Ecommerce – The Pros and Cons

It’s not a surprise that business from all across the board in New York City, corporate to local shops, have been shifting from physical sales to digital purchasing of their products or services. More and more people are simply ‘Googling’ the products that they want to find online and clicking on the first online shops that the see above the fold.

This form of selling and marketing has proven to be truly effective on large and small scales for any kind of business. Ecommerce; defined as online shopping, selling, and business, has swept the world as the emerging dominant form of sales and there are many reason; especially in places like New York City where people don’t have time necessarily to physically visit all of the stores they see in newspaper ads, magazines, and commercials. Yet like everything, Ecommerce can quickly become a double edged sword with both advantages and drawbacks.

With everyone shopping online in New York, businesses are shifting their products to online shopping carts; many of this digital entrepreneurs are quickly swayed by the advantages of ecommerce. These advantages include things like:

  • Being able to sell products 24/7 and make money while asleep.
  • Being able to appeal to a wider audience not limited by the physical. What this means is that people don’t have to live in the same city or state to buy your products
  • The ability to use ecommerce as a marketing tool to a businesses name out into the world to drive more sales and game to a company or business.
  • Speed. Much to my personal dismay, computers seem to not only be able to think faster than humans, but they can sell products faster tool.
  • Effort. Much of the effort of having to ring up a customer, fill out their information, and serve the customer are stripped away and essentially put on the customer themselves. This is also known as self service.

All of these advantages however seem to cover up the most apparent disadvantages despite their over-reaching repercussions. Drawbacks such as the ones listed below could destroy a business if they ever occurred.

  • 100% online businesses rely on platforms, servers, and technology that can crash at any point in time rendering the business useless.
  • Online sales completely take away the personality that you get from human interaction. These human interactions sometimes drive sales up and open new leads
  • Lawsuits. Ecommerce websites are vulnerable (no matter what people say) to hacking and digital theft which will leave you and your business wide open for lawsuits if any of your customers suspect this happened because of purchasing something through your website.

The disadvantages could go on for pages, but those three should get across the point that ecommerce web design can be a tricky business for some people. Yet New York consumers and retailers don’t seem to pay any attention to the disadvantages and continue to shop and sell online.

The Advantages and Disadvantages of Ecommerce

I remember my mom used to always test the water before she would put my little kid sister into the bath tub. Later my dad would say “Son, look at both sides of the coin before you start anything”. So here we are; mind made up and all ready to take the plunge but just before we do, some primeval instinct makes us pause and check both sides of the coin. The internet will provide you with a fairly extensive list of relevant, irrelevant and some downright fictional list of advantages and disadvantages of electronic commerce. What I’ve done is to lay out the real issues that would irritate or delight you on a day-to-day basis. So here goes:

The disadvantages of ecommerce

These usually consist of silly mistakes on the part of either the store owner or the customer:

1. Returned items – a major disadvantage of ecommerce
Very often customers misunderstand a description or are simply in too much of a rush to bother reading the detailed product description. Thus, an electrical item such as a cell phone charger that requires 220V of electricity and meant for use when on tour in Asia, is bought for local use in USA and subsequently returned often accompanied with a nasty “this is not working” letter blaming the seller for selling sub-standard products.

2. Back charging of credit card transactions – an irritating ecommerce disadvantage
Linked to above point, the customer will reject the charges. When that happens, the credit card company will not only reverse the credit but also levy a charge on your account. It wasn’t your fault but you’ve got to shoulder it.

3. Data entry errors – silly mistakes that are potentially expensive
Glenn, the store clerk entered the price of a box of finest pears as $0.96 instead of $10.96. Over the next two days the store owner was swamped with hundreds of orders for Pears. The missing digit nearly wiped out the profits for that month. Friends swear they saw Allan the store owner laughing and crying at the same time. Meanwhile Glenn, thanks to Allan’s generous heart, is now in the packing section.

4. The search engine fog – this a big disadvantage of ecommerce
If you set up a brick and mortar store at a prominent location, you get noticed instantly and will have customers from the moment you are open for business. This is not an advantage with ecommerce. In the virtual world, the only location that matters is the location in the search engine’s search results. If you’re not on the first page of the search results then you are relegated to the back alleys of cyberspace.

5. Can be equally expensive – hidden costs are a major drawback of ecommerce
True, you don’t have to spend on utilities or staff or for that matter, even on an office. But setting up a good online store requires a lot of hard work by professional people. First, they need to build you a good online store and then, it needs to be marketed by. The people who do it need to have special skills and deep knowledge, both of which are expensive. Successful ecommerce internet marketing of your online store results in a good search engine rank. The downside of ecommerce is that, the moment you stop spending on e-marketing, the search engine rank begins to slip. In a brick and mortar store you have to pay premium rentals for a premium location. The equivalent of premium rentals for an online store is e-marketing.

6. Rogue web hosting – a major irritation in ecommerce
My dad used to say “It’s so difficult to find good help these days”. I say, it’s very difficult to find good web hosting these days. Dropping rates have resulted in ecommerce web hosting services companies often running themselves on little more than hot air or recruiting staff who are clearly not competent. Any resulting down-time can prove potentially expensive. It is relatively easy to find good professional help to build and market your online store or office but finding good web hosting is a different matter altogether.

The Advantages of ecommerce

1. Location neutral – A fantastic advantage of ecommerce
How often have you heard the words “Location, location, location”? The first advantage of ecommerce is that it is location neutral. Every website is at a prime location and your customer only has to travel the distance of a single mouse click to reach you.

2. No need for supervisors and cashiers – ecommerce has a big cost advantage
An online store or online office does not need a separate set of supervisors or cashiers. At the most it needs one person monitoring the sales. Everything happens in a neat and orderly fashion. In fact, you can open as many online stores as you like for less than 5% of what it takes to set up a brick and mortar store or office.

3. Open 24 x 7, 365 days of the year – ecommerce does not take a break
You may be asleep but in other parts of the World, customers are awake and busy shopping. Ecommerce search engine optimization lets you take full advantage of this.

4. Go international from day one. Electronic commerce internationalizes your trade in an instant!
You’ve heard the term “global village” being bounced around by all and sundry. But did you know of its connection with your trade? By setting up an online store or online office, you reach out to customers irrespective of their location on the globe. For all practical purposes, you and your customers live in a village – a global village on an international scale. The advantage of ecommerce web site solutions truly boggles the mind.

5. Look Ma, no paper, no storage but I got money in the bank – Advantage of magic in ecommerce
Your online store emails you the orders; you collect them and email your suppliers the packing slips. Your suppliers ship out the orders. You don’t have to stock anything and can be as paperless as you like. Even your cash is collected directly by your bank which emails you a monthly statement.

In final analysis, if you’re careful, the disadvantages of ecommerce will not exist.
On the advantage side of ecommerce, its power is such that all you need is a little imagination and you could run an empire out of a laptop computer. Retailbizmd provides retail consulting services to help corporations in driving profitable traffic and optimizing conversion rates.

3 Key Advantages Ecommerce Offers

Were you that kid who set up a ice-cream stand in your neighborhood, dreaming of making enough so that you could buy that GI Joe/Barbi doll that was all the rage? Have you grown into an adult who goals of making enough to not have to fret too much about offering for your family or perhaps purchasing cool grown-up devices?

The Internet and Ecommerce have made global entrepreneurship possible, and along with it your dreams of financial security and more. I read somewhere that if you want to market something, you cannot miss NOT to go online. You have to go worlwide. Why?

Market Size

There are various advantages e commerce offers a merchant that a conventional business cannot (not without having to spending a ton of money, at least). For one, the online market is gigantic. 17% of the world’s population or over 1 billion people are online today. In 2006, shoppers spent a $102.1 billion online. Be sure that your web store takes advantage of this wide market by selecting and making use of a top-notch online ecommerce shopping cart solution.

Complement Your current Store

“90% of those surveyed say they have a better overall shopping experience when they research products online before shopping in-store.” – Harris Interactive

If you already manage a conventional brick-and-mortar store, an online store may actually elevate the profit of your offline store. We live in an age where data is competency. Consumers like to know a thing or two about the products they’ll be buying before they make purchases. Psychologists have suggested that several people research before they purchase for several reasons. Some like to be warranted that they are getting the best offers. Others like to know that they are doing the perfect thing by obtaining something that they need. From a marketing point of view, as long as you custom designed your information to target these various groups, you can pretty much assured to have sales.

DIY – Not A Hindrance

To take full advantages e commerce opportunities that the Internet provides, you need to make sure that you pick the best ecommerce solution. If you’ve made the suitable choice, you can run multiple online stores with relative ease. This is one of the key advantages e commerce solutions provide. You don’t have to worry too much about HR matters, storage space and boring department meetings. All you need to do as a merchant is make sure you market your store well, see to it that your site is “sticky” and ready to win over customers, and finally make sure that you have time to approve payments (if you do not subscribe to a payment gateway/processor) and reply customer email. That leaves plenty of time for golf, family and that vacation you’ve been wishing to go on.