From the initial dot-com boom in the late 1990s through the subsequent “dot bomb” in 2001, through the post 2001 rebound and 2008 mortgage meltdown, the only “constant” in the in online business world is “constant change.” One thing is certain: the pre-2001 approach of just exploiting a hot domain name and buying up cyber “real estate” no longer guarantees success.
Finally, online retailers must either know, or must hire others who know, website programming as well as online banking and fulfillment operations—all of which are necessary to generate profits and can be measured using eCommerce reporting tools
What is E-Business?
Today, successful online companies track the same metrics as their offline counterparts—that is, they carefully watch revenues, costs, and profit and loss analysis. For example, one savvy Internet entrepreneur eventually closed his retail sporting goods store because employees—too busy shipping orders to Internet customers— were neglecting brick-and-mortar customers.
Some trends for success have emerged: a successful online retailer commonly carries a wider assortment of goods than a traditional brick-and-mortar store. Online retailers cater to an international market that operates around the clock. Many online retailers try to keep inventory investment as low as possible by having some of their supplier’s ship orders directly from the manufacturer’s location to the retail customer (known as “drop shipping”).
Basic Of E-Business?
In this model, the online retailer pays the manufacturer’s invoice at a wholesale cost and collects cash via the customer’s credit card before an electronic purchase order is issued to the manufacturer. And online retail business also requires intensive management and sometimes requires a bit more vigilance than a typical retail store. These businesses often work on lower than average gross profit margins.
Since many online shoppers use the shopping bots mentioned earlier, savvy retailers make sure their products are found by the search engines. Finally, online retailers must either know, or must hire others who know, website programming as well as online banking and fulfillment operations—all of which are necessary to generate profits.
Online retail sales have been growing steadily and are forecast to continue growing. The same is true for online companies that provide services. Google, for example, earns steady profits from its online advertising program where a business pays a fee for each click through to the sponsored link. One advantage of this program is that a merchant can track the cost effectiveness of the program on a daily basis (and stop or start it at any time).