E-Business Applications: The Impact of E-Commerce and Omni-Channel Retail Module

This article discusses the impact of e-commerce and omni-channel retail module on the retail industry. It explores how physical stores can leverage technology to avoid extinction and offers recommendations for retailers to reimagine and redefine their stores to suit the digital age.

E-BUSINESS APPLICATIONS
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Table of Contents
Introduction................................................................................................................................3
E-Commerce..............................................................................................................................4
Omni channel retail module.......................................................................................................6
Conclusion and recommendations.............................................................................................7
Bibliography...............................................................................................................................8

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Introduction
The retail industry in the recent past has recorded what appears to be a steady
migration to mobile and e-commerce. Digital migration has seen the retail sector experience
severe turbulence in terms of change. Closure of businesses and layoffs has dominated news
headlines on a global scale. This can be blamed on the accelerating shift from in-store
shopping to e-commerce. This does not necessarily mean the end of the mortal and brick
stores as they offer the shopper something that the e-commerce cannot. Nevertheless, the
selection pressure on retail businesses is shifting, and those retailers who fail to adapt risk
their businesses going extinct. Technology today allows consumers seek additional
information on a product or service prior to the purchase, compare all available prices, order,
and have it delivered at the comfort of one’s home. This is the main reason why brick and
mortal shops risks extinction(Meier & Stormer 2012).
With the continued proliferation of mobile devices, smart glass, and smart
appliances, e-commerce and the marketing associated with it is becoming more intertwined,
as it grows it is becoming fine-tuned to meet the varying lifestyle of its users. The world
currently is approaching an era where every touch point ranging from digital TVs’ and social
media networks will allow consumers to complete immediate purchases on the spot. Change
is inevitable, in the last 15 decades, the world has seen big cities emerge and the rise of the
railway line which paved the way for the modern department stores(Ontario 2013).
Approximately five-decade later automobiles were introduced and with them came the rise of
the department stores with specialty retailers in them. In the late 60s and early 70s, discount
stores were introduced for example Walmart and home-depot. These changes however have
not changed or eliminated the old phenomenon but have only reshaped the environment in
which retailers and consumers interact. The same is happening with the rise of e-commerce.
Disruption in the retail industry is not a new phenomenon(Gupta 2014).

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E-Commerce
What e-commerce promises is an abundance of information, a near perfect price
transparency, and a wide range of special offers refined to fit the shoppers lifestyle. The
change that sets in does not necessarily mean the end of what was there before it, however
with each wave of change consumer expectations are reshaped and redefined within the same
context. Those retailers who fail to adopt to these changes die as those who adapt more
profitable. Research indicates that digital information already influence approximately 50%
of purchase decisions, the number are expected to keep growing(Maamar 2003). Ecommerce
is not a new phenomenon, when it was first introduced; digital retail technology was met with
a bit of resistance. Online retailers such as Amazon.com and Pets.com were among the very
first online stores. They were promising at first until a combination of ill-conceivable
strategies, speculative gambles, and a slow economy burst what was known as the dot-com
bubble. What followed was a massive collapse of the sector that saw a majority of the online
retailers close shop(Turban et al. 2010).
Research estimates that e-commerce is valued at approximately $200 billion in
revenue in the US alone accounting for 9% of all retail sales. The corresponding figure is
about 10% in the United Kingdom, 3% in Asia-Pacific, and 2% in Latin America. The figures
on a global scale reveal that e commerce account for 15% to 20% of total sales, however the
number is dependent on the industry. Digital retailing appears to be profitable for example,
Amazon average return on investment is approximately 17% whereas traditional brick and
mortal stores average return on investment is 6.5%. Sales figures from UK leading retailers
prove that e-commerce is promising and its potential for growth is unmatched. In 2013,
Amazon holiday season sales report showed that 36.8 million items were ordered globally on
Cyber Monday alone, over half of these orders were placed via mobile devices. Statistics
from the last quarter of 2013, online shoppers spent $69.2 billion up from $59.6 billion the
previous year marking a 16.1% increase(US Department of Commerce 2016).

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These disrupting technologies does not however mean the end of brick and mortal
shops. As discussed earlier, these changes means a redefinition of the context in which
retailers and consumers interact. Retailers who will survive the changes brought about by
technological advancement are those who reimagine and redefine their stores to suit the
digital age. Brick and mortal stores are yet to exhaust their potential as they have massive
opportunities that can be leveraged to suit the digital shopper. The in-person experience
offered by physical stores is unmatched and extensively absent in online shops. The future of
physical stores lay in their capacity to incorporate the digital world in the physical stores in a
manner that delights customers, builds loyalty, and generate brand value(Barratt & Davis
2009).
There is no denying of the potential of e-commerce, in as much there are claims that
physical stores face extinction, brick and mortal shops have a uniqueness that no online shop
can match. Even with the advent of new technology, shopping remains to be a social
experience, it is a visceral experience, there are delays associated with shopping, physical
stores allows one to try a product before going ahead with the purchase. Furthermore,
physical stores offer their customers with instant gratification. All these are not available with
online shops(Qin, 2013).
The current consumer however appears to be combining both realms; using phones to
compare prices among different vendors, seeking opinions from family and friends by
sharing things on social media, trying on items so that they can purchase later, and giving and
seeking unsolicited feedback on social media. Research indicates that the shopping
experience remains to be a key shopping aspect that is more important than the purchase
itself(Meng 2009). Physical stores should therefore design their shops as social venue whilst
still transmitting intensive brand and product experiences. This way physical store can
maintain their physical stores and still have an online presence. What is needed is

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establishing a multi-channel shop for instance physical stores and online shops in order to
create a seamless consumer experience(Barratt & Davis 2009).
An Omni-channel approach gives potential consumers an opportunity to engage with
the brand whenever they want, where, and how they want. Omni-channel offers flexibility
hence creating a positive relationship between the business and the consumer. This offers a
much needed link between the physical world and the online world creating a symbiotic
world of interconnectivity between the physical stores, the online realm, and the mobile
devices(E-commerce Europe 2016).
Omni channel retail module
Transforming a traditional physical store into an Omni-channel model requires sellers
to optimize locations based on new shopping behaviours. As a retailer understanding the
consumer behaviour for instance their behaviour while shopping, do they use their phones for
price comparison helps a retailer optimize the location(Dou 2016). Physical stores should
reinvent themselves by becoming places where consumers or potential customers visit to
tailor-make products with the assistance of experts. Physical stores ought to be a place for
collaboration and customizations, which contributes to the overall shopping experience(Liao,
2017).
Online shopping is growing steadily; innovation will help physical stores leverage to
avoid the threat of extinction. Innovation along the lines of integrating mobile, web, and in-
store activity in the brick and mortal shops will see retailers increase revenue. For example,
Eugene, a restaurant in Oregon allows customers order food directly to the kitchen through a
text without necessarily waiting for the waiter. An integration of all operations will help
create a seamless customer experience. This way every operational channel forms part of the
supply chain allowing customers to continuously communicate with the company through
several channels(Mari 2015).

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Conclusion and recommendations
There is a prevailing assumption that physical stores are on the verge of extinction,
this may or may not be the case. Technology has however redefined how consumers and
sellers interact. More than 60% of all American have or have access to a smartphone; of this,
80% are what is defined as smartphone shoppers. This means that they use their phone to
shop; they employ the help of phones to help them shop while in a store by researching
reviews, specification, and comparing prices available(Dou 2016).
Technological advancement having paved the way for e commerce, the interaction of
the consumer with the limitless online presence has shifted the arc of the consumer decision
journey. Today consumers are more inclined towards choice, convenience, and accessibility.
Recommendations, product reviews, and feedback, wide variety of products have empowered
consumers make decisions on their own terms. When they visit physical stores, consumers
bear the same expectations with the physical shopping experience(Strang 2013).
Approximately 80% of shoppers compare prices online whilst inside an actual store.
An Omni-channel consumer expects information to be readily available wherever they are.
The digital age produces new kind of consumers calling for a certain level of personalization
and tailor-made marketing based on the consumers’ location, social networks, and purchase
patterns. The physical store remains to be the visceral expression of the brand essence and the
most essential aspect of the consumer to interact with the brand. Leveraging a various
technologies and employing new media strategies will improve the physical shop shopping
experience, alternatively mortal and brick shops will be extinct soon based on the changing
dynamics of the consumers(Elia et al. 2014).

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Bibliography
Barratt, S. & Davis, S., 2009. Connected commerce: The intersection of e-commerce and e-
communication. Journal of Direct, Data and Digital Marketing Practice, 10(3), pp.249–261.
Dou, L., 2016. Research status and prospect of consumer behavior in omni-channel retailing.
In Proceedings of the International Conference on Electronic Business (ICEB). pp. 105–111.
E-commerce Europe, 2016. The Business Enviroment, European B2C E-commerce Report
2016, 4(2), pp.201–298.
Elia, V., Gnoni, M.G. & Lanzilotto, A., 2014. Designing and managing operations in
innovative multi-channel retailing systems. In 19th Summer School Francesco Turco 2014.
pp. 37–42.
Gupta, A., 2014. E-Commerce : Role of E-Commerce in Today’S Business. International
Journal of Computing and Corporate Research ISSN (Online, 4(1), pp.2249–54.
Liao, C.Y, 2017. Analytics solution for omni-channel merchandising. In Lecture Notes in
Computer Science (including subseries Lecture Notes in Artificial Intelligence and Lecture
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Maamar, Z., 2003. Commerce, E-Commerce, and M-Commerce: What Comes Next ?
Communications of the ACM, 46(12), pp.251–258.
Mari, A., 2015. Department store boosts IT investment to create seamless omni-channel
experience. Computer Weekly, pp.10–13.
Meier, A. & Stormer, H., 2012. Advancing in Business operations, E-Business & E-
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Meng, X., 2009. Developing Model of E-commerce E-marketing. … of the 2009
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Ontario, G., 2013. E-COMMERCE : PURCHASING Why E-Commerce for Small
Businesses ? E-Business Toolkit, p.1.

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Qin, Z, 2013. Understanding busines evolution, E-commerce strategy, pp.2–55.
Strang, R., 2013. Retail without boundaries. Supply Chain Management Review,
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Turban, E., Bolloju, N. & Liang, T.-P., 2010. Social Commerce: An E-Commerce
Perspective. Proceedings of the 12th International Conference on Electronic Commerce:
Roadmap for the Future of Electronic Business (ICEC 2010), pp.33–42.
US Department of Commerce, 2016. Quarterly Retail E-Commerce Sales 1st Quarter 2016,