Top 15 Benefits of Ecommerce to Business in 2022

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With the many advantages of ecommerce, it is expected that the sales momentum will continue to increase in 2022. Understanding ecommerce and its fundamentals will be beneficial for businesses in this period to better target the consumers. Well, this blog is the right place to begin. So let’s get started.

What is Ecommerce 

A business model that facilitates the transaction of goods and services over the internet is called ecommerce. It also goes by the names electronic commerce or internet commerce. Today, nearly everything can be accessed through ecommerce platforms. It is a disruptive technology that helps businesses to increase their market reach and ensure better distribution for their products or services. 

Ecommerce supports both buying and selling of goods and has several tools designed to achieve the same. It employs a complete transaction cycle, including the payments just like brick and mortar stores. It is a safe and effective model and has evolved to attain the trust of consumers worldwide. The benefits of ecommerce have made consumers loyal to this model, ensuring its dominant presence in the business world in the coming future. 

The Evolution of Ecommerce

From a non-existential business model to a trusted shopping option for millions of consumers worldwide, the growth of ecommerce has been nothing short of a revolution. What started as a simple and fairly limited concept has transformed over the years to meet changing needs of consumers. Ecommerce has utilized the technological advancements rightly and to full potential to offer the consumers an experience like no other. 

Let’s see a timeline of the ecommerce evolution to understand the extent of its growth. 

1969: CompuServe, a technology built using a dial-up connection, marked the beginning of the online service industry. It was the first service to introduce email and internet connectivity to computer users.

1979: Michael Aldrich, an English entrepreneur, invented Teleshopping which became the foundation of modern ecommerce. By connecting a TV to a transaction processing computer through a telephone line, he carried out the first electronic shopping. 

1982: Boston Computer Exchange, the world’s first ecommerce company, was launched. It was an online marketplace for people to sell used computers. 

1990: The invention of hyperlinks, HTML and HTTP by Tim Berners, which became the groundwork for the technology that would facilitate online shopping. 

1991: The World Wide Web was invented, and The National Science Foundation lifted the ban on internet commerce.

1992: Book Stacks Unlimited, an online bookstore, was launched by Charles M Stack. Initially, it followed the dial-up bulletin board format and later switched to the internet. 

1994: The first widely used web browser Netscape Navigator was launched. The first complete ecommerce transaction occurred–from purchasing to payment being made online. 

1995: Jeff Bezos launched Amazon, and Pierre Omidyar launched eBay.

1998: PayPal was founded as an ecommerce payment system and was a revolutionary innovation in transforming online payments.

1999: Alibaba launched its first big online marketplace with more than $25 million funding with complete faith in the future of ecommerce

2000: Google launched Google AdWords, a way for online businesses to advertise their sites to Google users with pay-per-click ads. 

Walmart launched its website. 

2003: Apple launched iTunes, the first digital music store. 

Google extended its services to ecommerce retailers by launching Adsense to enable advertising around the world.

2004:  Shopify, an ecommerce platform for online stores and point-of-sale systems, is launched. It also marks the launch of Facebook, which would have a significant impact on ecommerce in future. 

2005: Amazon introduced Amazon Prime membership. It offered its members perks like two-day shipping at a flat fee, discounted one-day shipping, and members-only events. It boosted customer loyalty and encouraged repeat purchases. 

Etsy, a platform for the makers’ community, was launched. It allowed small sellers to sell products through an online marketplace.

2008: The first mobile ecommerce purchase happened. 

2009: BigCommerce, a 100% bootstrapped ecommerce storefront platform, was launched. 

The year also marks the launch of Square, which enabled payments via credit and debit cards through a mobile platform. 

2010: Shopify surpasses 20,000 web stores created by small businesses expanding to ecommerce.

2011: Google launched Google Wallet, a peer to peer payment service giving direct competition to PayPal. 

It also marked the launch of WooCommerce, a popular ecommerce platform. 

Stripe, a payment processing company, was launched and became a competition to Square.

Facebook ventures into advertising by rolling out sponsored stories for business page owners. 

2014: Apple introduced Apple Pay, a mobile payment method for Apple users. 

Jet.com was launched targeting people who require bulk ordering and the lowest prices for longer shipping.

2017: Instagram launched shoppable posts, enabling people to click on an item and go directly to the product page to shop. 

Amazon bought Whole Foods Market.

2018:  Mobile shopping increases and contributes to more than half of ecommerce sales. Purchases through voice assistants become common. Amazon accounts for 80% of the growth of the ecommerce industry.

2019: Global ecommerce sales touch $3.5 trillion, overtaking brick and mortar sales for the first time. 

2020: Covid-19 accelerates ecommerce growth, and ecommerce transactions reach $82.5 billion in May 2020– a 77% increase from 2019! 

Today, ecommerce is a trillion-dollar industry, with a clear promise of more growth and a bright future. 

The Importance of Ecommerce Today

According to a report by Adobe, Covid-19 accelerated the growth of the ecommerce industry by 4-6 years. The benefits of ecommerce, such as convenience and ease of shopping, were particularly appreciated by people during the pandemic outbreak. 

A Deloitte report states that until 2019, 85% of retail sales were through brick and mortar stores. But Covid-19 turned things around and threw retailers into dark times. Online shopping soared to record heights. Several ecommerce giants ventured into grocery and food delivery seeing its potential and demand among the consumers. Overall, ecommerce thrived, and its importance grew in 2020. 

Industry experts predict that from being a temporary adoption by consumers to cope with the pandemic, online purchases have now become a permanent option. Even after the pandemic, people are expected to continue with online shopping. 

The global ecommerce retail sales is expected to grow up to $5.4 trillion by 2022. This shows that the future of ecommerce is bright, and it is in demand more now than ever!

Top 15 Benefits of Ecommerce to Business in 2022

Everything that we have discussed in the previous sections makes one thing clear– if you want your business to expand and reach a wider audience, ecommerce is the way to go. It has proven to be a powerful model that has helped several businesses increase their sales and make more profit. Understanding the benefits of ecommerce will help you see the extent to which ecommerce solutions can assist businesses. 

• Less investment for set-up 

Having a physical store for your business is a financially taxing process. It requires a large amount of investment in the form of retail space and store design. For small to medium business owners, this poses a big challenge. Further, this large investment affects the pace of ROI adversely. 

The benefits of ecommerce in this aspect is a blessing. E-commerce eliminates the need for a physical storefront. The only space you would need to run an ecommerce business is storage spaces, which are way less costly than retail space. This makes setting up an ecommerce store more affordable. 

• Reduced operational cost 

It is possible to maintain an ecommerce store with low overhead cost, unlike an offline store. Running a physical store involves high operational costs. Businesses have to spend money on inventory, maintenance, rent, staffing costs, etc. For ecommerce stores, all of these factors are reduced to a minimum. 

It is found that ecommerce stores help to reduce operational cost by more than 60%. Since no physical storefront is needed, the costs related to maintenance, bills, rent, etc., is not applicable. Further, ecommerce stores require only fewer staff members. So, the staffing expense is also manageable. 

• No geographical limitations 

Ecommerce businesses have the benefit of not being restricted to physical locations. They have visibility over the entire global market, thereby giving access to a wider audience base. Ecommerce businesses can sell products to anywhere in the world. It opens the possibility of catering to different audiences, which would be impossible with an offline store. There will be no difference between a business based in an urban area and a rural area. Both will have the same reach with ecommerce development services. 

• Notify customers effortlessly

A significant advantage of ecommerce platforms is that they have various ways to send notifications to customers. This is an excellent technique to remind customers of your products and motivate them to shop. Notifications can be general product pitching, sales alert, restocking alert, etc. 

Notifications can either be sent through emails, or if the ecommerce solution has an app, push notifications can be set up. Suppose a customer added some products to the cart and did not complete the transaction. With ecommerce, it is possible to remind customers of the pending cart and encourage them to complete the purchase. Physical stores don’t have any such options. 

• Encourages impulsive buy

With ecommerce platforms, it is very easy to cash in on the impulsive buying tendencies of people. Impulsive buying is an unplanned purchase where customers make a purchase without any advance planning. It is a spur of the moment decision that stems from their feeling at the moment. 

Impulse buying can be induced by creating a well-crafted promotion of products. This can be in the form of attractive images or engaging promotional messages that drive customers to perform a purchase then and there. It gives customers instant gratification and makes them feel satisfied, and for businesses, it increases sales. 

• Easy to keep in touch with customers

Since ecommerce businesses have access to customers’ contact information like email and mobile number, it is easy for them to keep in touch with customers. By sending customers emails or text messages, ecommerce providers can give instant updates and alerts to them. It can be regarding a sale, order updates, or an occasional promotional message. Customers will also get the assurance that the ecommerce service is available to them in case of any need, which will increase trust and loyalty. 

• Affordable advertising and marketing

If a business has an online store, they don’t have to spend much money on advertising and marketing. They have various affordable ways to achieve this. Since ecommerce marketplaces are essentially visual medium, businesses can promote their products through good quality images, creative marketing videos, catchy infographics, etc. 

They can use social media to promote their business, create customized coupons, deals, etc., for customers. They can also employ sponsored ads which is a great way to attract customers to ecommerce businesses in a budget-friendly way. 

• Easy to scale up your business

For brick and mortar stores, scaling up a business is quite challenging. They have to

take into consideration factors like physical store space, employee numbers, shelf space, new store branches, logistics, etc. Among all these factors, the only one that is applicable to ecommerce stores is logistics. Since they already have unlimited shelf space and global reach, they don’t have to think about new branches or more space during the scaling up of business. 

More storage space and logistics are the only hurdles ecommerce businesses have to overcome while expanding their business. However, with the right choice of logistics provider, logistics can be managed, and more storage space can be availed at an affordable price. 

• Open 24X7 

An ecommerce business can remain open 24X7 throughout the year without the need for extra staff or resources. This introduces great flexibility in providing services. Customers can essentially shop from ecommerce platforms at any time and on any day. Concepts of Sunday holidays or public holidays do not apply to ecommerce stores. 

And not just regarding the sales, people can also avail customer support 24X7 as customer services will be automated and not human dependent. This is a wonderful benefit of ecommerce compared to physical stores.

• Faster response

Because ecommerce marketplaces follow a streamlined approach, every interaction happens fast. Be it a response to market demand, buyer query, or ecommerce trends; everything is swift. For example, if users are looking to buy an out of stock product, ecommerce providers can realize this and restock immediately. Similarly, if a shopping trend involves the use of discount coupons, it can be integrated quickly to stay on top of the game. The streamlined business process helps to bring awareness to the changes and take suitable actions fast. 

• Easy to provide customized services to customers

Getting access to tons of customer data is a benefit of ecommerce businesses that aren’t possible for physical stores. Apart from customer contact details, they also give information about customer behaviour, demographics, etc., with the help of data analysis tools like Google analytics. 

This helps businesses to learn customer requirements and provide personalized services to them. Using data insights, an ecommerce provider can find out the previous products that customers viewed or bought and provide customized recommendations based on them. It gives the business providers an idea about the customers’ taste and helps them curate personalized content. This significantly increases the conversion rate. 

• Use of trust elements

Trust elements are an important aspect of online stores that help to build customer trust in your platform. It can give more value to customers and can help increase conversion. Testimonials, reviews, etc., are examples of trust elements. When a customer is attracted by a product, after checking out all the features of the product, they will check for reviews from users. If a product has no or poor reviews, they might not buy it. 

So ecommerce stores have the advantage that they can use reviews to uphold their product. By showing the number of people who have brought a product, sharing real reviews, user videos, etc., ecommerce platforms can gain the approval of users.   

• More sales due to transparent product details

Brick and mortar stores lose a significant part of their sales due to the lack of proper product descriptions. Often, the customers are unable to find more information about a product when they desire it. Ecommerce businesses offer a significant advantage here. Customers can view detailed product descriptions, which helps them to make better decisions. This motivates them to shop more with ecommerce businesses as transparency in product details is a much-valued criterion. 

• Sale of digital products

Digital products such as videos, music, ebooks, etc., can be sold with the minimum overhead cost through ecommerce platforms. There is no concern about storage or delivery when it comes to digital products. The digital items can be delivered to customers within seconds of purchase. This increases customer satisfaction and improves their chance of shopping again. In this digital era, this is a noteworthy benefit of ecommerce. 

• Help businesses track logistics

When all business processes are digitized, it is easy for businesses to collect data related to their operations. They can find out what is the best moving product and which products are not getting enough customer attention. This helps them to better manage their inventories and marketing strategies. By knowing which categories are selling out fast, ecommerce businesses can promote more efficiently and prepare to expand their business according to customer demands. 

Wrapping Up

After reading the benefits of ecommerce and its importance in today’s times, you must have understood the need of making an online presence for your business. Online is the way forward. Even if you have a physical store, an online presence will bring you more sales and prosperity. 

If you are looking to digitize your business, contact a digital transformation company that can help you rise to new heights. MindsterDX is a top-rated company in the digital transformation field and has several acclaimed clients on our list. If you want to enjoy the full benefits of digital transformation, avail our services today.