E-commerce has formulated new means of online shopping tendency and distribution channels to boost the wants and needs of consumers. The transformation in information technology has led to the emergence of e-commerce in the industry arena by the means of selling services and goods. Based on this, e-commerce can be defined as the trading of services and commodities by using the internet and network tools. Online shopping supports effortless accessibility, commodity attributes and features, perceived risk and timelessness pose more effects on buying intention (Selvaraju & Karthikeyan, 2016). Additionally, the development of e-commerce has also transformed customer expectations; currently, consumers are expecting a seamless shopping experience across every channel, be it online, via a mobile application of in-store. This forces retailers to offer an omnichannel experience that fulfils such expectations in order to remain relevant and competitive in the business industry. Therefore, e-commerce and online shopping can pose some social and economic impacts. E-commerce and online shopping have been associated with various social and economic impacts such as increased customer satisfaction, positive consumer behaviour and increased GDP growth; however, online shoppers should be concerned with privacy and security issues.
e-commerce and online shopping
The emergence and development of e-commerce and online shopping have led to increased customer satisfaction due to the aspects of product variety, information quality, and product delivery. The quality of information and consumer satisfaction determine the loyalty of customers towards web stores (Mofokeng, 2021). Even though a significant benefit of the internet is its capability of simplifying data searches and facilitating transactions, enhancements in the usage of innovative website technology expect retailers to showcase commodity data while also cultivating positive connections with consumers. This can be made possible by providing a satisfying shopping experience featuring web design, information quality and ease of navigation, that is salient for the continuous success of online retail (Mofokeng, 2021). An excellent example of how e-commerce and online shopping have positively influenced customer satisfaction can be realised through the case of eBay Australia. In 2018, eBay launched its national Fulfilment Partner program in partnership with Fulfilio, to offer online sellers effective prices for picking, packing and delivering their orders. Consequently, it reduced delivery periods and end-to-end fulfilment by 15% for participating sellers. In the same year, eBay announced Guaranteed Delivery in Australia, promising to deliver goods within a time span of three days or less (Fei et al., 2020). eBay Australia offers an excellent example of customer satisfaction through product delivery that presents one of the significant social impacts of e-commerce and online shopping.
eBay Australia partnering with Fulfilio
Additionally, e-commerce and online shopping have led to positive consumer behaviour, such as site or store revisit intention, word of mouth and repurchase intention. High-quality service presents a necessity for achieving high levels of client satisfaction, that often leads to positive consumer habit intentions. The ingredient of success in online shopping business is a site with sophisticated electronic service quality, quality of information and quality of system (Rita et al., 2019). The analysis by Rita et al. (2019) discovered a correlation between customer happiness and site revisit, word-of-mouth and repurchase intent. When clients are happy with a product or service they acquire, they will do so from the same provider in the future. In other cases, repurchase intent and word-of-mouth were positively impacted by customer trust (Rita et al., 2019). A customer is more inclined to suggest a business to others if they feel more trust in it. Consumers are likely to rely on suggestions from more seasoned consumers because it can be challenging to evaluate online services. In keeping with the findings of this study, word-of-mouth was more significantly impacted by consumer trust than repurchase intention (Rita et al., 2019). The case of UberEATS in Australia is an excellent example of how high-quality service in the e-commerce business can positively affect consumer behaviour. An experience is told of a Foreign UberEATS driver operating in Australia who initially received bad customer ratings. The driver decided to give away free water with each delivery. Also, the driver decided to send a text through the application to ask clients to give him a thumps up before completing the trip, if they were satisfied with the offered service. Within a span of two weeks, his ratings climbed from 78% to 91% as seen in figure 1 below. This demonstrates the significant change in consumer behaviour owing to the high-quality services in the e-commerce business.
Figure 1: Positive consumer behaviour following better services.
Considering economic impacts, e-commerce and online shopping pose a significant and positive effect on Gross Domestic Product per capita in relation to purchasing power parity. The internet particularly offers room for a possible revolution in world trade for business-to-consumer transactions. Technology has significantly increased the size of the consumer market (Anvari & Norouzi, 2016). Furthermore, Lund and McGuire (2005) concentrated on the components and expansion of economic growth and electronic commerce, concluding that e-commerce enhanced company profitability and facilitated country development. Their findings demonstrated that the inclusion of low development nations in the multilateral trading structure was significantly influenced by e-commerce. To boost e-commerce indicators and ensure that overall government measurements eventually result in economic growth for the nation, it is advised that the government give economic planning more consideration (Anvari & Norouzi, 2016). Shopify in Australia provides an excellent example of how e-commerce can significantly increase the Gross Domestic Product of a nation. According to Shopify, entrepreneurs in Australia contribute a significant share to the Gross Domestic Product than any other nation except for the UK and the USA. Shopify’s new Entrepreneurship Index highlights that Australian consumers contributed approximately 18.47 Australian billion dollars to the national economy last year.
Despite the positive impacts of e-commerce and online shopping mentioned above, online consumers should be concerned about several privacy and security issues. Privacy and information security have been perceived by organizations and governments as crucial obstacles to the development of online shopping and e-commerce. Both seasoned and new subscribers of internet technology have been linked with issues of risk perceptions associated with security and privacy on the internet (Miyazaki & Fernandez, 2001). Questions about customers’ intentions for online purchases are raised by Internet shopping. Consumer issues related to online purchasing include trade fraud, product quality, financial losses, privacy, information quality, and more. Those worries could be the result of an unsuccessful online buy (Naiyi, 2004). Transactions performed on the internet significantly vary from conventional consumer habits in a number of ways, comprising the inherent unpredictability of utilising open network infrastructures for transactions, the distant and impersonal nature of the online market domain, and the extensive utilisation of technology (Naiyi, 2004).
In summary, even though online buyers should be aware of privacy and security risks, e-commerce and online shopping have been linked to a variety of social and economic effects, such as higher customer satisfaction, positive consumer behaviour, and increased GDP growth. Due to the features of product variety, information quality, and product delivery, the birth and development of e-commerce and online shopping have resulted in an increase in customer satisfaction. E-commerce and online buying have also encouraged good consumer behaviour like the intention to return to a site or store, spread the word, and make another purchase. great customer satisfaction scales necessitate great service quality, which typically yields positive behavioural intentions. E-commerce and online buying have a considerable and favourable impact on the gross domestic product (GDP) per capita in comparison to purchasing power parity.
Anvari, R. D., & Norouzi, D. (2016). The impact of e-commerce and R&D on economic development in some selected countries. Procedia-Social and Behavioral Sciences, 229, 354-362. https://doi.org/10.1016/j.sbspro.2016.07.146
Fei, W., Jiang, D., & Xing, C. (2020). Business Plan for Future eBay——Subject: Introduction to Business. The Frontiers of Society, Science and Technology, 2(14). https://doi.org/10.25236/FSST.2020.021418
Miyazaki, A. D., & Fernandez, A. (2001). Consumer perceptions of privacy and security risks for online shopping. Journal of Consumer affairs, 35(1), 27-44. https://doi.org/10.1111/j.1745-6606.2001.tb00101.x
Mofokeng, T. E. (2021). The impact of online shopping attributes on customer satisfaction and loyalty: Moderating effects of e-commerce experience. Cogent Business & Management, 8(1), 1968206. https://doi.org/10.1080/23311975.2021.1968206
Naiyi, Y. E. (2004). Dimensions of consumer’s perceived risk in online shopping. Journal of Electronic Science and Technology, 2(3), 177-182. http://www.journal.uestc.edu.cn/fileDZKJDX_EN/journal/article/dzkjdxxbywb/2004/3/PDF/2004-3-177.pdf
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Selvaraju, K., & Karthikeyan, P. (2016). Impact on E-commerce towards Online Shopping and Customer Buying Behavior. Asian Journal of Research in Social Sciences and Humanities, 6(7), 1260-1270. https://doi.org/10.5958/2249-7315.2016.00511.6