Does e-Commerce Bring More
Opportunities to Enterprises?
The advancement in technology and the changes in marketing
demand brings new development in commerce and trading. The
rising popularity of the use of mobile networking attracts more
users to transact online via e-Commerce platforms. Yet,
e-Commerce stretches beyond online shopping. There are
mainly four models for e-Commerce, including "Business to
Business", "Business to Customer", "Customer to Customer" and
"Online to Offline". Amazon from the United States and Taobao
from Mainland China are two of the leading e-Commerce
platforms. As a result of the high mobile network penetration and
our advantaged role as a transit port, e-Commerce also starts to
gain popularity in Hong Kong.
The popularity of e-Commerce has a positive impact on trading
activities and also the recent development of smart living. Smart
Living can usually be referred to as a knowledge system and / or
an industrial chain. It aimed to improve one's living quality
through technology. Smart living covers areas such as living
space, healthcare and cultural-oriented living technology.
E-Commerce is part of the cultural-oriented living technology. It
brings convenience to users across aspects such as clothing,
food, housing, transportation, education and entertainment. The
borderless e-Commerce allows users to acquire customised
service with low transaction cost and time effectiveness.
From an enterprise's perspective, there are at least three other
advantages of e-Commerce. First, e-Commerce lowers the
purchasing and storage cost as the real-time online statistics can
effectively reflect and predict the market trend. Second,
e-Commerce shares the advantage of the world-wide web that
allows enterprises to communicate and interact with customers
on social networking platforms. Third, e-Commerce also opens
up markets for the enterprise as the Internet expands the pool of
potential customers across national borders.
However, e-Commerce also has its limitations. The reliance on
the virtual network may complicate the enterprise-customer
relationship when there is not any physical entity to deal with
issues regarding the after-sales service and product return. In
order to run an e-Commerce smoothly, it will require a more
advanced management information system to deal with issues
such as order aggregation, logistics, fund transfer and integration
of various systems in a more accurate and synchronised manner
which will greatly affect the order completion time.
Besides, e-Commerce and the online transaction can also cause
security problem, namely Internet fraud, credit card fraud and
other e-payment issues. These issues are mainly caused by the
difficulties in authenticating the user identity. If users overlooked
the importance of authentication and data encryption, they
might risk leaking their personal information or causing
monetary loss. Credit card fraud is another common problem.
Users should be alert to security hazards to avoid phishing
attacks, fraudulent transactions and other forms of security
fraud. Hong Kong Government has noticed the rising need of
security measures for online credit card transaction. Nowadays,
most banks offer extra security measures, such as "Visa
Verification" and "MasterCard SecureCode". The Hong Kong
Monetary Authority also requires the banks to alert the user by
sending SMS when a suspicious transaction is found.
Apart from these, e-Commerce has also fostered the
development of online payment methods. Most popular online
payment methods belong to the category of "Third-party
payment". Paypal and WeChat Pay are two significant examples.
Paypal allows users to transfer payment by e-mail with just a
small amount of service charge. WeChat Pay requires users to
assign their credit card to create a "Wallet". After the assignment,
users can transact through scanning the QR code or bank
transfers. Yet, these new online payment methods still bare the
risk of Internet fraud and personal information leakage.
The United States and China are two important pillars in
sustaining the growth of e-Commerce in view of their success in
the development of online payment methods. As mentioned,
Amazon and Taobao are two of the most popular e-Commerce
platforms. Yet, they have very different target users and profit
gaining methods. Amazon is unique in the sense that it is more
than an e-Commerce platform. Amazon is actually a
transnational e-Commerce enterprise with its own supply chain
and storage. Its service covers from retail to publication and
cloud computing service. For Taobao, it is an Asian-oriented
online shopping platform focusing on providing service under
the "Customer to Customer" model. Users can create their own
online shop and interacts among themselves freely. In addition,
Amazon mostly takes advantage of the Internet to minimise the
pressure of fixed asset as well as rental and storage cost faced by
traditional business. For Taobao, it mainly gains profit from
advertising and providing customised analytical services. The
success of Amazon and Taobao reveals that there are multiple
ways to make good use of the Internet to expand the potential of
an enterprise.
E-Commerce has also started to gain popularity in Hong Kong.
According to a report conducted by Go-Globe in 2015, Hong Kong
has a market size of HK$350 million in e-Commerce. With the
increasing rental pressure on enterprise, there is a rising number of
online stores established in Hong Kong. 3M Hong Kong Limited,
Bonjour Holdings and Bossini International Holdings Limited are
three of the most successful examples in Hong Kong in relation to
e-Commerce. Although the "Business to Business" model is
relatively more popular in Hong Kong in the operation of
e-Commerce, the enterprises and consumers in Hong Kong begin
to see the convenience and benefit of e-Commerce through the
trend of online payment and diverse logistic services. It is not
impossible that more and more users will give e-Commerce a try in
the near future.
In short, the prevalence of e-Commerce is inevitable. The
continuous development of the e-Commerce platform and online
payment method also creates a favourable environment for the
future of e-Commerce in Hong Kong. Therefore, enterprises should
consider grabbing this golden opportunity to further expand the
market for their business in response to this new era in commerce
and trading.
