E-Business Essay: Changes in E-Commerce Trading Patterns and Models

This essay analyzes the significant transformations in e-commerce trading patterns and marketplace models. It begins by defining e-business and contrasting it with traditional business approaches, highlighting the shift in consumer and business behaviors. The essay delves into the impact of e-commerce on industry structure, including the influence of factors like bargaining power of suppliers and buyers, barriers to entry, and competitive rivalry. Industry and firm value chains are also examined to understand how e-commerce optimizes operations. Furthermore, the role of social commerce and the Technology Acceptance Model (TAM) in shaping consumer behavior are critically evaluated, providing a comprehensive understanding of the dynamic e-commerce landscape. The essay also explores social commerce constructs and consumer's intention to buy, examining the impact of social media marketing on brand loyalty and purchase intention. The analysis considers how consumer's virtual experiences and technology features influence their participation in social commerce.

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Changes in e-commerce trading patterns and marketplace models
In the 21 century, social commerce in a new development in e-commerce business is
generated through social media to empower the clients to interact majorly on the internet. The
emergence of e-commerce has brought the changes in trading patterns of the customers and has
brought changes in the marketplace. The purpose of the report is to understand the changes in e-
commerce trading patterns and marketplace models. The paper includes the concept related to e-
business with the difference in modern as well as a traditional business approach. The
approaches and concepts have been used to evaluate the fluctuating behaviour of consumer and
business trading patterns. Further, the role of the social e-commerce business model with the
change business patter is discussed by applying TAM theoretical framework to strengthen the
discussion. The scope of the business is limited to the changes in the trading pattern due to e-
commerce and models of the marketplace.
The term e-business refers to as the digital allowing dealing as well as procedures within
the organisation that include the information system under the control of the firm. In simple
words, the concept of e-business shows that it is a kind of business or commercial transaction
that consist of sharing of the information through the internet (Laudon & Traver, 2014, 10). The
commerce constitutes the exchange of the products as well as services among the businesses,
groups, as well as individuals. This can be seen as one of the required activities of any business.
The business practice through e-commerce is entirely different from the traditional business
approach. The traditional approach includes the practice of selling the products and services
within a single industry within a specific geographical area (Laudon & Traver, 2014, 10). It has
been witnessed that traditional commerce majorly relies on operating the business hours at a

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specific period. In the traditional approach, there is face-to-face interaction with the consumers
and this thrives is based on the word of mouth, networking as well as the referrals of the
customer for new business.
In the e-business model, there is automatic processing of the transactions with the help of
internet and other hardware’s. On the other hand, the traditional approach includes the manual
processing of the transactions. This reduces the errors in any kind of dealing related to goods as
well as services. In the traditional approach, this has been witnessed that there is face-to-face
interaction with the customers for the products and services (Gupta, Bindal, Agarwal, &
Khandelwal, 2018, 137). The customers visit the store and then make the purchase of the
products while on the other hand there is not personal connecting in the e-business. The
interaction of the customer happens with the screen from which they can easily order the
product. Further, the major comparison that occurs between the e-business and traditional
business approach is related to the scope of business as the traditional business has a limited
scope of business only for the specific location. The stores of the business always remain at one
place only because it is not movable. On the other hand, e-business is present across the world
that allows the easy accessibility to the people due to which they can easily make the purchase of
the products (Gupta, Bindal, Agarwal & Khandelwal, 2018, 137). The system of the e-business
has totally replaced the traditional business system due to which the people like to purchase the
products with the help of e-commerce.
The emergence of e-business has brought the changing consumer and business trading
patterns related to the industry. The changes in consumer trading patterns can easily be
understood with the help of industry structure and dynamics. E-commerce has brought changes
in the industry structure in different industries (Laudon & Traver, 2014, 87). This industry

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strategy refers to the nature of the players that exist within the industry along with their relative
bargaining power. The analysis of industry structure can be done with the help of five forces that
include the threat of substitute products, bargaining power of suppliers, barriers to entry into the
industry, bargaining power of buyers, and rivalry among the existing competitors.
Bargaining power of suppliers is one of the major features which is considered for the
analysis of industry because suppliers have a vital role. The online procurement systems lead to a
decline in the bargaining power of the suppliers. Although, suppliers can avail the benefit of e-
commerce by eliminating the intermediaries by allowing them to directly sell products to end-
purchasers of the product (Laudon & Traver, 2014, 88). The structure of the industry is majorly
influenced because of the bargaining power of buyers that include the availability of the global
product and price information shift across the area. It is considered that changes are witnessed in
consumer purchasing related to the product as they like to make the purchase products through
online mode that is easily accessible from any part of the world.

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(Source: Laudon, K. C., & Traver, C. G. (2014)
The barriers to entry are major factors that are considered while analysing the structure of
the industry for e-commerce. The barriers of entry might decline in the industry, as the
emergence of e-commerce which is evident with the decline in a physical store, salesforce and
many others new start-ups (Laudon & Traver, 2014, 89). Thus, it leads to the first-mover
advantage that will lead to a rise in barriers to entry for the subsequent entrant. Another factor
that influences the structure of e-commerce is the threat of substitute products. The rise in the
online shopping website has reduces the customer visit to the physical stores. Similarly, the
online reservation system has declined and replaced the travel agents (Laudon & Traver, 2014,
90). Thus, this is clear that there is no threat of substitute products to e-commerce Company. The
competitive rivalry is a major factor that is considered by the e-commerce that is expected to rise
in terms of the price and the delivery of products. The customers can easily select the online

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website that offers the product at comparatively lower prices. Thus, this is concluded that e-
commerce has an impact on the industry structure and competitive conditions.
It has been witnessed that e-commerce company can influence the structure as well as the
dynamics of the industries in different ways. Different customers are taking the benefit due to the
emergence of the e-commerce business. For instance, earlier travel agents were mode through
which the customer can book the tickets but now the emergence of e-commerce has brought the
new ways for the customers through which they can book the tickets with the help of the online
reservation(Laudon & Traver, 2014, 90). This clearly reflects that e-commerce has brought the
new dynamics that have not only brought the changes in trading patterns but has also created an
impact on a customer purchasing decision. However, this has been found that the manufacturer
who is performing their business with different companies are not using e-commerce through
which they can strengthen the distribution of products and ensure that they offer the products on
a real-time basis to their customers. In the present era, some of the consumers want to purchase
the product on a real-time basis that is only possible because of the presence of physical stores.
The overall industry structural analysis supports to understand the major influence of e-
commerce on technology and environment of business. However, the detailed analysis can be
understood with the help of industry value chains analysis. The value chain is referred to a set of
activities that are performed within the industry that transforms the raw input into the final
products as well as services (Laudon & Traver, 2014, 91). The value chain consists of suppliers,
manufacture, transports, distributors, retailers, and customers. E-commerce leads to the
opportunity for every player such as a manufacturer who can decline cost payment for raw
material by forming an effective B2B exchange with suppliers. The e-commerce system offers
the opportunity to customers to directly purchases the products at an effective price in which

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they do not include distributors and retailers (Laudon & Traver, 2014, 91). The effective
inventory management system can be developed by the distributor that supports them to reduce
the cost that can be operated through e-commerce. Moreover, customer relationship management
can be formed by a retailer for strengthening the services. These services meet the customer
needs of the best quality, fastest delivery, and lowest prices through e-commerce. Thus, e-
commerce can make the entire process with full operational efficiency.
(Source: Laudon, K. C., & Traver, C. G. (2014)
It is essential to look towards e-commerce impact on different firm value chains instead
of the single firm value chain. E-commerce effectively contributes to improve operational
efficiency and differentiation. The communications through the internet offer the benefit to
companies for outsourcing the primary as well as secondary activities. The coordination and
reduction in cost are possible with the effective link between every activity that is possible with
the help of e-commerce (Laudon & Traver, 2014, 92). For instance, Amazon Company is able to
manage operations in the e-commerce industry in an effective manner.

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(Source: Laudon, K. C., & Traver, C. G. (2014)
Social commerce is a new development in the e-commerce filed that leads to the rise in
use of social media by the customers to interact through the Internet (Zhang & Benyoucef, 2016,
95). The vendors can reach to the various different markets by combining the social interactions
of consumers. Most of the companies form the online community as well as motivate their
clients to share their experience and knowledge with the brand. The experiences are not only
shared for the brand but also for the product as this contributes effectively in changing the
purchasing patterns of the different customers (Zhang, Lu, Gupta, & Zhao, 2014, 1017-1018).
For instance, companies like Channel, H&M, Selfridge, Dell and many others have Facebook
pages on which they can make the customer to share their experiences (Hajli, 2015). The reason
behind this is that SCCs leads to the influence on trust which leads to rise or decline on that
platform. This is a fact that while purchasing the product the consumer visits the social
commerce where they get the reviews and rating for the products (Huang & Benyoucef, 2013).
The rating and review contribute to improve user satisfaction when they undertake any sort of
transaction. The interaction of customers on social commerce is considered as the social word of
mouth that leads to positive trust and makes the customers purchase the product (Fayad & Paper,
2015, 1003-1004). However, along with this, it has been witnessed that negative reviews and
rating of the product will affect sales. Thus, this can be considered that social media has become

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the hub for the market intelligence as marketers begin to understand consumer's purchase
behaviour and gain insight for how customer feel for certain brands (Balakrishnan, Dahnil & Yi,
2014, 178).
The consumer behaviour and intention of purchasing a product can easily be understood
with the help of technology acceptance model (TAM) which is a successful theory in expecting
an intention of the individual person to purchase a product (Hajli, 2015).
(Source: Fedorko, Bacik & Gavurova, 2018)
(https://content.sciendo.com/downloadpdf/journals/mmcks/13/4/article-p1242.pdf)
This has been found that in the model of TAM user satisfaction is a potentially essential
variable in IS online environment research. The modern technologies like social networks,
mobile apps as well as the online advertisements have a major impact on the use of e-shops
(Mugo, Njagi, Chemwei, & Motanya, 2017, 2-3). This model is considered as one of the most
used models of what the system uses to determine the perceived usefulness as well as simplicity
of use. The perceived usefulness majorly likelihood of the prospective user who assumes that
social commerce can influence user behaviour towards the products (Fedorko, Bacik, &

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Gavurova, 2018). Customers will shape an individual’s behavioural intention towards the use of
social commerce for sharing experience and knowledge that leads to the rise in the purchase of
products.
In the end of paper, this has been found that there are tremendous changes in e-commerce
trading patterns and marketplace models. The rise in the trading through internet is growing that
is e-business; it is entirely different from the traditional approach of the trading in which people
used to visit the store for purchasing the product from market. The person has started conducted
operations with the use of internet that reflects that the behaviour has changed. The change in the
trading patterns will definitely make the changes in the marketplace model that include industry
structure, value chains, firm’s value chains, and others. The E-business and traditional business
vary a lot and each model has their own advantage and disadvantage, where e-business offer the
easy and convenient buying but physical stores offer personalised service and real time
availability of products. In addition, this has been clearly witnessed that social-commerce
contributes in bringing the changes in the purchasing pattern of the people. The change can occur
due to the reviews, feedbacks and experience shared by the company. The implementation of
TAM theoretical framework is done which shows the customer intention for purchasing the
product as well as their loyalty.

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