Online Shopping

Group Members:

George Harris

Da’Vid Robinson

Binh Dao

Kwadwo Kwakwa

Alex Covrljan

Tim Connolly

What is Online Shopping?

The online selling of or enabling

the sale of products or services to

consumers.

How did Online Shopping come about?

Online shopping emerged with the development of the internet.

Entrepreneurs saw the potential in online shopping and sprung at the chance to make virtual storefronts, so that consumers could shop without leaving their homes.

Growth of Online Shopping

There are over 70,000 new websites put on the internet every hour.Internet traffic is doubling every three months.Projected annual internet commerce revenue has grown from $35 billion in 1998 to $1.4 – $3.2 trillion in 2003.(Taken from CISCO Systems WEB Site)

Risks & Disadvantages of Online Shopping

Fraud- Do you know the Company?Security- Is your credit card safe?Privacy- Is your information being sold?Shipping- Are you getting the correct product at the requested time?Difficulty- Do you know how to shop online?

Consumer Benefits

Convenience

-Geographic

-Store hours

-Ease of transaction

-Quick and efficient shopping process

Information

-Quick location of items

-Easy price/attribute comparisons

Firm Benefits

Less dependence on intermediaries

-Geographic distribution

-Holdup

-Time to delivery

Marketing

-Target marketing

-Direct customer relationships

-Customer service

Online Shopping VS. Traditional Shopping

Differences

-Cannot try or test product before purchase.

-Minimum human interaction if any.

-Cannot pay by cash.

-Shop anytime online.

Online Shopping VS. Traditional Shopping

Similarities

-Advertisement.

-Security.

-Convenience.

2005 expected pattern of electronic shopping users

Consumer acceptance(%)

% itemsshoppedelectronically

1 15-20% "hard core" 50-75%

2 15-20% occasionals 25-35%

3 15-20% experimenting 10-20%

4 All the rest still irregulars! 5%

Key Findings of Michael De Kare-Silver in e-shock:

Already about 15-20% of consumers say they’d prefer to shop electronically rather than visiting the shops.

It only takes a drop of about 15% in store traffic to make many stores unprofitable.

This revolution will achieve critical mass as early as 2005.

Manufactures can seize the opportunity to decide whether to establish their own direct consumer distribution and bypass existing retail chains.