Question

1. Discuss any FIVE (5) benefits generated by the value delivery network of online retailers. Provide your clear justification on the benefits

2. Discuss FOUR (4) improvements needed on the value delivery network of online retailers to further enhance their competitive advantages. Provide examples in your explanation.

Answer 1

Ques1

- The expected benefits of e-commerce are numerous.

- For consumers, it provides a useful and convenient platform to purchase an enlarged set of items and services from more vendors at presumably better prices.

- Consumers can use search engines and price correlation sites, which altogether reduce search costs, to discover and compare a wide range of offers for the same item.

- What's more, electronic markets permit consumers to shop at anytime from anywhere, dodging the problem of opening hours, distance to shop or accessibility of items.

- E-commerce additionally benefits firms by giving a channel to better promote and distribute their items. Electronic markets permit sellers to efficiently transfer relevant item data to potential buyers, which reduce their search costs.

- Moreover, firms can use computerized technologies to increase item differentiation and soften price competition; to differentiate themselves by superior interfaces with respect to competitors and create exchanging costs.

- Furthermore, electronic-mediated exchanges offer better approaches to gauge customer preferences more honestly and hence offer opportunities for targeted advertising, personalized marketing, item customization and price segregation.

- Hence, numerous reasons suggest that e-commerce can positively affect social welfare, in spite of the fact that the question of who benefits more remains a matter of empirical examination.