• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Does e-commerce give a competitive advantage, and will it influence the future of business?

Extracts from this document...

Introduction

Does e-commerce give a competitive advantage, and will it influence the future of business? There is little doubt that electronic commerce has penetrated many people's, and particularly businesses', lives in one way or another during the past few years, but certain aspects of e-commerce are open to interpretation, such as; * What kind of businesses actually uses e-commerce? * What are the relative advantages and disadvantages of e-commerce? * Does it really give a competitive advantage? Data collected from the US (1999) shows the e-commerce percentages of total value in the following different business areas (See Appendix 1): Looking at this data, I could safely say 20% of the Total Value of Business Trades was e-commerce, which is a respectable amount considering how long e-commerce has been used for. This data shows Manufacturing and Merchant Wholesale Trade, (sectors where goods are sold to other businesses) had substantially higher e-commerce percentages than Retail Trade and Selected Service Industries (sectors where goods and services are sold to individual consumers as well as to other businesses). Looking closer at the percentages, if all manufacturing and wholesale e-commerce was entirely business to business trade and all retail and service e-commerce activity was entirely business to consumer, more than 90 percent of total e-commerce would be business to business. ...read more.

Middle

Egg estimates that 54% of Britons are now using interactive technologies, which is probably why they also report that a huge increase of 37.5% in online banking within the past 6 months, now standing at roughly 5.5 million online bankers. (See Appendix 3) Looking at egg's 5-year report from 1996 to 2000 (See Appendix 4), egg's net interest has gone up and up and up from �1 million in 1996, up by �3.8 million when they reached 1997, and most noticeably, particularly after the 1998 period, up to �10.5 million when Prudential launched the Egg business (www.egg.com) in October 1998, which shows fantastically how well electronic commerce, along with the huge boost in home technology and internet access has effected the company. This is shown as in the next year they reached �22.4 million net interest income, and up to an incredible �80 million by 2000, showing a 761% increase since the introduction of the Internet to the company. Also what is quite noticeable is the amount of egg customers, and how quickly they increased, not surprisingly after the 1998 launch of egg (which stood at 155,353 customers) ...read more.

Conclusion

To conclude, I strongly believe the potential to reach a global audience, and the potential to leave your business open at all hours, all the time, is a fantastic advantage for any company to have, not to mention the other advantages, which clearly outweigh the disadvantages I already mentioned earlier. This tied in with the demand for new technology, and the seeming consumer hunger for better service, and more opportunity opens up an amazing amount of potential. I wish to fall back onto two statements, which I feel sums up the beliefs of e-commerce perfectly, but still shows that e-commerce is only the beginning of what's to come in the future, and is defiantly a possible standard to what the world might see in future businesses. "The appetite continues to grow for new and exciting innovations that are either already on the market or on the technological horizon. Consumers have developed a liking for the value and flexibility that digital technology affords them, and are becoming increasingly confident in the possibilities of transacting online." - Mark Nancarrow, Chief Operating Officer, Egg. "No other aspect of e-business has garnered more attention then that of e-commerce. After all, consumers are expected to spend roughly $180 billion online in the next four years" - Spokesperson, IBM e-business solutions. Charles Mallah Economics & Business Coursework ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level ICT in Business section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level ICT in Business essays

  1. Marked by a teacher

    business online

    4 star(s)

    people older then this figure don't shop online but this age group shops online more then others. Maybe people older don't have great knowledge of accessing the internet and maybe old fashioned with minimum reliability of making transactions online. Income Income plays a great role in transactions made over the internet.

  2. For my business report I am investigating the Co-op erative society supermarket.

    For example suppliers have to be communicated to by either written documents or email to obtain supplies and the lines of communication have to be very clear to ensure no mistakes are made. Co-op mainly contacts its external customers, important potential business customers and senior sales staff by letters, telephone and fax.

  1. I have selected a nursery because there is high demand in the UK as ...

    business objectives hence my business objectives are: Jingle Bells will within the first three years in Nursery: > Establish the business name and reputation. > Increase profitability to 15% by achieving more bookings. > Achieve a market share of 10%.

  2. Advantages and Disadvantages of e-commerce in terms of easyjet

    elsewhere in the world, but an e-commerce presence can be available 24 hours a day. Reduces Barriers to Entry Because it is relatively easy to set up an e-commerce site, this breaks down some of the natural barriers to entry into markets, so firms can react quickly to new market opportunities.

  1. This coursework that I intend on completing will be based around setting up a ...

    Currently I am looking at the business to make a loss during the first few months. This is because the business will face various expenses incurred from start-up costs. However following a rough few months I hope the cash flow will potentially show to me a profit and not a loss.

  2. Business Online

    At times the media may create stories that would discourage customers to come to your store, therefore you would lose customers. On the internet customers/buyers are able to find out information about a particular business, its good and bad, it also provides chat rooms where different customers would debate on what is the best business to go to and why?

  1. In this coursework I need to produce a detailed business report on one medium-sized ...

    Tesco plc. is a national company, but it is becoming to multinational. Main objective is to make a profit. As Tesco is a limited company that means all owners have limited liability. If a company has debts, the owners can only lose the money they have invested in the firm.

  2. Sources of competitive advantage in Internet book retailing in relation to stock price

    This can also create arenas where word of mouth (or rather keyboard) makes the products more attractive. * Buying books on the Internet does not allow the customer to touch, feel or browse through the book. Thereby the consumer might be disappointed when receiving the actual product.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work