What is E-Commerce?


… And why is it needed in modern Marketing?

E-commerce is the buying and selling of services and goods over the internet. In most cases, e-commerce is automated using digital tools to help streamline the process.

An example of this would be most online retailers using their own online store as a sales platform. Here, potential customers can browse the offerings, make purchase and pay digitally. Most online stores are also linked to a warehouse management system. This system automatically updates the inventory when an order is placed, sends out the invoice and starts the shipping process. Once the goods are packed and handed over to the shipping company, the customer is also automatically informed via email that their order is on the way.

What is the goal of e-commerce?

The main goal of e-commerce is to use various programs to consistently optimize sales processes in order to increase sales with as little effort as possible.

A clever online retailer does not rely on one sales channel/distribution channel, but rather has a healthy mix of different sales platforms. Which distribution channels and technologies are feasible for a company depends on its goals and of course the respective industry. It is not a requirement for a successful online retailer to digitize all processes. A good example of this is the drug store Mueller. The company is active in offline retail but also sells online.

Despite this, more and more e-commerce companies are opting for cross-channel or multi-channel marketing in order to sell goods simultaneously through multiple channels. It is important here that the different sales channels are optimized for each other or individually customized for different target groups.

What is the big advantage of online retail?

E-commerce not only makes it easier for companies to gain new distribution channels but also makes it much easier to maintain customer relationships with minimal financial and time investment – keyword: social media.

On the web, retailers can offer their goods and services location-independently and regionally or cross-border. Despite the digital possibilities, a certain logistics capacity must still be available. However, owning your own store is no longer a requirement.

The buyer is no longer bound by the opening hours prescribed by the government. He or she can shop online whenever they want.

E-commerce reduces the logistical and financial effort for the seller considerably, as he or she does not have to travel and is not obliged to rent a store.

In addition, various tracking options make it easy to see if a marketing campaign is running empty. With print marketing, on the other hand, this is extremely difficult to track how many people actually saw the advertising.

Online advertising also has two distinct advantages – it can be much more easily personalized and tracked.

In addition, the various tools of e-commerce (social media, content marketing, etc.) offer the opportunity to build more customer proximity. At the same time, the external perception of the company can be controlled much more easily.

The aforementioned advantages are just a small selection of the highlights and possibilities that e-commerce actually has to offer.

What are the disadvantages of e-commerce?

E-commerce has advantages and disadvantages for both buyers and sellers.

Setting up a digital infrastructure requires time and money to be invested, and not just once, but on an ongoing basis. At least if you want to sell successfully online in the long run.

Planning and implementing digital advertising requires a certain level of expertise. At the same time, advertising must be done regularly in order to reach as many potential customers as possible and to have a continuous awareness in the market.

Although potential customers can be advised by email or telephone during online shopping, personal customer contact is completely eliminated.

E-commerce is largely responsible for the extinction of local businesses and also increases traffic due to the increasing number of package delivery services.

Another “problem” of e-commerce is data and payment security as well as compliance with data protection standards.

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