E-commerce Business Strategy

This report focuses on the modern E-commerce market and it’s related strategies for maintaining that business. The advantages and disadvantages of technology in E-commerce, E-strategy model, and the big picture of E-strategy are discussed.

Running head: E-COMMERCE BUSINESS STRATEGY
E-commerce Business Strategy
Name of the Student
Name of the University
Author Note

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Executive Summary
This report focuses on the modern E-commerce market and it’s related strategies for
maintaining that business. This concept of E-commerce is one of the huge platform in the
business industry that is growing in a very fast manner due to its popularity among the all age
group of people from children to old age. . The use of internet helps the consumers of
different part of this world and also allow to explore different kinds of product in a single
window. Not only this, from the viewpoint of the business personnel, it is also very beneficial
as it is allowing more advertisement of their products in more effective and efficient way.
Therefore, it is reported that, the E-strategy is one of the subset of the business strategy and it
is not at all an IT strategy, rather it is a strategic planning for the business which is associated
with the business of a particular company. Therefore, this changed business concept help the
companies to retain their customers as they can communicate with the consumers through the
social media.

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Table of Contents
Introduction...........................................................................................................................................3
Critical Understanding of the Technology Use in the Industries...........................................................4
The advantages and Disadvantages of Technology in E- Commerce.................................................5
Findings.................................................................................................................................................7
E- Strategy Model..............................................................................................................................7
Big Picture of E-strategy...................................................................................................................8
Change in Business Model................................................................................................................9
Growth Value in Economic Perspective..........................................................................................10
Recommendations...............................................................................................................................11
Analysis of External Environment...................................................................................................11
Analysis of Internal Environment....................................................................................................12
Conclusion...........................................................................................................................................13

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Introduction
In recent times, along with growing technology the popularity of the new concepts of
E- commerce and E-strategy in the business have become very popular in the business
process in the world. Nowadays, along with the vintage business strategies, the modern
concept of E –commerce and E-strategy in business have also become an undetachable part
of the business process. Although the concept of online business or E-commerce is not so
new and in the year 1979 the concept of online business was coined by Michael Aldrich
(Veit, 2014). This concept of E-commerce is one of the huge platform in the business
industry that is growing in a very fast manner due to its popularity among the all age group of
people from children to old age. Although it is debatable, still it is assumed that, the E-
commerce or online shopping gives more satisfaction than that of the physical shopping.
Unlike the physical shopping, it is very easy to find any product in an E-commerce sites and
it is just one click away from the buyers. Therefore, the immense popularity of the E-
commerce business also encourages the companies to take E-strategy and it is expected that
the population of this era are greatly impacted by this E-commerce business strategy. The
world of business is changed a lot with the improvement of technologies and changes in the
consumers’ behaviour towards the business is another reason of evolvement of the business
strategy of companies in the world (Basu, 2016). The use of E-strategy also allow the
companies to give more options to the consumers. The improvement of the internet, has one
of the key reasons behind the development of E-commerce and E-strategy in today’s world.
The use of internet helps the consumers of different part of this world and also allow to
explore different kinds of product in a single window. Not only this, from the viewpoint of
the business personnel, it is also very beneficial as it is allowing more advertisement of their
products in more effective and efficient way. According to the requirement of the modern
business marketing the companies are using internet, email marketing strategy, taking help

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from the social media for endorsing their product (Fleisch, Weinberger & Wortmann, 2015).
Due to popularity of the E- commerce business platform in all over the world, the companies
are now focusing more in those social media marketing technique as this allow the company
to make their product popular in a very low cost as most of the social medias are free of cost.
Although, the E-commerce system in the business are proving a lot of advantages to the
customers, the security issues are not completely safe for the customers and along with this,
the customers can have the chances to examine the product physically before buying the
product. So it can be said that, there are a few flaws of this E-commerce system in the
business. All the renowned companies of the world are now using this E-commerce system
by creating their own online shops and also delivering products to the customers (Hajli &
Sims, 2015). In this report, the changing nature of the business and its advantages and
disadvantages in the business industry. In addition to this, the E-strategy of the business,
growth value of this new business model, problems of this business models in a large
perspective are also highlighted in the later part of this report.
Critical Understanding of the Technology Use in the Industries
In the world of business, the use of technology has greatly impacted the business and the day
by day technology is growing in a constant manner as the new generation customers are
liking the use of technology in their shopping experiences. It is also important for the owners
of the E-commerce business, to become aware of the new technologies. As part of this, the
manufacturers should concentrate on the digital transformation of the industry and definitely
they should pay attention to the digital transformation trends that drives the industry towards
the industry 4.0. It is observed that, 86% of 2000 manufacturers are expecting that, they will
reduce their production cost and will increases net revenue gain due to digitalization of their
business in next 4 years. The term, industry 4.0 refers to the assimilation of traditional and
technological business practice and manufacturing process of a business company. The

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technologies such as use of advanced analytics, IoT, human-machine interface are now used
by the companies as a part of their business. Nowadays, the customers are connected with
their desired product through the social networking sites instead of having physical
experience of their particular product ( Newman, 2018). Through the data analytics, the
companies are now can have the information related to the desired product of the customers
as they can store the data of their mobile app in cloud storage. By using those data, the E-
commerce business companies can predict the current market trend and consumer behaviour.
This transformation in the use of technology in the business has greatly impacted the
industry. Not only this, the use of modern technology has also allowed the manufacturers to
modify their products as per the consumers demand as the customers can give feedback about
the products in the social media page of a particular company ( Newman, 2018).
The advantages and Disadvantages of Technology in E- Commerce
The use of technology inventions in the business is greatly affected the business of the
companies as most of the companies are now focusing on the E-commerce business and E-
strategy for increasing their business. The improvement of the technologies are also
associated with the improved customer experiences and as well as they are also contributing
to the net revenue gain of the company. As a part of the advantages it can be said that, the
digital invention in the business industry has allowed the buyers to sell their product in all the
time and due to use of the internet the consumers can access their product from any part of
the world. Due to the presence of the online shops of the company need not to have physical
set up for showing their products. Along with this, the customers also can see various type of
products in a single window of the official application of that company (Savrul, Incekara &
Sener, 2014) However, there are many disadvantages of using technology in the business.
For example it can be said that, as there is absence of physical checking of the product before
buying, the customers cannot check the quality of the product. In addition, as it is mainly

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dependent on the use of internet, so it can be said that, any technical problem in the internet
system can hamper the total process. Moreover, use of online payment option during buying
any product, the consumers may face issue of security as there are many hackers who can be
a major threat for the use of digital invention in the process of business. From the viewpoint
of the manufacturers, it can be said that, the issue of customer loyalty is absent in case of
digital business process. Therefore, many fraud business sites are present and this can be
another threat for the consumers and simultaneously the companies may also lose their
positive impact in the business market if any fraud business company use their name during
this process and this will negatively affect their brand image in the market (Kaur & Singh,
2017).
Current Business Scenario
The rising trends of E-commerce business is continuously promoting the growth of
world business through this E- business practices among the companies. Despite of presence
of traditional business market in the world, the online business practice or E-commerce has
made its own strong base in the world of business. It is expected that, the global E-commerce
market will face a growth rate of 19.42% CAGR in between 2016 to 2020 (The Next Scoop ,
2019). It is assumed that, due to the improvement of the social media advertising practice, the
E-commerce business practice is facing so much growth in the world as it is observed that the
social media penetration is increasing day by day and it has become an ideal platform for
acquiring new products. The, E-commerce advertisers are producing sponsored content and
display banner advertisements as a part of their E-strategies. The social media platforms like
Facebook, Twitter are now generating traffic towards the websites of a specific company so
that, the product of their company can be endorsed more and a large amount of customer can
know about their new products and services ( Hajli, 2015).

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Findings
E- Strategy Model
The E-strategy model refers to the commercial use of internet for a particular business
purpose of a particular company. The use of E-strategy model is associated with the reduced
production cost of the product, increased revenues of the company and along with this this E-
strategy model in the business will allow the company to reach even in an unexplored market.
The use of internet, in the business process will allow the E-commerce company to use most
of the technologies in their business process. Moreover, it can be said that, the use of internet
or related technology is an iterative process and success may come after significant number
of do and learn cycles of the same process ( Ross, 2016). Therefore, it is reported that, the
E-strategy is one of the subset of the business strategy and it is not at all an IT strategy, rather
it is a strategic planning for the business which is associated with the business of a particular
company. The E-strategy based on E-solutions such as mobilized shopping strategy, data
analytics, subscription based selling process of the company can be used as a E-strategy of
the E-commerce platform of a particular company (Nurmi, 2014). This will not only affect
the entire organization, but it is also associated with the targeting of the new internet based
market segment of the overall business market. In addition to this, E-strategy of the company,
can also help to create shareholder value in the market and this E- Strategy of the E-
commerce business company will help the company to compete in this new internet based
world of business. The E-strategy of a company is not only the internet based business of the
company, but it is associated with strategy of conducting business over the internet
(Fatorachian, 2014). The E-strategy of a company mainly refers to the long-term and short-
term goal of the company and that is associated with the skilful and careful business goal
setting for a particular company. The E-strategy of a company comprises of IT strategic plan,
organizational and marketing plans of that particular company. Moreover, contingency

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planning and E-Risk management planning are also the part of the E-strategy of an E-
commerce company. An E-strategy of a company helps an E-commerce company to set its
goals, visions and objectives. Therefore, an E-strategy of a company, just give an outline of
business plan of that company, although it is not capable of providing any detailed business
strategy. In order to make an E-strategy successful, the company must have to implement the
E-strategy of the company in all segments of the company which may include the technical
and business infrastructure of the company. Therefore, it is quite evident that the
participation of members of all the segments are required in order to make the E-strategy
successful and without this spontaneous response from all of the employees the E-strategy
will face an immense failure ( Mbise et al., 2018). After, setting an E-strategy for an E-
commerce business company, an integrated technical and planning process is very important
and after implementation the monitoring is very crucial. A crystal clear concept about the
company’s goals and objectives is required as it is required for achieving the goals of the E-
commerce company. The monitoring process is very crucial as it can assess the customer
satisfaction and may contribute to the service improvement of the E-commerce company.
This new E-strategy of the E-commerce business can establish a different business
environment in the market which can address the requirement of the modern consumers of
the world (Turban et al., 2017)
Big Picture of E-strategy
As a part of the effect of E-strategy, it can be said that, the use of an E-strategy in the
business of modern world, has become an obvious part of any business organization as it is
associated almost with the every part of the business segments. In a broader way, the use of
E-strategy is affecting the customer services, commercial systems of the company, supply
and logistics of the company and those technologies used in the E-commerce sector, can help

9E-COMMERCE BUSINESS STRATEGY
the companies in building up subcontracts, in reducing payment costs (Qin, et al., 2014). By
using modern technology, in the business process, the organization is focusing on the overall
improvement of the organization and this E-strategy in the business process will help the
organization in making connection with other companies of this world. As a result, the
overall revenue of the company will increase and it will enhance the overall revenue of the
company as well (Turban et al., 2015). In a study conducted in Saudi Arabia, it was observed
that the e-commerce business in the Saudi Arabia, has greatly affected the small and medium
scale industry of Saudi Arabia. In this study, it was found that, the introduction of
digitalization in the business market of the country, has changed the plans and strategies of
their business market of the country. The use of this E-strategy and E-commerce in the
country has increased the use of most recent technology in their business process (Alzahrani,
2019). In this study it is also reported that, the adoption of E-commerce in the business of the
country also provides strategic advantages to the small and medium scale industries of the
country (Awa, Baridam & Nwibere, 2015). According to the Communication and
Information Technology Commission (CITC) of the country it is reported that, the E-
commerce industry will grow 20% in upcoming years. In 2016, the volume of E-commerce in
that country was almost 29.7BN RS (CITC, 2017).
Change in Business Model
Due to the introduction of E-strategy and E-commerce business in the world of
business, the traditional model of business has changed in recent times. The incorporation of
internet in the business has completely altered the way of business specifically, it changed the
methods of traditional selling and buying technique of the consumers as well (Alizadeh &
Sipe, 2015) Earlier, consumers are mainly dependent on the physical showrooms of any
company or product and the condition of the manufacturer companies are also same as they

10E-COMMERCE BUSINESS STRATEGY
have no other options. Therefore the E-commerce industry in recent times are offering all
time services to the consumers and the consumers can have access of all products in a single
area. Due to the E-commerce business industry, it has become very easy to initiate a business
as no physical structure is required for initiating an E-commerce business. In the traditional
business market, there is lack of monopoly in the market and it is observed that, the E-
commerce business has brought back the concept of monopoly in the business market as it is
very tough to survive in the market because this requires immense digital marketing skills
(Savrul, Incekara, & Sener, 2014). The big companies in the business industry has become
the key players of the market due to their high quality services. The E-commerce business
has also offered the customers to access a huge variety of products and along with this easy
payment options are also another change that is offered by the E-commerce business
companies. The social media marketing, search engine marketing, video adds, which are one
of the key components of the E-commerce business, allow the E-commerce companies to
target a specific customer group and marketing is now based mainly on customer interests.
Therefore, this changed business concept help the companies to retain their customers as they
can communicate with the consumers through the social media ( Hajli, 2014).
Growth Value in Economic Perspective
The recent growth of the E-commerce industry is directly affecting the growth of the
economy and it is one of the most impactful contributor of the economy. As per the recent
study, it is observed that, the E-commerce sales will be hiked 200% by the end of 2020. For
example, the data of Alibaba group can be stated. From this data it can be said that, the
Alibaba group is associated with the 60% of online delivery in China and the company is
associated with 80% of total online business in China (Greeven, & Wei, 2017). In the
regions like middle-east and Africa the growth of the E-commerce industry is almost 82 %. In

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2013, the economic contribution was almost 93.6 million and in 2018 the contribution was
almost 170.6 million (The Next Scoop, 2019).
Recommendations
Analysis of External Environment
3.1 While focusing on the external reason of failure of the E-commerce companies it
can be said that, the lack of technology use in the business process is one of the key reason of
that failure. It has become a big challenges for the companies to cope up with the modern
technologies as it is very important for managing the modern business strategies and
innovation in the market. The lack of technological innovation in the business process is one
of the key reasons of failure of the E-commerce business companies (Laudon & Traver,
2016). Due to the Fourth industrial revolution, the global trade, world economic growth are
greatly affected. However, the use of E-commerce has also contributed to the generation of
huge amount of revenue to the world economic growth. So, it can be said that, the hamper of
technological advancement in the E-commerce industry can affect the generation of revenue
of the company as well. The Therefore the digital trade barriers are another area of concern
and such barriers include strict data localization policies, fragmented governance and
outdated regulations.
3.2 Due to lack of technologies, the E-commerce business may fail to maintain their
websites and as a result the company may fail to maintain their E-commerce site in a proper
customer friendly way. For example it can be said that poor images of any product in online
website can hamper the reputation of the company and it can ultimately hamper the sale and
revenue generation of the organization. So, it is very important to maintain the website of the
online store of the company. All the products that are available in the websites of a particular
E-commerce site, all of those products should have clear images of those products as it will

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give the buyers a clear idea of that product. Due to bad maintenance of online store of E-
commerce sites, the customers sometimes fail to resize the image properly. So that, they may
not buy that particular product and it can directly affect the sales and revenue of that E-
commerce company (Chaffey, 2015). Moreover, such bad customer experience can create
bad impression of that company in the market. In addition to this, the slow speed of online
product page can also create a bad reputation of the company in front of the customers and it
may happen that, due to their past bad experiences, the customers may not visit that page in
future. Such kind of bad customer satisfaction level may also affect the business of the E-
commerce of the company (Bilgihan et al., 2014).
Analysis of Internal Environment
3.3 While analysing the internal environment of an E-commerce business for finding
the reason of failure it can be said that, the gap in the E-strategy can be one of the key reason
of failure of the company as the E-strategy of the company is the most crucial for this E-
commerce sites. Hence any gap in that E-strategy can affect the company most. As a part of
E-strategy gap it can be said that the company should focus more on the customer satisfaction
level as in this business it is very difficult to retain the customers. In order to make a positive
impact on the customers, the E-strategy should be customer-centric. Along with this, in order
to serve the customers in a competent manner, the company should emphasize on the service
delivery. As a part of this, they can provide 24/7 services to the customers (Yadav & Sharma,
2014).
3.4 A bad online reputation of E-commerce company can be a vital reason of a company to
face failure and along with this, a good reputation can give competitive advantages to the
companies. Hence, it is evident that lack in a proper emphasis on maintaining the good
reputation in the E-strategy of the company can create problem for the E-commerce company
(Rodríguez-Díaz, Rodríguez-Díaz & Espino-Rodríguez , 2018).

13E-COMMERCE BUSINESS STRATEGY
Conclusion
Hence it can be concluded that, the E-commerce business is now a rising business in
the world and in order to continue the E-commerce business in a proper way, developing and
implementation of the E-strategy is very important. Therefore, the advancement of the
technology and internet, are greatly affecting the model of business in a worldwide manner.
In recent years, the traditional model of business is changed a lot and inspire of opening new
physical stores or showroom, the companies are mainly focusing on opening E-stores in order
to enter the E-business market. The following of new trends of business allow the companies
to generate most of their revenues from the E-commerce business model as this model of
business does not require any physical stores or staffs. However, the maintenance of online
stores is important as a part of the E-strategy of the company.

14E-COMMERCE BUSINESS STRATEGY
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