Online retailing, e-commerce, e-shop etc., all these terms refer to the financial transactions which takes place between a seller and a buyer for sale and purchase of products in a virtual environment to facilitate both the parties in retailing with the involvement of software technology.
There are different types of online retailing sectors depending upon the bodies involved in electronic commercial activity :
- B2B, business-to-business, takes place between two companies over the internet. For example, sale and purchase of raw material through internet between company A and company B, where company A is the retail supplier of raw material and company B is Buyer Company.
- B2C, business-to-consumer, takes place between a company and the individual consumers. The products of the company are mostly individual oriented. Amazon.com, ebay.com are the real life example of such retailing type.
- C2C, consumer-to-consumer, this is new type of e-commerce recently introduced, where a company provides a web-based platform to different individuals to sell or purchase the products online. Here the involvement of the company is just to provide the platform to interact. All the supply & demand activities are handled by these individual users.
During the year 1994, the online banking and other online commerce activities were opened and in the same year, Netscape introduced the SSL, Secure Socket Layer, for the encrypted and more secure online transfer of data which made the online transactions more secure, thus facilitating the e-shopping web-sites. A German company, Intershop, was the first company to introduce first Online Shopping System.
Online shopping provides both ease and convenience of shopping to the customers and allows retailers to maintain the balance between demand and supply. Some other advantages of online retailing can be summarized as:
- Requires low level of investment, retailer need not to build a huge complex for storage and display purposes. Only a web-site works and storage is the matter of concern.
- Builds the customer base, as it reaches to a huge number of users through ads campaigns, adverts, search engine results etc.
- Eliminates the geographical barrier for the business as online stores can be visited from any part of the country at anytime.
- Improved customer interaction through feedback and reviews from customers; customer interaction can virtually be served at one-to-one basis.
- Improves the brand value while customers in real-world scenario aren’t much aware about the technical know-how’s of a product. Online stores provide that information to a customer without facing the hassle of answering multiple customers simultaneously. This gives a reputed face and sense of trust in user’s perception and improves the brand value of online retailer.
- Automates working of various entities involved in retailing and helps in maintaining the inventory, finance and other aspects by integrating various modules of retailing with the online store. For example, whenever any product is ordered, inventory can be automatically updated.
During these past 15 years stretch, online retail has been through various trends in market. Companies’ like Walmart has introduced the “in-store pick-up” for the orders placed online for more sophisticated customers who are keen to bring their newly ordered commodity by themselves.
Mobile apps for smart-phone are the new trends in new mobile-world. Smart-phones are now in the reach of every person and so the online stores are keeping their reach with their customers on their smart phones. This modern era of Mobile Application Development has allowed online stores to launch their own mobile apps for stores and provides laxative shopping experience to users.