From this week onward we will have weekly titles for the blog, as part of our group, I am responsible for E-Commerce Failure and its causes.
In my daily life, I have the habit of purchasing goods online. Although there it provides convenience but disadvantages accompanies it. I found that the delivery process is upmost troublesome. It’s time-consuming and costly. If we buy thing in supermarket, it’s on cash on delivery system whereby online transaction have time-slack problem. After the payment, I have to wait few days only get the goods. Moreover, buyer normally needs to bare the delivery cost, the cost make the goods become more expensive. Sometimes I feel that is not worth to purchase online.
I have read though some article about the E-Commerce Failure and its causes. I found out that publicity of a company is rather important as a way of communication of the company with the public or rather provides brand awareness in the market. Advertisement, as one of the method of publicity is much focused for E-companies mainly because it needs to have internet traffic into the particular website to operate.
However, one of the main causes of failure is due to advertisement investment done by the companies. Overinvestment in advertisement is the main reason of several dot.com flops such as Pets.com.
Delivery problems prove another critical issue to be dealt with E-Commerce. Customer base of these online services will be rather wide in geographic locations. Delivery cost and time would be crucial to provide competition with local competitors such as shops and hypermarkets. Compared to its advantage of convenience, its cost of shipping would reduce consumer incentive to purchase online. Nevertheless its shipping time would be a disadvantage for many products for example pet litter sold by Pet.com. Urgent necessities would not be delightful to be delivered late to consumers. Another obvious example is from Kozmo.com, which operated well and were optimistic about their future, but failed to see delivery cost as an important factor to the operation of business.
Many other factors such as mismanagement, overly rapid expansion and so on would cause E-Commerce Failures. Therefore, companies operating E-Commerce would require extra attention to the above matters.
Everything has its pros and cons; we have to balance it ourselves. Before “shopping “online we should consider the consequences.
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