Going by internet trending report of recent times, Ecommerce has advantage over brick and mortar now. From history of Ecommerce when it started in 90s till date, the revenue share has not experience any decline.
In fact, it is the fastest growing industry in digital marketing presently. From US to Europe and Asia to Africa.
This is best time to tap into Ecommerce space because of its advantage over brick and mortar. Ecommerce has shape business model, purchasing power and fast track demand and supply. Contributed greatly to global economy.
Without physical contact buyers and sellers can confidently transact million dollar businesses. Get it delivered to destination which never has been possible or near possibility in the past. With the use brick and mortar store.
The industry has the largest share of internet business at the moment. Though, many businesses are yet to adopt this strategy to reach customers beyond their locals.
Which if they start, it’ll be more competitive now than ever. The advantage still remains pretty huge over brick and mortar business. Even now the competition is getting tougher.
Digital generation which is this present generation and future ones will harness greatly into Ecommerce both locally, nationally and internationally to unimaginably level.
Buyer’s behavior had changed. They make decisions, read several reviews through online stores for a product before making purchase.
The ever busy schedule of people, working online almost 24hours each day. From house to office and office to house.
With their busy schedule; buying online is safer and less time consuming than the stress of going to retail store searching what stuff needed.
Read about What exactly is What exactly is Digital Marketing and it’s career paths
Brick and mortar still exist and maybe will exist but needs digital enabler to fast track profit.
Statistics prediction say revenue of Ecommerce will rise to $4.13T this year.
As brick and mortar moves online there’s going to be constant rise in yearly revenue. The availability of modern tech will gradually allow in-store businesses accept ecommerce.
Thus, the rest brick and mortar stores may find themselves gradually moving into extinction. One of the reasons is because most buyers will prefer online store to brick and mortar due to its reviews advantage from previous buyers and reason.
The next is online store has so many products to select from. The advent of mobile phone will force much transaction into internet space. Because now everyday activity’s is done with Smartphone, buyers will like to know exactly what, how and which product before purchase.
Now, let’s head to the definition of Ecommerce. May be you’ve never heard about Ecommerce or somehow you need proper understanding of this stuff. Don’t go away, read to finish.
What Is Ecommerce?
Ecommerce came from the word commerce.
Commerce is buying and selling of goods and services to meet consumer’s need.
Ecommerce means electronics buying and selling of goods and services to satisfy buyers need. Internet is the medium through which this transaction is made.
The advantage of Ecommerce over brick and mortar is the technology behind the transaction. That’s application of internet technology.
Digital technology enables the buyer decision. Whereas the brick and mortar allow you to have physical touch of what you want.
Though brick and mortar still has its benefit over ecommerce.
Statistics available tells us that almost half of the world’s population is going digital.
By 2040 about 95% of globally transaction will be through Ecommerce. That is great advantage of Ecommerce over brick and mortar.
The brick and mortar doesn’t have this kind of increase rather it is declining over the years.
The next marketplace is Ecommerce through internet. More and more people prefer internet buying. The rising population of internet users presently surpasses 4.6 billions as of today.
Now, about 1.7 billion website are online. Some of these sites are Ecommerce. About 2 billion people are expected to do online transaction in 2020 alone.
While brick and mortar may not have this staggering figure, if it does there is decline at moment because of shift of people’s into internet.
Couple with crave of buyers to consume knowledge enough before making purchase.
This may not really be the only factor why ecommerce has advantage over brick and mortar. We are going to delve into that to explain whole lot of that later.
Amazon CEO hits net worth of 204.6 billion as o f this month by Forbes. Amazon is the largest ecommerce retail store at the moment. Owning to that fact, Amazon stock now rises above 2%. Jeff Bezos’s net worth added $4.9 billion.
Making Amazon exceeds other brick and mortar retail stores. This is clear fact that to prove the advantage of Ecommerce over brick and mortar. The industry has overtaken all other industries in recent times.
All these happened, as a result of consumer buying behavior. Couple with pandemic related challenges.
Still Amazon, while physical industries downsizing and firing staffs he was busy employing 175,000 staffs. Because of business expansion.
Now Alibaba Ecommerce, Chinese leading Ecommerce giant; stock rose 40% during corona virus era.
About 62% increase in fiscal year from 2018 till date. One of the factors is retailer’s exciting performance.
Its revenue also appreciated to 34% year-on –year. Triggered by robust Chinese’s cloud computer and retail businesses.
Alibaba alone gathered yearly consumer’s community of 742 million and active mCommerce users of 874 million this year. According to Forbes
This is another clear indication of Ecommerce surpasses brick and mortar retail store. Because it’s pretty hard to control population of 874million mobile shoppers or 742 million consumers.
What kind of expansion metrics can do this without technology? Retail stores cannot be effective without technology.
The reason is there must be;
• Technology powered inventory
• Data of various product
• Sale record
• Buyer’s statistics
• Revenue made and more
But it cannot have consumer have;
• Consumer behavioral data
• Consumer geo-location
• Consumer full details at a go like buying trend
• Communicate on comment of people over thousands at a go.
• Reach old consumers with targeted advert; video, graphics etc
This is clear indication of shift in commerce over the years. Retail and wholesale businesses that integrate technology will grow faster than the rest because of massive opportunity it has today and in future.
Report from Ecommerceguide
• From prediction experts said retails ecommerce sales will reach $4.13 trillion in 2020
• Mobile commerce will have market share of ecommerce of 72.9% in 2021
• The number of online buyers stands via smartphone 51%
• Total number of digital buyers is 2 billion
• All purchase that will be made from now till 2040 will stand 95% will be ecommerce (more online buyers than offline)
There are between 12m to 24 million Ecommerce websites available globally.
Amazon grabbed 44% of total US Ecommerce sales in 2017.
Having total number 75.4% of users of US users, Amazon became the most popular ecommerce app in 2018.
Online shoppers preferred credit to any other payment system.
Men make more online purchase than women.
When buying, 85% consumers make online research before purchase
Report from emarketinginstitute shows that;
• Ecommerce market is increasing yearly
• Shoppers make several researches before buying product
• Buyers prefer best price with free delivery
• Webrooming will soon overtake showrooming purchase
• Mobile commerce (Mcommerce) shares is rising beyond other sector
• Instant and safe delivery has become buyers demand
Looking at the Ecommerce business trends, you’ll quickly understand what is becoming buyer demand.
Convenient buying and quick delivery. The good side of ecommerce business is it’ll be open 24/7. That one advantage makes it better than brick-and-mortar store. You can just receive order at mid night to be deliver early the next day.
Item selection could vary from sizes, shape, colors, designs and more. This allow customers to make better choice than brick-and-mortar store. Purchasing order comes from so many geo-location. With prefer sizes and categories.
However, ecommerce still experience few disadvantages. Buyers still complain of disappoint of delivery time, product value and all that.
Advantage Of Ecommerce Over Brick And Mortar
We’ve been analyzing statistics of ecommerce in latest development and models.
Now we are going to take close at advantage it has over brick and mortar.
1. Low entry point
It is very obvious that starting ecommerce store require low capital. You no longer require very expensive store, pay other utility bills, TV adverts before startup.
With laptop or Smartphone in your parlor business can be done. This makes good advantage over brick-and –mortar where you need all of these.
2. Unlimited sales
Ecommerce store is open 24hours. Online store require only data and internet facility for its operation.
With that it create opportunity for selling by focusing on their store at all times. With the instant message app provided customers can drop messages for seller.
Interaction is so simplified that question about purchase is never a challenge. Purchase could be made morning, noon and night because of technology. Payment system is provided and shipping information too. That is sellers have sells everytime. Where as brick-and-mortar may find very hard doing this.
3. Large customer community
What exactly do I mean by that? Selling location goes further away from immediate location. Merchant takes product beyond its country to reaching audiences around the globe. As long as location is connected to internet. This advantage make ecommerce business to overtake brick-and-mortar store.
4.) Customer behavioral analysis and tracking
Technology simplify tracking process for ecommerce merchant, enable him analysis customer’s buying behavior, tracking leads, make targeted ads and keywords use.
Daily store visit in particular location. Most converting ads and how to increase sales. Buyer’s comments, reviews. Those who order where not fulfill and many more.
Can brick-and-mortar store gather this kind of analysis? Of course not possible.
5. Buying convenience
If you closely observe how purchase is made online, many buyers have the pleasure to receive goods while in office, kitchen, busy preparing for event or busy with something else. It becomes very safe for them to make next order when needed.
Quick and smart response, couples with ease of receiving goods make them feel better.
With this point, it shows that Ecommerce stands good advantage over brick-and-mortar store and still do.
6. Constant communication with buyers
What exactly do I mean? Sending constant message to customers keep them abreast of latest product, trends, development, news and lots more.
Constant emailing customer and showing casing new arrival contribute to making ecommerce having advantage over brick-and-mortar store.
Having said all these don’t forget that Ecommerce is still growing and getting saturated day by day. Whatsoever advantage it has over brick-and-mortar. There are still disadvantages and challenges facing it.
Disadvanges of Ecommerce business
1. Payment system (Credit card fraud)
Payment failure and stealing of credit information is still common. Debit card without delivery is happening now and then..
2. Tech loophole (insecurity)
Hacker are not retiring from stealing user data.
Inspite of cloud computing and constant bug fixing. Information on website have been constantly hijacked by the bad guys.
3. Price disparity
As price differ from seller to seller, depending on channel seller bought good. It has become normal buyers attitude to compare prices before making purchase.
Where ever seller price falls, purchase is made.
4. Lack of trust
Some sellers practice fowl play to maximize profit. ranging from wrong graphic images to delivery of different product and damage products.
5. High cost of logistics
Cost of delivery is becoming in some ecommerce stores. After making other buyers maybe expecting free or low delivery charges rather cost delivery becomes higher than goods purchase.
6. Internet subscription
It takes internet to check product. When internet accessibility becomes expensive like in developing country. That becomes great disadvantage. Buyers will leave to brick –and-mortar store.
7. VAT and other charges
Every purchase has VAT charges. Other related charges like business registration, advert campaigns and more. Research for new application and business information has never been so cheap.
No doubt, Ecommerce is the future of commerce. Businesses that embrace it fast will automatically make in ROI. As seen by every indication from statistics available Ecommerce has more advantage over brick-and- mortar store. It better to adapt Ecommerce now or retail business begin to slowly fade away.
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