Benefits of Online Malls to Vendors and Shoppers

ECOMMERCE
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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
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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.
Basis Lazada Shoppe
Established in Year 2012 Year 2015
Offers Product Via Internet Website Mobile Application
Fees Charged from Sellers In a form of payment and
shipping fees
In a form of transaction and
service fees
Items Listing High efforts and tedious Medium efforts and easy
Delayed Shipping Penalty
charged
Charges $15 per delay Works on De-boosted posts
Traffic 31.29 million approx Approx 10.88 million
Value Preposition Affordable, Convenient and
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.
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2. Analysis of business model of the two online 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
choice for selecting best suitable product to customers which satisfies their needs and
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
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