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Cost Savings and Marketing Benefits
In order to explain how an organization can achieve significant cost reduction as well as marketing benefits with the help of internet technology, it is necessary to define e-business first. According to a definition provided by IBM, “e-business is the transformation of key business processes through the use of Internet technologies.”1 It should be mentioned that the term ‘e-business’ could be used to denote organizational strategy and operations as well as refer to the type of business that operates online.
Taking into consideration significant benefits of name recognition, cost reduction, and increase in revenues that the Internet offers for businesses, it could be argued that it is “a typhoon force” rather than “a bit of wind.”2 The use of internet technology allows making electronically mediated transactions between different parties thereby significantly reducing the cost of conducting business. Moreover, e-commerce offers numerous opportunities for directing pre-sale and post-sale operations thus fundamentally changing marketing structure of the past. By taking intermediaries such as retailers out of a transaction, it is possible to save up to 30 percent on sales.3 Not only does the Internet provide buyers with access to direct selling channels, but it also allows business to outsource various services, components, and materials driving the cost of doing business down. Moreover, pervasiveness is one of the main characteristics of e-commerce, and it is inextricably connected with marketing dimension. It allows businesses and non-profit organizations achieve a high rate of growth by marketing their products and activities through the Internet.4
Business Strategy and Environment
Every business strategy has to be aligned with unique characteristics of an environment in which an organization operates. Without understanding economic, political, technological, and sociological implications of conducting business in a certain sector of the economy, it is impossible to identify threats and opportunities as well as to set a clear strategy.5
The retail business environment is associated with a high level of volatility and change that present a significant threat to long-term competitiveness. In order to achieve sustainable corporate development, my organization has adopted a business strategy that focuses on the promotion of sustainability and integration of innovations.6 To this end, it constantly measures its performance using specific industry benchmarks. In order to take into account all local priorities and issues, the organization adopted a bottom-up approach to measuring its performance. Specifically, it allows all suppliers to participate in the process of developing a framework of benchmarks for assessing sustainability. The organization builds its business strategy with the help of information about sustainable retailing provided by its customers thereby taking advantage of the business environment as well as new technological solutions for heightening consumer recognition.
By encouraging customer participation in the development of sustainable solutions for retailing, the company circumvents subjectivity bias inherent to other organizations that adopt a top-down approach to developing the framework of measurements.7 It allows the organization to integrate perspectives of society, retailers, and consumers into its operation process. Therefore, it could be argued that every enterprise that wants to achieve material efficiency and economic viability should develop their business strategies according to the unique characteristics of an environment in which they operate. Moreover, there is a large body of evidence suggesting that those organizations that include the factor of sustainability into consideration of their business strategies and management practices, not only achieve long-term competitiveness but also “induce positive direct or indirect effects on profitability” thereby benefiting both their customers and stakeholders.8
Chaffey, D., E-business and E-Commerce Management, Harlow, FT Prentice Hall, 2011.
Radovilsky, Z., Application Models for E-Commerce, San Diego, Cognella Academic Publishing, 2015.
Youn, C. et al., ‘Measuring Retailers’ Sustainable Development’, Business Strategy and the Environment, vol. 12, no. 3, 2016, pp. 103-108.
- D. Chaffey, E-business and E-Commerce Management, Harlow, FT Prentice Hall, 2011, p. 13.
- Chaffey, E-business and E-Commerce Management, p. 47.
- Z. Radovilsky, Application Models for E-Commerce, San Diego, Cognella Academic Publishing, 2015, p. 14.
- C. Youn et al., ‘Measuring Retailers’ Sustainable Development’, Business Strategy and the Environment, vol. 12, no. 3, 2016, p. 103.
- Youn et al., Business Strategy and the Environment, p. 105.
- Youn et al., p. 105.
- Youn et al., Business Strategy and the Environment, p. 107.
- Youn et al., p. 107.