Understanding Internet Commerce
For companies that produce goods or services, electronic commerce, through the creation of e-commerce web sites, represents an opportunity to produce a whole new sales channel. This has already happened within the past because of the combination of opportunities provided by technology and organizational solutions according to the accessibility of the sales force and money.
This new electronic channel has two exclusive features in respect to the previous channel:
It's global, and will reach potential customers who are anywhere on this planet.
It has relatively low development costs tech and finance sector it's therefore also accessible to smaller businesses.
Electronic commerce means that the company should start to think in terms of global trade policies. The costs on internet sites and promotional offers are visible on the internet to customers in each country.
If this kind of globalization becomes too frightening, it's possible to fall back on Websites dedicated to specific markets, in local languages, but a qualified customer would notice any differences in the offers on the different web pages online.
E-commerce Internet sites are the opportunity for SMEs
It must be underlined that this new adverting channel has lower costs than existing ones, and especially it's able to cope with growing volumes of contacts without having to increase advertising spaces or staff.
The low cost investment required to develop this channel is a great opportunity for the small to medium sized companies to compete with bigger ones. To enter within the business market you don't need to have vendors, branches or shops, except what is strictly necessary to maintain physical contact with customers. The creation of electronic commerce will eliminate protective barriers represented in the past by geographical distance.
E-commerce enhances the business intelligence
If the products are either digital or quickly transportable (ie, parcels, or packages), it's going to be almost irrelevant to buy them from your country or possibly a distant country dealer. In fact these items can be sent quickly real-time via the network, in the example of digital products, or in a few hours via shipping companies in the case of physical products.
The dismantling of these barriers will emphasize the importance of business intelligence and creativity in promoting their very own products and services. Since we may very well buy English books in discounted international web pages, why should we waste time to sort through a library locally, where they cost more and not be available until much later.
E-commerce Internet sites cancel the distance between firms and markets
Many companies, over the E-commerce internet sites, may set up a direct channel with their end-customers. It bypasses the traditional distribution chain and tries to grab a portion of the product's value that was previously left to intermediaries downstream.
Direct contact with end customers can significantly reduce the expenses of product's marketing. Several of the savings are retained by the company, with obvious profit advantages, and other savings may be transferred to the market when it comes to selling price reduction.
