesses, it can be stated that e-commerce introduces a new relationship between electronic media and the consumer by mediating complete retail transactions.

Approximately, more than half of all Internet users (59%) have bought a product on-line (Pew Research, 2000, p. 12 and 27), which can create a significant issue regarding the safety and value of the purchase. Several people have voiced their concerns regarding the use of all e-commerce capabilities available for purchases online. Thus, it can be argued that even e-commerce has negative aspects, its contribution under certain circumstances can have many positive effects as regards to consumers, companies and society, as a whole.

There are several positive effects of e-commerce towards consumers. First, through e-commerce consumers have easier access to products offered by the companies via online means. Time and geographic restrictions do not apply at the Internet (, 2003, p. 3). In other words, consumers can shop 24 per day and 7 days per week. Moreover, e-commerce offers consumers immediate access to shopping via the Internet. Thus, the Internet and consequently e-commerce expands new horizons for the purchase of goods and services worldwide (, 2003, p. 2).

Another positive impact of e-commerce having on consumers is that through the Internet the choice for goods or services has been expanded (, 2003, p. 3). One is able to choose a product from different businesses between a wide variety of products. In addition, customers can also find detailed information regarding the desired product. So even the most unusual needs are now satisfied. Thus, one can claim that e-commerce tailors goods and services according to consumer’s needs (, 2003, p. 4). Further, consumers benefit from e-commerce as the choice for a good is not limited by the stock of the retail company as for instance, traditional shops have limited amount and sizes concerning clothing, however, this is overcome through e-commerce, as the online show can sell any product of the company, regardless of the location of the store.

E-commerce also has positive effects on companies. First, it enables all companies to improve their competitive level by coming closer with the consumer (, 2003, p. 3). E-commerce enables the smallest companies to attain a worldwide attendance and to sell their goods and services at a global basis, as there is no limit to computer networks. For instance, is a small store that has created a website selling comics around the world. To illustrate this point there are various businesses that employ e-commerce technology. This in addition to the offer of pre-and post-sales support including product information and guidance on goods’ use raises the level of quality of service for the benefit of the consumer (, 2003, p. 3).

At the same time, e-commerce has a positive contribution on companies, especially on the ones that have online economic transactions with customers through the Internet. Companies enhance e-commerce for its potential to develop their businesses worldwide and due to its direct effect upon customer needs and wants (, 2003, p. 2). The latter brings further changes to the definition of new markets. To illustrate this point, global online consumers can purchase goods from a single site that may be located on Greece. On the other hand, organisations that close their eyes to technological changes will suffer the consequences of market changes (, 2003, p. 2).

Through e-commerce, companies try to aim to a greater target market group. As companies have global presence due to Internet, their products do not address specific countries. Boundaries fall and the target market goes global. Goods and services now address to consumers from different countries and different age groups. The target market for a specific group is not restricted upon the borders of a country. This has a positive economic impact on the marketing and the financial returns of the business.

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