USING THE INTERNET FOR BUSINESS EXPANSION
“Bezos’s idea was simple: as the Internet extended its reach, an efficient retailer could do away with the bricks and mortar (hereafter referred to as B&M) of physical stores and serve customers better because the Net allows sellers direct contact with buyers. All at a potential profit margin the B&M guys can’t match. If a chain of 1,000 stores wants to double sales, Bezos says, it has to open another thousand stores, with all the land and manpower costs that that entails. But once an online operation gets past the fixed cost of its Web site and distribution channel, it can handle bigger sales with very few extra expenses. “You can offer both the lowest prices and the highest service level,” he says, “which is impossible in the physical-world environment.” (Levy)
That quote in itself puts most of the positive aspects of online commerce in plain view. …And by the way Jeff Bezos is the CEO of Amazon, which is a $25.4 billion dollar Internet super-store. The Internet represents a new business medium. More and more, companies are taking advantage of online marketing to increase revenue and reach a new playing field so to say. The growth of the Internet has been phenomenal and continues to rise. Many businesses have either seen huge growths because of the Internet or become multi-billion dollar companies who are completely web-based. Companies who originally had nothing to do with the Internet have the opportunity to reach millions of new consumers by creating their own web-sites to either advertise or directly sell online.
In an article written in 1997, the author gives an interesting statement about the future of online commerce.
“Electronic commerce is bound to happen but it is going to take longer and require more technology infrastructure and organizational reshuffling than some have predicted. And it won’t begin with the mass consumer market that was once envisioned, but with businesses selling or sharing information with other businesses.” (Ambrosio 14)
Electronic commerce was bound to happen and has happened perhaps quicker then expected. And, the Internet does have a mass consumer market. Online shopping is huge, in fact most clothing manufacturers, electronics companies, and music stores now use the Internet to sell directly to anybody who has an Internet connection and a credit card. Even more, I think it’s safe to say that you can pretty much buy anything you can imagine online. You can even go to auction sites and bid on those hard to get items such as antiques and collectibles. Using the Internet to both sell and purchase products is on a major rise.
“Even though online buying represents a fraction of total consumer sales these days, it’s a fraction that didn’t exist a few years ago—and with sales estimated at $184 billion within three years, the curve is headed straight up.” (Levy)
To put things in perspective, this scale amazingly compares the market capitalization of large Internet based companies to a handful of national economies.
Market cap vs. GDP, in billions. Company Value Nation GDP AOL $67.1 New Zealand $65.6 Yahoo! 33.9 Kuwait 32.5 Amazon 25.4 Ethiopia 24.8 EBay 11.8 Honduras 11.5 Lycos 3.9 Martinique 4.0 (Bigbucks.com)
Those five companies represent the potential of online commerce. They are billion dollar organizations who are completely web-oriented. You don’t have to provide an Internet service to benefit though and large already established companies are using the Internet to advertise and sell. For example…
“Could the car salesman be headed the way of the milkman and the door-to-door encyclopedia pitchman? Ford certainly thinks so, and moves a little closer that day with the announcement of a trial agreement with online broker Priceline to sell cars on the web.” (Eskenazi)
You can even buy a car online! Saturn also offers Internet service in selling automobiles. If you can buy a car on your computer, what can’t you buy?
The bottom line is the Internet is already a huge playing field in the game of commerce and is only getting bigger. Companies who function without the use of the Internet, but don’t offer a web-site for various reasons are lagging behind. It’s the technological revolution and if you don’t take advantage of the Internet and what it has to offer—you’re missing a great opportunity!
“The story of the Web is the story of change. Many companies that didn’t exist three years ago are among today’s leaders in Internet commerce, technology, and influence. Although there are plenty of barriers to entry, and many more barriers to success, hundreds of new Web companies start up every month in the hopes of becoming the next Netscape, Amazon.com, or Yahoo. The history of business and technology has never seen anything quite like it.” (Wilder 46)

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