The Evolution of Online Retail

Introduction

The industry considered within this report and one that I have been inherently involved in is the retail industry especially the current online retail that is facilitated through online websites and sites. While the retail industry is significantly developed and represents a big industry around the globe, the introduction of online sales and delivery introduces a new niche to the market for which businesses have significantly taken up, including those giving business dissertation help. A sale of products and services online is an effective process as it cuts down on some challenges that were initially involved in the process of retail and trade. For instance, individual retailers or companies do not need physical stores or even to meet face to face with their intended customers, rather the entire transaction is carried out for both the seller and the buyer by the company e-bay. The company facilitates advertisement and sales of products from different sellers through their website and facilitates the delivery as well after the sales.

Running of e-bay as a business is dependent on a wide range of professionals within the sales and marketing department of any business including sales agents, marketers and promoters, delivery individuals as well as sales managers. Most of the work carried out includes receiving products for sales, advertising the products and keeping up with the websites updates to take in and process any buyer orders.

Regardless of whether the company has a huge base and following, continued delivery in the market for ideal and quality products remains a major concern for which their market growth and following is based on. Consumers will only come back to e-bay to purchase products if the products they had initially are of satisfactory standards in terms of quality and durability, as such it is within the companies need to ensure the quality durability and up to standards of all the items of products they market and sell within their websites. Identifying genuine sellers with legitimate products of good quality and durability to market as such is a major concern for the company and just another reason why investment in an Information system and Information technology is critical for e-bay.

Challenges and Potential Disruptors

Among the potential internal challenges and disruptors that impact e-bay include disparities when it comes to pricing of products between different sellers and the company’s rivals such as Amazon. The company has outdated systems and as such development of a better pricing system to further improve the potential of sales of the company is a general disruptor to the business process. In addition the company also faces some of the major challenges that the online retail industry face including: Labor shortages, Sustainability concerns and outdated systems (Loeb, 2019).

Outdated Systems

Bold (2015) Point out that e-bay has a major problem of using outdated trading systems which often result to wrong deliveries and wrong transactions including wrong pricing of products thereby birthing challenges with the sellers. Lack of an appropriate information system limits the company’s ability to effectively research and develop a suitable business system that is favorable for both the buyers and the sellers. Khurana (2019) highlights that the e-commerce competition in online trading is cutthroat and for any company to be able to dominate then they must equally apply a cutthroat attitude as well as an effective strategy to actualize the goals of domination.

Given the wide range of options that consumers have to choose from as well as different brands of products that are available the marketing techniques of an e-commerce company are tasked with double work (Bold, 2015). First convincing the customer of to buy from e-bay the convincing them of the worthiness and quality of the product being sold to them. This means research in both the buyers and sellers side for effective business practice. However according to Maroko (2008) e-bay is known to favor the buyers over sellers which in itself present a challenge as the sellers are equally important for their business. Developing IT/IS for the company as such should be able to provide enough resources for updating their business strategies and systems as well as provide more information o how to properly manage both the buyers and sellers of the products they sell.

Sustainability Concerns

Given the foreseen potential impacts of greenhouse gases, a global trend of sustainability has been taken up all across the globe by different companies who not only aim to ensure the conservation of the environment and sustainable development but also strategize along sustainable development given the consumer awareness with regards to its importance. According to the Centre for Retail Compliance (2017) Natural resources in the supply chain, environmental impact of products, energy and green house gases, chemical and toxins as well as waste from products are among the environmental issues that are attached to the retail industry and that businesses in retail including e-bay and e-commerce websites should be concern about.

As such to be able to attract more buyers and sellers sustainability issues are a prerequisite for the company given that most buyers are now environmentally aware and looking to be sustainable themselves Development of an information system through the use of relevant and effective information technology represents an effective strategy for ensuring sustainable growth and development of any industry (Naujok, Fleming and Srivatsav, 2018). Through the information systems different aspects of sustainability within the industry as well as ways to implement them within the business process can be effectively researched and implemented. Including ensuring the safety and sustainability of all the products accepted for sales within the website.

Price Inflations

Given the products being sold within the e-bay website come from different sellers, pricing presents a tricky factor in the type of business conducted by e-bay. For instance companies will price their products differently in different websites that they intend to sell their products thereby developing a competition between different e-commerce sites with regards to the same product. According to e-bay.com (2019) the pricing of the products is entirely left to the seller who should price in relation to other similar products within its categories.

Different buyers may need to sell their products at different e-commerce sites, pricing these products differently in different sites due to the pricing policy put the company with the higher price at a disadvantage. Given the company’s focus on the buyer rather than both buyer and seller, often products are priced higher which limit the companies productivity. Development of an information system should be able to define effective pricing strategies that would then impact sales and propel e-bay to growth and profitability.

Tools and Techniques

One of the most effective ways of managing the company’s challenges and disruptions presented above and others include the development of an effective Information System or through the Use of Information Technology. In being able to develop an effective IT/IS to enable the solution of the highlighted business challenges, an evaluation of the company and industry’s business environment is critical. This should be able to highlight the various elements that are critical for the Information System. This report will outline these requirements through the use of various tools and techniques highlighted by Peppard and Ward (2016) including: Competence analysis through the use of SWOT analysis, Business Portfolio analysis, Industry and competitive analysis, as well as PESTEL analysis and a wide range of many others. This report illustrates the use of SWOT analysis and Business portfolio analysis in the development of is/it.

SWOT

The SWOT analysis covers for both internal and external factors that impact an organization and an industry and as such highlight an effective technique for developing IS in being able to manage the company’s challenges which are both internal as well as external. The technique ensures the analysis of the company/industries strengths and weaknesses which represent internal qualities as well as opportunities and threats which are concerned with the external environment.

Strengths

Among the company’s major strengths and that afford it an upper hand within the retail industry includes its huge presence in the market. The company has been in existence for quite a while and has as such solidified its presence in up to 30 countries whose market recognizes its brand name (Bhasin, 2019). The company has also integrated its services including online purchase, online payment, ticket tracking, online money transfer and many others within one site and boasts of a significant international presence. The company according to (Mitchell, 2017) is a leading and trusted online brand and has thus solidified a significant market share all across the globe which gives it competitive advantage. Further it has a huge workforce and strong acquisitions in parties and partners such as paypal, skype and stub hub which effectively contributes to strengthening the brand. The company has a strong business focus facilitating both B2B and B2C business models in addition to a wide variety of products and good customer relations. These strengths can further be implemented in the development of an IS through ensuring systems access to and analysis of different relevant data that impact more efficiency as well as a peak concern for both the buyer and seller.

Weaknesses

Among the major weaknesses faced by the company include the companies limited emphasis on innovation given it still uses outdated systems that are less effective for the volume of products moved on a single day across the globe. Jurevicius (2013) further highlight high fees, no significant growth strategy, intense competition and fake sellers represents major weaknesses that the company currently still faces. However in developing an IS a significant database can be accessed to enhance research and ingenious ways of impacting the companies supply system as well as ways of impacting efficiency in operation to be able to impact profitability and growth.

Opportunities

The company also has a range of opportunities at their disposal including the new global business market enhances by the internet revolution. Bhasin (2019) points out that the company can also benefit from increased use of mobile technologies among customers, they can persuade unwilling customers and enlighten them on the benefits of online marketing to further expand their market base, the company can also take advantage of the new global market opening in India and China. The company can also partner with manufacturing companies for bulk selling to further increase their profitability. As such the development of the IS should have in place a wide database for research on different ways of exploiting the new markets that are available for the online sales domain.

Threats

The major threats faced by e-bay include security threats to the company’s websites which may range from hackers, malware, as well as security breaches which may impact the business normal operations, involvement in the sale of illegal entries within a particular jurisdiction, government policies and taxation structures that impact online businesses as well as increased competition from other e-commerce sites across the globe (Mitchell, 2017) development of an effective IS should be crucial as such in being able to address a variety of these threats including the unauthorized access and security breaches.

Business Portfolio analysis

Another effective tool in the development of a company’s Information System includes the Business portfolio analysis. A business portfolio analysis refers to the process of classifying a company or organizations product or services with regards to their relative competitive position as well as in consideration to the business growth rate so as to impact effective strategic planning (Whiting, 2018) it enables a company to be able to evaluate the competitive advantage of its products within the market so as to develop ways of impacting increased sales or impacting more quality of the product being delivered. Based on an analysis by Zaware (2016) a viable business portfolio analysis is one that fits perfectly in a company’s strengths and enables companies to maintain a competitive advantage over their rivals through exploiting the most attractive industries or markets.

eBay as an online e-commerce site is involved in the sales of virtually all legal products that sellers log in and are willing to sell to their customers. Determination of the area of focus of a company is significant in order to be able to highlight the boundaries of its operation and develop effective boundaries for the Information system created. Lack of focus on this aspect leads to other challenges and threats including fraudulent sellers as well as involvement in illegal product sakes which eventually significantly impacts the company’s profitability and reputation.

Conclusion

Challenges and disruptors are a common phenomenon within a business set up and as such communication and information is among the key requirements of the eventual business success. This highlights the relevance of the development of a n IT/IS to enable the management of the business and is strategies and its propulsion towards local and global success. Based on the identification of the major challenges and disruptors impacting the retail industry, the report highlights the use of the SWOT analysis in the design and development of the companies Information Technology system. Consideration of the challenges enables a customized design of the IT/IS to specifically suit the business in question and propels it to profitability and growth.

In addition given the challenges highlighted such as the outdated systems as well as the sustainability concerns in the retail industry, development of the IS should be quite elaborate and capable of research functions seller identification strategies which will in turn impacts the growth of the company and its competitive advantage. With unlimited research capabilities, the business can identify manageable alternatives in the less profitable industry in order to enhance effective growth and development.

References

Bhasin H. (2019). SWOT Analysis of e-bay. [online]. Marketing91.com. Available at

Bold B. (2015). Disrupting the disruptors: five disruptors of yore and their upstart rivals. [online]. Available at

eBay.com (2019). Pricing your items. [online] available at

Khurana A. (2019). E-commerce competition is intense. But you can win. [online]. thebalance.com Available at

Loeb W.(2018). eBay must evolve and adapt to changes and challenges.[online]. Forbes.com. Available

Maroko J. (2008). The challenges facing eBay in 2008: time for a change in marketing strategy [online]. Available at

Peppard, J. and Ward, J., 2016. The strategic management of information systems: Building a digital strategy. John Wiley & Sons.

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