A MINOR PROJECT REPORT

ON
“A study of impact of E- Commerce on
Emerging market”

Submitted in partial fulfilment of requirement of Bachelor

of Commerce (Hons.)

•
B.Com (H)-II Semester (Evening) Batch
2020-2023

Submitted to: Submitted by: Ms. Vidya Sharan Adarsh

Kumar Jha Assistant Professor IPU139775
JIMS engineering management technical campus
(JEMTEC)
Greater Noida

1
Acknowledgement
The present work is an effort to throw some light on ‘a study of impact of E
commerce on emerging market .
With deep sense of gratitude, I acknowledge the encouragement and guidance
received by my project guide MS.VIDYA DIYANEE SHARAN She has been a
constant guiding force and source of illumination for me. Without her
supervision and motivation, the work would not have been possible. I would
like to thank her for her valuable advice and guidance.
I would also like to express my warm thanks to all the people for their valuable
ideas, suggestions,support and guidance.

ADARSH KUMAR JHA

JIMS greater Noida

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STUDENT’S UNDERTAKING

The project on the ‘study of impact Of ecommerce on

emerging market is completed under the guidance of
Ms.Vidya diyanee sharan is the original work done by me
and it has never been submitted elsewhere.
ADARSH KUMAR JHA
IPU139775

UNDERTAKING

THIS IS TO CERTIFY THAT Adarsh kumar jha of B.COM (H) has completed his
minor project on ‘study of impact of ecommerce on emerging markets who
carried out the project under the partial fulfillment for the award of the degree
of B.COM (H) of JIMS engineering management technical campus under my
guidance and her work is up to my satisfaction. This project work is original and
not submitted earlier for the award of any degree/ diploma or associate ship of
any other University/Institution.

MS.VIDYA DIYANEE SHARAN

[ASSISTANT PROFESSOR]

CONTENT

1-
Acknowledgement……………………………………………………………………………
……………………………..2 2- Student’s
undertaking……………………………………………………………………………………
…………………3

3 -Executive
summary…………………………………………………………………………

…………………………………4 Chapter 1:

1.0 INTRODUCTION
1.1 Background of the study………………………………………………………………………8
1.2 Statement of problem…………………………………………………………………………..9

1.3 Objective of
thestudy……………………………………………………………………………10

1.4 Research
Hypotheses………………………………………………………………………….12

1.5 Significance of the

study………………………………………………………………………14

1.6 Scope and limitation of the study……………………………………………………..15 1.7

Definition of terms………………………………………………………………………….17 1.8
Organization of the study…………………………………………………………………18

Chapter 2:
2.0 LITERATURE REVIEW

Chapter 3:
3.0 Research methodology…………………………………………………………………….20
3.1 sources of data collection……………………………………………………………………24
3.3 Population of the study…………………………………………………………………….27 3.4
Sampling and sampling distribution……………………………………………………….30 3.5
Validation of research instrument………………………………………………………….34 3.6
Method of data analysis…………………………………………………………………..40

Chapter 4:

DATA PRESENTATION AND ANALYSIS AND INTERPRETATION

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4.1 Introductions ……………………………………………………………………………….45 4.2
Data analysis……………………………………………………………………………………49

Chapter 5:
5.1 Introduction …………………………………………………………………………………………50

5.2 Summary…………………………………………………………………………………………….52
5.3 Conclusion…………………………………………………………………………………………..56

5.4 Recommendation…………………………………………………………………………………….60

APPENDIX
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EXECUTIVE SUMMARY

Electronic commerce may have large economic effects in the future. Internet commerce will
change the face of business forever. Moreover, e-commerce will change banking in 21st
century. The e-commerce has affected the global economy in many different ways. First of
all, it has affected the information technology, and all the economic sectors, all and above e
commerce has enhanced the productivity growth worldwide and here we are going to discuss
this impact, they are able to identify the number of qualified people needed to advance their
country’s information economy or to calculate the amount of investments needed to provide
business with access to the internet. Some countries are already benefiting from the results,
they are now in apposition to benchmark their economies with competitors internationally and
there are many ways to accelerate the growth of productivity but the reason for this is rather
controversial. Banks and financial services companies in the developing countries will need
to adopt online payment system, to obtain e-trade finance and equity investment, tourism
and its internet incarnation is regularly cited as one of the fastest growing ecommerce
sectors.
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CHAPTER 1:
INTRODUCTION OF
TOPIC
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INTRODUCTION .

Background of the study

E-commerce, is more than just electronics and commerce added together. It represents an
entirely new way of doing business over a medium that changes the very rules of doing
business. It is therefore, far more about strategy and business management than it is about
technology. E-commerce and the internet, if correctly utilized for development, can be
instruments for ensuring future sustainable economic growth [1]. Throughout the world, the
profound impact of electronic commerce in the economics and societies of the glob will no
doubt improve economic efficiency, competitiveness, and profitability (for those engaging in
e-commerce) and, therefore result in the development of the information society.
E-commerce and the new emerging digital technologies and services can be tools for
development and help improve the livelihood of millions across the globe, by linking up
remote regions and bringing together scientist, administrators development professionals,
managers, and people into projects and programmes to promote economic and social
development The Internet revolution was really about people customer and fundamental shift
of market power from the seller to buyer. In the new economy customers expectations are
very different than before. A company understanding of this difference and its ability to
capitalize on it will be the key to success. The web, the internet and emerging computing
and communicatin technologies have redefined business erasing traditional boundaries of
time and geography and creating new virtual communities of customers and suppliers with
new demand to product and services. E commerce only forms a fragment of e-business.
Earlier companies had web sites displaying the company products etc. then they started to
use the e-commerce as one of the distribution channel in addition to the existing system for
sales that is e-commerce. The term Electronic commerce or e-commerce consists of all
business activities carried on with the use of electronic media, that is, computer network. It
involves conducting business with the help of the electronic media, making use of the
information technology such as Electronic Data Interchange (EDI). In simple words,
Electronic commerce involves buying and selling of goods and services over the World Wide
Web. Customers can purchase anything right from a car or a cake sitting comfortably in his
room and gift it to someone sitting miles apart just by click of a mouse. Shipping method is
generally used for the delivery of the goods ordered. Every Bank which is highly leading now
performs their transaction through computer and computer is not only the concept can make
off the transaction automatic. All the commercial application now transfers to the concept of
e-commerce and is one of the very important aspects for carrying bank transactions falsity.
In the commercial world surrounded by highly competitive and volatile market conditions,
any new concept or technology would be acceptable only if it provides strong benefits to all
concerned. Ecommerce offers some distinct advantages. The E-commerce is more than just
electronics and commerce added together. It represents an entirely new way of doing
business over a medium that changes the very rules of doing business. It is therefore, far
more about strategy and business management than it is about technology (ILO, 1999).
E-commerce and the internet, if correctly utilized for development, can be instruments for
ensuring future sustainable economic growth through the promotion of retail businesses in
Nigeria. Throughout the world, the profound impact of electronic commerce in the economics
and societies of the globe will no doubt improve economic efficiency, competitiveness, and
profitability (for those engaging in e-commerce) and, therefore result in the development of
the information society. E-commerce and the new emerging digital technologies and services
can be tools for development and help improve the livelihood of millions across the globe, by
linking up remote regions and bringing together scientist, administrators development
professionals, managers, and people into projects and programmes to promote economic
and social development (Goldsmith & McGregor, 2000).

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The general category of e-commerce can be broken down into two parts which are E
merchandize and E-finance.

E-merchandiseis area that concerns the retail business and the focus of this study. E
merchandize involves selling goods and services electronically and moving items through
distribution channels, for example through internet shopping for groceries, tickets, music,
cloths, hardware, travel, book, flower or gifts. Ahmed (2001) reported that the enormous
flexibility of the internet has made possible what is popularly called e-commerce, which has
made inroads in the traditional method of business management. All facets the business
tradition with which we are accustomed in physical environment can be now executed over
the internet including online advertising, online ordering, publishing, banking, investment,
auction and professional services.

E-commerce involves conducting business using modern communication instrument:

telephone, fax, e-payment, money transfer systems, e-data inter-change and the internet. E
commerce is not only a new technology and a new frontier for global business and trade, it is
also still evolving. It is essential, therefore for Nigerians to understand in detail what is e
commerce, what are their challenges, and opportunities it holds, lastly what can be done to
harness the benefits from e-commerce. All these are being focused upon in this study.

It is important to elaborate on the definitions of e-commerce as that will help determine the
scope of the technology and how it can be applied into retail business. E-commerce has
been simply defined as conducting business on-line. The organization for economic
cooperation and development (OECD) defines electronic commerce as a new way of
conducting business, qualifying it as business occurring over network which use
nonproprietary protocols that are established through an open standard setting process such
as the internet (OECD, 1999). This definition distinguishes it from electronic data
interchanges (EDI) type proprietary based networks or intranets that were not based on an
open (and therefore, not cost effective information infrastructure) like the internet. In the
WTO work programme on electronic commerce, it is understood to mean the production,
distribution, marketing, sales or delivery of goods and services by electronic means. A
commercial transaction can be divided into three main stages; the advertising and searching
stage, the ordering and payment stage and the delivery stage. Any or all of these may be
carried out electronically and may, therefore, be covered by the concept of electronic
commerce. Broadly defines electronic commerce encompasses all kinds of commercial
transaction that are concluded over an electronic medium or network, essentially, the
internet.

First, portability improves bottom line of and organization. And secondly expanded market
share, some component can be handled by multiple customers at the same time.

1.2 Statement of the Problem

A study by the United Nations Conference on Trade and Development (UNCTAD) has shown
that SMEs, while generally lagging in ICT, have the most to gain from increases in
productivity thanks to e-commerce. SMEs, however, actually run the risk of missing
opportunities in both productivity and profitability by not engaging in e-business.

1.3 Objectives of the Study

1. To study how e-commerce aid in the economic development of developing
countries.
2. To identify the relationship between e-commerce and emerging market.
3. To identify the significant impact of e-commerce on emerging market. 4.
To assess the influence of e-commerce in developing an economy.

1.4 Research Questions

1. Does e-commerce aid in the economic development of developing countries?
2. Is there a relationship between e-commerce and emerging market?

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3. What significant impact does e-commerce have on emerging market?
4. Can e-commerce influence the development of an economy?

1.5 Research Hypotheses

H0: E-commerce has no significant impact on emerging market.
H1: E-commerce has significant impact on emerging market.
H0: there is no significant relationship between e-commerce and emerging
market H2: there is a significant relationship between e-commerce and emerging
market

1.6 Significance of the Study

E-commerce has been hailed by many as an opportunity for developing countries to gain a
stronger foothold in the multilateral trading system. E-commerce has the ability to play an
instrumental role in helping developing economies benefit more from trade. Unlike the
requirements necessary to run a business from a physical building, e-commerce does not require
storage space, insurance, or infrastructure investment on the part of the retailer. The only
pre-requisite is a well-designed web storefront to reach customers. Additionally, e-commerce
allows for higher profit margins as the cost of running a business is markedly less.
1.7 Scope/Limitations of the Study
This study is on the impact of e-commerce on emerging markets using konga online store as a
case study.

Limitations of study

Financial constraint– Insufficient fund tends to impede the efficiency of the researcher in
sourcing for the relevant materials, literature or information and in the process of data collection
(internet, questionnaire and interview).
Time constraint– The researcher will simultaneously engage in this study with other academic
work. This consequently will cut down on the time devoted for the research work.

1.8 Definition of terms

E-commerce:
It is the buying and selling of goods and services or the transmitting of funds or data, over an
electronic network, primarily the internet. These business transactions occur either as business
to-business, business-to-customer, customer-to-customer or the customer-to-business.

ICT
Information and communication technology (ICT) is another/extensional term for information
technology (IT) which stresses the role of unified communications and the integration of
telecommunications (telephone lines and wireless signals), computers as well as necessary
enterprise software, middleware, storage, and audio-visual systems, which enable users to
access, store, transmit, and manipulate information
Economic development
Economic development is the process by which a nation improves the economic, political, and
social well-being of its people. The term has been used frequently by economists, politicians, and
others in the 20th and 21st centuries

ORGANIZATION OF THE STUDY

This research work is organized in five chapters, for easy understanding, as follows Chapter one
is concern with the introduction, which consist of the (overview, of the study), statement of
problem, objectives of the study, research question, significance or the study, research
methodology, definition of terms and historical background of the study. Chapter two highlight the
theoretical framework on which the study its based, thus the review of related literature. Chapter
three deals on the research design and methodology adopted in the study. Chapter four
concentrate on the data collection and analysis and presentation of finding. Chapter five gives
summary, conclusion, and recommendations made of the study.

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CHAPTER 2 –
LITERATURE REVIEW

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The rapid growth, adoption, and penetration of digital landscape comprising the Internet and
mobile technologies is transforming the dynamics of business and competition globally. The
business terms like brick-and-mortar setup, retail stores, regional competition, local
customer segment, and value-chain are replaced by new terms like online platform, e stores,
global competition, global customer segment and virtual valuechain. The ongoing digital
advancement along with increasing adoption of internet and mobile technologies is resulting
in the creation of global markets where buyers and sellers undertake transactions of goods
and services using the different combinations of physical and virtual networks for value
offering, value creation and value delivery (Kunesova and Micik, 2015; Lucia-Palacios et al.,
2014; Jahongir and Shin, 2014; Hajli et al., 2014; Chiejina and Soremekun, 2014; Jahanshahi
et al., 2013; Bonera, 2011; Etemad et al., 2010). The use of the electronic platform for taking
the customer orders, receiving and making payments, providing customer service, collecting
market information as well as conducting marketing and promotional activities are
collectively referred to as e-commerce. From a business perspective, e-commerce involves
not only sale and purchase of a product or service but also involves managing the real-time
communication platform and ecosystem for providing pre-purchase information, post
purchase feedback, and support (Sharma and Lijuan, 2013). However, e-commerce is still
considered to be halfway between inception and growth phase with huge potential for future
growth and adoption globally (Oliviera and Toaldo, 2015). At one end, the continuous
evolution of digital technologies is bringing new dimensions to the business, customer, and
competition. At the other end, the majority of the countries especially the developing and
underdeveloped economies are characterised by lack of basic infrastructure for enabling
technology and computer education among the masses and low level of internet and mobile
penetration (Oliviera and Toaldo, 2015; Alshibly and Chiong, 2015; Sila, 2013; Al-Somali et
al., 2011; Kamari and Kamari, 2012; Bordonaba-Juste et al., 2012; Weisberg et al., 2011;
Ifinedo, 2011; Yen, 2010; Van Slyke et al., 2010; Yee-Loong et al., 2009; Boateng et al., 2008;
Elbeltagi, 2007; Zhuang and Lederer, 2003; McKnight and Chervany, 2001). This article
analyses the research literature to understand the past trends and future directions regarding
the role of e-commerce in the global business landscape. The article attempts to answer the
following questions. What is the definition of e-commerce? What are the underlying research
themes? How different theoretical frameworks and models are being used to understand the
e-commerce research themes? What are the key challenges faced by the e-commerce
providers? The article is organised into the following sections. Section 2 provides an overview
regarding the e-commerce growth and trends. Section 3 describes the methodology and
organising framework being used for selection and coding analysis of the e-commerce
related articles. Section 4 focuses on the broad perspectives and statistical overview of the
selected articles including the publications summary, research themes, methodology and
target locations. Section 5 elaborates the key content of e-commerce literature including e
commerce definition, theoretical frameworks and models, and challenges faced by the e
commerce organisations. Section 6 discusses the theoretical, management and policy-level
implications. Section 7 concludes the article.

According to the ISO/IEC 15944-7:2009 of the International Organization for

Standardization, e-business is defined as a “business transaction, involving the making of

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commitments, in a defined collaboration space, among persons using their IT systems,
according to Open-edi standards” (Kunesova and Micik, 2015). These business transactions
are broadly categorised into business-to-business (B2B), business-to-consumer (B2C),
consumer-to-business (C2B) and consumer-to-consumer (C2C) depending upon the type of
buyer and supplier involved. During 2000–2015, the significance of e-commerce has
increased significantly resulting in dramatic growth and acceptance worldwide. Regarding
value contribution and growth trends, the total world-wide value of B2B and B2C e
commerce exceeded USD 13 trillion and USD 1.2 trillion respectively in 2013 with the major
share held by the USA, the UK, Japan, Germany and China (Table 1). As an example, the
contribution of e-commerce to the revenue of the manufacturing sector in the USA has
increased from 19% in 2002 to more than 50% in 2012 (UNCTAD, 2015). Globally, Asia
Pacific region has emerged as the major growth market regarding B2C e-commerce
transactions, followed by Europe, North America, Latin America and Middle-East. USA, UK,
and China accounted for 57% of the global B2C e-commerce sales in 2013. According to the
PWC Report (2015), the B2C e-commerce value distribution comprised Asia-Pacific (USD
567.3 billion), Europe (USD 482.3 billion) and North America (USD 452.4 billion). However,
there is a huge gap and contrast regarding e-commerce growth and adoption between the
two fast-growing and most populous economies – India and China. India (USD 10.7 billion)
has 3.3% of the B2C e-commerce sales achieved by China (USD 328.4) in 2013. This gap is
attributed to the huge difference regarding internet penetration among these two
economies – China (641 million) versus India (243 million) in 2014 (PWC Report, 2015).
Figures 1 and 2 highlight the internet users and penetration percentage across the major
economies of the world.
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INTERNET USERS
3 . Methodology and organising framework

The selection of e-commerce related articles for literature review involved a systematic and iterative
approach to identifying the initial set, analysing the abstract and finalising the final set for full review
and analysis. The process involved in the final selection and subsequent coding of selected articles is
explained below

3.1 Selecting the articles

The authors referred the ProQuest database for identifying the e-commerce related articles. This is
considered to be the major online database covering the majority of the peer-reviewed journals in
business related disciplines. The authors used the following keywords for selecting the relevant
articles – ‘e-commerce’, ‘electronic commerce’ and ‘online commerce’. The authors restricted the
keyword search for the articles published after 1999 across the peer-reviewed and scholarly journals.
The keywords based search led to an initial selection of 163 articles. The next step involved reviewing
the title, abstract, introduction and conclusion sections of these articles to understand their relevance
and contribution to the e-commerce field. The articles which did not have meaningful relevance to
the e-commerce context or having a partial reference to the e-commerce context were excluded from
the consideration list. This detailed analysis of relevance to the e-commerce context led to the
exclusion of 65 articles, thereby leading to the final list of 98 articles in the scope of this study.
Appendix depicts the categorisation of articles in scope as per their respective journals and
publication year.

4.E-commerce research – broad perspectives

This section focuses on the following broad perspectives of the selected e-commerce articles –
publications summary, research themes, target locations, and methodology. The main consideration
of the authors during the literature review is to understand the evolutionary perspective of the e
commerce.

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4.1 Publications summary

The period-wise summary of the selected e-commerce related articles . The time periods of 2006–
2010 and 2011–2015 reflect a radical increase in e-commerce publications as compared to
2001–2005. This highlights the gradual increase in focus and attention given to the e-commerce
theme by the researchers. Going by the current technology and globalisation trends, e-commerce
theme will gain further attention in the coming time-period.

4.2 Research themes

The e-commerce literature has mainly focused on three broad research themes (Figure 4). The first
theme relates to understanding the consumer behaviour, loyalty, and adoption. The second theme
relates to the adoption of e-commerce by SMEs as well as the impact on their performance. The third
theme relates to the theoretical models and frameworks applicable to e-commerce research. This
implies that the key challenge as well as the opportunity for e-commerce providers lies in
understanding the consumer behaviour towards the adoption of e-commerce as well as increasing
the adoption of e-commerce by SMEs.

4.3 Research methodology

The majority of the selected articles have followed the quantitative methodology followed by
conceptual approach (Figure 5). In fact, there are very few research articles among the selected
ones, which made use of qualitative approach or mixed methods approach. This trend relates well to
the research themes. Since the predominant research themes evident from the selected articles
relate to the consumer behaviour and SMEs towards the adoption of e-commerce, the primary
methodology being adopted is quantitative.

4.4 Target locations (sampling)

The research articles have mainly focused on studying the locations across Asia and Europe while
undertaking the study (Figure 6). Around 40% of the selected articles have considered more than
one location while selecting the sample for the study.
Implications for theory, management, and policy
This study contributes to the field of e-commerce across academic, practitioner and policy
levels. From an academic perspective, this article reviews the existent literature and brings
out the detailed understanding on key themes like different definitions of e-commerce,
underlying research themes, underlying theoretical frameworks and key challenges faced by
the e-commerce organisations. These findings add value to the existent literature by
providing a consolidated view of the e-commerce related research, which has happened till
date. How the research around e-commerce theme has evolved over a period of time since
2000? What has been the key focus areas, supporting theoretical frameworks and
underlying research themes? What types of challenges are considered to be important by
the e-commerce organisations? This, we believe has made an important contribution to
enhance and extend our understanding of the key operational challenges across the
following dimensions - infrastructure, government policies and regulations, competition, the
customer (4As), cognitive, and organisational. From the practitioner perspective, this article

16
provides a consolidated view of the key challenges, which need focus and strategic actions.
There are three broad categories of challenges. The first category involves macro challenges
like lack of proper technology and banking infrastructure (internet penetration, digital
literacy, financial inclusion, credit card penetration) as well as ineffective government
policies and regulations towards data privacy, taxation, the fairness of competition, secured
online payment infrastructure etc. The second category involves consumer-oriented
challenges like the need for aesthetics, affordability, accessibility, availability, and awareness
as well as managing the cognitive perception and attitude. The third category involves
organisational level challenges like channel coordination and integration, scarcity of skilled
resources, need for competitive differentiation, processes, and systems etc. This implies that
e-commerce organisations should focus on designing and implementing appropriate
business models having a mix of strategic actions to manage these challenges. Regarding
policy perspective, this article recommends the focus and attention of the global institutions
and respective national governments towards design and implementation of technology,
education, and financial infrastructure as well as effective policies and guidelines with
respect to e-commerce transactions. The right mix of policies and guidelines are required for
ensuring fairness of online competition, online customer data security, and privacy,
consumer rights, resolution of domain name disputes, clarity on taxation and foreign
investments.

Conclusions
This article is an original contribution to the e-commerce research stream and reflects the
growing significance of e-commerce research as an area of academic enquiry during the
current and in the future. The first contribution lies in elaborating the broad perspectives and
statistical overview of the selected articles including the publications summary, research
themes, methodology, and locations. The second contribution involves presenting an
integrated view of the different e-commerce definitions across five dimensions – information
sharing, use of technology, buy-sell transaction, monetary transaction and competition. The
third contribution involves highlighting the theoretical 20 S. Goyal et al. models and
frameworks, which have been used across the existing research articles to study the drivers
for consumer (individual and business) behaviour towards technology acceptance, the
influence of cultural dimensions as well as criteria for diffusion of innovations across a social
system. The fourth contribution lies in identifying the key challenges faced by the
e-commerce organisations. The challenges are categorised along infrastructure (education,
technology, financial, electricity, warehousing, and transport), government policies and
regulations, competition, the customer (4As), cognitive, and organisational dimensions. The
existent research literature lacks clear documentation of strategic actions and choices to be
adopted for managing these challenges. The first recommendation involves undertaking the
field based research to identify the strategic choices to be adopted by the e-commerce
organisations for managing the challenges and environmental complexities effectively. The
majority of the research articles have followed the quantitative methodology for studying the
consumer behaviour (individual and business) towards the adoption of e-commerce. The

17
second recommendation is to analyse these articles further using the meta-analysis
technique to have a better understanding of moderating variables affecting e-commerce
adoption across countries.
18
 19

CHAPTER 3 – RESEARCH
AND
MATHODOLOGY
 20
INTRODUCTION.
Research methodology is a way to systematically solve the research problem. It
may be understood as a science of studying how research is done scientifically.
In research we study the various steps that are generally adopted by a
researcher in studying his research problem along with the logic behind them. It
is necessary for the researcher to know not only the research techniques but
also the methodology. Researchers not only need to know how to develop
certain indices or tests, how to calculate the mean, the mode, the median or
the standard deviation or chi-square, how to apply particular research
techniques, but they also need to know which of these methods or techniques,
are relevant and which are not. Researchers also need to understand the
assumptions underlying various techniques and they need to know the criteria
by which they can decide that certain techniques and procedures will be
applicable to certain problems and others will not. All this means that it is
necessary for the researcher to design his methodology for his problem as the
same may differ from problem to problem. Research is equally important for
social scientists in studying social relationships and in seeking answers to
various social problems. It provides the intellectual satisfaction of knowing a
few things just for the sake of knowledge and also has practical utility for the
social scientist to know for the sake of being able to do something better or in a
more efficient manner. Research in social sciences is concerned both with
knowledge for its own sake and with knowledge for what it can contribute to
practical concerns. This double emphasis is perhaps especially appropriate in
the case of social science. On the one hand, its responsibility as a science is to
develop a body 87 of principles that make possible the understanding and
prediction of the whole range of human interactions. On the other hand,
because of its social orientation, it is increasingly being looked to for practical
guidance in solving immediate problems of human relations.

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3.1 SOURCES OF DATA COLLECTION
Although there is a goldmine of web data freely available to crawl and extract, businesses
need to be pointed in the right direction while identifying the correct sources of data collection
for their particular use case. The uncertainty while identifying web sources is natural since
the data available on the web is primarily meant for human visitors and not bots. While
accessing the data on a website using a web crawler setup, you will have to factor in the
legal aspects of the extraction along with the technical accessibility. These apart, not all
websites make ideal sources of data collection. We’ll explain the reasons and suggest some
of the best web data sources for various business applications.

Things to keep in mind while selecting sources

Stay away from sites that block bots

There are certain websites that use aggressive bot blocking technologies despite legally
allowing web crawling via their robots.txt rules. Such sites aren’t great data sources
since their blocking activities might give you incomplete, skewed or no data at all. This
lack of stability makes them poor sources of data collection.
Watch out for broken links
Broken links are a clear sign of a poorly maintained website. Broken links can cause
issues while the web crawlers try to navigate the site to reach different pages to fetch
the data. It’s best to steer clear from sites with too many broken links.
User experience and site design
Websites with a cluttered and complex user interface often have low quality, unreliable
information available on them. If you have to use a website with poor user experience as
your source of data, it’s better to ensure the reliability of the information manually
before proceeding.
Frequently updated sites
Fresh data is critical for time-sensitive applications of web data such as pricing
intelligence, brand monitoring and news feed aggregation. For most cases, you should
ideally look for frequently updated websites.

Sources of data collection by application

Brand monitoring
Brand monitoring is critical for all companies, given the power of internet to make or
break a brand. Conversations now happen in real time on the web and opinions and
reviews posted could significantly impact your business. Brand monitoring using web
crawling helps you discover negative opinions voiced by consumers so as to fix the

22
overlooked issues within your offering. Ideal sources of data collection for brand
monitoring are:
• Public forums
• Niche blogs
• Reviews section on e-commerce/travel sites
• Social media platforms

Sentiment analysis
Sentiment analysis is essentially the process of identifying the emotional tone from a
series of words, used to gain an understanding of the opinions, emotions and attitudes
expressed via an online mention. By crawling certain websites where your target
audience is likely to express their views about your brand, product or a certain world
event, you can gather data required to perform sentiment analysis. Here are the popular
sources used by companies for sentiment analysis.
• Social sites like Twitter,Reddit,YouTube and Instagram
• Sites where reviews are posted
• News websites
• Other niche social media sites

Market research
Market research is crucial for gauging the market size, demand and competition among
other important aspects of the market. Companies should perform a thorough market
research at a pre-defined frequency to garner the information necessary to stay relevant
in the industry. With web scraping, the process of market research can be easily
automated and accelerated.
• Government websites
• Statistics websites
• Competitors’ websites

News feeds aggregation

News and media sites need ready access to the breaking news and trending information
from the web. This can only be covered by using a dedicated web crawler setup to
extract data from frequently updated sources. For news feeds aggregation, the best
sources are: • News websites
• Feed aggregator websites
• Social media sites
• Blogs

Job feeds aggregation

Job boards, HR consultancies and recruitment analytics firms can make good use of job
posting data. Since job listings reflect the current trends in the labor market such as
skills

23
in demand, trending job titles and the industries that are hiring, companies in this
industry can derive crucial insights from this data. Best sources for job data aggregation
are:
• Job boards
• Career pages of company websites
• Classified websites

Pricing intelligence
Competitive pricing is one of the defining traits of e-commerce, hotel and flight booking
businesses today. The price sensitivity of today’s customer has also lead to the
mushrooming of price comparison websites. Companies looking to gather pricing data
can extract it via web scraping from the following sources:
• Ecommerce portals
• Travel portals
• Price comparison websites

Catalog building
Travel portals with huge inventory find it difficult to manage their catalogs. Keeping the
product pages up to date would require relevant data extracted from sources where the
hotel room data is present. The ideal sources for catalog building are: • Other travel
portals
• Hotel websites

Applications for financial market

Companies or individuals that are closely associated with the financial industry would
require near-real time data from sites that host financial data. The data is time-sensitive
in this case and would require a live web crawling solution to fetch it with ultra low
latency. Sources of data include:
• Stock market websites
• Websites of major financial institutions
• News and media sites

Conclusion
The applications of data collection using automated technologies such as web scraping is
on the rise. However, selecting the right kind of source websites is a crucial step to
ensure proper results from your data aggregation project. Since the quality and
relevance of data present on different websites vary a lot, one has to be extremely
selective while adding a site to the source list. Reliable and relevant sources of data
collection can greatly enhance the ROI from web scraping.

24
3.2 Population of study .
25
 ONLINE RECOMMENDATION
3.3 sampling and sampling distributions

The COVID-19 crisis has led people in many OECD countries to significantly limit
physical interactions. Self-imposed social distancing to avoid contagion, together with
the strict confinement measures implemented in many OECD countries, have put a
large share of traditional brick-and-mortar retail virtually on hold, at least temporarily
(OECD, 2020[1]). In the United States, retail and food services sales between
February and April 2020 were down 7.7% compared to the same period in 2019.
However, sales increased for grocery stores and non-store retailers (mostly e
commerce providers),1 by 16% and 14.8% respectively. In the EU-27,2 retail sales
via mail order houses or the Internet in April 2020 increased by 30% compared to
April 2019, while total retail sales diminished by 17.9% (Figure 1). The resulting shifts
from brick-and-mortar retail to e-commerce are likely significant across countries. For
example, while in the United States the share of e-commerce in total retail had only
slowly increased between the first quarter of 2018 and the first quarter of 2020 (from
9.6% to 11.8%), it spiked to 16.1% between the first and second quarter of 2020. The
development is similar for the United Kingdom, where the share of e-commerce in
retail rose from 17.3% to 20.3% between the first quarter of 2018 and the first quarter
of 2020, to then rise significantly to 31.3% between the first and second quarter of
2020. Similar changes are also observed for other regions, including the People’s
Republic of China (hereafter China), where the share of online retail in total
accumulated retail sales between January and August 2020 reached 24.6%, up from
19.4% in August 2019 and 17.3% in August 2018.

26
 27

Not all online sellers and product categories benefitted from the
rise in e-commerce

The effect of the COVID-19 crisis on e-commerce is not uniform across product categories or
sellers. In the Unites States, for example, a surge in demand was observed for items related to
personal protection (e.g. disposable gloves), home activities, groceries or ICT equipment, while
demand dropped for items related to travel, sports or formal clothing (e.g. suitcases, bridal
clothing, gym bags, etc.) (OECD, 2020[2]).3 Shifts towards e-commerce have been observed in
several countries, in particular along the food supply chain, including farmers who started using
digital technologies to sell their produce directly to consumers or restaurants that switched to
providing food or grocery delivery services (OECD, 2020[3]). In Germany, online sales grew
significantly for medicines and groceries, historically laggard sectors in terms of e-commerce,
while overall online sales contracted by around 18 percent in March 2020 in comparison to the
previous year (OECD, 2019[4]). In Korea, where official statistics are available, the e-commerce
transaction value rose by 15.8% between July 2019 and July 2020. Significant increases were
observed for food services (66.3%), household goods (48%) and food and beverages (46.7%),
whereas online transactions involving culture and leisure services or travel arrangement and
transportation services declined significantly, by 67.8% and 51.6% respectively. In China, food
products were the single biggest winner in e-commerce, with an increase in accumulated sales
from January to April 2020 of 36%, relative to the previous year. In contrast, total online sales
over January to April 2020 remained almost constant compared to the same period in 2019
(+1.7%), after having grown significantly over 2018-19 (17.8%). Accumulated sales of clothing
products contracted by 16% compared to 2019, after significant growth from 2018-19 (23.7%).
While dynamics likely vary across countries, these data suggest that despite the shift to
e-commerce, a significant share of e-commerce sellers are facing the same economic
repercussions as traditional brick-and-mortar retailers, following reduced spending by individuals
on items considered non-essential. A sample of 200 000 third party Amazon vendors in the Unites
States suggests that by April 2020 around 36% of merchants were inactive, an increase from
around 28% in February.4 Particularly affected were sellers with less than 1 500 product listings
(ASINs), while sellers with over 3 000 listings saw positive upswings. This highlights how the
COVID-19 crisis might have involved a shift in demand from small and specialised sellers to
larger and diversified sellers. The COVID-19 crisis also highlights the complementarity between
online and offline sales channels. Thus, while Amazon’s own sales in the first quarter of 2020
were 26% higher than in the previous year, its share in total e-commerce in the United States fell
from 42.1% in January 2020 to 38.5% in June 2020. In particular, Amazon lost market share to
Walmart (from 4.2% to 5%) and Target (from 2.2% to 3.5%). It can be inferred that these and
similar companies benefitted from large networks of bricks-and-mortar stores, facilitating fast
delivery and pick-up by the consumer (kerbside fulfilment).

28

Policy makers need to ensure that e-commerce delivers for

everyone – now more than ever

As detailed above, the COVID-19 crisis accelerated an expansion of e-commerce

towards new firms, customers and types of products. For individuals, e-commerce
enables physical distancing while retaining access to the full product variety. While e
commerce in the past for many consumer groups was centred on high tech goods,
toys or books, it now increasingly involves goods for which availability is critical to a
large share of the population, including groceries, medicine and other necessities. E
commerce has further enabled continued access, either online or physical, to certain
areas of public life, such as concerts, museums or swimming pools, including by
efficiently allocating time stamped tickets to avoid overcrowding. Similarly, for many
firms e-commerce is now a vital alternative or complementary sales strategy, allowing
continued operation in spite of contact restrictions and other confinement measures. It
has therefore become increasingly important to close remaining digital divides. For
consumers, these can be linked to factors like access, income, awareness or skills.
For example, the elderly, a segment of the population that would particularly benefit
from e-commerce-enabled physical distancing, have persistently been lagging behind
in terms of e-commerce participation in many countries (OECD, 2019[4]). Significant
and persistent gaps also remain for low-income households or individuals with low
education, which is concerning given the decreasing costs of connectivity, the ubiquity
of digital technologies and the increasing scope of products available online. Besides
closing these divides, governments also need to ensure that consumers, and in
particular the most vulnerable, are sufficiently protected from unfair, misleading and
fraudulent commercial online practices, which have been increasing in the current
crisis (OECD, 2020[5]). Persistent gaps in terms of e-commerce participation also
remain for firms, and in particular small and medium enterprises (SMEs). In 2017, the
participation rate for SMEs in e-commerce was less than half the rate for large firms in
a majority of OECD countries (OECD, 2019[4]). This explains and adds to a low level
of resilience and flexibility among SMEs in dealing with the costs of reduced demand
and local containment measures (OECD, 2020[6]) Low levels of digitalisation and
difficulties in accessing and adopting new technologies make it particularly difficult for
those firms to change existing work processes, by introducing teleworking or an e
commerce sales channel. The COVID-19 crisis has exacerbated many of these
divides. Additionally, regulatory uncertainties about which rules to follow (e.g. offline or
online) suddenly can affect a larger number of firms trying to flexibly combine and shift
between offline, online and omni-channel sales channels. While many of these
challenges have existed before the COVID-19 crisis (OECD, 2019[4]), the current
situation has heightened the need for policy action. Some countries have already
taken initiatives, in particular to support the digitalisation of business models, during
the COVID-19 crisis, but challenges remain pressing in many countries.

29
Closing digital divides among individuals and fostering
participation of the vulnerable
Factors that limit e-commerce participation for certain groups of individuals are often
related to economic and social conditions that reach far beyond e-commerce,
including rural-urban divides, income distribution, unequal access to education and
an aging society. These conditions may manifest themselves in low connectivity, a
lack of digital skills, low levels of trust (including security and privacy concerns) or a
lack of access to online payment mechanisms, all factors that can be addressed by
policy action (OECD, 2019[4]). Relevant measures in this regard include targeted
information campaigns, trust building initiatives, adult training, or public-private
partnerships that target the participation of low-income households and those in rural
areas. During the COVID-19 crisis, governments and businesses in several countries
(e.g. Japan, the United Kingdom and the United States) announced measures to
reduce the financial burden associated with Internet access for particular consumer
groups, including poor or young individuals (OECD, 2020[5]). Developing and
emerging countries also provide examples for innovative approaches to tackle
lingering digital divides, including through mobile money (e.g. M-Pesa in Kenya), cash
on delivery, deliveries through mom-and-pop stores in remote areas, or the use of
landline phones and social media to co-ordinate online orders for those with limited
digital skills or access to digital tools. In OECD countries, related strategies could be
considered to introduce community-based delivery programmes for particularly
vulnerable consumers (e.g. those in public care homes) and consumers that lack the
required skills to participate in e-commerce. Targeted actions may be needed
particularly for vulnerable groups in the context of grocery shopping, a required
activity with high contact probability. Experience from the first wave of the COVID-19
crisis has shown that difficulties to obtain a delivery slot or wait times of several
weeks deterred many elderly with access to digital technologies from using these
tools for grocery shopping. Some grocery merchants have reacted by reserving
online grocery delivery slots for elderly and vulnerable shoppers or asking
non-vulnerable shoppers to shop in-store in order to ease capacities for the
vulnerable (e.g. Waitrose, Tesco, WholeFoods). Governments can actively support
this process. Ireland’s Citizens Information Board provides information on safer
shopping during COVID-19 and explicitly recommended non-vulnerable people to
shop in-store or pick-up online orders at the retailer to avoid occupying delivery slots
that could be used by vulnerable people. Many countries have also conditioned the
opening of stores on reserving dedicated shopping hours to vulnerable groups, a
practice that could be extended to home delivery. In some cases it might also be
necessary to regulate how grocery stores can identify vulnerable shoppers in the
context of online shopping, with current approaches often being ad-hoc and
heterogeneous, e.g. based on loyalty schemes and customer accounts. Additionally,
even mainstream consumers often become financially and psychologically more
vulnerable during the crisis. Governments therefore might need to foster trust,
engage in a dialogue with online businesses about fair business conduct, educate
consumers about possible scams, and avoid rolling back consumer protection and
product safety measures (OECD, 2020[5]). Governments should also ensure
sufficient competition in the retail sector, given that the COVID-19 crisis may lead to

30
the exit of many small and local brick-and-mortar retailers, enhancing market
consolidation (OECD, 2020[1]) to the benefit of larger retailers with online sales
channels.

Fostering innovative e-commerce business models and digital

transformation in SMEs
As digital transformation progresses, new business models arise in ways that are
difficult to predict and that challenge traditional policy frameworks (OECD, 2019[4]).In
particular, regulatory frameworks may preserve artificial distinctions between online
and offline commerce, even as firms increasingly pursue business models that
combine both elements. Planning and zoning rules can further hinder a swift
repurposing of existing brick-and-mortar facilities (e.g. converting store fronts in
warehouses or logistics hubs in urban centres). They can also prevent or slow down
the use of innovative, contact-free delivery methods, such as drones or robots. This is
particularly relevant in times of the COVID-19 crisis, when firms have to adapt to
limitations on physical interactions or supply chain disruptions, accommodating new
business functions and logistics solutions, to ensure their economic survival.
Regulatory approaches to new e-commerce business models, to the extent possible,
should therefore allow for experimentation, and be transparent and flexible.
Regulatory flexibility in response to the COVID-19 crisis is observable in a number of
countries, including the easing of caps on contact-less payments or temporary
exceptions to planning and zoning rules, e.g. allowing restaurants to increase their
terrace space and creating additional biking lanes (e.g. in Paris). Governments
should consider similar flexibility in the context of e-commerce, relying for example on
properly monitored and evaluated experimental regulatory waivers (e.g. regulatory
sandboxes), which have been successfully used to test new technologies like drones
and digital payment mechanisms. Governments could also reduce uncertainty for
firms, e.g. with regard to the rules for an omni-channel business models, by providing
clear information about the existing rules and their implications for particular business
models. For example, the Japanese Ministry of Economy, Trade and Industry
provides Interpretative Guidelines on Electronic Commerce and Information Property
Trading since 2002, a good practice that could help to provide specific and simplified
advice to firms transforming their business models in response to the COVID-19
crisis. Several governments have also taken targeted steps to support brick-and
mortar shops in their digital transformation and in fighting the economic
repercussions of the COVID-19 crisis (OECD, 2020[1]). For example, Japan
designed a business continuity subsidy, helping firms to diversify and expand their
sales channels. Korea also encouraged brick-and-mortar shops to open their
business online through a dedicated support programme. In this context, some
governments have explicitly acknowledged the role of online platforms, which can
play an important role in easing the move from offline to online sales by providing a
range of services, including logistics, fulfilment or customer service (OECD, 2019[4]).
For example, China and Singapore actively supported MSMEs in accessing e
commerce platforms with regional or global reach, to help them reduce costs or sell
overseas through digital means. Some online platforms have also directly supported
31
SMEs in the transition to e-commerce as a response to the COVID-19 crisis. For
example, eBay.uk temporarily dropped registration fees for small sellers (up to 250
items), set up free listings promotions for established sellers and protected sellers
from downgrades in their seller ratings due to late delivery or cancellation. In Brazil,
large online retailers or platforms opened up their sales platforms to SMEs, including
by providing access to their logistics infrastructure, or have supported SMEs
financially.5 Recent regulatory approaches to promote fairness and transparency for
business users of online intermediation services are particularly relevant in this
regard. Related platform-to-business regulation has, for example, been recently
enacted in Japan and is being applied in the EU since July 2020.
 32
3.5 validation of research instrument.

This paper develops and validates an attitudinal scale that can measure the performance of e
commerce operations both in "pure play" Internet firms and in on-line components of
multichannel firms. The measurement instrument is grounded in a resource- based view of the
firm. The final instrument contains a 14-item perceptual measurement scale. It was tested with
data collected from a sample of 595 managers responsible for e- commerce operations.
Psychometric testing of the instrument showed adequate construct validity.

... The construct validity of the measurement included in the questionnaire was
assessed. Specifically, construct validity indicates the degree to which a factor
accurately reflects the construct of interest (Gefen, 2000;Wade & Nevo, 2006).
Construct validity is normally assessed via measurement of convergent validity and
discriminant validity

... Construct validity is normally assessed via measurement of convergent validity

and discriminant validity. The former denotes the degree to which the measurements
of the constructs that are assumed to be theoretically related are actually related
(Wade & Nevo, 2006). As is shown in Table 4, the values of Cronbach's alpha (α),
composite reliability, and average variance extracted (AVE) for the constructs are all
above the thresholds: 0.7, 0.7, and 0.5 respectively (Gefen, 2000).

... These results show that adequate convergent validity was obtained for the
measurement scales. Discriminant validity reflects the extent to which two variables
that should not be related to one another are actually unrelated (Gefen, 2000;Wade &
Nevo, 2006). As Table 5 shows, the square roots of AVE are higher than their
correlations with other constructs.

33
34
35
e

36
3.6 METHOD OF DATA ANALYSIS

Statistical Analysis of Indian E-Commerce Market

Vyomkesh Nandan
Assistant Professor
Dept. of IT
Amity University Uttar
Pradesh
Noida, India
mhooda@amity.
Madhurima
Assistant Professor
Dept. of IT
Amity University Uttar pradesh
Noida, India
[email protected]

37
Saru Dhir
Assistant Professor
Dept. of IT
Amity University Uttar
Pradesh
Noida, India
[email protected]

Anchal Garg
Assistant Professor, Dept. of CSE
Amity University Uttar Pradesh
Noida, India
[email protected] Madhulika
Assistant Professor
Dept. of CSE
Amity University Uttar
Pradesh
Noida, India
[email protected]

Abstract— With the advent of the information age, e-commerce has become the hottest
business trend. It offers convenience to the business organization as well as the
customers. It provides affordability, anywhere, anytime service, opting to choose a wide
variety of products online etc. to the customers. At the same time, business organizations
acquire wider market opportunities and can reach new customers more easily. With
e-commerce, more and more organizations have an online business model. They are
able to offer their products directly to the customers without the
brokers. The revenue of such organizations has increased many folds. But with the rise
of e-commerce, security has become a critical concern. As the number of e-commerce
users has increased around the world, so have the security breaches. Credit card theft,
hacking, computer systems remotely, etc. is not uncommon. This research paper will
focus on the growth of e- commerce in the Indian market and the security perception
from both customer and organizational perspective.

I INTRODUCTION

The internet for businesses and customer has irradiated a revolution in electronic
commerce. In relevance to the present scenario, security has become a vital issue that
must be elucidated to nail down consummation of Electronic Commerce. As the number
of users has elevated around the world, thus beefing up has provided the impetus and
the squeaks for the people around the globe especially E
Commerce. But security is accosted in front for the success of E-Commerce, as
managerial, organizational and human dimensions also take into consideration.

38
1. Product Recommendations
Do you remember the time you visited the general store when the friendly storekeeper or an

assistant helped you throughout your shopping experience? He knew the food items you

bought, the laundry detergent you purchased, or the ice-cream your kid loved. He knew your

shopping budget and would make recommendations. And you did end up purchasing what he

recommended quite a few times. Didn’t you? That relationship with the customers is what the

companies need. A product recommendation engine is the solution. What is a

recommendation engine? It is simply an automated form of the ‘friendly storekeeper’. It is a

tool that uses machine learning algorithms to suggest products to customers that they might

be interested in. The recommendations can happen through the following channels:

• Within websites

39
• Email campaigns

• Online ads
The recommendation engines are of two types:

a) Impersonalized Recommendation Engine:

This is useful for sending out recommendations via welcome emails or

bulk newsletters, without using customer data. Here are some useful
categories:

• new products like a new chocolate ice-cream that has been recently

launched

• trending products like a fast-selling coffee brand to help recruit new

customers

• slow-moving products like a luxurious bar soap at a discounted price

b) Personalized Recommendation Engine:

This is gold! It uses customer data to recommend the best offers and promotions. It

uses deep learning algorithms and Natural Language Processing (NLP) to make the
customer experience as personalized as possible. The algorithms use data from the
following spheres:

• Purchase history

• Recent activity

• Online behavior

40
• Social media browsing
These algorithms are really powerful and can greatly boost e-commerce sales by:

• improving conversions rates

• increasing the average purchase value of customer

• reducing bounce rates & cart abandonments

Here’s what Amazon’s recommendation engine shows me currently. It looks like it

knows that I love to workout.

Market Basket Analysis

Market Basket Analysis is a technique that identifies the strength of association

between a pair/group of products that are purchased together. In simpler words, it’s
based on the concept that if a customer buys a product, they are more or less likely to
buy another related product. Market Basket Analysis also uses machine
learning/deep learning algorithms, like product recommendation engines.

I’ll explain this with an example from the project at Colgate-Palmolive that I

mentioned earlier. I bundled a children’s toothbrush (unprofitable product) with a

deodorant, a
 41
dad’s product (fast-moving product), and was able to increase the total weekly profit
of the combination by 8%.

Association rule learning is a machine learning method that is used for

discovering associations between products. It does not consider the order of the
purchase of products. Let me explain this with a demonstration.

The analysis is run on millions of baskets, but I’ll demonstrate it with 7 baskets and

explain the 3 important measures used. Let’s explore the association between
shampoo and conditioner (Basket 1):
 42
a) Support

Definition: No. of transactions that include both the products x and y as

a percentage of the total number of transactions

Business meaning: It indicates how frequently both the products

are purchased together.

a b) Confidence ◊

Definition: Ratio of the number of transactions that include both the

products x and y to the number of transactions that include the product
x.

Business meaning: It indicates how often the association rule is

true, i.e. how often both the products are purchased together.

43
 Demand Forecasting

Let’s imagine Benjamin Franklin and Abraham Lincoln to be e

commerce business tycoons for a minute.

Franklin seems to have warned against underestimating the potential

of demand forecasting in e-commerce retail sales,

44
“If you fail to plan, you are planning to fail.”

And Lincoln seems to have provided the perfect strategy for including
demand forecasting in the analytics scene at your e-commerce company.
“Give me six hours to chop down a tree, and I will spend the first four
sharpening the axe.”

Demand forecasting refers to the use of analytics techniques to predict

the demand for a product and forecast sales. When you know the sales
trends in advance, it gives you an advantage over your competitors in the
following ways:

a) Better Inventory management

An underestimation of inventory levels can lead to inventory getting out

of stock and hence cause customer dissatisfaction. An overestimation of
inventory stock levels can lead to overstocking of inventory and hence
cause unnecessary storage costs.

Demand forecasting helps in informed inventory planning and saves you

from both selling out of popular products and warehouse space wastage
due to slow-moving stock.

b) Better cashflow management

Since the money is not tied up in slow-moving inventory, It helps you

plan the budget properly and use the cash optimally. Thus, it helps you
to reduce financial risk.

45
c) Better pricing strategy

Effective demand forecasting also helps in improved pricing strategy. You

can charge more for the products having a high demand forecast, and
vice versa. You can better plan the marketing budget, advertising
investment, and discount plans.

d) Better customer service

The prior knowledge of the product demands and their fluctuations helps
in planning better customer service. It’s time for a business example.

Photo by Bryan Angelo on Unsplash

Amazon patented ‘Anticipatory Shipping’ in 2013 to use predictive

modeling to ship products to you before you would even make the
purchase. Amazon’s algorithms would predict your purchase, and it
would send the product to your nearest warehouse. Then, Amazon would
wait until the actual purchase. Amazon believed that this would
drastically cut

46
the delay from the time of purchase to the actual delivery and boost the
overall company sales.
CHAPTER 4 – DATA
ANALYSIS

47
DATA PRESENTATION AND ANALYSIS AND INTERPRETATION
Based on current data, it is projected that e-commerce will experience the growth phase of
its S-Curve over the next decade. I expect the rapid growth to result in the maturation
(roughly 90% penetration of the potential market) of online shopping by 2020. Despite the
current economic downturn, e-commerce continues to grow while other industries move
backward (“E-Commerce”). Since online shopping is based on saving time and money for the
consumer, as well as the business owner, hard economic times will only deepen the
e-commerce trend. While sales may not increase as rapidly as in strong financial conditions,
individuals will look to spend their limited finances in as efficient a fashion as possible. The
internet, coupled with the ability to do comparison shopping, research, analyze customer
reviews, and order from a single location, provides the demanded shopping efficiency.
S-Curve economics presents a case for the rapid growth of online shopping. Due to the
nature of market development, exponential growth occurs once a new technology reaches
roughly 10% market penetration and continues until it reaches roughly 90% market
penetration. Data compiled by Forrester Research shows that e-commerce has entered its
growth phase in the United States. Their definition of e-commerce retail sales includes all
online sales except auto, travel, and prescription drug sales. Since the expected market cap
of US online sales is 50% of total U.S. sales, the growth phase begins once online sales equal
5% of all sales. In 2007, the feat was achieved according to Forrester Research when online
retail sales reached 5% of all retail sales in America (“U.S. ECommerce”). Historical evidence
strongly suggests that a period of exponential growth will follow, accelerated by the speed of
the information age. As stated

48
earlier, new products and technology generally take the same time to complete the
introduction phase as they do to complete the growth phase. Ecommerce appears to have its
humble beginnings during the latter months of 1994. Since it took 13 years (from 1994-2007)
for ecommerce to reach 10% market penetration, it is expected to take approximately 13
years from 2007 for US online sales to reach 45% of total US sales, which is 90% penetration
of the projected market. According to my initial projections, e-commerce would complete its
growth phase during the year 2020. The results may be historically significant as the
American culture is transformed by internet Shopping.

The fact that American society is in the midst of a culture-changing trend makes it a
significant area of investigation for Americans in general, for research, and for the business
field. On the individual level, ecommerce tends to save Americans both time and money.
Online shopping allows consumers to compare costs and read product reviews from the
comfort of one‟s own home. This saves time that would otherwise be spent in traffic or
waiting in line. The nature of ecommerce forces businesses to respect the consumer. The
internet makes it easier than ever to compare and contrast products, do research, and read
reviews. Businesses must offer customers competitive pricing and a satisfying online
experience or risk losing the sale. With the click of a button, customers can leave one virtual
store and enter another. According to a Forrester Research report, retailers must make their
websites more conducive to browsing. They can elicit favor with shoppers by focusing
additional energy on accurate product information, improved imagery, flexibility in payments
and returns, and by reducing the hurdles of shipping costs (Rosencrance 2008). Essentially,
ecommerce empowers the consumer. The concept of consumer empowerment is
demonstrated by the fact that people‟s actions on the internet dictate the response of
businesses. The supply of specific information, products, and services is tailored to the
individual based on past purchases or search results. The level of consumer empowerment
created online cannot be duplicated in the traditional store. On the research level,
e-commerce is important because it is altering the face of the consumer. As convergence of
the telecommunication industry and internet occurs, individuals change the way they buy
products and services, communicate, bank, pay bills, and research information. According to
one of the world‟s leading authorities on technology and trends shaping the world of
wireless mobility, Mr. Andrew M. Seybold, this connection allows for greater access to voice,
audio, data, and video services than ever before (Seybold 11). New research is now
necessary to understand how the new consumer makes decisions. As information is
constantly changing, a rapid response from researchers is required to stay up to-date. Online
shopping is creating major changes in not only the way consumers think, but the way in
which businesses market to their customers. The growth of e-commerce and converging
technologies recreate the need for trust. Analyzing the need for trust is central to market
research. Piotr Cofta, Chief Researcher in British Telecom‟s Mobility Research Group, shows
that without a trust in businesses or the medium through which the transaction takes place
(the internet), no commercial transaction will occur no matter how convenient or developed
the technology is (Cofta 1). Despite the recent scare of entering credit card and personal
information online, security measures and higher encryption standards allow

49
consumers to trust the safety of online shopping. In the 21st century, it has become more a
risk to hand one‟s credit card to a clerk in a store than to enter the information on a
mainstream website. Although risks do exist on lesser known websites with lower levels of
data encryption, the majority of competitive internet companies offer high levels of security
for customers. More and more online firms offer all-encompassing return policies. Such
policies guarantee that the customers receive the exact product they are looking for in
excellent condition. If they are not satisfied, they can send it back to the company for
replacement or refund. As return policies are improved, customers will be more confident in
making purchases over the internet. E-commerce will continue to flourish and grow if trust
continues to grow in the minds of consumers. On both sides of the equation, e-commerce is
laying the groundwork for major changes in society – changes which pave the way for future
research. On the retail level, internet shopping is extremely significant to the business field.
Currently, many businesses are changing their focus from traditional retailing to driving
online sales. According to Ken Allard, a chief executive strategist, a wide range of
organizations are making large investments in internet commerce. He understands the new
investment cycle to be the result of four main trends, consisting of internet commerce
becoming a reliable engine for growth, new web technologies enabling additional
capabilities, both consumers and businesses demanding new features and services, and
marketing budgets shifting to the internet (Allard). As current trends propel online shopping
to not simply become the way of the future but the way of the present, companies must
quickly adapt their business practices to meet the growing demand. Similar to researchers,
businesses must learn to understand the changing face of the consumer. They must learn to
supply customers with what they want and how they want it, while competing with more
and more competitors online. If actions are not taken to utilize the marketplace of the
future, online market share is lost daily. Companies simply will not survive if they do not
have a viable internet option for customers to access.

50

51
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e
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CHAPTER FIVE – CONCLUSION
AND
SUMMARY

54

SUMMARY

Electronic commerce over the Internet is a new way of conducting business. Though only three years
old, it has the potential to radically alter economic activities and the social environment. Already, it
affects such large sectors as communications, finance and retail trade (altogether, about 30 per cent
of GDP). It holds promise in areas such as education, health and government (about 20 per cent of
GDP). The largest effects may be associated not with many of the impacts that command the most
attention (e.g. customised products, the elimination of middlemen) but with less visible, but
potentially more pervasive, effects on routine business activities (e.g. ordering office supplies, paying
bills, and estimating demand), that is, on the way businesses interact.

The analysis focuses disproportionately on the United States, owing to the availability of material.
Because of the size of that country and its cultural and regulatory characteristics, the relevance of its
experience to other countries may be limited. However, information and communication technologies
(ICTs) are closely linked to the emergence of electronic commerce, and as ICT diffusion rates in other
countries begin to approach those of the United States (or of countries such as Finland), their
experience may be similar. If so, the demographic and industrial diversity of the United States may
provide a useful indication of what can be expected in other countries that openly embrace ICTs.
Lastly, the Internet is less country-specific and more international in nature than earlier ICTs, so that
its impact in any given country is likely to be more generalisable than that of earlier ICTs (i.e. France’s
Minitel). While this book tries to rely on scholarly work and solid statistical data as much as possible,
to gain insight into the macroeconomic impact of a phenomenon that is changing as quickly as e
commerce requires relying on private data sources, expert opinion, the popular press and anecdotal
statistics as well.

55

CONCLUSION
Still small in economic terms, e-commerce has the potential to accelerate existing trends and
introduce new ways of conducting business, organising work and interacting in society. As with the
advent of any new technology that may be widely diffused, there are overly optimistic and pessimistic
predictions, which are generally inaccurate (mail order has not displaced traditional retail trade and
the VCR has not displaced teachers). Nor is this the first time that our societies have been exposed to
the broad diffusion of information and communication technologies: over the 20-year period from
1874 to 1895, the typewriter, telephone, phonograph, electric light, punch card, hydro-electric plant,
automated switchboard, cinema and radio were all invented. At this point, research is needed in
order to see more clearly the problems and the potential. These preliminary findings and broad
policy implications constitute an initial analytical basis for identifying areas of future research. The
following conclusions are offered for discussion with the aim of establishing research priorities
concerning the economic and social impact of electronic commerce. Fundamental to any analytical
work on electronic commerce is the ability to measure it accurately. To focus the policy debate,
statistics that measure the level, growth, and composition of e-commerce are badly needed. Today,
while nearly all sources indicate that business-to-business e-commerce dominates the market, most
existing analysis and available data focus on the business-to-consumer segment. • A statistical
methodology and apparatus for measuring electronic commerce should be developed. Key areas for
future research are the business-to-business segment; electronically delivered products such as
software, travel services, entertainment and finance; and country-specific differences in the size and
growth potential of electronic transactions. A main reason for the rapid growth of electronic
commerce, especially the business-to-business segment, is its significant impact on costs associated
with inventories, sales execution, procurement and distribution, and with intangibles like banking. To
reap the potential cost savings fully, firms must be willing to open up their internal systems to
suppliers and customers. As firms integrate their operations more closely, issues of security and
potential anti-competitive effects arise. More generally, e-commerce illuminates differences that may
exist between products, industries and countries, thereby highlighting the need to reform
inconsistent regulations. • The economy-wide and sector-specific impact of e-commerce on
productivity should be assessed, and the notion that this application may lead to a sustained higher
level of economic efficiency should be explored. E-commerce can dramatically reduce some
production costs, but it does not offer a “friction free” environment. Rather, owing to new costs
associated with establishing trust and reducing inherent risks, it requires new intermediaries.
Widespread “disintermediation” (producers selling directly to consumers without aid of
intermediaries) is unlikely, but the nature of intermediary functions is likely to change. • Monitoring
of the restructuring of intermediary functions is needed. Cost reductions are not automatically
translated into price reductions. They are contingent on sufficient competition. Electronic commerce
will certainly change the structure, if not the level, of pricing as more products are subject to the
differential pricing associated with customised products, fine market segmentation and auctions, and
as the ease of changing prices increases. • While a general assessment of the impact of e-commerce
on prices may be premature, sectoral studies on a variety of consumer and business products should
be undertaken to measure the impact and identify factors that encourage and inhibit price
competition, including the use of intelligent agents. The impact of the structure of price setting and
of the frequency of price changes on markets and on measurement also requires study. Electronic
commerce is transforming the marketplace by changing firms’ business models, by shaping relations
among market actors, and by contributing to changes in market

56
structure. Electronic commerce also changes firms’ competitive advantages and the nature of firms’
competition. Given the dynamic nature of these processes, the impact of electronic commerce will be
firm-, sector-, and timespecific. • The electronic marketplace needs to be continuously monitored.
Case studies should address the sectoral and market specificity of organisational impacts. Ongoing
assessment of potential new barriers to market entry is also needed. 01_Summary.fm Page 24
Thursday, January 28, 1999 11:24 AM Executive Summary 25 Research on the evolving nature of the
commercial environment will help policy makers address issues of commercial governance, which are
critical to the development of electronic commerce. Asymmetries in firms’ ability to control access to
the electronic marketplace should also be investigated. This research will help policy makers to
address competition issues, as well as to formulate policies targeted to SMEs. The overall impact of
electronic commerce on employment is the net result of the countervailing forces of job
displacement in one industry and job creation in another. Electronic commerce will also create new
markets or extend market reach beyond traditional borders. The final effect on jobs will depend
crucially on development of demand for electronic activities. • Case studies can help to better
understand impacts on sectoral employment. As the employment potential of electronic commerce
differs among countries, differences in their production of Web-related hardware and software
content, which seems to be driving employment gains from electronic commerce, should be
explored. Also, the impact on employment in the distribution sector, which will depend on countries’
regulatory and organisational differences, should be investigated. Given the crucial role played by
demand, trends in demand for new activities should be monitored and policy makers should be
made aware of the factors underlying country-specific differences. Electronic commerce generates
demand for a flexible, multi-skilled work force and is likely to accelerate existing upskilling trends in
the OECD labour force. • It is important to identify specific skill needs for e-commerce and
opportunities for worker requalification. Policies to cope with skill mismatches will have to be
reinforced as the volume of electronic transactions increases. Better methodologies and data are
needed for tracking rapidly changing skill requirements and monitoring labour market responses and
adjustment mechanisms given the swiftly changing demand for different categories of ICT workers.
Fundamental changes are taking place at virtually every level of society, prompted by the growth of
the Internet, electronic commerce and other applications of information networks. • Since gaining
access to the network is crucial for participating in the “Information Society”, the factors that help
and hinder access to the Internet, such as cost, language and skills, should be analysed to learn
whether they can explain differences observed across countries. Many efficiency gains in the
electronic marketplace will hinge on the climate of confidence businesses can create in their
relations with their business partners and customers. Assurances of protection of privacy and
personal information play an important role in building that confidence. Both the public and private
sectors need a fuller understanding of the requirements for fostering confidence in electronic
markets, particularly among consumers. • It is necessary to better understand the economics
associated with the use and protection of private information, and the means to evaluate the costs
and benefits of various proposals to protect or reveal private information. These may include firm-
and industry-level benefits, and costs of assuring the confidentiality and integrity of personal data;
the relative impact of firm-based, sectoral-based and economy-wide standards for safeguarding
personal information; and the effects on trade and investment of divergent levels of privacy
protection across economies and jurisdiction.

57
RECOMMENDATION

The contemporary e-commerce trend recommends companies to shift the traditional business
model where focus on "standardized products, homogeneous market and long product life cycle"
to the new business model where focus on "varied and customized products". E-commerce
requires the company to have the ability to satisfy multiple needs of different customers and
provide them with wider range of products.
With more choices of products, the information of products for customers to select and meet their
needs become crucial. In order to address the mass customization principle to the company, the
use of recommender system is suggested. This system helps recommend the proper products to
the customers and helps customers make the decision during the purchasing process. The
recommender system could be operated through the top sellers on the website, the
demographics of customers or the consumers' buying behavior. However, there are 3 main ways
of recommendations: recommending products to customers directly, providing detailed products'
information and showing other buyers' opinions or critiques. It is benefit for consumer experience
without physical shopping. In general, recommender system is used to contact customers online
and assist finding the right products they want effectively and directly.

58
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