Digital Business: Analysis of Trends, Models, and Strategic Impact

This report provides an overview of digital business, emphasizing the advantages of digital technology, key trends such as robotic automation, artificial intelligence, and quantum computing, and the implications for virtual businesses. It evaluates emerging digital business models, including e-commerce, free, ecosystem drivers, and on-demand models, in the context of ethics and cyber security. The report also examines the impact of digital technology through strategic and collaborative alliances, highlighting benefits like gaining new customer bases and enhancing competitive skills. E-commerce principles are discussed, focusing on transparency and customer consent. The analysis uses examples like Amazon to illustrate the concepts and their practical application in achieving business growth and competitive advantage.

DIGITAL BUSINESS

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Advantages of digital technology................................................................................................3
Key trends in digital business......................................................................................................4
Implication of digital technology on virtual business..................................................................5
Evaluation of the emerging digital business model in context of the issues such as ethics and
cyber security...............................................................................................................................5
Impact of digital technology through strategic alliance and collaborative alliance.....................7
E-commerce principles................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Digital business refers to the process of using advanced digital technology that helps in
creating value for the business (Sousa. and Rocha, 2019). Also, it helps in enhancing the internal
capabilities of the business and customer satisfaction. Nowadays companies are using several
differentiated digital technologies that is helping the business to connect and to build a
relationship with its customers. With an aim of expanding the business into international market
for higher profit maximisation. While implementing the digital technology it is very important
that the organisation abide by the ethics and principles. With the strategic alliance and
collaborative relationship it helps business in using the opportunities in best possible ways.
The report shows the advantages of the digital technology and the key trends in the
digital technology in context with virtual business. Also it represents the emerging the model
with the issues faces by the virtual business. Further the report evaluates the impact of strategic
alliances and collaborative relationships through digital technology.
MAIN BODY
Advantages of digital technology
In business digital technology refers to the using if technologies that adds value in the
business models, customer experience (Senyo and Effah, 2019). Also, it has capabilities that
helps in supporting the core business operations of an organisation. For the growth and success
of a business, digital technology plays a vital role. It helps business in several ways that is by
enhancing the communication with its customers by offering effective customer services that
helps in enhancing customer satisfaction. Thus, it results in enhancing the brand image of the
organisation in front of customers which helps in attracting more customers towards the business
(Rangaswamy and et.al., 2020). Also, with using digital technologies, it helps businesses in
improving the quality of their products and services hat helps in higher customer satisfaction
level. Thus, this results in increasing the sales of the organisation with higher profit margin and
leading the organisation towards success and growth.
However, it can be analysed there are several advantages of the digital technology in the
organisation. That is it helps businesses in connecting with its target audiences and providing
them products and services according to their requirements and preferences. On the other hand, it
also helps organisation in improving its production and manufacturing process with the use

advance technology that helps in lowering the production cost with higher efficiency. With the
use of modern technology it will help business in reducing their cost of production and thus,
increasing their profit margins (Ismail and Zaki, 2017). Thus, it can be evaluated that in
Amazon, with the advancement in its digital technology and digitalisation of its business, it has
helped the organisation in providing quality services to its consumers with the aim of higher
profit maximisation. Also, it has helped the Amazon in gaining a competitive advantage over its
competitors which as in turn resulted in the success of the business and led the company towards
growth.
Key trends in digital business
With the rapid changes in the fast growing world there has been a massive growth in the
digital technology (Ukko and et.al., 2019). With faster processes, technology has been evolving
at rapid pace. There has been several trends that have emerged in the digital technology that are
given as follows: ROBOTIC AUTOMATION PROCESS- It is considered as a key trend in the world of
digital technology. Robotic automation process refer to the processing of different
business transactions and interpreting the information and data. It helps the organizations
in using of processes which are quicker and faster. Thus, providing the business with
higher profit margin with accurate results. ARTIFICIAL INTELLIGENCE- Another significant trend in the digital business is the
application of artificial intelligence. AI is considered one of the new trends in the digital
world because of its effects on the work done (Nwaiwu, 2018). AI is also known for its
speech recognition superiority, assistance and image etc. AI helps in providing services
that are personalised and caters to the individuals needs and requirements of the
customers that helps a business in connecting with its customers.
 QUANTUMN COMPUTING- Another key trend in the digital technology world is the
quantum computing. Taking the benefit and advantage of quantum phenomena, it is a
form of computing such as superposition and quantum enlargement. Thus, it helps
businesses in interpreting, analysing and monitoring of data without focusing on its
sources.

Implication of digital technology on virtual business
Nowadays with the applicability of the appropriate digital technology it can either make
or break a business that is business processes have become very complex (Bican and Brem,
2020). For companies to be successful, adaptation of digital technology is very important so that
the organizational goals and objectives can be fulfilled efficiently and effectively. On the
contrary, it can be analysed that digital technology has both positive and negative impact on the
business. Thus, the positive impacts of digital technology has affected the amazon business in
various aspects that is it has helped the business in reducing its overhead costs. Also, it has
helped in enhancing the job satisfaction for the employees that has affected the productivity and
efficiency level of the organisation in a positive way. It also, has helped Amazon in diversifying
its business operation and accessing new markets and targeting new market and opening new
areas from which revenue can be generated. On the other hand, it can be evaluated the negative
impacts of the digital technology has a direct effect on the brands image that may further lead to
low profit margins (Nadeem and et.al., 2018). Also, it requires huge capital investment for
application of the latest technologies within the business. Thus, with one negative feedback, it
can decreased the customer loyalty towards the brand that will drastically affect the sales volume
and lead to decline of profit margins.
Evaluation of the emerging digital business model in context of the issues such as ethics and
cyber security.
There are several new and emerging digital business model in the market that are used by
organization in other to resolve the issues of cyber security and to provide aid to ethics while
performing its business operations. It is characterized in the basis of the services which are being
delivered to the customers (Remane and et.al., 2017). Different models such as free model, e-
commerce model, ecosystem drivers and multichannel business are used by Amazon in solving
the issues faced such as cyber security while its business operations. Thus the following models
are described as follows:
 E-COMMERCE MODEL- It is a model that is used by the Amazon in selling its
products and services. That is it sells its goods services through websites to the customers
where they can easily purchase goods using internet (Scuotto and et.al., 2017). While
using the E-commerce model in the virtual business organisation must ensure that there is
optimum level of transparency. That means all information related to the products and

services must be shared with the customers. It very important while using any personal
information of the customers consent must be taken from them. Thus, with the use of this
model it has helped Amazon in building a relationship of trust with its target audience.
Also, it has resulted in enhancing the brand image of the company in the external
environment.
 FREE MODEL- It is considered one of the most common business model that is used by
several organisations across the world (Ismagilova and Glukhov, 2017). The ideology
behind the application of this model is where user can freely sell goods and offer free
services to the customers. Similarly, Amazon lays effort in collection of vital information
such as the taste and preferences of the consumers with the use of target post
advertisement. This, helps in attracting new customers towards the organisation which
turn leads to higher revenue with higher profits maximisation. While applying the free
model, Amazon tries to abide by the ethical compliances. It also tries to ensure cyber
security with protecting the crucial information of the users and the customers.
 ECO SYSTEM DRIVERS- It is considered one of the most important and useful model
in the digital technology. That is with the use of this model it has helped the organisations
in solving several key issue that are concerned with the drivers of ecosystem. It is a
model that provides the organisation with a thorough and detailed knowledge about the
preferences of the consumers and also a broad supply base. Amazon leverages the
dimension of this model in provides their customers with an impeccable experience by
offering products from across the world by maintaining high end security so that there is
no breach. Also, it expands the scope of users for selling their products which helps in
creating value for the organisation with maintaining the ethical values that governs the
business.
 ON DEMAND MODEL- Another model that has emerged in the digital technology for
solving the issues of ethics and cyber security is the on demand model. It is model that
helps in building a relationship with the customers with a deep knowledge about their
taste and preferences. By offering products and services to the customers from various
different sources, it helps in enhancing the customer experiences and satisfaction. It is a
model that provides virtual goods and services such as Amazon video. It caters to the
needs of the consumers by providing them with high definition quality products. With the

use of digital technology this model helps in solving the several issues that are being
faced by the virtual business. Also, with the application of this model it helps in
connecting the digital platforms with the local business. That is turn results in increasing
the profits of the local business by increasing their visibility across the world.
Impact of digital technology through strategic alliance and collaborative alliance
Strategic alliance refers to an agreement between two and more companies who wants to
achieve the same goals and objectives (Bock and Wiener, 2017). This is also known as
collaborative relationship. In other words, it refers to when to or more businesses comes together
with an aim of gaining mutual benefits it is called as strategic alliances. For achieving growth in
future and for expansion of their business organisation focuses on building collaborative
relationships which helps the businesses in entering into new markets. So that they can target
more customers and increase their sales volume with higher profit margins and many other
advantages. In the case of Amazon it can be seen in the case that amazon has built collaborative
relations and strategic alliance with several companies like Blackberry, Yahoo, QNX, Netscape
etc. that is helping in gaining various benefits that are described below:
 Gaining new customer base- One of the major impact of the strategic alliance and
collaborative relationship with using the digital technology to amazon is attracting new
customers (Xu and Koivumäki, 2019). That is with collaborating with several firms it is
able t target new audiences that has helped the company in increasing its visibility in the
markets. Similarly with using the bran image of the collaborative companies, it has
helped amazon in also enhancing its brand image. That is with collaboration of Amazon
with Blackberry it has helped to use the target market of Blackberry and attract them
towards Amazon. Thus, it has resulted in increasing the profit maximisation of Amazon
and leads the company towards growth.
 Enhancing competitive skills- Another advantage of building collaborative relation with
inculcation of digital technology in Amazon has helped the them in gaining competitive
advantage (Guggenberger, Boualouch and Otto, 2020). That is with strategic alliance it
helps the company in gaining more skills, knowledge and competitiveness of employees
with an aim of expansion. Also, it helps organisations in sharing their expertise skills and
knowledge with one another which provides them an competitive advantage. As with
higher expertise skills it helps in catering the needs of the customers more efficiently. As

it can be seen in the collaboration of Blackberry and Amazon, with both companies
having an expertise workforce with capabilities of utilizing the digital technologies
efficiently so that they can meet the needs and requirements of the customers, thus, it has
helped the companies in enhancing their skills and knowledge with delivering higher
customer satisfaction.
 Reducing the risk by sharing the liabilities- Another positive impact of strategic
alliance through digital technology to amazon is reducing the risk (Tesch and Brillinger,
2017). That is with formulation of collaborative relationship it has helped the
organization in sharing their liabilities that helps then in reducing the burden of the risk
associated with the losses.
 Facilitating global expansion- It can be analysed that with collaborating with different
firms, it helps the businesses in easily entering into newer markets with an aim of
expanding globally and adding new customer base to their organisation (Seo, 2017).
Thus, with forming strategic alliances with local business with using the digital
technology, it will help Amazon in understanding the taste and preferences of the local
market in which it wants to operate and accordingly provide them with goods and
services that will helping in fulfilling their needs efficiently. Similarly it will help the
organisation in understanding the risk and opportunities associated with the market. So
that effective strategies can be formulated to gain the maximum benefit out of the
opportunities.
 Decrease in overall expenses and costs- With the use of digital technology in building
strategic alliance and collaborative relationship has helped in reducing the overall costs
that is incurred by the both the parties (Kreutzer and Pattloch, 2017). That is with the use
of digital technology there can be easy and smooth communication between the
organisation for formation of strategic alliances. On the other hand, the procedure related
with the collaboration can be completed within specific tine limit and less cost. Also, the
use of digital technology reduces the cost of stationery and other expenses related with
strategic alliances.
Thus, with the several befits of strategic alliance and collaborative relationship. There are
some disadvantages of it also that affects the companies profit maximisation. That is some times
using of digital technology in strategic alliance may lead to miscommunication between the

employees. Thus, it may further lead to conflict among the employees about their duties and
responsibility. It may also lead to duplication of work. Thus, all these factor may directly affect
the profit maximisation of the company.
E-commerce principles
Nowadays e-commerce business are becoming the primary mode of buying and selling of
goods and services (van der Meulen and Woerner, 2020). The consumer expectations and
behaviours are continuously evolving with the new technologies and business models. Customers
want instant gratification as e-commerce is mainly driven by convenience and price. It very
important that businesses provides it customer with an impeccable experience with proactive
customer services ans low cost delivery. Therefore, business needs to inculcate certain principles
for effective functioning of their business. These principles vary according to the time and
environment. The principles that are being followed by Amazon are as follows:
Digital payments
with the pace of time there has been a significant change in the payment method.
Contactless payment have replaced the old forms of payment. That is nowadays customers are
adopting to digital payments that is using their phones and smart watches for payments. Thus, in
this context Amazon has also launched its payment app that is the Amazon pay through which
customers can pay and transfer money from one account to another.
Express delivery
The aim of every e-commerce business is to deliver at most level of satisfaction ots
customers (Freitas Junior, Maçada and Brinkhues, 2017). Thus, it is vital for every e-commerce
business to deliver their products and services on time. In the present times, customers have
expect express deliveries that is click and collect, they can even pay extra for fast deliveries.
Thus, for Amazon to deliver at most level of satisfaction to its customer it is very important that
Amazon opts for express delivery that will help them providing higher level of satisfaction to its
customers. Thus, will enhance the customer loyalty and will lead the organisation towards
growth.
Chatbots
one of the most important element in providing higher level of satisfaction to the
customers is to provide them with effective after sales services. That is it is very important for
every organisation to provide after sales services so that grievances of the customers can be

resolved. Thus, to provide these services Amazon uses chatbots and Artificial intelligence that
specifically cater to the individuals needs and requirements and provides them with quality
services that helps in gaining optimum level of customer satisfaction. Thus, it helps the
organisation in building a relationship with its customers that helps in profit maximisation.
Thus, it can be analysed that for a successful running of an e-commerce business, it is very
important that the organisation follows certain principles. With the inculcation of these principles
it will help the organisation in gaining customer loyalty with providing quality services that
increases their level of satisfaction. Thus, it will lead the organisation towards growth and
success.
CONCLUSION
From the above report it can be concluded that digital business to enhance consumers
satisfaction and to add value to their brans uses digital technology. With the inculcation of digital
technology in the e-commerce business it provides organization with several advantages. It can
also be concluded that there are several trends that are emerging in the digital technology that is
helping organisation to increase their profit maximisation. With the use of these tends in the
business, it helps in offering quality services and products to the customers at reasonable prices
with higher profits. Furthermore, it can be concluded that to solve the issues that are being faced
by the e-commerce business there are new business models emerging that helps in proving high
security and protection. At the end, from the report it can be summarised that there are certain
principles of e-commerce business that an organisation needs to follow for smooth functioning
and for higher customer satisfaction level. Also, with the use of digital technology in stratgis
alliance it has helped organisation in gaining several advantages.

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