Market Structure of Retail Industries †Free Samples to Students

Question: Discuss about the Market Structure of Retail Industries. Answer: Introduction The rapid advancement in technology in recent times has led to shrinking of the world into a small global village. It is amazing how technology has brought the world together and how businesses have advanced to produce, disseminate and sell goods world over with the aid of technology. The world of business has evolved into an ecommerce stage whereby, markets are no longer going to exist physically but rather, on the internet, and this is what is referred to as the ecommerce business (Gao). Ecommerce refers to the business process of buying goods and selling goods over the internet. It is a new emerging business trend in the contemporary world (SMC Digital). Businesses have gone online which enables potential customers to buy whatever they need and have the products delivered to them after the payments. Ecommerce as a form of business saves time, and reduces the hectic processes of having to walk to the market place to buy goods. Therefore, in this case, my online ecommerce business is shopeasy.com. It is a startup online market place that will aim at providing all the online shopping solutions from electronic appliances to kitchen appliances and clothing products among others. Electronic commerce entails different models (Menon, 2014), and as an entrepreneur, understanding a model that fits your business is the most significant factor in this field. Hence, shopeasy.com will employ the merchant ecommerce model which specifically entails sellers and buyers meeting over the web to transact business. It is a basically employing the old retail model mode into ecommerce, enabling people to buy goods and services over the internet. While ecommerce has numerous characteristics that differentiate it from the traditional commerce, online ordering of goods and logistics support is one of the primary characteristics that differentiate it from the rest. Value Proposition The starting of the shopeasy.com is motivated by the fact that there has been a huge market gap in the online business sector. People and potential customers like engaging in time-saving business processes as well as favourable prices on top of their priority list (Vu, 2013). The online platform seeks to address the need for customers to access products they deem rare to find and improve seller-buyer relationship which boosts the trust of the buyer towards the seller. Increased relations between the business and the customers will in return lead to increased positive review feedback in regard to the services offered by shopeasy.com. First and foremost, the business seeks to address the factor of time. In traditional commerce, the buyers spend considerable amount of time walking around shop after shop, market after market or mall after mall looking for the specific products they want to purchase. But with this platform, it will be much easier with the availability of the products just a click away from the customers computers at home (Goldmanis, Hortacsu, Syverson, Emre, 2009). Most buyers prefer having what they need from home or a place they deem be comfortable. The shopeasy.com site will offer a wide range of services and products to the online buyers. These will include electronic appliances, ranging from computers to kitchen equipments and entertainment gadgets. Other products such as clothing will be made available in different fashions among other numerous products. The ecommerce business platform will further add product review and rating section to enable the customers express their opinion about the product they acquire (Bobbala Murugan, 2008). Most importantly, shopeasy.com will offer product delivery services for its customers. Logistics services including shipping of products from overseas suppliers will add gloss to this dynamic business venture really worth trying. Market Opportunity The shopeasy.com ecommerce business dynamic range of operations intends to satisfy a variety of consumers. But since it is an online business platform, segmentation and target of the individual groups of potential customers is a significant process. It narrows down on which particular group of people a business will address their needs depending on their demand of goods and services on the platform. Having a target market for your goods as a seller expands selling options and eliminates aimless sales (Lee, Ze, Chen, Fan). Hence, shopeasy.com will target particular groups of people, including the young adults and the middle class. The young adults exhibit greater confidence in use of technology. They are versatile and dynamic and willing to try out new technological trends, hence their suitability to ecommerce platforms such shopeasy.com is inevitable. Having a vibrant target market such as the young adults will be an added advantage to the business, as they enhance the activeness through their constant inquiries, product reviews and service feedbacks that will aid the business in a self-check analysis for rectifications and service improvements (Mahadevan, 2000). On the other hand, the middle class population is a crucial target for most businesses. They comprise the largest groups of consumers in most global economies and they are the huge spenders. The middle class is characterized by overspending on new products in the market; therefore, having them as a target market will surely boost the business performance and potential. The main advantage about the young adults and the middle class market segments is that they make the majority of buyers for most businesses. They are the largest consumers which will make shopeasy.com have a wide network of buyers. With the use of the internet making it easy to access the online platform, the market size is predicted to have unlimited size. Cost Structure and Revenue Model It is important to note that the primary objective of most business ventures is generation of revenue which results in profits and shopeasy.com is not excluded. The success of an ecommerce business relies heavily on the type of revenue model(s) adopted, depending on what the business want to achieve (UnLtd). The cost structure involves the total business expenditure used in the running of the business. The shopeasy.com online platform will look forward to utilizing more than one revenue model, i.e. the merchant model, and the advertising model. The venture will earns its revenues majorly on the sales of goods and services through the online shopping, which will make up of the 80% percent revenue source. However, the additional revenue sources which will be gained from logistics and postage services offered by the platform will count. In addition, shopeasy.com will provide an open advertising space for various willing advertisers, and all these activities will provide a good source of income. With a starting annual budget set at $50 million, shopeasy.com will harness all the available possible avenues to generate an estimated $80 million in revenues, which represents a $30 million net profit annually and a sustained near $100 million dollars in a three years period. Given the market gap which conspicuously is visible in ecommerce, shopeasy.com stands to reap big. In a technological age whereby almost every individual is relying on the technology to solve their problems, then online shopping will become one of the most utilized forms of buying and selling products and services. Increased demands of online products has increased in recent years, a circumstance that will signal the start of a competition era, which will mean that only the best survives. But the prospects of huge business returns on investments projected from ecommerce epitomizes the financial viability of the venture. Market Strategy Any business venture understands the importance of creating awareness about its existence to its customers. Promotional practices are very significant in advancing the marketing agenda of the firm through. It is, therefore important to create an advertising campaign that would generate traffic towards your website and your products. The shopeasy.com start up budget includes the marketing budget to cater for promotional activities. While the traditional commerce employs the normal traditional marketing strategy of 4Ps (Frolova, 2014), ecommerce can easily advertise itself. It important to note however, that 4Ps can still be used. The shopeasy.com venture will rely on the online promotion of its activities including use of social media to promote the business. The most top effective social media sites includes Facebook, twitter, Instagram and Google plus. They are the most populous in terms of users. The business will intensify its marketing through social sites to reach its followers. The constant running of promoted ads and even a possibility of mainstream media such as the television ads and the radio advertising will boost the presence of the shopeasy.com business activities (Nimble Division). Furthermore, shopeasy.com will create a mobile app that enables easier and direct access to the shopping platform without having to visit the website from a browser. The online shopping platform will employ promotional tactics such as reduction of prices through discounts, frequent limited offers on most sought after products, free delivery of the fully paid products as well as effective customer service towards the customers by providing an outstanding support from the communications team towards the clients. For the review and tracking of the business performance, customer feedbacks and activities will determine what course of action is necessary to improve the services of the platform. Human Resources The prosperity of a business is enhanced by the team that propels it (Pal), and that is why having the right workforce is fundamental for the growth of the business (Hussain Ahmad, 2012). In terms of requirements on what type of the organizational team is required to power the performance of the platform, shopeasy.com will require a strong team guided by highest level of cooperation. With cooperation and coordination then it gets easier for task coordination, which results in best customer service delivery to the clients (Tubey, Rotich, Kurgat, 2015). The expansion and growth of the activities within the organization will lead to an increased workforce to spearhead the operations and selecting the right team will be very important. The communications team to provide online support is necessary; the same applies to the technical team which oversees the efficient and smooth running of the platforms website. Furthermore, regional managers will be required to provide physical contact with the customers in case they have a question they cannot address online through the firms website. The organization will also require the logistics team who will deal directly with the delivery of purchased goods to the right buyers after payments are completed. The top management, all the stakeholders, the suppliers and business partners should also understand the organizational values and goals in provision of quality services that customers appreciate. Conclusively, ecommerce business is taking over the modern world, and it is becoming easier to have all your shopping needs sorted out online via an efficient website trading. But the success of ecommerce business venture requires a well strategized approach as well; from understanding your target market to the models an entrepreneur wishes to employ in his/her business practices. The business potential exhibited indicates a bright future in ecommerce. References Bobbala, A., Murugan, K. (2008). E-commerce Website Design. 2-9. Frolova, S. (2014). The Role Of Advertising In Promoting A Product . Thesis: Centria University of Applied Sciences-Degree Programme in Industrial Management , 2-61. Gao, J. (n.d.). Introduction to E-Commerce. Computer Information Systems Engineering . 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