Electronic Commerce Semester 1 Term 1 Lecture 25

Changing Retail Industry Dynamics Overbuilding and excess supply Changes in consumer demographics, with more premium placed on efficient use of time Changes in consumer behaviour, with less focus on brand name and more on lowest prices Technology improvements that provide greater convenience and more information than traditional retailing

Overbuilding and Excess Capacity With online retailing, constraints of time and space disappear There is bricks and mortar storefront to worry about, no critical locations This new way of retailing can severely affect companies that have invested in expansion and adding capacity It is important to understand the trouble traditional retailers face with the event of on-line retailing

Demographic Changes Shopping patterns are changing with the increase of time-strapped, two-career couples and the aging population Calue and time management are the onsumer concerns driving interest in online retailing As technology improves, driving to a store has given way in many cases to online shopping with home delivery

Consumer Behaviour Consumer behaviour is more volatile than ever before, and companies need new ways of responding to consumer needs and satisfying demand The real differentiating characteristic for retailers will be their ability to define what specific consumers are looking for, identifying characteristics of consumers in each target segment and learning how to bundle products and package brands so they become the preferred choice of online customers

Technology Improvements in Electronic Retailing Today, electronic retailing is still far from being a serious competitive threat to more traditional store retailing in most industry sectors But it is becoming increasingly attractive as technology and applications improve and retailers gain experience Three dominant forms of electronic retailing channels are: television retailing, CD-ROM retailing and online service based retailing, including web-based retailing