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Unit 14: Contemporary Issues in Store Management

14.4 Online Retailing Notes

Online retailing (also known as B2C or business-to-consumer e-commerce) is basically a
Web-enabled interface between your company and your target consumer for selling products
and services on the Web with the facility of online payment.
Online shopping provides an opportunity for retailers to extend their markets and attract new
markets. Also, the online shopping channel may provide retailers with unique opportunities
for brand building and/or leveraging their brand. However, factors influencing consumers’
patronage of online environments are only partially understood. Consumers may feel motivated
to shop online for many reasons.
Multi-channel retailers may leverage favourable brand images, extending the benefits of strong
branding to new channel members. In their study, “What induces online customer loyalty
toward a multi-channel retailer? Online versus offline brand images,” Kwon and Lennon propose
that synergy between online and offline operations can enrich customers’ experiences with the
retailer, strengthen the brand image of the retailer, and cultivate customer loyalty in both
channels.

What Exactly Can Retailing Do for You?

To compete in today’s high-pressure business scenario, sellers are looking at the internet as a
very effective alternative sales channel, which gives them direct access to target customers.
Here are some of the advantages it can give you:

Requires lower investment (when compared to setting up a conventional, “brick-and-
mortar” store)

Extends your reach to new customers and new markets, and builds an extensive customer
base
Quicker Return on investment (RDI) than conventional, off-line selling

Reduces customer acquisition costs by up to 70%
Reduces transaction costs

Reduces advertising and promotional costs
Faster inventory turnover
Improves your understanding of your customers on a 1-to-1 basis

Helps serve your customer better by giving her greater choice and greater convenience of
shopping

Increases brand value and brand recall
Eliminates geographical boundaries for your business, and can establish a global market
for your product or service

Lab Exercise Go to website http://www.retailcustomerexperience.com/research/431/
Online-Retailing and explain how does Forrester predict an e-commerce boom.

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