Learn More – Online Shopping

Online shopping is the process consumers go through to purchase products or services over the Internet. An online shop, eshop, e-store, internet shop, webshop, webstore, online store, or virtual store evokes the physical analogy of buying products or services at abricks-and-mortar retailer or in a shopping mall.

The metaphor of an online catalog is also used, by analogy with mail order catalogs. All types of stores have retail web sites, including those that do and do not also have physical storefronts and paper catalogs. Online shopping is a type of electronic commerce used forbusiness-to-business (B2B) and business-to-consumer (B2C) transactions.

The term “Webshop” also refers to a place of business where web development, web hosting and other types of web related activities take place (Web refers to the World Wide Web and “shop” has a colloquial meaning used to describe the place). Buying online introduced new ways of reducing costs by reducing the number of staff needed. It is a more effective way of getting products to people and spreading into different demographics.

Benefits of online shopping

1. Bargaining power of consumers. They enjoy a wider choice
2. Supplier power. It is more difficult for consumers to manage a non-digital channel.
3. Internet increases commoditisation
4. Threat of new entrants. Online means it is easier to introduce new services with lower over-heads
5. Threat of substitutes
6. Rivalry among competitors. It is easier to introduce products and services to different markets

History

Online shopping pre-dates the internet/www, the IBM PC and Microsoft. It was invented in the UK in 1979 by Michael Aldrich of Redifon Computers. Aldrich connected a modified 26″ colour television to a real-time transaction processing computer via a domestic telephone line and demonstrated online shopping.^[1] From 1980 onwards he sold his systems in the UK with considerable success.

The world’s first recorded B2B online shopping system was Thomson Holidays in March 1981.^[2] The world’s first recorded B2C was Gateshead SIS/Tesco in May 1984.^[3] The world’s first recorded online home shopper was Mrs Jane Snowball of Gateshead, England in May 1984.^[4] During the 1980s online shopping was also used extensively in the UK and some parts of continental Europe by auto makers Peugeot-Talbot, Ford, Nissan and General Motors.^[5] All these organizations and others, particularly in Financial Services and manufacturing industry, used the Aldrich systems. These systems operated over the switched public network in dial-up and leased line modes. There was no broadband capability.

In 1990 Tim Berners-Lee created the first World Wide Web server and browser. In 1992 Charles Stack created the first online book store, Book Stacks Unlimited (aka Books.com), two years before Jeff Bezos started Amazon. In 1994 other advances took place, such as online banking and the opening of an online pizza shop by Pizza Hut. During that same year, Netscape introduced SSL encryption of data transferred online, which has become essential for secure online shopping. In 1995 Amazon expanded its online shopping, and in 1996 eBay appeared.

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