P2 - The impact on customers of the online presence of a selected business
An online shopping facility allows customers to order and pay for your goods and services over the internet. However there are many disadvantages and advantages of using an online presence:
Advantages
Reduced overheads – by having an online business you don’t have to put up with buying or renting a place for your business therefore the expenses of a shop are eliminated. Superdrug can therefore focus on building an attractive website for their customers and then can spend the money that they saved from not buying/ renting a place on hiring a specialist that can monitor the website at all times e.g. administrator.
Access to new customers – buy having an online business you will be targeting new customers all over the world and making your existing customers permanent as they are now able to access your product/services at all times. Superdrug can impress their new customers by having a personalised website and perhaps making them loyal.
Having an online business gives you the ability to compete with larger businesses on an equal footing – if you are a small business than to become an online business can be very beneficial to your company. This will enable you to then compete with much larger businesses because customers judge the business by the appearance of your website and not the size of your business. Superdrug can therefore go a long way by having a professional to satisfy their customers.
Gives customers access to products and services not available in their area – by being an online business, it enables everyone to access your products/services but if Superdrug was not an online business than not everyone could have an access to your products/services therefore you would have less sales and profit making it harder for you to compete and maintain your position in the market. Offers convenience and privacy for your customers – Superdurg offers a professionally personalised website to their customers according to their wants and needs.
Appealing to a wide and varied base of customers e.g. online shopping allows disabled or housebound people easy shopping. Special offers (cheaper online) – Superdrug offers many offers to their new and existing customer e.g. buy one and get one free or buy 2 items for the price of one.
Email feedback comments to the company – Superdrug has a very good website which allows their customers to feedback on their products/services or recommending any changes. This is a very easy and quick way for Superdrug to interact with their customers, as they are receiving a quick response at the cost of nothing!
Track your order – If you have bought a product online and still haven’t received it then you can track your order and can actually find out how long it will take until it reaches you as they email to inform their customers. Customers of Superdrug therefore have the advantage of tracking their order and can check where their product has reached if it’s being shipped from another country and how long it will take.
More convenient – by having a website allows customers to shop very easily and quickly. They don’t have to put up with the long queues and not finding the car park which makes it more convenient for customer, especially the elderly and disabled people who would find it very difficult to travel.
Comparing prices – by having an online business, you are able to compare prices and find the best deal!
24/7 access – having global availability is very important for any type of business to be successful. Having global availability means more customers can have access to your business at any day and at any time. Superdrug therefore is very fortunate to have an online business as they would be receiving a big profit.
Good customer service – good customer service is essential to any business’s bright future. Superdrug has indeed a very good customer service as they offer great deals and deal with customer’s complaint instantly showing that they care about their customers.
Customers can get information about the company – new customers of Superdrug can read company’s profile in their website if they are not familiar with Surperdrug or their products/services. This will benefit the customers because they can find out if the company is reliable and save to buy from, by making sure that they have a good reputation and are well known around the world.
Disadvantages
Payments online – the downfall for having an online business is that many people still can’t give out their card details because they feel that it can be accessed by a third party which is not safe. This would result in customer not buying from the Superdrug website therefore you might face decrease in sales and profit.
A lot of spoof websites - by having an online business, many fraudsters create a website that looks exactly the same as the original website, they do this to divert the customers to them so they can get their bank details when they buy something, which would then result in Superdrug losing their reputation and their loyal customers!
If the website they are buying from is not secure then hackers may be able to gain vital information e.g. fraud – it is very important that Superdrug website is well secured to ensure that their customers feel secured as well in giving out their bank details without any hesitation.
May not be computer literate – some of the users might not know the basic on how to use a computer which can be a downfall as they will not be able to use the internet therefore they will not be able to buy.
May not have access to the internet – some people have computers but most of them do not have the access to the internet as it costs to have a internet connection, this can be another major problem for the customer as the won’t be able to take full advantage of Superdrug’s online services and offer.
Brand loyalty - if your business has a bad reputation then the word could spread like wildfire. therefore make sure that your customers are happy and satisfied by your services/products at all time, which means that Superdrug’s staff has to be efficient in dealing with customers complaints and feedback comments and respond to them immediately to keep everything in under control.
Slow internet speeds can make websites slow for users – many people can’t afford to have high speed internet connection e.g. if a Superdrug customer has a dial up connection (56k) and logs into the Superdrug website, experiencing the web page not to open or taking too long to open then that would make the customer to just completely shut it down as many people will get impatient waiting for the website to open, resulting in the customer not being able to browse through the website.
Difficulties in delivering goods to worldwide customers – this can be one of the major downfalls to the customer, not receiving their goods immediately after they have ordered. Many businesses have problems delivering their products worldwide, this will be known as poor customer service therefore getting the product on time to your customers is essential, and when they receive their product on time they will be happy and spread good remarks about your product and service getting you more new customers!
P3 – Creating My Website
To make my website I used Microsoft FrontPage as a web-authoring tool. I chose this because it was available and much easier to use than Macromedia Dreamweaver, as it was the first time I was making a website so I wanted to start with a simple software to get me going.
Ensuring that my website complies with national and internal legal requirements:
The Data Protection Act, (DPA) 1998:
DPA is a British Act of Parliament that provides a legal basis and allowing for the privacy and protection of data of individuals in the UK. The act places restrictions on organisation which collect or hold the data which can identify a living person. The act does not apply to domestic use, for example keeping a personal address book.
Companies must comply with 8 principles of good practice. The data must be:
- Fairly and lawfully processed
- Processed for limited purposes
- Adequate, relevant and not excessive
- Accurate
- Not kept longer than necessary
- Processed in accordance with the rights of the data subject
- Secure
- Not transferred to other countries that do not have adequate protection
The Trade Descriptions Act, 1968
The Trade Description Act, 1968 is an Act of the Parliament of the United which prevents manufactures, retailers or service industry providers from misleading consumers as to what they are spending their money on. The Act makes it a criminal offence for a trader to describe goods falsely (including on a website). The two main offences under the Act are:
- Applying false description to goods or supplying goods with such a description
- Making false statements about the provision of services accommodation or facilities.
This law empowers the judiciary to punish companies or individual who make false claims about the products or service that they sell.
The Sale of Goods Act, 1979
States that all goods must be:
- Wherever goods are bought they must ‘conform to contract’. This means they must be as described, fit for purpose and of satisfactory quality (e.g. not inherently faulty at the time of sale).
- Goods are of satisfactory quality if they reach the standard that a reasonable person would regard as satisfactory, taking into account the price and any description.
- Aspects of quality include fitness for purpose, freedom from minor defects, appearance and finish, durability and safety.
- It is the seller, not the manufacturer, who is responsible if goods do not conform to contract. If goods do not conform to contract at the time of sale, purchasers can request their money back ‘within a reasonable time’. (this is not denied and will depend on circumstances)
- For up to six years after purchase (five years from discovery in Scotland) purchasers can demand damages (which a court would equate to the cost of repair or replacement).
- A purchaser who is a consumer, i.e. is not buying in the course of a business, can alternatively request a repair or replacement. If repair and replacement are not possible or too costly, then the consumer can seek a partial refund, if they have had some benefit from the good, or a full refund if the fault/s have meant they have enjoyed no benefit.
The Consumer Protection Regulations, 2000
Consumer Protection is a form of government regulations which protects the interest of consumers. For example, a government may require businesses to disclose detailed information about products – particularly in areas where safety or public health is an issue, such as food. Consumers protection is linked to the idea of consumer rights (that consumers have various rights as consumers), and to the formation of consumer organisation which help consumers make better choices in marketplace.
The Copyright, Designs and Patents Act, 1988
There are also important laws and regulations governing the copying of ideas, and products. The Copyright, Designs and Patents Act 1988 provides rights to authors not to have their work copied and sold without their management. Today it also applies to computer software, as well as all sorts of publication. It is illegal to copy software or to sell copies of manuals that come with the software, without the permission of the copyright holder. It is also against the law to run software on more than one computer at the same time unless you have purchased a multiple license.
How I made my website, from step 1 to 10!
- Firstly, before I started to do anything I checked to see if I had access to the internet, if not then I would need to find a suitable Internet Service Provider (ISP) e.g. NTL, this would then provide me with a username password and access phone number allowing access to the Internet and World Wide Web where you can host your website. However, this is what I would have to do if I was making the website at home, but because I was making the website in college I was provided with the internet connection.
- The second thing I did was to decide what type of business I’m going to have along with the name of the business (universal shoes) and what sorts of products and services will I offer to my consumers in order to be competitive.
- After I had decided what business I’m going to have, the next step is to decide from a range of authoring tools I can use such as Microsoft FrontPage, Macromedia Dreamweaver and Macromedia Flash, depending on the resources available to me.
- Now, before I started to use Microsoft FrontPage to make my website, I came up with the design/layout of what my site should look like, and the content of the site.
- I was now ready to get started on my website straight away. I opened Microsoft FrontPage and saved 4 pages in my documents with their headings e.g. homepage, women’s shoes, men’s shoes and children’s shoes.
- The next step was to, log into the internet and find suitable pictures for my website. After that I opened Microsoft FrontPage and saved all the relevant pictures in my folder.
- I then started to decide which colours I am going to use for each page. I gave a pale green colour to the homepage, a pink colour for the women’s page, a blue colour to the men’s page and finally a pale yellow colour for the children’s page.
- The next step was to start putting the images on to the website. So firstly I made a text box and placed the image in the box with its details and price e.g. flat boots (brown) - £54.99 and I did that for each page. I also included a navigation box on the homepage with hyperlinks linking to each page.
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My website was now complete and the only thing left to do was to register my website. I then went to to register my domain name. I then found a domain name which never had been registered before by anyone. This is now my website’s address .
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Finally, the last thing was to find a server that will host my work (website). There are hundreds of sites that will give me all the space I need as well as tools for building and editing my site. Such as and . I then registered my website with several browsers e.g. Yahoo and Google.
P4 - Key business opportunities arising from an online presence
Opportunities for greater processing efficiency
Online order tracking and monitoring – one of the main benefits of an online presence to an organisation is the way in which it enables online order tracking. For instance, if you have bought a product online and still haven’t received it, then the order tracking system allows you to track your order to see where it has got to and how long it will take until you receive it. I once had ordered an Alienware laptop from the official Alienware website and I tracked my order to see how long it will take, as it was coming from Ireland. I then found out that the laptop was going through 9 steps to check everything before it reaches the customer and I still had to wait for 2-3 weeks. This is a very useful and helpful method for having online business. As this is a very fast and simple procedure to track your orders.
Integration of supply chains – from the business point of view there are many benefits in the integration of supply chains. The supply chain includes all the steps involved in bringing goods to the final consumer. The online business supply chain is; a producer selling to an e-tailer, the e-tailer then sells to the customers. This method of supply chain has more benefits to the customer in many ways e.g. when you order something online and you see the product is not in stock and you can’t click on it to confirm your order as it is not available in stock, this really happens nowadays. If you do online shopping then you have 95% or even more certainty in finding the product you looking for on the spot, not just that the product will be much cheaper. Online businesses use the modern electronic data interchange systems to transfer data electronically to view information such as how much stock we need. The overall effect of EDI is to massively reduce costs in a range of industries.
Online payments - online payments system often mean that businesses which trade electronically are able to receive money payments more quickly and more securely, with a reduction in bad debts (non-payment), because customers are expected to pay immediately by credit card or other means of electronic payment. Online transaction processing involves settling payments as they occur. You will experience this when you buy mail-order goods, order from a supermarket on-line, or buy travel, sport, and theatre or concert tickets to a Coldplay concert online your payment will be processed while you are making the transaction. For instance, I paid online for my Thorpe Park tickets, which also allowed me to get discount. They then send you a confirmation email with all your details and the amount you paid; you then just simply print that out and take it with you to show it at the entrance. Bad debt – money that is never paid back.
Freedom of locations – by trading online many businesses are free to change location to a low-cost area. Some businesses such as banks have exploited the online advantage by transferring their activities to offshore tax havens such as Jersey in the Channel Islands where taxes are lower then in the UK. For instance, if you were not an online business then you would have to base your business in an appropriate place, preferably in a crowded area where many people visit everyday. For that you would have to pay a much higher rent which you might not be able to afford therefore you would have to base the business somewhere else which perhaps won’t be very beneficial. So in comparison you would have the freedom of locating your business anywhere on the internet and would be relatively cheaper.
Human resources – e-business has also made it possible for business to re-organise their human resources, e.g. your able to work from home and don’t need to rent out expensive offices. Increasingly work involving e-business activity is being outsourced by companies to places where labour costs are cheapest. In 2003 and 2004 we saw many of the UK banks and even BT outsources call-centre work to India. People in work places are far more reliant on computers to manage and support their work online.
Opportunities for enhanced competitiveness:
Constant global web visibility – an attractive website gives constant global visibility. For instance, you can log into Ebay at any time and any day to buy or sell products. You will therefore be receiving more profit while you’re at home targeting customers all over the world!
Keeping track of competitors – another advantage to businesses is that they can be much more aware of what their competitors are doing, as a result of ongoing research into rival websites. This then allows companies to plan ahead of their competitors in order to become the leader in the market or to maintain your position in the market. For instance, if you find out that your competitors are launching a new product, then you can work according to that and produce something better than your competitors in order to steal their customers.
Lowering barriers to entry – another important advantage of operating online is that barriers to entering many global markets have been lowered. For example, a small manufacturer of specialist high quality chocolates in the past probably had to concentrate largely on its own local market. Perhaps it had a link with a foreign distributor, but that would involve sacrificing some of the profit to agents. Now even the smallest business can trade globally, provided that transport costs make up only a relatively small part of the overall price.
Keeping track of customer preferences – an online presence also provides the capacity for increased awareness of and responsiveness to changing customer preferences. When internet surfers make a ‘hit’ (visit a site), they provide useful marketing information on the host site. It provides information about the location of visitors, and the intensity of their interest in a particular subject. For instance, if many people are visiting your website on a particular page e.g. games page, then have that page set as a homepage so you’re catching peoples attention straight away. You are able to check customers profile as well e.g. male/female, address, hobbies, interest etc. This is very important information and according to this information you can make your product and services e.g. if you find out that many of the customers that visit your website are females then you can products/services that will attract all ages of females.
Improving delivery – you have already seen the importance of punctual delivery and online order tracking, and these provide important competitive advantages. This is particularly true in the business to business world, where just-in-time delivery lies in the heart of many manufacturing processes.
Diversifying sources – another opportunity provided by online trading is that of wider product range and lower supply costs through more diversified sourcing. For example, some of the low-cost retailers such as Primark wouldn’t buy stock from mass-market manufacturers and suppliers, therefore having an online presence help you to search for better and cheaper deals and then you can trade over the internet. You won’t be looking at one manufacturer or just one supplier but rather you would be buying from range of suppliers who can offer better deals, in other words you’re able to select the cheapest supplier instead of always buying from the same one.
Developing brands – a successful brand is developed by identifying consumer needs, designing the brand, making it efficiently and creating a unique position for it in the market. A successful brand is then managed by monitoring lifestyle changes, exploring technological change, measuring brand performance, monitoring change in distribution and maintaining the unique positioning. There are four stages in developing a successful brand. Brands rarely become successful overnight. It takes time to achieve a good reputation and for that reputation to be recognised e.g. identifying consumer needs, designing products, producing the brand cost effectively and creating brand positioning. By having an online presence your brands and logos are restricted in any way and therefore you are able to promote the brand, and spread awareness of the business all over the world.
Opportunities for service support:
Staffs have access to business information while away from their office – this can occur in a number of ways, ranging from email access (which keeps an individual in immediate and direct communication with others at work), to the latest information for use in dealings with third parties, for example in sales meetings, businesses are able to keep huge quantities of information on centralised databases which can then be made available to employees wherever they are located – working from home, working abroad with customers, and so on. This is a tremendously powerful opportunity because it does not tie employee to a particular location, and they don’t need to carry around large quantities of paper records as they can use laptops for fast and easy access to all their data.
Access to instructions – set up instructions for equipment can be made available online. For instance, the huge global engine manufacturer Cummins provides online tutorials for its customers, enabling them to install, set up and maintain engines although they may be hundreds of miles away from a Cummins technician. As a result you would be saving a lot as you won’t have to train your staff.
Problem solving and feedback – business are often repeatedly asked for answers to the same type of problems – these are ‘frequently asked questions’ (FAQ). For instance, these may be about:
- how to install or get help with a product or service
- complaints about the way in which the business is being run
- a company’s history, policies or activities
- product and service information
Rather than responding to all these questions individually over the telephone or by letter, a company can save money by setting out clear and understandable answers online. Customer’s feedback pages also provide an opportunity for customers get their views across, and are an important part of the market research as the customers will be telling you what you lack in your business and perhaps what are your strength and how to maintain that.
M3 - How an online presence facilitates greater freedom of business operations
There are many ways in which an online presence facilitates greater freedom of business operations. Consider the following:
Location – you don’t have to be located on busy, expensive high streets. The advantage of having an online presence is that you have the freedom of locating your website anywhere on the internet and the rent would be relatively cheaper compared to renting a place on the high street. One other important thing is that, you wouldn’t need to expand the business in terms of making buildings worldwide or renting offices.
24/7 – by having an online presence you have the freedom of not being restricted to opening and closing hours. In other words for example, if you were an offline business you would open your shop at 9am till 5pm whereas being an online business gives you all the freedom and allows you to keep your business running 24 hours a day and 7 days a week. By having an online business gives you the freedom of reaching to customers worldwide and you’re not restricted to selling to customers in just one small area. Having an online presence also allows you to operate your business from home.
Lower costs – running an online business is much affordable compared to an offline. Therefore you would have low costs for thing such as labour, less staff, extra stock, etc. If you are not spending a big amount of money on these things then it’s resulting in a high profit. That is why most businesses are becoming online presence to enable greater freedom of operations.
Small business – customers judge the business on the appearance and usability of its website, not on its size. Small business can therefore compete with much larger ones, because there is less brand loyalty online.
Diversification (selling different types of products) – by having an online presence allows you to have greater independence in terms of selling diversification products online. In other words, there is less restrictions on goods being sold e.g. you are able to sell larger products and a wider range of products due to not being limited to a small place because once you have made a website you are eligible for as much space as you would like at a very low cost.
Advertising - The cost of spreading your message is next to nothing if you have an online business. Emailing your subscription base is more often cheaper than sending a letter through the mail e.g. to get your message across to your customers either about a certain product/services or any offers which allows them to have discount can be very cheap through emailing but if you’re an offline business then this whole process can cost a lot, and for some offline business at this point can’t afford all the advertising therefore their business is not a success. This is a great advantage to the online business as they are getting greater freedom of advertising at very low expenses therefore you are able to attract customers attention over the world, from your competitors, which also mean improved cash flow and fewer debts.
D1 – evaluate the extent to which the website you created may both; attract customer interest and facilitate greater freedom of operation.
I think my website will certainly attract customers to a certain extent.
Ways in which my website attracts customers:
One of the obvious ways to attract customers to my website is by making my website look colourful and presentable. I made sure that everything is neat and spread out over the page and not clustered in one corner, which would make it look unprofessional and would drive my visitors away.
My website also includes range of products which allows many customers to choose from the ones they like. The thing that would attract customers to my website is that I have shoes for women, men, shoes for kids as well for every occasion.
The other way that I would attract customers to my website is that by having a unique name for the business that stands out, the advantage in the unique name is that by looking at it you know straight away what the business does (Universal shoes) its more precise and would attract customers straight away. My website is pretty straight forward to use and would be easy to find on any search engines such as Yahoo and can be seen worldwide (). Even if someone is not a computer illiterate they can use my website by following simple instructions and guidelines.
I think my website is able to operate with greater freedom to a certain extent. In terms of location my website definitely has the freedom of being located anywhere online. Whereas I would have difficulty paying the high rent for a shop in a busy area and half of my profit would be used to pay the rent. My website also sells diversification products online which would attract customer’s attention all over the world e.g. shoes for party wear, formal wear, school etc. My website certainly is able to operate with greater freedom in terms of lower costs – running an online business in much affordable compared to offline therefore my website wouldn’t require thousands of pounds to run and then it would mean that I would also have lower costs for staff, labour and the use of modern electronic data interchange systems to transfer data electronically to view information such as how much stock we need would make business much easier to handle. In other words low overheads costs result in high profits.
Another way that I may attract customers is by the use of good quality pictures that lets the customers have a good look at the product and also allow them to enlarge individual image for details so the customer is satisfied before they can purchase anything. Compared to the amount of writing (text) on my website I have more images presented which would attract customer’s attention straight away. In terms of hiring a specialist for the success of my business I believe that even if I had to pay a little more than expected to hire them, than it’s still worth the effort as it will make my website look more professional and will continue to attract more customers. Hiring a specialist such as a consultant that can give customers advice through email on which shoe to wear with which outfit and keep you dated with what’s happening in the industry of fashion today along with the latest tips. Hiring an I.T specialist would mean that the website would be monitored all the time and keeping the website up to date with special offers and the latest products. If all are working as a team than your just moving one step closer to success.
Conclusion
I think customers will be attracted to my website to a certain extent as I have some great features on display for the customers to look at in detail. However I feel that I could have added a lot more features to make my website competitive. I felt that my website lacked a few things e.g. no FAQ page, not giving customers the opportunity to able to give their feedback which is essential in order to be competitive and meet all your aims and objectives. The other thing that I felt was missing is the cart page, which allows customers to buy the products online from your website; by not having this most important feature on the website, I felt that this was the most downfall side to my website. I think by adding few things like perhaps a game or quiz page on my website would definitely attract customer’s attention.
The other weaknesses that I see in my website is not having any information on the history of the business e.g. how it started, who was the founder etc. Having information about the history of your business allows the customers to visualise the effort you put in to start up your business and what obstacles you had to face, this also gives the sense of your personality in terms of how hard working and ambitious you are to achieve your goal.
The other thing I’d like to mention is that there is no contact detail on my website which means there won’t be any communication between the seller and the consumer, the seller can’t promote the products/services to its target audience and the consumer can’t give feedback or would have unanswered questions/queries that would drive the customer away which is the last thing you want. Another vital point is to locate your warehouse close by, so when you need to deliver the product to its owner you should be able to do it efficiently and swiftly in order to deliver the product in time and to make sure your customers are satisfied with the service you provided.
I think my website facilitates greater freedom of operation to a certain extent. My website is certainly strong in some operations such as diversification, 24/7, location etc. However some of the operations that I felt were considered to be less important while making the website which tends to be the most vital part of a business was advertising. I think my website won’t be successful in terms of spreading the message because my website doesn’t have a lot to offer in terms of special offers or any other services which is again a downfall to the business success. The only way this can be done is to promote and publish about my website and advertise on popular websites such as ebay, this way I will be attracting many customers to have a look at my website which would result in a rapid increase in profit!