Emergence of E-Retail

Topics: Retailing, Online shopping, Electronic commerce Pages: 7 (2171 words) Published: July 21, 2009

INTRODUCTION: The importance of the Internet as a marketplace has substantially grown over the past decade, even though expectations have been dramatically

tempered since early 2000. A distinctive feature of doing business electronically is that transactions no longer require the physical coordination of buyers and sellers: market participants find each other at their screens. There are many aspects of

market interaction which are affected by this online nature of trade. On the supply side, we may think of all kinds of cost reductions, resulting from new ways of organizing production and sales processes. On the demand side, the major impact of the Internet is on consumers’ ability to acquire information about firms and their prices.

E-R ETAILING : E -Retailing or E -tailing is the selling of retail goods on the Internet. It means buying items from a retailer’s website. Traditional retailers are quickly becoming the dominant online retailers because they are the best positioned to master the economics of online retailing and capture growing consumer demand.

"Online retailing is entering a new phase in its evolution," says Michael Silverstein, Senior Vice President and Global Leader of BCG ( Bosto n Consulting Group ) . What was once an industry characterized by entrepreneurial dot -coms, targeting the discretionary spending of the Internet -savvy consumer, is fast becoming the domain of traditional retailers, selling both necessities and discretionary items to the broader population.

H ISTORY : The term "electronic retailing," was used in Internet discussions from 1995. It had began to work for some major corporations and smaller entrepreners u from 1997 when Dell Computer reported multimillion dollar orders taken at its Website. The success of Amazon.com hastened the arrival of Barnes and Noble's e-tail site. Concerns about secure order taking receded. 1997 was also the year in which Auto-by-Tel reported that they had sold their millionth car over the Web, and Commerce Net / Nielsen Media reported that 10 million people had made purchases on the Web.

GROWTH A ND PERFORMANCE: Online retail is one of the fastest growing segments of the global economy. Increasing use of broadband has been the single, biggest influence on the dramatic growth of online shopping, according to a retail analyst. “As more and more consumers sign up to a broadband connection, the attraction of internet shopping i becoming even more s pronounced,” Angela Schorah, marketing and communications manager at Zendor. Any retailers who have not yet developed a multi -channel or online strategy need to move fast if they are to embrace this shift in consumer behavior and stay ahead of their competitors. The growth in online shopping sales shows no signs of slowing. In fact the latest statistics published by the IMRG (Interactive Media in Retail Group) shows that on 2007, the growth have risen to 75%. says

The following figure shows the hype of E-Commerce.

Some of the leading players in online retailing are “Amazon.com ”, ” Office Depot”, ” Staples”, ” Gateway, Inc. ”, ” Costco Wholesale ”, ” Barnes & Noble.com ”, ” Buy.com”, ”QVC.com ”, ” Spiegel Group” and ” J.C. Penney”

POPULARITY: Reasons for e-tailing becoming a hot opening can be attributed to many factors viz.


E-tailers do not have to maintain expensive showrooms or warehouses in prime locations, they operate through their web sites and thus save drastically on the real estate costs. The real estate costs in the metropolitan cities are sky high. Besides this, maintenance costs of a virtual store vis-à-vis a physical store is much less.


Information can be obtained easily and comfortably. On the Internet, product information is just a few clicks away, all accessed in the comfort of a home. Traditional retailing stands out in stark contrast: the consumer searches frantically,...
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