Advantages and Disadvantages of E-Commerce

E-Commerce Origins

Before we even dive into the advantages and disadvantages of e-commerce, we will rewind the time to where it all started.

Humanity began as a consumer of its own products. Be it hunting for food, gathering herbs, or making our clothes; it was all done for only ourselves. A time long past, it was before any form of civilization came along that we had cared only for our most basic needs of food and shelter. This “animesque” period is more like a seed from which all commerce sprang then root in itself. Keep reading to find out more about the advantages and disadvantages of E-commerce.

What then is the origin of all today’s e-commerce? Here lies an age-old question to what came first, the egg or the chicken, or in our case – commerce or civilization? Since science had already solved the mystery of the first hatched chicken (spoilers: the egg came first), we will move towards our part of the equation. Arguably, we could say that the history of commerce is also the history of civilization. It does not exactly give an answer, but it does shed some light on chronologically the darkest part of our kind. There wasn’t a single society capable of producing every single thing it desired. As we have met some needs, others arose with time. This fundamental principle is precisely what necessitated the trade among each other.

Egyptians, Phoenicians, and Greeks count towards the first recorded to do so. If we fast forward a few thousand years ahead but still stay on the same planet, we will find that our needs and desires are being met globally.

It was not only the start of all e-commerce business but also its grandest beauty.

What Is E-Commerce?

Put plainly; e-commerce is to commerce what email is to mail. It is an electronic enhancement and a modernized solution to an old-fashioned process. If commerce is a transaction of physically buying or selling goods, e-commerce is its electronic counterpart – selling and buying online.

Making deals has never been easier. E-commerce embodies the spirit of convenience. Whatever your trade might be, and whichever product comes from your labors, you now have the option, or more precisely the power, to exchange it with anyone and for almost anything worldwide from the comforts of your sofa. E-commerce is an indirect product of web development – the modern day craft. Developers create websites using formal computer languages – of which there are many sites used exclusively for online transactions.

What’s an E-Commerce Website?

It does not take an Einstein to put two and two together. If we know, or at the very least understand, what e-commerce and websites are then it is a simple matter of understanding what an e-commerce site is. What truly separates them from the rest of the “fishes in the sea” is its internal division based upon the types of business with which it deals.

Traditional Retail

Inch by a long inch, we are getting closer to a complete transformation of the traditional retail. We are eliminating the need to carry any cash at any given moment, or even to pick up our groceries. In turn, we get more leisure time to spend with our loved ones, a good book, or even a walk in a park instead of the usual walk in a parking lot. In this post, we would like first to dismantle e-commerce and compare it to traditional retail afterward.

Advantages and Disadvantages of E-Commerce

There is an ancient adage which I am sure will sound familiar. It says that a coin has two sides. We are not trying to discuss the morally good or bad, but we would like to discuss the best and the worst that an e-commerce business offers.

Short Story

Advantages of E-Commerce

• Much faster transactions available 24/7.
• Products and services are easy to find.
• Easier time managing a business.
• Doesn’t require much (if at all) physical space.
• No geographical limitations translate as a bigger customer reach.
• Higher quality of services and lower operational costs.

Disadvantages of E-Commerce

• No guarantee of product quality.
• Customer loyalty becomes a bigger issue as there is a minimal direct customer-company interaction.
• Inability to experience products beforehand leads to more checkout dropouts.
• Anyone can start an online business, which sometimes leads to scam and phishing sites.
• Hackers target web shops more often than you think.
• Mechanical failures can get quite more punishing.

Long Story

Advantages:

Not such a long time ago, people used to travel great distances to meet both their needs and desires. You would make a journey to the Orient if you were in need of spices or silk, or even closer in time to us was traveling abroad if the prices there were lower than in our vicinity. Traveling to acquire goods was eliminated by the surge of e-commerce.

E-commerce is global. That is a whole lot of space which it covers. With the rise of the delivery drones, it is also becoming a lot more convenient than driving to a store, browsing merchandise, waiting in a line, buying a product, and driving all the way back whence you came. Herein lies the power of electronic commerce and its websites. Instead of doing this (mostly) tedious routine day in, day out, you could hop on your phone, browse for nearby shops and restaurants with delivery, and order everything you need.

All of these advantages mostly pertain to your typical homo sapiens consumer. If you are a wise businessperson, it will not take you a long time to see all of these benefits as an opportunity to expand your empire. Once again, e-commerce is global. There is no possible wider audience, at least for the moment.

With a global reach, comes global access. You can operate and manage your business all the time, 24 hours a day, seven days a week, all year long. In turn, as you can get orders faster, you get to enjoy faster transactions. A true win-win situation if I have ever seen one.

Disadvantages:

For the third time, e-commerce is a global marketplace. You can order various products and services from nearly anywhere in the world. Sure, you can use e-commerce websites just to order a pepperoni pizza, but imagine how long it would take if you ordered it from across the globe. Of course, you will not be ordering pizza from the polar opposite of your current standing point. As common sense dictates, the farther you and your order are, the longer it takes for it to arrive. This particular disadvantage does not affect services such as content creation, web development or web design, but it does massively affect products with a shorter shelf life.

Even though e-commerce offers a lot more information about a product or a service than traditional retail, it does not allow you to experience any of it before buying.

Another disadvantage that we often see pop up here and there is credit card or identity theft. Although both are severe issues, we could argue that a lot worse could happen the next time you carelessly run over the street to grab that delicious popsicle.

Popsicles melt. While it might not be a direct disadvantage of e-commerce, the delivery of certain products is at the moment cost inefficient. However, we do hope that drones carrying ice cream in little refrigerators will be the next big thing of the future!

Benefits of E-Commerce to Society

We’ve reached a point where we can’t anymore deny the apparent benefits e-commerce has over retail. But who does it benefit? The seller? Customers? Or both?

Let us explore together what benefits e-commerce offers to society as a whole. Many times we’ve heard e-commerce labeled as a job killer, but how much of it is true remains yet to be seen (psst, in the paragraphs below).

Job Opportunities

While the 20th century was marked by a constant growth of factory workers, this era is making those same workers slowly obsolete. It is a hard truth to accept, we know, but there is a light at the end of that rabbit hole.

E-commerce is a job provider, period. In one word – Amazon. Amazon is employing over 300,000 people at the moment of writing. Not only that, but they’ve reached that number in record time.

Digital companies are expanding all over the world. It’s not just the USA coast, but the whole country too. China’s growth in 2016 was even more impressive, surpassing the retail growth by twice as much, according to ECN.

Still, don’t believe us? Then you’ll be thrilled to hear that the Bureau of Labor Statistics has done an analysis to cover the growth of job opportunities in e-commerce.

Instant Information

Having information in (quite literally) the palm of your hand is another great example of the benefits of e-commerce to society. People are able to access information even on the “go”, which further simplifies and hastens the shopping experience. Want a boat? No problem, a quick Google search reveals all the info you’ll need as an amateur fisherperson. It still boggles my mind to think I carry a whole library in my back pocket.

The Age of Entertainment

There is not a greater e-commerce gift to society than the ability to download and play seemingly countless numbers of songs, book, video games, TV shows, etc.

As an artist, your audience isn’t only the rabble that passes you by on the main square while you are slowly strumming away at the notes of The Sound of Silence on your 10-year old guitar. Think global, be global is the new motto. Well, at least in this decade.

Online Education

Oh man, to hit the books has completely changed its meaning. Thanks to the rate of growth in e-commerce, students today can acquire knowledge in seconds. Seconds! Completing assignments was never easier. And if you thought for a second that it would lead to a less educated population, simply go back a step and reflect upon our decade’s motto. The global competition is harsh and numerous. However, the reach is still so wide that it easily compensates for a growing concurrency among students.

The virtual classrooms bring another layer to this advantage. With the anonymity that comes with the Internet, every student gets equal exposure and opportunity, no matter the age, gender, hair color and so on of the student.

E-commerce and Environment

Fewer papers and less traffic amounts to a healthy dose of air. Remember when I stated earlier that the entertainment was the most significant benefit of e-commerce to society? A blatant lie. Lessening the global warming has got to be the number one benefit. Since we can do so much through the internet nowadays, there isn’t any more a high demand for traveling to acquire everything we want. Since this leads to less traffic, less traffic logically leads to less air pollution.

E-Commerce vs. Retail – The Verdict

What a time to be alive. Pizza comes to our doorsteps and groceries carry themselves. Soon we will have flying assistants and delivery bots ready to fly in with our order. On whichever end of the spectrum you might find yourself, be it as a consumer, business, or a provider of services, this age of popping digital trends and technological advances is equally exciting!

Buy and sell, trade and barter; there are no limits to what you can do when your audience takes up a whole planet. E-commerce is not just a fad; it is the future and the consequence of the aforementioned technological advances. As a consumer, you get to pick what you want or need, in whichever color, shape, or size you desire. As a business, you get to target a global audience and to let your customers speak for your quality honestly.

Traditional retail will not perish, at least not soon. It has its purpose, charms, and advantages. In some cases, it is more cost effective while in others it flunks. Even though e-commerce and retail are often contrasted, it does not mean you only have an either-or choice.