Intro

Introduction of E-Retailing:

E-retailing, also known as e-commerce or online retailing, has emerged as a transformative force in
the world of commerce over the past few decades. It represents the practice of buying and selling
goods and services through electronic channels, primarily the internet. E-retailing encompasses a
wide array of products and services, ranging from consumer electronics and clothing to groceries and
digital subscriptions.

Significance in the Modern Retail Landscape:

The significance of e-retailing in the modern retail landscape cannot be overstated. It has
revolutionized the way consumers shop, businesses operate, and economies function. Several factors
have contributed to the rapid growth and prevalence of e-retailing:

1. Internet Proliferation: The widespread availability of the internet, along with improved
connectivity and access through mobile devices, has opened up new avenues for consumers
to explore and engage in online shopping.

2. Technological Advancements: Innovations in technology, including secure payment

3. Changing Consumer Behavior: The increasing reliance on digital devices for information,
entertainment, and communication has naturally extended to shopping behavior. Consumers
now expect the convenience, variety, and accessibility that online retailing provides.

4. Globalization and Market Expansion: E-retailing has eliminated geographical boundaries,

Growth and Evolution:

E-retailing has witnessed remarkable growth and evolution since its inception. Initially, it primarily
involved the sale of books and electronic gadgets, but it has since expanded to include nearly every
conceivable product category. Some key milestones and trends in the e-retail industry include:

1. Marketplaces and Aggregators: The rise of online marketplaces like Amazon, eBay, and
Alibaba has provided consumers with a one-stop-shop for a vast range of products from
various sellers.

2. Mobile Commerce (M-Commerce): The advent of smartphones has given rise to mobile
commerce, enabling consumers to shop on-the-go through mobile apps and responsive
websites.

3. Subscription Services: Businesses are increasingly offering subscription-based services, such

4. Ecosystem Integration: Many e-retailers have expanded their reach by integrating services
like cloud computing, digital content delivery, and logistics into their business models.
 5. Innovative Fulfillment Methods: Innovations in logistics and fulfillment, such as same-day
delivery and click-and-collect options, have enhanced the convenience of online shopping.

In this rapidly changing landscape, understanding consumer behavior in the context of e-retailing is
crucial for businesses seeking to thrive in the digital age. Consumer preferences, expectations, and
habits have evolved alongside the growth of online retailing, and analyzing these behaviors is
essential for tailoring marketing strategies, improving user experiences, and achieving business
success. This report will explore the differences in how consumers behave when buying online
compared to the conventional physical store, shedding light on the unique dynamics and challenges
of e-retail consumer behavior.

2. Differences online and physical store

Certainly, understanding the differences in consumer behavior between online and physical store
environments is essential for businesses looking to adapt their strategies to meet customer
expectations in both settings. Here are some key differences in how consumers behave in these two
purchase environments:

What They Purchase:

 Online: Online shoppers tend to buy a wider range of products, including digital goods,
clothing, electronics, and groceries. Niche and specialized products are also more accessible
online.

 Physical Store: Physical stores typically focus on selling tangible products that customers can
see, touch, and try before purchase. They may offer a more limited selection compared to
online retailers.

When They Shop:

 Online: Online shopping is available 24/7, allowing consumers to shop at their convenience.
This flexibility often leads to purchases during non-traditional hours.

 Physical Store: Physical stores have fixed operating hours, limiting when consumers can visit.
Shopping is often done during store hours, which may be restricted.

Where They Shop:

 Online: Consumers can shop from anywhere with an internet connection. This includes
shopping from the comfort of their homes, offices, or while on the go.

 Physical Store: Consumers need to physically visit the store location to make purchases. This
limits shopping to specific geographic locations.

Why They Shop:

 Online: Online shoppers often seek convenience, a wide selection of products, price
comparisons, and the ability to avoid crowds. They may also shop online due to the
availability of discounts and promotions.
  Physical Store: In physical stores, consumers may value the tactile experience, immediate
product availability, and the ability to seek assistance from in-store staff.

How They Shop:

 Online: Online shoppers rely on digital platforms, such as websites and mobile apps, to
browse, compare products, read reviews, and make purchases. Search engines and social
media play significant roles in product discovery.

 Physical Store: In physical stores, consumers can physically inspect products, try them on (in
the case of clothing), and receive in-person assistance from sales associates.

Decision-Making Process:

 Online: Consumers often engage in extensive research, reading reviews and comparing prices
across multiple websites. Online shopping allows for a longer decision-making process.

 Physical Store: In physical stores, decisions can be more impulsive, with consumers making
choices based on what they see and feel in the store environment.

Returns and Exchanges:

 Online: Online shoppers may experience a higher rate of product returns due to the inability
to physically assess products before purchase. E-retailers often have lenient return policies.

 Physical Store: In physical stores, consumers can inspect products before buying, potentially
reducing the need for returns. Returns and exchanges typically follow the store's policy.

Payment and Security:

 Online: Online shoppers use digital payment methods like credit cards, e-wallets, and online
banking. Security concerns related to online fraud and data breaches are paramount.

 Physical Store: Payments in physical stores are typically made with cash, credit/debit cards,
or contactless methods. Physical transactions may be perceived as more secure.

Social Influence:

 Online: Online shoppers are influenced by online reviews, social media, and
recommendations from friends and influencers.

 Physical Store: In physical stores, consumers may be influenced by in-store displays,

Understanding these differences is crucial for businesses to tailor their strategies and provide a
seamless and satisfying shopping experience for consumers in both online and physical retail
environments. It allows them to meet the unique needs and preferences of their target audience in
each setting.

3. adoption of market

As of my last knowledge update in January 2022, I can provide you with some insights into the e-
commerce and online retailing scenario in Malaysia. Please note that the situation may have evolved
since then, so it's advisable to verify the latest information for the most accurate understanding of
the market.

Market Size:

 Malaysia has a rapidly growing e-commerce market. In recent years, it has witnessed
significant expansion, with an increasing number of consumers turning to online shopping
for a wide range of products and services.

Adoption Rate:

 The adoption of online shopping has been on the rise in Malaysia, driven by factors such as
increased internet penetration, smartphone usage, and a growing middle-class population.

 The COVID-19 pandemic further accelerated the shift to online shopping as people sought to
minimize physical contact.

Security Concerns:

 Like in many other countries, security concerns related to online shopping exist in Malaysia.
Consumers may have concerns about the security of their personal and financial information
when making online transactions.

 Businesses and government agencies have been working to improve cybersecurity measures
and raise awareness about safe online practices.

Infrastructure:

 Malaysia has made significant investments in digital infrastructure, including high-speed

 The country's digital infrastructure is relatively well-developed, supporting the growth of e-

E-commerce Players:

 Major global and local e-commerce players like Lazada, Shopee, and Zalora are active in the
Malaysian market.

 Many businesses, including traditional retailers, have established their online presence to tap
into the growing e-commerce market.

Payment Methods:

 Multiple payment methods are commonly used in Malaysia for online transactions, including
credit/debit cards, digital wallets (e.g., GrabPay, Touch 'n Go eWallet), and online banking
transfers.

 The availability of various payment options has contributed to the growth of online
shopping.

Challenges:

 Despite the growth, some challenges persist, including logistical issues in certain areas,
competition, and the need for businesses to build trust with consumers.
  Regulatory changes and evolving consumer preferences also pose challenges for e-commerce
businesses.

Future Outlook:

 The e-commerce and online retailing sector in Malaysia is expected to continue growing,
driven by factors like increased internet connectivity, smartphone adoption, and changing
consumer behaviors.

 The government and industry stakeholders are likely to continue working on initiatives to
support and regulate the e-commerce ecosystem.

Please keep in mind that the e-commerce landscape is dynamic, and market conditions can change
rapidly. For the most up-to-date information and insights on the e-commerce scenario in Malaysia,
it's advisable to consult recent reports, market studies, and government publications.