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Consumer Behavior and E-commerce

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Since 1995, technology has steadily advanced to the point that what was once a dream is now a reality. Instead of visiting brick-and-mortar stores to make purchases, consumers have more shopping choices because of e-marketplaces. What are e-marketplaces? E-marketplaces such as Jumia allow buyers and sellers to meet online to exchange goods, services, money, or information. Although Jumia is an e-marketspace (and opening brick and mortar stores without cashiers), its presence still affects traditional brick and mortar stores around the world.

Due to technological advances in the areas of e-commerce, Internet connection speeds, Internet security, social media, and mobile app development along with increased mobile device usage and faster shipping options, consumers have more shopping options than ever before. There are still those that prefer to shop in-store rather than online. According to an article from, 51 percent of Americans prefer e-commerce, and 49 percent prefer heading into an actual store.

E-commerce in Big and Small Businesses

Believe it or not, there was a time when e-commerce was only available to large companies. Why is this? Setting up e-commerce was expensive and involved a great deal of technical expertise. Depending on the amount of inventory available to sell, it could also be time-consuming. Big businesses had the in-house technical and marketing expertise along with more extensive budgets to purchase the necessary resources and equipment to either do it themselves or hire consultants to do it. Some of these resources consisted of hardware, software, and personnel (internal and external). As hardware and software updates become available for the e-commerce components, big businesses could readily purchase them to not only keep their operations going but also enhance them.

In the past, when it came to small businesses, it was unfortunately a different story. Small- to medium-sized businesses operated with a handful of employees doing multiple jobs to cut costs and lacked the financial resources to purchase the necessary e-commerce components to compete with their big business counterparts. Due to the nature of their size, small businesses’ expenses were typically higher. They also lacked the internal technical expertise to do it themselves along with the money to hire a consultant. Sometimes they relied on friends and volunteers to help fill those technical and staffing voids, which wasn’t always the best idea. As a result, they were either forced to abandon the idea of an e-commerce solution or implement it on a tiny scale because of limited resources. This might describe your business, but things are about to change.

Consumers have less disposable income to spend and want to make sure they are getting the best deals possible. They use price comparison apps on their mobile devices while shopping in-store and use price comparison browser add-ons and extensions when shopping online. Brick and mortar retailers often miss out on potential sales because their prices are not as competitive as those for similar items online.

With the new shift in how consumers shop, many brick-and-mortar stores that are not shifting their business models as economic conditions and consumers’ needs change have either gone out of business or are slowly going out of business. Other factors that contribute to them closing their doors include convenience, flexibility, and the popularity of e-commerce. Consumers value their time and money and e-commerce caters to both. Instead of visiting a brick-and-mortar store to purchase items, consumers are using the power of the Internet and their mobile devices to shop for goods and services while avoiding crowds, long lines, and limited product selections. With a press of a button, they can have their items delivered to their doorsteps or to a brick-and-mortar store to avoid shipping costs.

Why E-commerce?

Now that you know you can create an online store, the next question becomes why should you create one? Which of the following accurately describes you and your business?

You own a brick-and-mortar store and are considering adding an e-commerce component to become a click-and-mortar store where people can purchase in-store and online and have items shipped directly to them or your store.

You own a brick-and-mortar store but want to close it and sell strictly online.

You plan to launch an online store only to sell physical or digital products or services or both.

When it comes to e-commerce, most people have the Field of Dreams fantasy where they believe that if they build and launch an online store, customers will come. If only it was that simple and easy! It is always good to dream big but be realistic at the same time. Contrary to popular belief, e-commerce requires a lot of planning and work. No matter how well you design your e-commerce store, potential customers might never visit or make a purchase. On the other hand, your sales might not be as high as you anticipate. These are the realities that you must plan for.

Don’t let me scare you! E-commerce is not all doom and gloom. Depending on your purpose, e-commerce has its benefits.

Some of them include:

  1. Sell your products or services to a global audience.

Reduce overhead costs such as rent, utilities, and salaries due to doing business over the Internet.

Sell physical or digital products and services.

Unrestricted store hours, which allows you to sell 24/7.

Create and maintain your own store without paying expensive consultants to do it.

Sell to customers on any Internet-connected mobile device.

Improve customer service.

Setup is quicker and easier than a brick-and-mortar store.

Whatever reasons you have for adding e-commerce to your business model, always remember that first and always you will be in the people business. Without people with a need for your products or services, you won’t have a business nor a need to sell online.

With all its advancements and advantages, e-commerce has leveled the playing field by eliminating many barriers to entry that once existed and kept many businesses out. Today, anyone or any sized company can set up an online store with relative ease with low cost and efficient technology such as WordPress and WooCommerce. No matter what tools you use, your online store will only be as good as your plan. The same way you shouldn't build a house without a blueprint, you should not create an online store without one. Planning is essential. As the old saying goes, “If you fail to plan, you plan to fail.” The rest of this book aims to help you develop a plan and show you how to execute your plan. In the next chapter, you will learn why it is vital to create an e-commerce strategy and how to go about creating one.

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