The Impact of the Internet on Retail

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Introductory Business Studies

Nowadays, the development of the Internet is faster and faster. And it has brought some effects on our social life, for example, it is changing the retail industry gradually, both in content and structure. Today we will discuss main four impacts of the Internet on retail , which are, ⑴Internet promotes retail business prosperity by reducing cost;⑵Internet helps retailers enlarge market share; ⑶Internet creates a new form of retailing----e-retail; ⑷Internet brings crisis to bricks & mortar retailers.

Internet promotes retail business prosperity by reducing cost As we all know, if a industry want to be prosper, the people related to it must be willing to developing it. Therefore,If the retail industry want to be prosper, sellers and buyers must be willing to selling goods and buying them. However, what factor can lead them to do it? The answer is “ Lower cost”.”The Internet market can reduce costs, including fixed costs and variable costs, for both buyers and sellers.”(Lulu Yang, 2009) Yang believes that, to buyers, these costs include the opportunity cost of time spent searching, as well as associated expenditures such as driving, telephone calls, computer fees and magazine subscriptions. Similarly, sellers face costs in identifying qualified buyers for their products, such as market research, advertising, and sales calls. For instance, quite a few internet-based technologies lower buyer search costs. Many sites help buyers identify appropriate seller offerings. Internet can also lower the cost to buyers of acquiring information about the reputations of market participants. The Internet lowers seller search costs as well, by allowing sellers to communicate product information cost effectively to potential buyers, and by offering sellers new ways to reach buyers through targeted advertising and one-on-one marketing. By reducing costs on both sides of the market,...
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