Impacts of E-commerce

GE Elec 3: Living in the IT Era

Judd P. Tablazon
Lecturer
Tarlac State University – College of Science
Social and cultural effects of E-commerce
adoption
Shifts in Consumer Behavior
• Convenience: Consumers now prioritize convenience in their shopping behavior,
leading to an increase in online shopping as it offers the ease of browsing and
purchasing from anywhere at any time.
• Personalization: E-commerce platforms utilize data analytics to provide
personalized recommendations and targeted advertising, influencing consumer
choices and preferences.
• Price Comparison: Online channels allow consumers to easily compare prices
across different retailers, encouraging them to make informed purchasing
decisions based on the best deals available.
• Increased Expectations: The efficiency of e-commerce logistics has raised
consumer expectations regarding delivery times and service quality, pushing
businesses to enhance their operations to meet these demands effectively.
Social and cultural effects of E-commerce
adoption
Increased Access to Goods and Services
• Electronic commerce has enabled online sales to skyrocket, with e-commerce
companies leveraging diverse e-commerce business models to cater to
consumer needs efficiently.
• Detailed product descriptions on e-commerce platforms provide consumers with
the information they need to make informed purchasing decisions, further driving
the exponential growth of online shopping.
• The convenience of mobile commerce has also played a pivotal role in enhancing
access to goods and services, allowing consumers to shop anytime, anywhere.
Social and cultural effects of E-commerce
adoption
Changes in Employment Patterns
• Job Displacement: Traditional roles are being replaced by automation, leading
to a shift in the labor market.
• Job Creation: E-commerce platforms create new job opportunities in areas like
digital marketing, data analysis, and logistics.
• Digital Skills: The demand for employees with digital skills is on the rise,
emphasizing the importance of adapting to technological advancements.
• Remote Work and Gig Economy: E-commerce enables remote work
opportunities and promotes the gig economy, allowing for more flexible work
arrangements.
Social and cultural effects of E-commerce
adoption
Cultural Exchange and Globalization
• E-commerce has enabled businesses to transcend geographical boundaries,
tapping into a global market. It has facilitated smoother international trade by
simplifying cross-border transactions.
• Moreover, the digital commerce landscape has fostered cultural diversity by
exposing consumers to products and ideas from around the world. E-commerce
plays a crucial role in enhancing connectivity and enriching the online shopping
experience, creating a more interconnected and culturally diverse marketplace.
Social and cultural effects of E-commerce
adoption
Privacy and Security Concerns
• Data Breaches: Stay vigilant against potential data breaches that can
compromise personal and financial information.
• Secure Payment Methods: Opt for platforms that offer secure payment methods
to safeguard your transactions.
• Encryption Technology: Look for websites that utilize encryption technology to
protect data exchanged during online purchases.
• Cybersecurity Measures: Implement robust cybersecurity measures to prevent
unauthorized access and enhance identity theft protection.
The economic impact of E-commerce
on global markets
• The rise of cross-border e-commerce has opened up new opportunities for
businesses to reach international customers, driving economic growth and
fostering global market integration.
• Government bodies are increasingly recognizing the importance of regulating e-
commerce to ensure fair competition, promote economic development, and
protect consumer rights.
• As the e-commerce industry continues to evolve, the role of government bodies
in setting policies and guidelines for e-commerce practices becomes vital for
maintaining a level playing field and fostering consumer protection.
The influence of E-commerce on Small
and Medium Enterprises (SMEs)
• Increased Reach: SMEs can now reach a global audience through online
platforms, expanding their customer base beyond local boundaries.
• Cost Efficiency: E-commerce enables SMEs to reduce operational costs by
eliminating the need for physical storefronts and streamlining processes.
• Enhanced Competitiveness: Through e-commerce adoption, SMEs can
compete more effectively with larger corporations by leveraging digital commerce
tools and strategies.
• Improved Logistics: The development of e-commerce infrastructure has
enhanced logistics for SMEs, allowing for smoother supply chain management
and faster deliveries.
Environmental impact of E-commerce
• The convenience of online shopping has led to an increase in the carbon footprint due
to transportation and packaging. However, e-commerce also presents opportunities for
green practices and eco-friendly initiatives throughout the supply chain.
• One of the key challenges faced by online businesses is reducing their carbon footprint.
The transportation of goods from warehouses to customers contributes significantly to
emissions. Implementing sustainable practices like optimizing delivery routes and using
eco-friendly packaging materials can help mitigate this impact. Additionally, ensuring
that data centers and servers are energy-efficient is crucial for reducing the
environmental footprint of e-commerce operations.
• On the flip side, e-commerce provides opportunities for businesses to adopt sustainable
practices. By leveraging technology to streamline operations and reduce waste, online
businesses can contribute to environmental conservation. Embracing eco-friendly
packaging, promoting recycling programs, and investing in renewable energy sources
are ways in which e-commerce companies can enhance their sustainability efforts.
Balancing growth with environmental responsibility is essential for the future of online
businesses.
Ethical issues in E-commerce
• E-commerce revolutionizes traditional commerce by enhancing convenience,
broadening product selection, and reducing costs, thereby driving economic
growth and job creation.
• However, it also faces ethical challenges, including issues related to privacy,
consumer rights, environmental impact, and intellectual property.
• Adhering to ethical guidelines that emphasize fairness, transparency, and
integrity is crucial for protecting consumer rights and data, promoting
environmental responsibility, and building trust in the digital marketplace.
Ethical issues in E-commerce
Privacy and data protection
• Online transactions involve sharing personal and financial information, making
data privacy and security critical.
• Ethical concerns, such as unauthorized data collection and inadequate security
measures, can lead to breaches that exploit consumer privacy.
Ethical issues in E-commerce
Consumer rights
• E-commerce must uphold fair treatment of consumers, which includes
transparent disclosure of product information and pricing, honest marketing
practices, and the right to return or exchange products.
• Violations such as deceptive advertising, hidden fees, or misleading product
descriptions challenge ethical standards.
Ethical issues in E-commerce
Intellectual Property Rights (IPR)
• Currently, counterfeit goods represent approximately 10% of global trade. The
digital nature of e-commerce makes it easier for counterfeit products and
intellectual property theft to proliferate.
• Ethical challenges include protecting creators' rights and addressing issues such
as copyright infringement and trademark violations.
Ethical issues in E-commerce
Corporate Social Responsibility (CSR)
• Businesses are expected to operate responsibly, considering the social and
environmental impacts of their operations.
• This involves engaging in philanthropy, ensuring ethical labor practices, and
contributing positively to communities.
Ethical issues in E-commerce
Legal compliance and cross-border trade
• Navigating the legal requirements of different countries can be complex,
particularly around issues like tax compliance, import-export regulations, and
local consumer protection laws.
• Ethical e-commerce practices require adherence to all applicable laws and
regulations, which can vary significantly from one jurisdiction to another.
Ethical issues in E-commerce
Environmental impact
• E-commerce impacts the environment through packaging waste, increased
transport emissions, and the carbon footprint of data centers that host online
platforms.
• Ethically, businesses are encouraged to adopt sustainable practices such as
using eco-friendly packaging, optimizing logistics to reduce emissions, and using
renewable energy sources.
Ethical issues in E-commerce
Labor practices and supply chain ethics
• E-commerce companies must ensure fair labor practices throughout their supply
chain. This includes providing fair wages, safe working conditions, and avoiding
child or forced labor. Transparency in supply chain operations is crucial to
verifying ethical practices.
Ethical issues in E-commerce
Fair competition
• Ensuring a level playing field in e-commerce is essential to prevent practices like
price fixing, misuse of market dominance, or anti-competitive behaviors that
undermine fair competition and innovation.
Importance of E-commerce ethics
• Consumer Trust and Reputation: Upholding ethical standards in e-commerce is
essential for building trust, credibility, and a positive reputation. This foundation
fosters customer loyalty and is vital for long-term success in the competitive
online marketplace.
• Fair Competition: Practicing ethics in e-commerce, such as steering clear of
price-fixing and deceptive advertising, promotes innovation and competition. This
ultimately benefits consumers by providing better prices and more choices.
• Social Responsibility: In e-commerce, embracing social responsibility through
fair labor practices, diversity, and community support is vital. This commitment
not only enhances a business's reputation but also garners positive recognition
from consumers and stakeholders.
• Consumer Protection: Consumer protection in e-commerce focuses on
upholding consumer rights, privacy, and data security, alongside promoting fair
pricing to prevent exploitation and foster trust in the online marketplace.
Future trends and the continuing
impact of E-commerce
• E-commerce trends indicate a significant shift towards mobile shopping,
personalized shopping experiences, and the integration of augmented reality. The
impact of e-commerce on online retail sales is undeniable, with projections
showing a continuous rise in online transactions globally.
• As e-commerce adoption rates soar, businesses must focus on enhancing their
e-commerce infrastructure to meet the demands of the digital consumer. The
success of e-commerce ventures will depend on their ability to leverage data
analytics, streamline logistics, and optimize the customer journey.
• The future of e-commerce holds exciting possibilities, with innovations like voice
commerce and drone delivery on the horizon. To thrive in this dynamic
landscape, businesses must stay agile, embrace technological advancements,
and prioritize customer-centric strategies to capitalize on the ever-expanding
opportunities in the digital commerce domain.
References
• https://verpex.com/blog/ecommerce-woocommerce-hosting/e-commerce-ethical-
issues
• https://www.mohitecommerce.com/impact-of-ecommerce/
Next lectures
• Understanding digital marketing
• Digital marketing plan
Thank you.
Judd P. Tablazon
jptablazon@tsu.edu.ph