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Section 11. Economics and management
Section 11. Economics and management
Mukhina Maria Mikhailovna, Plekhanov Russian University of Economics student, Department of Trade policy Nikishin Alexander Fedorovich, PlekhanovRussian University of Economics associate professor, Department of Trade policy Pankina Tatiana Viktorovna, Plekhanov Russian University of Economics associate professor, Department of Trade policy E-mail: [email protected]
The role of image in the e-commerce
Abstract: Current online shopping is characterized by a high degree of competition. On the other hand, the specificity of distance selling in which the buyer does not have the ability to interact directly with the seller increases the possibility of unfair trade from the online store. In this situation, the image of an Internet store becomes one of the factors in consumer choice. Keywords: trade, retail trade, image of the company, stimulation of sales, electronic commerce, electronic trading.
The last few decades are defined by the rapid development of digital technologies. The invention of the Internet at the end of the last century led to the opportunity of free access to telecommunications networks. All of it has led to the rapid development of e-commerce. The creation of online store for small business is possible even at low initial costs and it directly determines the high level of competition in the Internet trade. Another trend of the last decades is the growing influence of non-material resources on the results of business operations of trade organizations, non-material resources directly determine the results of business operations of trade organizations
[1]. Currently, a large number of scientific papers are devoted to ways for improvement the competitiveness of stores offering e-commerce, but exactly the non-material resources largely determine the competitiveness of the store in the consumer market.
Non-material resources that are associated with the interaction with customers play the greatest role in the business activities of commercial organizations that operate using the Internet. These resources include business reputation, customer loyalty and others
[2]. The huge role of such intangible resources is explained by the large number of unscrupulous shops that operate for a very short time, sell low-quality goods and do not fulfill their obligations.
Before making a purchase, the consumer analyses the supply of goods, value for money, technical and aesthetic characteristics, taking into account the media. However, traditionally one of the important factors while making a purchase are the brands of the products among offered product assortment.
The existence ofwell-known brands in the assortment of Internet store let the byers have positive association because this kind of products are characterized by the guarantee of quality and reliability, providing confidence. It identifies the store among the competitors, enhances customer loyalty. The presence of well-known product brands in the assortment tells about its good reputation, recognition and exclusivity of offered goods. Widely recognized brand sets high standards in everything, and, primarily, recognized quality which constitutes its main value. Famous brand must maintain its high sta-
tus in the competitive environment, otherwise it loses its leading position and is replaced by the more successful brand. In this case, the Internet-shop need to review its assortment, taking into account the changed situation. The attempt to use brands who have lost the trust of customers is the risk of financial loss, lack of demand for goods, existence of illiquid.
Choosing a particular brand, the consumer orientates on the principles that brand represents and relates it with himself. For some customers it is necessary to purchase products of premium class to show the level of income and lifestyle by affording expensive clothes, accessories, jewelry. The loyalty of consumers to expensive things is not often explained by the characteristics of the goods, it is the desire of buyers to show their status. Trade allowance is not always characterized by high quality of goods ofpremium class. There is a widespread practice that artificially set price of goods creates a positive image of the product in the consumer's mind and it is a factor of attractiveness for customers. Selling luxury goods online provides the high level of income, but there is a risk that the sale of luxury goods takes more time because they are not in high demand. People who do not get used to luxury lifestyle and do not seek to acquire premium brands orientate on the value for money while choosing the products. Online stores need to assess the risks associated with possible difficulties in marketing goods ofpremium class and define a niche for its operation.
In the contemporary competitive environment a huge number of trade organizations struggle for consumers' attention, and the role of the brand is especially enormous for consumers who are not versed in the individual product segments. Many customers have difficulties with selecting computer equipment, household refrigerators and televisions due to the lack of knowledge in a given category. These products are expensive and long-term, so the consumer face the dilemma of choosing qualitative products that will serve for many years, justifying the price set by the trade organization. In the first instance technique is selected by parameters, confirming the quality of the product in the mind of the consumer; for fridge it is the energy, the kind of refrigerating chamber, defrosting system, for TV — brightness, screen resolu-
The role of image in the e-commerce
tion,. However, the consumer often chooses goods according to the parameters that are actually not the main determinants in the quality of goods. For example, for compact digital cameras more important parameters are the physical size ofthe matrix, the lens aperture — but often the number of megapixels is specified as a basic parameter. Also brand plays an important role while realizing digital products.
The successful brand should not be associated with multiple attributes, only a limited number of them is optimal. Presence of strong competitive brands in the assortment lets online store stand out among others due to its main attributes. Distant trade and e-commerce as one of its types fulfill great social function. There are groups of people for whom visiting traditional stores is difficult. The service of these groups is an important goal of e-commerce. However, the implementation of social functions in terms of trade organizations is an important intangible resource. It has a positive effect on the image of trade organization and leads to increased efficiency of economic activities. One of the most important missions of distance selling is service the population from remote regions, which is also an important social function of e-commerce.
The problem of involving customers in the online shop is closely related to the problem of increasing customer loyalty [3]. Every person has a certain psychological barrier, and after its overcoming he can start making purchases in the Internet. It was mentioned earlier that the trade organizations in the network are in a competitive environment, and consumers prefer online shops a positive image.
It necessary to notice that unlike the traditional store where customers can buy only part of goods, e-commerce buyers seek to buy all goods in one order. In e-commerce more than in traditional trade the concept of key product or products is significant. The buyer while creating a shopping list defines the basic product or products and add the list of other products that may be more expensive. For example, the buyer must purchase a memory card or the battery for the camera before the holiday, but the buyer can purchase a photo printer later. Moreover, there is no demand in this product before the holiday. Nevertheless, the buyer may add such products in it while forming the order. If the buyer acquires such additional products in the absence of key product in the traditional store, he will form the completely entire order in the rival store in the internet-shop.
An important task of forming the image of an Internet store is also the presence ofvariable forms of payment for goods. For this purpose, online store need to have an efficient system of interaction with banks, payment systems. After the acquirement of goods in the shop the buyers form their own opinion about it and share it with others. According to the opinion of the buyer about the store, the image of the Internet shop and its competitiveness increases or decreases.
Therefore non-material resources such as the professionalism of the employees, their personal qualities, availability of service quality monitoring and others have a huge impact on the efficiency of business activities [4].
Purchase of goods via the Internet is connected with a number of risks for buyers. While buying goods in the Internet the buyer
does not have the ability to inspect goods visually, to evaluate its convenience — he is forced to focus only on the description of goods presented by the seller. Especially strong risk appears when products are presented in a limited number of Internet stores and goods require fitting before buying. The buyer has the right to refuse to buy goods directly at the delivery, but it is associated with a number of psychological difficulties — and this right is not often used. Courier performs a lot of orders a day, begins to hurry and does not let the customer acquaint with the product. In addition, the detailed acquaintance with goods often requires special knowledge of the courier but knowledge is usually absent. For sure, if the buyer does not have the opportunity to get acquainted with goods, he should refuse to sign the contract of sale, but in the beginning it will be difficult to overcome the psychological pressure from the courier, and then he has to re-wait for the new courier from another store. In this case the image of the online store has a huge role. If the buyer is aware of good business reputation of the store and all disputed issues decided in the direction of buyers it simplifies the buying process of products.
Moreover, in accordance to the legislation, the buyer must pay for the delivery of goods. In the end, the buyer would rather prefer to receive goods of good quality, which are slightly does not fit him than to reject the goods. It led to the next stage of development of e-commerce, when the most famous online stores began to offer the service of self-delivery of purchased goods to the buyer. This situation contradicts the concept of e-commerce promoted at the beginning of its development. One of the conceptual slogans was the opportunity of buying goods without leaving home. It means that service delivery itself is perceived as an additional convenience to the buyer, and the buyer is unlikely to refuse it. However, experience has shown the opposite. Moreover, even the positioning of self-delivery as the ability of the buyer to refuse delivery with the aim of reducing costs was not justified — in many online stores self-delivery service is more expensive than buying with delivery, in other stores while purchasing with the self-delivery the range of products is restricted as well as the bonus program.
Thus, the next factor which forms the image of trade organization is the opinion of the buyer while visiting the locations of self-delivery. While purchasing a product on self-delivery conditions several times the buyer creates the reputation to trade organization and is not afraid of making purchase with delivery in this online shop. A special role is played by the franchise. The business model of the online store and the traditional store (and the manufacturer of the goods) varies and online store is advantageous to use a franchise, using the accumulated business reputation of the franchisor.
In conclusion, it should be noted that the task of maintaining the image of the online store is not limited by discussed factors, the image is influenced by a number of other factors such as the level of sold trade allowances, rates, conditions and terms of delivery and other factors.
References:
1. Mayorova E. A., Nikishin A. F. Intangible assets influence on the efficiency and competetiveness in retail//SWorldJournal. 2015. T. 17. № 1 (8). C. 78-82.
2. Ivanov G., Mayorova E. Intangible assets and competitive advantage in retail: case study from Russia//Asian Social Science. - 2015. -T. 11. - № 12. - C. 38-45.
3. Nikishin A. F., Pankina T. V. The problem of involvement of clients in electronic commerce//Austrian Journal of Humanities and Social Sciences. 2015. № 3-4. C. 15-17.
4. Maslova A. E., Timyasheva E. T., Nikishin A. F. Factors that form an attractive image of trade organizations//Austrian Journal of Humanities and Social Sciences. - 2015. № 7-8. P. 146-148.
