Unit 2 Business Skills For E-Commerce Assignment Help
Business (chosen industry):
The FMCG industry is chosen here to discuss how it can be benefitted by using e commerce. Other industries like fashion, media, education etc have seen higher growth rate than FMCG by implementing e commerce in their business. Though it has several challenges, at the same time huge opportunities and scope are there to be the fastest growing e retailing industry in UK. (Bushry, 2005)
As per Institute of Grocery Distribution, UK grocery sector revenue will increase to £184bn by 2016. Recently some giant retail firms have grown the online business such as Tesco, Sainsbury, Asda, Morrison etc. (Dholakia, 2002).
The reason of growth is laid in the benefits of e commerce over the conventional and traditional commerce is discussed below.
Target Audience: The audience or the target customers of traditional grocery shops are the nearby customers to whom it is the most convenient options. But with the advent of e commerce in FMCG the target audience could be across the geographical boundaries and the customers will get wide choice or options to choose from. For example, the online selling services of Tesco or Asda provide opportunities to targeted customers order from a variety of options online. Anyone who is availing internet services can place the order from their home and they need not go to separate stores, in a single website of the company target customers can get all. The advertising massages are also targeted to the particular customers. (Turban & King,2003) Any offers or promotions Tesco directly mail to individual customers that they can avail the deals. The channel members or different companies are also audiences of Tesco, thus order placing, delivery information, warehouse management etc are done efficiently than traditional businesses.
Low Cost: The cost of e commerce is lower than traditional one. For example to start up a business in traditional approach it needs a place on rent or own, employees to recruit, advertising in print , broadcasting media, warehousing etc includes huge cost. On the other hand the cost of implementing e commerce approach is efficient and cost effective. It does not require organising a place or brick and mortar shop to sell the product. (Tassabehji,2003)The cost of selling from website is low. Advertising and informing the promotional offers to the customers are also less expensive. Customers are communicated individually through email, open forum discussion that helps in targeting them in low cost.
Better Maintenance: The systems are used in e commerce better than the traditional business. The process is automated here and any customers orders, feedback, payment, inventory details, company’s order processing, database management, suppliers and vendors details all are automated . By clicking on the options organisation can avail all the data, nothing has to be done manually. (Qin, 2010)
24/7 Service: In e commerce customers can avail any services of the organisation from anywhere, any point of time. Virtual store is always open for them. In traditional marketing customers are bound to maintain shop timings though they have huge work to be completed.
The below figure will give the example how ecommerce has influenced the offline sales of UK FMCG industry.
(mecglobal.com, 2016) It is clear that the e commerce influenced sales is higher than traditional sales.
Some examples also can be given from popular brands ecommerce approach. The famous Mondelez, has tie up with facebook to sell coockies online by promoting through video that will target directly the impulsive customers. In UK they have taken long term initiatives to market Oreo and Cadbury through e commerce platform to achieve “digital storefront in Facebook.”
Unilever, another giant organization, promoted their Maille Mustard Brand through their e- commerce platform and planned to increase their growth by 40% in the year 2015 to be more digitized and gain maximum return on investment.
The following pie chart will show how the internet purchasing has increased in 2015 by using
From the data it can be said that the numbers of internet users are increasing day by day and almost all have become slave of mobile and computer due to various facilities. Thus it can be a beneficial option over traditional businesses.
The FMCG products are such that is needed lesser involvement of people and risk is also less. It is daily consumed and thus it needs to replenish the stock as soon as order comes in the traditional shop. If the organizations adopt ecommerce it is going to sell their products more as now everyone as lesser time in hand to go to the different store everyday and purchase different products. Thus it is better to market online for customer’s convenience, marketer’s convenience in targeting them without lesser effort and cost in a systematic manner. (Whiteley, 2001) Order Now