Aeris Click Blog

by Chris Ho

The vast space we know as the Internet is consuming and transforming business faster than ever before. The appearance of established traditional shop brands in cyberspace is testament to the increasing attractiveness of online business ventures. The music industry is a prime example, with digital music accounting, for the first time, for more than a quarter (27%) of total worldwide music revenues in 2009, reaching a figure of US$4.2 billion. It has been estimated that online platforms will drive the growth of this industry in years to come. This can be attributed to the many advantages of online business, namely in cost and revenue, as well as to the retailer or service provider and consumer.

Starting an online business is comparatively less costly than starting a brick-and-mortar (shop-based, traditional model) one.

Going online involves minimal start-up and investment, thereby reducing the financial risk. Barriers to entry are far less obstructive online where the internet is considered an open market with many opportunities for innovative business strategies. Even Governments have jumped on the bandwagon and many actively encourage the use of the Internet for business by subsidizing access. One concrete example of a recently lowered start-up cost is the availability of Internet Service Providers (ISPs) that offer their services for free owing to advertising funding.

An Internet-based company can also easily achieve economies of scale by automating business processes, hence lowering operational cost. There is less need to rent a shop/office space, less spent on staffing as centralization of processes decreases number of staff required, decreased advertising/marketing budget and lowered transportation cost. There is an added benefit of increased efficiency by reduction in error rate, as use of electronic systems can conduct checks and there is less risk of human error. Efficiency also extends to faster procurement, whereby once an order has been authorized, it can be sent virtually immediately, and any changes, queries and billing is instantaneous when done online.

The image of a company can only be boosted when it takes its business online. Businesses both big and small regard developing an online presence as imperative to a competitive edge. The Internet is the tool to link a business to a global network, increasing opportunity for making new contacts, number of potential trading partners, and network sizes. The ability to penetrate new markets aids international expansion, creating a 24/7 global presence and professional front.

Consumer attitude towards online purchasing has shifted from regarding the Internet as a medium for reclusive ‘nerds’ to realising the convenience of avoiding long queues and taking advantage of straight to doorstep delivery services. Online shopping offers time-pressured customers an opportunity to save time and effort. Full online offering enables consolidation of customer relationships by allowing them to shop regularly and reliably any time on any day. Consumer use of the Internet has grown exponentially, resulting in an ever growing pool of potential customers for an online business. To add to this, A Datamonitor survey found that, even amongst the most ‘disloyal’ online consumer groups, 87% intend to re-buy from the same site once they have bought a product online. It is evident that the value of online expenditure is increasing rapidly.

An online business is also environment friendly, with a reduction in fuel and paper demand. But perhaps a major draw is the huge potential for fast growth and unlimited possibilities for automation. All the above keeps cost low, and lessens time needed, so that a boss of an online business has the freedom to work from anywhere, and may even run multiple business single-handedly and concurrently from one location.

Incoming search terms for the article:

• advanatages of click businesses
• advantages of brick and click business
• advantages of click business
• advantages of click businesses
• advantages of online expenditure
• internet based company

Tags: Advantages of Online Business, eCommerce Portal, internet business, Online Business

This entry was posted on Tuesday, May 18th, 2010 at 2:29 am and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.