The Changing Environment of E-Commerce

The advancement of the Internet from Web 1.0 to Web 2.0 has had a significant impact on the e-commerce industry. For many people, e-commerce is viewed as an ultra convenient and accessible way to purchase goods without having to leave the comfort of their home. However, in the early stages of e-commerce the benefit to the consumer heavily outweighed that to the online retailer. With the emergence of Web 2.0 technologies, retailers are now able to tap into customer preferences and buying habits unlike ever before.

Online consumers are usually prompted to fill out surveys relating to their spending preferences after an online purchase. Sometimes these surveys will even be linked to promotional offers as an added incentive to participate. In fact, most online shoppers will happily provide their personal information to a favorite online retailer, because they know that they’ll be the first to receive a notification of new promotions. In an article on Digitaltransactions.net (see below for link to article) the author supported the claim that the information sharing between online retailer and consumers is now a two-way street.

Web 2.0 technologies have fueled the expansion of online communities, blogs, and other open channels to share information. These channels of communication have helped retailers to differentiate themselves. In the world of Web 1.0 the competitive advantage in e-commerce was dominated by the lowest price offer. With the development of Web 2.0, online retailers now have the marketing tools to reach out to a specific target audience. In fact, many of the social networking services allow members to rate products and provide reviews and feedback. In this sense, e-commerce is shifting from a low-cost dominated environment to a customer-friendly culture.

Many of the social networking sites already include member profiles which contain useful marketing information relating to a member’s demographic and personal preferences. In the future, some of the major players in e-commerce may team up with social networking sites to provide selective advertising to a specific target audience. A relationship like this would make online shopping even easier for the consumer. No longer would we have to search through our favorite online retailers to find the newest items or hottest deals. Instead these types of promotions would automatically appear as the banner advertisements on our Internet browser.

http://www.digitaltransactions.net/newsstory.cfm?newsid=2038