Online malls provide numerous benefits to both vendors and shoppers. Vendors can save costs, shoppers can compare prices and features, it is less time-consuming, and there is a wide variety of products available. Discover the advantages of online malls for vendors and shoppers.
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ECOMMERCE 1
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Table of Contents INTRODUCTION..........................................................................................................................2 TASK..............................................................................................................................................2 1. Introduction of the background of the selected two online shopping malls...........................2 2. Analysis of business model of the two online shopping malls...............................................3 3. Recommendations to improve competitive advantage...........................................................5 4. Benefits of online malls to vendors and shoppers...................................................................6 5. Reasons to use online malls or search engine.........................................................................8 CONCLUSION...............................................................................................................................8 REFERENCES..............................................................................................................................10 INTRODUCTION Electronic Commerce or better known as E-commerce is an online platform where people can buy their goods or services according to their needs, requirements and companies can sell their offerings fulfilling business objectives. It comprises of various facilities such as shopping, payments, e-auctions, ticket booking, internet or online banking, and many more. Online shopping mall is a combination of various types of shops offering different kinds of products and services on an online platform which does not carries any physical outlets in market(Das and Varshneya, 2017). In the present report two online shopping malls are being considered that is Lazada and Shopee. Here various business models are described which are used by these two online shopping malls along with some recommendations provided to both the firms in order to improve their competitive advantage. Further in this report some benefits of online malls for vendors and shoppers are listed with their reasons to use such malls or search engine. TASK 1. Introduction of the background of the selected two online shopping malls. Lazada 2
Lazada is an online shopping mall offering various kinds of products and services 24*7 for customers. The mall started its operation in year 2012 as an e-commerce platform offering its services in Malaysia, Indonesia, Philippines, Singapore, Vietnam and Thailand. Lazada is a regional flagship of Alibaba group since 2016 and uses its latest technological infrastructures for operations. Shopee Shoppe is an e-commerce online shopping mall having its headquarter in Singapore being established in year 2015.It serves its products in regions of Malaysia, Thailand, Brazil, Vietnam, Indonesia, Taiwan and Philippines. Buyers can place their order via mobile app of Shoppe by installing it on their android devices. BasisLazadaShoppe Established inYear 2012Year 2015 Offers Product ViaInternet WebsiteMobile Application Fees Charged from SellersInaformofpaymentand shipping fees In a form of transaction and service fees Items ListingHigh efforts and tediousMedium efforts and easy DelayedShippingPenalty charged Charges $15 per delayWorks on De-boosted posts Traffic31.29 million approxApprox 10.88 million Value PrepositionAffordable,Convenientand Accessible. Easy availability, free and fast shipping. Both Lazada and Shoppe are tough competitors of each other as they both offers identical amenities to general public only having a mild different which made them different from each other. Shoppe more focuses on mobile application then Lazada which makes it separates from its competitors. 3
2.Analysis of business model of the twoonline shopping malls. There are various business models which every e-commerce company applies in their operations such as Business to Business (B2B), Consumer to Consumer (C2C), Business to consumer (B2C), Consumer to Business (C2B), and many more. Lazada and Shopee both uses Consumer to Consumer that is C2C and Business to Consumers that is B2C which are described under: Consumer to Consumer (C2C):The model says that under this both sellers and buyers are consumers. Companies here charges their fees from transaction and listing of items. Here customer sells his product or services via third party who is a company showcases item to be sold on its website and then sells to buyer who finds the product suitable and matching to his demand(Heinemann, 2019). It includes offering of second hand items which are used by some one else prior to the sales made under C2C category. Consumer now-a-days sometimes prefers to buy such second hand items because of frequent changes in technology which does not allows them to purchase latest products at frequent pace having high prices so prefers to buy used products. This type of business model is very common and growing in today's world. In case of C2C business payments are only allowed through online mode such as via credit or debit cards, PayPal, etc. the quality and guarantee for product or of its accessories does not lie under the accountability of online platform since it is only an intermediary between buyer and seller here. Advantages of C2C- Consumer to consumer business model offers products and services at low price as compared to offered via other forms as it reduces the cost of middleman, agents, commission holders, etc. As there are lot of buyers available in market so it also provides a lot of choiceforselectingbestsuitableproducttocustomerswhichsatisfiestheirneedsand requirements(Kim and Lee, 2018). For sellers this model proves most profitable due to non presence of agents or middleman which increases sellers profit margin ultimately leads to enjoy higher profits. Business to Consumer (B2C):This model says that there are two different parties involved in trade that is business company and the other is consumer to fulfil whose purpose firms offers their products and services. This form of business is categorised as traditional form but in e-commerce business firms does not offers their goods and services via physical stores rather they follow their tradition in offering products online(Kong and et. al., 2020). It involves 4
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direct sales by business organisations to the end users who are final consumers of product and services. B2C firms collaborates or hires some people and agencies who acts as their delivery agents in all parts of operations and delivers order items at customers set location. Such business model is supported by updated and fine technological logistics along with strong supply chain. Advantages of B2C-Business to consumer model provides numerous benefits to business firms as well as to consumers. Since such businesses are available 27*4 across the globe so offers their services at domestic as well as international level easily. Business firms under such category does not involves physical stores or not requires establishment expenses which reduces overheads costs and increases profit margin of companies(Kremez and et, al., 2019). For consumers buying goods online under this model is very beneficial as online platforms provides continuous tracking facility to those who placesorder on website for certain product. Buyers can track their order process in tracking history and can know where their order has reached. Lazada and Shopee both uses Consumer to Consumer (C2C) and Business to Consumer (B2C) business model in their operations which proves a profitable and successful selection in order to offer various products and services to customers globally. 3. Recommendations to improve competitive advantage. Today is a world full of tough competition and now-a-days people are preferring buying their products and services online due to its convenience and home delivery benefits. This leads to high competition in market for e-commerce platforms over which every online platform wants to win and survive in market. For this there are certain recommendations which online shopping malls such as Lazada and Shopee can adopt in order to have competitive advantage either over each other or over other rival firms. The recommendations are mentioned below: Online shopping malls should focus more on their target audience who are their core customers and visits website frequently. The focus will allow malls to provide products and services accordingly as per preference and demand of their niche customers. It is recommended that while picking up target audience shops should not hurt the sentiments and feelings of people irrespective of their cast, religion, ethics and morals etc. It is recommended to Lazada and Shopee that they should follow some unique or different channel for marketing their website and its products or services which can cater more and more customers also in area where the platform is not familiar or is not known 5
by general public. This will increase their sales and offers high market share which will give an competitive advantages to both the firms over their rivalries. Lazada and Shopee can use more and more social media platform to advertise their website and mobile application in order to popularise their brand. In today's scenario more and more people especially the youth is spending their most of time on social media and on the other hand advertisements on social media encourages individual to go for window shopping which increases sales on platform. Placing an advertisements on social media platforms such as Facebook, Instagram, LinkedIn attracts people to visit website and place order. This attraction can act as an competitive advantage for Lazada and Shopee which will allow them to win over their competitors in market. It is to be recommended to Lazada and Shopee to develop user friendly and attractive website or mobile application which does not looks tough or tricky while using it. Easy application or website makes buyer more comfortable in accessing and searching for their products and services, through which they can place their order more quickly. User friendly interface attracts more and more customers to visit their platform and spend time there. Such spending encourages visitors to buy something for them or for their peer members. This helps Lazada and Shopee to gain competitive advantage over similar irms in today's tough market. Lazada and Shopee can provide various offers or rewards to their prime customers or frequent visitors in order to allow them feeling of belongingness and encourages them to stay connected with their platform. They can also provide shopping vouchers or coupons to them who shops for big amount or places huge order to motive themfor future. This can allow them to win over their rivals and gain competitive advantage. 4. Benefits of online malls to vendors and shoppers. Online malls are proven very much beneficial for vendors as well as shoppers in many ways. Online malls is an emerging platform of trade and commerce which is continuously growing very frequently and is acting as growth component for economic development(Kumar and Dutt, 2020). A world is of technology and sue to which most of the traditional businesses has entered into market of online selling in which shopping mall is very common platform for doing business. The advantage of online malls for vendors as well as for shoppers are listed below: 6
Cost Saving:The most important advantage is of cost saving. Online shopping does not requires physical presence of either buyer or seller that means no one is required to spend his or her expenses for selling and buying of products which saves cost of both parties (Li, Zhao and Pu, 2020). Secondly shopping via online platforms such as malls does not involves cost of travelling or cost of setting up physical store. When a person is not required to visit store personally this means that he or she is not needed to reach store which saves cost of travelling expenses. Cost is also saved from part of vendor as he is not required to setup his store rather can sell his product directly which avoides various expenses of vendor and allows them to enjoy high profit margin. Price and Feature Comparison:Online platforms allows buyer to compare price of desired products with different brand or on various platforms which is not available in physical stores. The price which is suitable and is in budget of consumer can place order for same(Mao and et. al., 2021). On the other hand a customer can easily compare product's features and characteristics while serving various platforms at same time. Platform which offers best feature product with certain additions can be easily selected by a consumer and can buy that no matter where the seller lives. These two benefits are not present in offline shopping and does not provides an option of differentiated price and unique features to buyers. Less time consuming:Online shopping provides a facility of serving website and placing order as per the convenience of customers no matter at same time how many are accessing same platform. Unlike physical stores it does not allows to stay in queue and wait for their turn. Customers can place their order even millions of visitors are scrolling or placing their order at same time(Martínez-López and D'Alessandro, 2020). Online shopping malls are also beneficial at the time of festivals as during festive seasons mostly people shops and during that time market seems to be very busy and collusive which is not present in online stores. Staying away from such issues and placing order online saves maximum time of consumers. Availability of variety of products:Since online shopping mall is a composition of various shops that means there are some shops who offers same or identical products to customers(Natarajan, 2017). The presence of online shopping mall provides varieties of 7
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products and variation with some different touch in same product. Buyer can see varieties of same product at one time offered by different vendors which is not possible in shopping offline because at one time a customer can visit only one store. 5. Reasons to use online malls or search engine. Online malls refers to a place which can be accessed via internet where people buy and sell numerous items under one roof. Search engine refers to an internet website with the help of which people looks for their searches and finds their requirements. There are several reasons available in order to use online malls or search engines which that are listed below: Convenient to use:Online shopping malls or search engines are very convenient to use by general people as one does not need to get ready and drive vehicle in order to visit shop for purchasing their stuffs(Pryor and et. al., 2017). Online malls does not requires one to visit store personally rather they can shop at their convenience. 24*7 availability:Online malls are not like physical stores which requires to close their shops on specific time daily. Such malls are opened throughout the day and offers their products and services 24*7 which means that buyers can access website at any time and can place their order even after closing time of physical shops. Great Price:Online malls offers their products and services at prices lower then offered by physical stores in market(Ribeiro and et. al., 2018). The reasons behind this is such as public accesses internet websites in order to look for less costlier price products, and availability of numerous online websites offering similar products, etc. Variety in Brands:Online shopping allows shopper to search for various branded products just on one click which cannot be possible by visiting physical stores(Seo and et. al., 2017). This provides a huge option to select a product out of them. CONCLUSION From the present report it can be easily concluded that E-commerce is a platform where numerous or every goods and services are sold and bought. Online shopping malls are emerging concept in field of e-commerce which is a fastest growing market in today's world. They provide various facilities and benefits to visitors, buyers as well as vendors. Business to Business (B2B) and Consumer to Consumer (C2C) are most common business model which is adopted by big 8
online shopping mall giants in their operations which makes them different from others and provides huge benefit. Setting up of or selling via online shopping mall does not requires much cost of establishment by seller or business man and also saves much time of consumer as well as vendor both. 9
REFERENCES Books and Journals Das, G. and Varshneya, G., 2017. Consumer emotions: Determinants and outcomes in a shopping mall.Journal of Retailing and Consumer Services.38.pp.177-185. Heinemann, G., 2019.B2B eCommerce: Grundlagen, Geschäftsmodelle und Best Practices im Business-to-Business Online-Handel. Springer-Verlag. Kim, J. and Lee, J., 2018. The Effect of Emotional Responses to Out-of-Stock (OOS) Event Experience in Online Shopping on Behavioral Responses.International Journal of Costume and Fashion.18(2). pp.85-100. Kong and et. al., 2020. Cyber physical ecommerce logistics system: An implementation case in Hong Kong.Computers & Industrial Engineering.139.p.106170. Kremez and et, al., 2019. Ecommerce structures for retail and service franchises: Ecommerce implementation in mature franchise systems.Asia Pacific Journal of Marketing and Logistics. Kumar, A. and Dutt, V., 2020. CORONAVIRUS IMPACT ON MARKETING, ECOMMERCE & ADVERTISING: A DEEP STUDY.Journal of Critical Reviews.7(12). pp.4469- 4476. Li, X., Zhao, X. and Pu, W., 2020. Measuring ease of use of mobile applications in e-commerce retailing from the perspective of consumer online shopping behaviour patterns.Journal of Retailing and Consumer Services.55.p.102093. Maoandet.al.,2021.Hybridecommercerecommendationmodelincorporatingproduct taxonomy and folksonomy.Knowledge-Based Systems.214.p.106720. Martínez-López, F.J. and D'Alessandro, S. eds., 2020.Advances in Digital Marketing and eCommerce. Springer. Natarajan, S., 2017.Method for rapid development of schedule controled networkable merchant ecommerce sites. U.S. Patent 9,626,713. Pryor and et. al., 2017, September. Creating content guidelines for consistent display of information on an ecommerce website. InProceedings of the Human Factors and 10
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Ergonomics Society Annual Meeting(Vol. 61, No. 1, pp. 1834-1838). Sage CA: Los Angeles, CA: SAGE Publications. Ribeiro and et. al., 2018, June. eCommerce business-to-business platform for the footwear sector: The cluster of Felgueiras. In2018 13th Iberian Conference on Information Systems and Technologies (CISTI)(pp. 1-6). IEEE. Seo and et. al., 2017. The Effect of Consumer Attitude on the Characteristics, Service Quality and Repurchase Intention of the Agricultural Products Online Shopping Mall.Korean Journal of Food Marketing Economics. 11