1. Online Shopping

2. What is Online
Shopping?
The online selling of or enabling
the sale of products or services to
consumers.

3. How did Online
Shopping come about?
Online shopping emerged with the
development of the internet.
Entrepreneurs saw the potential in
online shopping and sprung at the
chance to make virtual storefronts, so
that consumers could shop without
leaving their homes.

4. Growth of Online
Shopping
There are over 70,000 new websites
put on the internet every hour.
Internet traffic is doubling every three
months.
Projected annual internet commerce
revenue has grown from $35 billion in
1998 to $1.4 – $3.2 trillion in 2003.
(Taken from CISCO Systems WEB Site)

5. Risks & Disadvantages
of Online Shopping
Fraud- Do you know the Company?
Security- Is your credit card safe?
Privacy- Is your information being sold?
Shipping- Are you getting the correct
product at the requested time?
Difficulty- Do you know how to shop
online?

6. Consumer Benefits
Convenience
-Geographic
-Store hours
-Ease of transaction
-Quick and efficient shopping process
Information
-Quick location of items
-Easy price/attribute comparisons

7. Firm Benefits
Less dependence on intermediaries
-Geographic distribution
-Holdup
-Time to delivery
Marketing
-Target marketing
-Direct customer relationships
-Customer service

8. Online Shopping VS.
Traditional Shopping
Differences
-Cannot try or test product before
purchase.
-Minimum human interaction if any.
-Cannot pay by cash.
-Shop anytime online.

9. Online Shopping VS.
Traditional Shopping
Similarities
-Advertisement.
-Security.
-Convenience.

10. 2005 expected pattern of
electronic shopping users
% items
shopped
Consumer acceptance(%) electronically
1 15-20% "hard core" 50-75%
2 15-20% occasionals 25-35%
3 15-20% experimenting 10-20%
4 All the rest still irregulars! 5%

11. Key Findings of Michael
De Kare-Silver in e-
shock:
• Already about 15-20% of consumers say they’d
prefer to shop electronically rather than visiting the
shops.
• It only takes a drop of about 15% in store traffic to
make many stores unprofitable.
• This revolution will achieve critical mass as early as
2005.
• Manufactures can seize the opportunity to decide
whether to establish their own direct consumer
distribution and bypass existing retail chains.