alexa Strategies for the Adoption of E-commerce
ISSN: 2375-4389
Journal of Global Economics
Make the best use of Scientific Research and information from our 700+ peer reviewed, Open Access Journals that operates with the help of 50,000+ Editorial Board Members and esteemed reviewers and 1000+ Scientific associations in Medical, Clinical, Pharmaceutical, Engineering, Technology and Management Fields.
Meet Inspiring Speakers and Experts at our 3000+ Global Conferenceseries Events with over 600+ Conferences, 1200+ Symposiums and 1200+ Workshops on Medical, Pharma, Engineering, Science, Technology and Business
  • Review Article   
  • J Glob Econ 2015, Vol 3(4): 157

Strategies for the Adoption of E-commerce

José G Vargas-Hernández*
Department of Economics, University Center for Economic and Managerial Sciences, University of Guadalajara, Mexico
*Corresponding Author: José G Vargas-Hernández, Department of Economics, University Center for Economic and Managerial Sciences, University of Guadalajara, Mexico, Tel: +523337703340, Email: [email protected]

Received Date: Jun 26, 2015 / Accepted Date: Oct 23, 2015 / Published Date: Oct 26, 2015

Abstract

This work seeks to analyze if there is an impact from the adoption of technology used for online transactions, starting from the theories of adoption of electronic commerce as well as the strategies that companies choose to develop a competitive advantage, the models on economic interactions, the barriers on the part of companies to be included in the electronic marketplace, Mexico data are revised in recent years to review the trend that has been e-commerce and exploratory.

Keywords: Adoption; E-commerce; Strategies

Introduction

E-commerce transactions are digital channels, which in manycases include data exchange for transactions between businesses and/or consumers. Within the e-commerce there are different types ofmodels which are named according to the actors involved in them,either consumers, corporations or government, should be analyzedthat although the relationship between companies is showing increasedvolume of trade is very interesting to review the models formed fromthese relationships. To see how e-commerce behaves in Mexico isattractive because it has only begun to take important and forecast to grow in the coming years.

This paper rises to be explanatory as to the theories that analyzee-commerce such as those based on the industry and also centered onthe resources and capabilities. The first approach is based on the modelof Porter and strategies that are given in the e-commerce adoption, toreview the behavior of Mexico in e-commerce measured by Internetusers viewed as potential customers and online sales reflecting market size and economic impact of e-commerce in these moments [1].

Problem Delimitation

While some authors note that electronic commerce providesbenefits to firms, but Mata, Fuerst and Barney argue that although theliterature agrees that IT resources alone do not produce competitiveadvantage, produce business value when combined and coordinatedwith other organizational and environmental resources [2]. Retailersare facing a kind of increasingly demanding and better formed thataccess to consumer brand from different channels, from waiting fora completely homogeneous purchase experience: speed, convenienceand customization are undoubtedly attributes expected by consumersin these interactions with the brand. It is to analyze whether to adopt e-commerce is an advantage.

Theoretical Framework

Alongside the institutional theory, Tornatzky and Fleischer discussthe framework TOE which is one of the theories that guide mostfrequently used in the investigation of technology adoption [3]. Itidentifies three types of factors that affect the adoption of technologyinnovation: technological context organizational context, for example,the size, the complexity of management structures, communicationprocesses, the availability of slack resources, and context theenvironment, e.g., industry characteristics and market structure, ITinfrastructure, government regulation). All these are under TOEbecause it is a well-defined framework. It is also consistent with the theory of diffusion of innovations [4].

Institutional theory suggests that organizations face pressuresto conform widely to the practices and policies that are consideredlegitimate in their institutional settings. In the work of DiMaggio andPowell, to do so may deny them the resources and social support tobe competitive [5]. The TOE framework is used to study the diffusionof innovations of various system information, including technicaltasks, supporting business administration and information systeminnovations integrated into the core business [6]. Internal technologicalresources such as infrastructure, expertise, time developer and user are significant for success is the adoption [7].

There is evidence in the literature that various technological,organizational and environmental factors distinguish adopters ofe-commerce for non-adopters and influence the extent to whichfirms adopt these technologies. Some firms are unwilling to committhe resources to participate in online markets, while others devotetheir resources to establish the necessary processes to participate inthe online business, according to Grewal, Comer and Metha [8]. Atheory that has been widely used in the adoption of innovation andthe adoption of e-commerce literature is the resource-based theory [9]tells that the resource-based theory argues that firms are heterogeneousresources that enable them to achieve a competitive advantage and superior long-term performance.

In an important context for companies to prepare their strategies and practices to adapt to different cultures, legal frameworks,geographic regions and industry structures context. However, researchoften focuses on “general theories” and puts relatively little attention tothe boundary conditions, and to direct and moderate the influence of contextual variables [10].

E-commerce

Some authors like Laudon and Traver, and Owens define electroniccommerce such as transactions and activities that occur in the WEB [11,12]. More formally, digitally enabled commercial transactions between two or more organizations and individuals. Commercial transactions involve the exchange of value across organizational or individual borders in exchange for goods and services. Exchange value is important for understanding the limits of e-commerce as Figueroa, Hernandez, Gonzalez and Arrieta [13].

E-commerce allows to understand how companies have developedin recent years and the adoption of electronic commerce to theirprocedures have grown significantly to improve their conditionsregarding presence in the international market and break downbarriers and reduce costs by removing intermediaries in the valuechain. The literature on electronic commerce reveals that the adoption of electronic commerce potentially brings significant benefits to SMEs as support [14].

The composition of electronic commerce has remained fairlyconstant over the past 10 years. E-commerce is dominated by businessto-business (B2B) sales which are often handled through electronic datainterchange (EDI). Approximately 90% of the value of e-commerce isB2B. Social networks and participatory web are also used increasinglyto market and sell products online in a way that is best suited to individual users.

Electronic commerce is present in economic life before theproliferation of the Internet. It must be noted that within the e-commerce it has developed mechanisms to that information technology is there toaccelerate as it has a strong presence when doing business that is inreal time. This means that it can give extremes on the planet since byreducing intermediaries; it has a direct relationship between businessesand consumers. Therefore, transaction costs are reduced and allowentering a global market to offer and demand for goods and services, these characteristics that differentiate the traditional e-commerce.

Porter et al. speaks of the internet architecture, along with otherimprovements in software architecture and development tools, hasbecome a much more powerful tool for the strategy as these helpdifferentiate companies with presence in e-commerce [15]. If the sameproducts may well have a clear differentiation this can be how theproducts are offered by web development and offline treatment, whichit refers to all sales processes that have to do with the customer after transaction.

To obtain these benefits, however, companies need to stop theirrush to adopt generic “out of the box” packaged applications andinstead tailor their deployment of Internet technology strategies fortheir particular applications. Although it remains difficult to customizepackaged applications, the inherent difficulty of the task contributesto the sustainability of the resulting competitive advantage. Smallbusinesses have both greater need for resources and an increased riskof appropriation of their own resources and are challenged to competeand collaborate with companies that often have more resources, power and broader social networks [16].

Sales of consumer goods to the general public via the Internet, alsoknown as Retail Internet has generated through e-commerce websitesand through pure operated by retailers based store on sales sites. Salesdata are attributed to the country where the consumer is based, rather than is attributed where the retailer is based.

Barriers of e-commerce

According to the UNCTAD it is reviews that there are a numberof factors that can restrict commerce, and divided into three groups of economic, socio-political and cognitive barriers [17]. Among the economic obstacles include the inadequacy of ICT infrastructure and its use, lack of reliability and the high cost of electricity supply, the limited use of credit cards, the lack of purchasing power and the low level of development of financial systems.

Among other socio-political obstacles include weak legal andregulatory frameworks, cultural preferences through personal contactand trust of society exclusively in cash. Finally, there are also a numberof cognitive obstacles, including low levels of computer literacy andunderstanding and knowledge of e-commerce, both among consumers and among businesses.

Models E-commerce

Kumar et al. help to conceptualize ideas, business models as anew organization which speaks of the constancy of the elements thatguarantee competition, also involves an investment in the traditionalvalue chain. Definition of customer-focused value, many aspects focuson customer preferences, through highly flexible processes, the clientreceives the new valuation by the speed of care, personalization and relationship between quality and price [18].

Models on electronic commerce as Tapscott gives the concept ofbusiness-web as a business model whose support is the network andwhich encompass a need to carry out environment. Timmers modelthat focuses on the value chain the company promoting its productsand services and the most tangible consumer benefits are lower pricesand greater variety best information convenience. The Timmers modelhas been widely used for the subjects of “Business web” to measure the relationships between companies and consumers.

Business-to-consumer (B2C) E-commerce: Is best known type ofelectronic commerce where business presence in online sales reachesconsumers. This includes the purchase of goods and services retailproducts and content online, although according to data of international organizations is relatively small. It has grown exponentially and hasextensive international presence by Laudon and Traver [11]. There areseven business models for B2C such as portals, online stores, contentproviders, brokers’ transaction creators market, service providers and community providers.

Business-to-business (B2B): The model of business to business(B2B) e-commerce is based on transactions made by companies withother companies and it is the model that represents the largest volumeof electronic commerce and this poses to Laudon and Traver a sizepotentially huge [11]. There are two main business models used in thearena: Net B2B Marketplace, including e-distributors, e-procurement,trade and industry consortia and private industrial networks, including networks of individual companies and whole networks the industry.

Helgueros et al. considers the full range of actions that can occur intwo organizations, such as purchasing, vendor management, paymentmanagement, procurement, and tasks as service and support [19].This method accounts for 80% of e-commerce in recent years. Someadvantages of this type of electronic commerce are reducing transaction costs and reducing time.

Consumer-to-consumer (C2C): This type of e-commerceconsumers speaks of selling to other consumers usually for online salesthrough auctions as a first consumer electronic market places or using search engines to easily display a catalog of goods or services.

Electronic commerce in Mexico

E-commerce is changing the economy and how business is done these days. It obliges e-commerce companies to find new ways toexpand markets where they compete to attract and retain customersby adapting products and services to their needs, and restructure theirbusiness processes to deliver products and services more efficiently andeffectively. In this section based on data AMIPCI, it will be establishedhow it behaves in Mexico e-commerce in recent years analyzing thenumber of users, how Mexicans spend in the electronic market and their preferences [20].

Based on data from the AMIPCI in Mexico, it has had significantgrowth in the number of internet users as shown in Figure 1, of which37% have made at least one purchase online at year [20]. Internetusers are an important data because they are potential consumers inelectronic commerce which have certain barriers to online shopping,such as how access to a computer, internet access, and access to acredit card. Internet users in the event Mexico must remember that asfar as Internet providers are subject to a strong oligopoly who’s most important is the TELMEX Company.

global-economics-internet-users-mexico

Figure 1: Internet users in Mexico.

Internet sales as shown in Figure 2 shows that for the year 2014amounted to 165.6 billion pesos this represents a 36% increase over the2013 and expected in 2015 reach 180 billion pesos, which representsa large increase in relation to the volume of e-commerce to GDP inthe last six years for the Mexican economy. It is clear to say that thegrowth of electronic commerce has but grown significantly. This willbe increased in a smaller volume over time because this growth willdepend on how much will break the barriers of electronic commerce by businesses and consumers.

global-economics-sales-by-internetin-mexico

Figure 2: Sales by Internetin Mexico.

Among the most relevant data for electronic commerce must be97% of the people who have made purchases online, they would again,so the user experience is positive in recent years. It has increased atconstant rate the internet users, as well as Mexico has worked in thelegal aspect and regulations in order to provide internet security toInternet users who wish to make purchases, thereby giving credibilityto electronic commerce through institutional measures such as qualityseal AMIPCI that gives prestige to the companies that own and at the same time gives certainty to the consumer [20] (Figure 2).

New knowledge and skills need to be acquired or developedby companies that enter into e-commerce to successfully enternew electronic markets ranging from cultural differences, the typeof institutions which are sought through agreements to regulatecross-border transactions by email to regulate certain aspects of thecompanies which should work on bringing international rules, and newagents that appear today in e-commerce in the form of intermediariesin electronic commerce markets. The strategic research should be doneto have the best decisions around how to enter this electronic market and how to have a presence that may be relevant to SMEs.

Some firms are unwilling to commit the resources to participatein online markets, while others devote their resources to establishthe necessary processes to participate in the online business [9]. Buttoday there are more companies that innovate in the field of internetto start making e-commerce while they are still few compared to othercountries, Mexico is in a good time to tip its perception of sales to online channels.

The corporate strategy is formulated with the highest administrativelevels of the organization and the action plan of a diversified companythat covers all levels of its multibusiness model. According to Morenothe strategy should consider several points as seen in industry what itsscope will be, to find the most profitable places and see how it uses itsresources to expected results and even how it should invest [21]. Davidstates that the implementation of strategies is the implementation ofthe results obtained in the process of formulating and implementing aplan should know how the business works and there must be motivatedstaff that shares the vision of the company [22]. I can count at any time adapting to a change in the way of implementation.

Mexican consumers are choosing in higher proportion to maketheir credit card payments at the few choices they have to do so bybranch payments, online payments (PayPal) or in stores, This leads tocertain Internet users cannot acquire products online because they donot have a credit card, and this limits them to grow sales at certainpoints because they should expect an increase in options for payments by companies.

Within Mexican consumers, companies are seeking to adoptstrategies as the plus they can offer in terms of promotions, such as fromreducing costs implied in the electronic commerce of the base pricethat the consumer appreciates in the market. Companies can reducecosts and offer some kind of promotion as discounts, free shipping, andmonths without interests, gifts, rebates, and other. Having companieswith online sales or the ability to buy or sell products or services iscritical for the advancement of e-commerce, which helped smallbusinesses to be more competitive and thus to be postulated to become traders worldwide.

The role of electronic commerce in the internationalization ofenterprises and the use of ICT in the same, in which the informationis a pillar of the economy, is the reason why firms investment in technology. Considering the integration of companies in their adoption of e-commerce, an important point is the one which seeks to remove certain intermediaries between the company and the consumer, the presence of SMEs in the Internet as marketing and the huge advantage that comes with the firm position of internet users in certain regions (catchment customers) to recognize the advantages achieved by having direct communication with consumers to try to go removing information asymmetries by the pre-sales though the online chats that make sales.

An analysis of production and distribution capacities of companieswhich are unable to compete in volume with transnational firms, butthey can win certain niches in the search of market and leverage itsadvantages in the process of innovation. These processes must be moreauthentic as there is no real way for both companies and users whoare more demanding on the electronic market. As their cognitive levelincreases, according to this, information allows to compare and reviewreputations of sellers (Free market), choose based on what offer Internetsuppliers in the same product and gain access to international marketsand have more options. Although there are no further developmentsto diminish both costs for international purchases making more accessible to the consumer, who may have also more options.

Model of Porter's Five Forces

The forces of Porter are the threat of new entrants, rivalry amongexisting firms, the threat of substitutes, bargaining power of suppliers,and the bargaining power of buyers [1]. This model applied to electroniccommerce can give a great application to electronic commerce. Fromthis can be analyzed some important concepts of electronic commerce using the model as a basis.

• The bargaining power of buyers

• The bargaining power of suppliers

• The threat of new entrants

• The threat of substitute products.

Within the model of Porter luring electronic commerce bargainingpower for both suppliers and buyers increases in high volume, becauseboth are destroying some information barriers which allow theconsumer or firm to check prices and compare that type of productwho want to buy [1]. But, there is within the certain informationasymmetries that having a virtual market consumers, do not have theproduct in their hands and using digital references, they can observebut this does not assure that their expectations and reality is spliced at the moment of receiving their products.

Although opportunism is present, international agencies havestarted working their rules as institutions seeking that consumers areprotected in cross-border transactions and thus avoid being scammedby a salesman who is outside their country. This is to remember thate-commerce breaks geographical barriers to buy in the EuropeanUnion and which are sent to Latin America. So, these countries mustdraw certain criteria for trust in internet shopping that does not have a low due to mistrust.

The threat of new entrants is latent because although havingan advantage as a sales channel online, competitors do not havemajor constraint to enter because the entry costs are low in terms ofinternet presence. But many companies manage to differentiate theirsales channels making each time more personalized and investingin information technologies. While moving to electronic level, competitors have minimal barriers to entry if it is very different the investment on web development and infrastructure to send their products to much of the world.

The threat of substitutes is more likely due to the great deal out therein e-commerce. This can foster electronic commerce and consumersto be able to compare prices in real time and also with a single clickcan be comparing products that seem related. Thus, not only compareprices between brands but also between products that can replace thefirst choice of consumers. With these volumes of information there are asymmetries of information to compare decrease rapidly.

The rivalry between the actors is more dynamic as consumers maybe in the website 24 hours a day as internet breaks the time barriersof purchasing with the option to buy in the hands of the consumer.While competitors may also view on real-time prices of competitorsis not as tangible who sells more at first glance, despite the price tothe consumer looking for more skills in his suppliers such as delivery times, reputation, quality of service and sales after-sales care.

Conclusions

Electronic commerce has grown considerably in the wayorganizations conduct their transactions and global negotiations. Costsfor using this technology also are reducing while developing the abilityto reach more customers worldwide. It is also included that Mexicostill has some issues such as lack of infrastructure to further increasethe possibilities of companies to include electronic commerce in their activities.

It is necessary to invest in technology to further exploit electroniccommerce and look how it can close the gap between companies inthe aspect of development and innovation since although it has grown,electronic commerce could take even more relevance in the comingyears since it must take into account that Mexico has a structure withlarge percentage of companies belonging to SMEs which althoughnot a marked limitation, it should work a little harder to introduce e-commerce.

Some advantages of e-commerce are the speed to purchaseproducts or information; convenience, for example, for the purchase,payment, collection or refund of items, and personalization in eachof these interactions [23-25]. Within Mexican consumers, companiesare seeking to adopt strategies as the plus they can offer in terms ofpromotions based on price from reducing costs of electronic commercethat the consumer appreciates. In the market, companies can reducecosts and offer some kind of promotion as discounts, free shipping, months interest, gifts, rebates, other.

Porter’s model can be exploited further as the dynamics of certainaspects must remain static for the evaluation and the dynamics ofelectronic commerce. Sometimes the analysis may not be as useful aftercertain periods of time and apply to certain industry to be addressed.Since a deficiency of the model is that it can only study the industryand not a specific business. As for the chances of e-commerce behaviorpositively continue to be a determining factor that companies consideras a strategy to adopt e-commerce and web development platforms and offline logistics system-wide for sales.

References

Citation: Vargas-Hernández JG (2015) Strategies for the Adoption of E-commerce. J Glob Econ 3:157.

Copyright: © 2015 Vargas-Hernández JG. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Select your language of interest to view the total content in your interested language

Post Your Comment Citation
Share This Article
Recommended Conferences
Article Usage
  • Total views: 13034
  • [From(publication date): 12-2015 - Jan 28, 2020]
  • Breakdown by view type
  • HTML page views: 12603
  • PDF downloads: 431
Share This Article
Top