Question

Case study: Online shopping expected to soar

Christmas shoppers are expected to make Monday the 10th December the busiest day of the year for online shopping. Credit card firms are predicting a rise of more than 50% in online shopping this Christmas, compared with last year. Shoppers will spend £5.6bn online this month - more than 10% of all plastic card spending. But consumers are being warned to protect their computers from fraudsters with antivirus software and to examine sites carefully. High Street retailers are facing a nervous Christmas, with stores worried that a dip in consumer confidence could hit sales. But online retailers are expecting their peak day on Monday as shoppers try to make sure presents are delivered by Christmas. In the past five years, the number of adults shopping online has doubled to 30 million. Internet firm Play.com is preparing for an average 650 orders every minute. The firm is expecting to ship more than 250 tonnes of goods during the day, while overall sales are likely to be up almost a third year-on-year.

Use the case study above to answer the following

a) Explain three factors which could account for the 50% increase in online shopping.

    

b) Consumer spending on internet shopping increased significantly in recent years however, as a proportion of total consumer spending, the figure is still very small. Explain three reasons why online shopping still makes up a small fraction of total consumer spending.             

c) Describe five major types of e-commerce business model.                                      

d) Discuss the key dimensions of e-commerce security                                                 

Answer 1

A) Explain three factors which could account for the 50% increase in online shopping.

Discuss have to three factors which is increase online shopping sales by 50% that is

1.Producer to Consumer -

Online shopping increase day to day because most of the production companies sale product online and consumers got this product directly, there is no mediator between producer and consumer, because of that consumer got products in less price compared to market price because of that online shopping increase

2. Discount -

In online shopping there are different type of discount scheme available which is beneficial for buyers, and it save there money,

compare to Local makers, Brand product always provide product in less price compare to Local makers

cause if that factor Online shopping sale increase day to day.

3.No Physical activity -

Most of the people want to do shopping but they get tired because of physical activity.

For example -

If any consumer have to buy shoes and shirt then he has to go to both different shop for buying two different product and they get tired or most of people lazy for this task but with online shopping no need to do physical activity only have to see and put order cause of date thing online shopping increase day to day.

B) Consumer spending on internet shopping increased significantly in recent years however, as a proportion of total consumer spending, the figure is still very small. Explain three reasons why online shopping still makes up a small fraction of total consumer spending.

Online shopping increased significantly in the second year but if we calculate proportion of online shopping then it is where is small compared to local shopping or directly Shop shopping

There are many reasons behind of that such as

1.Financial Risk -

In online shopping there is a risk of financial fraud, such as Credit/Debit card Hacking, internet banking hacking risk and most of the individuals or buyer don't want to take, cause of that profession of online shopping is very small compared to local shopping.

2. Product risk

In online shopping customer only show images of product but they can't feel it physically as shop shopping, most of the time images are different then deliver the product, quality, colour, size are different cause of that Consumer avoid online shopping, because of that proportion of online shopping is very small.

3.Non Delivery -

In online shopping most of the time online shopping site get payments and did not deliver product because of that fear most of the consumer avoid online shopping and it create small proportion of online shopping

Important reasons such as policy not available on different products in online shopping all cultural differences product choice.

C) Describe five major types of e-commerce business model.

1. Business to business (B2B)

In business to business model it is trade between business to business only, include companies to companies trade or companies to conventional wholesale trade.

2. Business to consumer (B2C) -

In this ecommerce model businesses direct sales to end users, such as online shopping,

3. Consumers to business (C2B)

In this e commerce business model consumers made products and sell to companies or businesses such as logo or any design.

4. consumer to consumer (C2C)

in this e commerce business model consumers made product and sell it to directly to consumers or end users For example - Mud Products, Or Plastic Making product

5. Consumer to administration (C2A)

In Ecommerce business model consumer has made products or services and directly sale to any public administration you have to take example then, distance learning electronic tax filing Etc.

D) Discuss the key dimensions of e-commerce security

One of the important key dimensions in e-commerce security that is

i) Privacy of consumer, when any consumer do electronic payment that time privacy should be kept by seller, he don't have to misuse of privacy of buyer.,

Such as Name, Mobile number, Credit/Debit card Number, CVV,

Internet banking Links, password, Username etc.

Another important key dimension of e-commerce security that is

ii) Authenticity,

The city should be provided by seller and also buyer for doing transaction, they have to trust each other, don't have to use fake email address on E-Commerce services by both.

Another important key dimension of e-commerce security that is

iii) Availability of customer care support, by seller company have to provide customer care support 24×7 to buyer if they have any query.