Building E-Commerce From the Ground Up: A Study of the Retail Industry

Abstract

The selling of goods and services on the Internet has evolved from a hypothetical business concept into a thriving, multi-billion dollar industry which has prospects of sustained double-digit growth well into the first decade of the 2000s. This new market channel is estimated to achieve over $108 billion in sales transactions by 2003 (Business Week, Sept. 1999). There are various definitions regarding what is meant by “electronic commerce,” however for the purposes of this chapter, we will confine our definition of the term to that segment of the retail industry which comprises sales transactions for products and services consummated via the Internet. This is a critical distinction from the far more vast array of literature devoted to companies’ use of electronic commerce such as Electronic Data Interchange for the purpose of reducing operating costs by streamlining productivity and efficiency. In short, we will limit our view of e-commerce to the business of selling goods and services via the Internet. Within this realm of e-commerce, there are several critical issues that arise for companies seeking to open an e-commerce storefront. In this chapter, we will use the actual experiences of one retailer to highlight various approaches to those issues.