Online Shopping in Australia - PDF
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Online Shopping in Australia With the advancements made in modern technology, Internet is offering more and moreconvenience to the people. Therefore, Internet allows a lot of things to be done by the peoplewithout going out of their homes. For example, people can watch movies, paid bills, study onlineetc. However, out of all these facilities the most attractive is the facility to shop online. Onlineshopping offers several advantages, but as everything has two sides, there are many who believethat a lot of these advantages are also associated with online shopping. Online retailing hasresulted in a number of changes in the Australian retail trade industry. It represents a shift in theway transactions are made by the consumers.1 Online shopping industry witnessed a significantincrease during the last five years, and it became the part of mainstream retail industry. The risein online shopping has also been fueled by the recent advancements made in the Internet andbroadband penetration along with the acceptance of electronic commerce by the consumers as asafe and viable alternative to traditional brick-and-mortar stores. Although, there are several whobelieve that their market share is difficult in e-commerce, the recent reports revealed thatsufficient growth is being experienced by online shopping and online purchases up by 11.5%.2The reasons behind the growth of online shopping may be different, but they certainly includeeasier comparisons, competitive pricing and the convenience and variety offered by online1Liu, C., Arnett, K.P., Litecky, C. (2000) Design quality of Websites for electronic commerce: Fortune 1000 Webmaster’s evaluations, International Journal of Electronic Commerce & Business Media, Vol.10, No.2, pp. 120–129.2Lundegaard, K M (1997). “New Owner to Streamline Shopping Alternatives.” Washington Business Journal, http://cgi.amcity/com/washington
shopping. Due to strong brand loyalty and also an increase in the number of sophisticatedconsumers, there has been an average increase of 16% in the number of. Parsers that aregenerated by each online transaction.3 It has also been suggested that as compared to traditionalretail, the growth in online shopping was 6.9% although the traditional retail sold 2 $61 billion asagainst the sale of $18 billion made by e-commerce physical goods. Department and varietystore is the highest category of online shopping. This segment with the 7% growth. Moreover, ithad 30% off the market share and a close second was the fashion segment that had 17% growthand 22% market share.4 Jointly, these two sectors account for more than half of all the onlineshopping.Online shopping can be described as the process of buying goods and services from merchantswho sell them on the Internet. After the rise of World Wide Web, merchants have tried to selltheir goods to the people who serve on the Internet. Similarly, consumers can visit the onlinestores from the comfort of their homes and complete their shopping while sitting in front of theircomputer.5 People are attracted to online shopping because it offers several advantages.Consequently, more and more people, particularly office workers, who cannot find sufficienttime to go for shopping, finding very attractive. Therefore, online shopping provides the mostconvenient and effective way of making purchases. In the same way, there are many personswho opt for online shopping because they just don't like the idea of standing in crowded andnoisy environment.6 However, in case of online shopping, a person simply needs to select the3Mahajan, V., Srinivasan, R. (2002). The Dot.com Retail Failures of 2000: Were There Any Winners?, Journal of the Academy of Marketing Science, Vol 30, No. 4, pp. 474-486.4Morganosky, M. and Cude, B. (2000). “Consumer Response to Online Grocery Shopping.” International Journal of Retail and Distribution Management, Vol. 28, No.1, pp 17-26.5Park, K, D Perosio, et al. (1998). What's in Store for Home Shopping. Ithaca, New York, Cornell University Food Industry Management Program6Saga, V.L. and Zmud, R.W. (1994). The Nature and Determinants of It Acceptance, Routinization and Infusion, IFIP Transaction: Computer Science and Technology, Vol. 45, pp. 67-86
article and then pay for it online. The shopping is finished and the product will be delivered tothe person. For most of the people, shopping is not an anguished and the hard task. They canremain within the comfort of their home, click on the mouse and within a few minutes they willget what they want without the need for leaving the comfort of their room or standing in aqueue.7In this way, we see that online shopping is faster and convenient and it also produces betterdeals. The concept of online shopping has been present in Australia for a long time now. Earlierit was available in the form of television infomercials and commercial catalogs. However, theconcept of home shopping did not achieve the status of such a widespread phenomenon until thearrival of Internet. As a result of the vast potential of the Internet, which was not present in theInternet technologies, online shopping has become an integral part of the people of Australia.8Moreover, it has also been adopted by almost all major brick-and-mortar retailer in Australia. Atthe same time, Internet shopping is also provided a competitive edge to certain companiesbecause this type of shopping allows them to get rid of intermediaries and they can directly selltheir products to the customers. Price: there are high chances that better prices may be offered to the consumers on the Internet ascompared to the shopping malls.9 There are a lot of Internet companies that operate as online7Selz, D., and Schubert, P. (1997). Web Assessment – A Model for the Evaluation and the Assessment of Successful Electronic Commerce Applications, the International Journal of Electronic Commerce and Business Media, Vol. 7, No. 3, 1997, pp. 46-488Schubert, P., and Selz, D. (2000). Measuring the Effectiveness of Electronic Commerce Websites with the Web Assessment Method, in: Hunt, B. (ed.), E-Commerce and V-Business, London: Imperial College, 20019Schuster, A and Sporn B. (1998). “Potential for Online Grocery Shopping in the Urban Area of Vienna.” Journal of Electronic Market, Vol. 8, No. 2
retailers only. This means that these companies are not required to pay to the intermediaries likethe distributors. Similarly, these companies are not required to hire people specializing in sales.Hence, some of the savings can be passed by these companies to the consumers as they offerreduced prices. Similarly, then it also allows the consumers to compare the prices of a particularproduct instantly.10 Therefore they can buy their product from the retailer, who is offering thelowest prices. Internet companies are also aware of this situation therefore be price their goodscompetitively. Similarly, the companies get a larger audience for their products online.Therefore, generally they put clearance products on sale, and also offered good deals so that theymake clear their inventory faster. The customers are also able to save on taxes, in case of onlineshopping because tax is apply only if the online retailer is operating in the same state as thecustomer. On the other hand, high costs have to be borne by shopping mall retailers. Not only they arerequired to invest in physical property, but these retailers also have to hire salespeople and otherstuff. Moreover, they have limited audience, confined to the number of visitors in the shoppingmall. Therefore they are under pressure to generate higher sales per customer. This means higherprices on the average. At the same time, it is more expensive for the visitors to compare prices interms of cost and time. And as a result, it has been seen that the. Customers purchasing in theshopping mall are at a disadvantage. Variety: the consumers unable to find a large variety of products on the Internet as compared tothe physical retailers.11 The reason is that shopping mall stores have limited variety of products,in view of the restricted space available. On the other hand, this constraint of space is not present10Barnes, S. J. and Vidgen, R. (2001) An Evaluation of Cyber-Bookshops: The WebQual Method, International Journal of Electronic Commerce, Volume 6, Number 1, Fall 2001.11Barnett, M. and Alexander P. (2003). Can e-Grocers Survive the Last Mile., 4th International We-BConference, Perth, Western Australia.
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