Published on International Journal of Economics & Business
Publication Date: July 16, 2019
Umar Lawal Aliyu
Faculty of Management, Department Of Business Administration
LIGS University Hawaii, USA
Journal Full Text PDF: Buying Goods Online: Advantages and Disadvantages.
Buying goods online has revolutionized the business world by making everything anyone could want available by the simple click of a mouse button. Buying goods online is a form of electronic commerce, which allows the buyer otherwise, referred to as consumers the ability to directly buy goods or services from a seller over the Internet using a web browser. In fact buying goods online can be referred to as online shopping which is the action or activity of buying goods or services over the Internet. The buyers or consumers buy goods or services directly from a seller in real-time, without an intermediary service, over the Internet. Buying goods online is easy, fast and convenient because it can be done from anywhere, at any time, from our phones and even on top of our bed as long as you have a decent internet connection. In addition, it is s cheaper than offline and problems like the shop is too far or might be closed are eliminated with online shopping. Most consumers in this modern world buy online because of benefits like its convenience, better prices are achieve, its ability to get more variety, easy price comparisons, No crowds and less pressure etc. Nevertheless, Buying goods online has its shortcomings like online shoppers do not have the ability to physically inspect or try on the items being considered for purchase and online shoppers sometimes lose the power to negotiate the price and payment terms that may exist in local stores. However, the thesis will critically analyse and highlight Buying Goods Online, its pros and cons so that we can arrive at a sensible conclusion.
Keywords: Computer, Consumer, Goods, Internet, Online & Services.
Internet has totally changed the way we do our Purchasing because of several Advantages it has on purchasing goods/services on the internet. More and more people in recent time choose to buy goods/services on the internet rather than over the traditional market. In fact, the benefits of online shopping cannot be undermined because apart from the convenience attached to it; it is cost saving for those that know how to get the best deal online. In addition, many people feel that better prices is one of the main reasons that online shopping has taken off, coupled with the believe of the simple fact that middle men being cut out of the delivery chain leads to a reduction in cost and thus, the final price of the product. Thus, almost all online shoppers feel online shopping is indeed convenient and hassle free.
However, to every advantage lies disadvantage so beside many advantages, Internet has some disadvantages too. Online shopping can cause social isolation due to heavy use of internet use, lack of significant discounts in online shops, depression can results by spending more time on computer and this are few among other negativities of online shopping.
Therefore, as great as shopping online is, it certainly does not come without setbacks.
2. THEORETICAL FRAMEWORK
2.1 What is online shopping?
Online shopping is a form of electronic commerce, which allows consumers to directly buy goods or services from a seller over the Internet using a web browser, (Wikipedia). In fact, it is the action or activity of buying goods or services over the Internet.
Online shopping was invented and pioneered by Michael Aldrich in the UK. In 1979, he connected a modified domestic television via a telephone line to a real- time multi-user transaction-processing computer. The first secure retail transaction over the Web was either by NetMarket or Internet Shopping Network in 1994. Immediately after, Amazon.com launched its online shopping site in 1995 and eBay was introduced in 1995, other internet shops came into existence all over the world. Online shopping, also known as e shopping or Internet shopping, which is the act of purchasing products or services over the Internet i.e. online shopping has grown in popularity over the years and is becoming more and more acceptable all over the world.
Online shopping is a form of electronic commerce, which allows consumers to directly buy goods or services from a seller over the Internet using a web browser, which enables shoppers to use “search” features to find specific models, brands or items. The process whereby consumers directly buy goods or services from a seller in real-time, without an intermediary service, over the Internet referred to sometimes as Business-to-Consumer (B2C) online shopping.
Some people feel online shopping is cheaper because Retailers do not always offer the same deals in brick-and-mortar stores as at their online counterparts and thus, the cost of running a physical establishment can be considerably greater than for an online store. However, a typical online store enables the customer to browse the firm’s range of products and services, view photos or images of the products, along with information about the product specifications, features and prices by using “search” features to find specific models, brands or items. In addition, online shopping is gaining more acceptances all over the world due to its flexibility and by using online shopping methods; consumers do not need to consume energy by physically visiting physical stores, but save time and the cost of travelling.
However, internet shopping has gained worldwide acceptance as most people in recent time engage in online shopping because of its convenience, easy price comparisons, getting better prices, ability to choose variety and send gifts more easily etc.
2.2 Online Shopping in Nigeria
Online shopping have gotten acceptability in Nigeria and the trend on online shopping is on the rise because people of all age both the youth and the elderly are not left out in the use of online shopping platforms. An online shopping survey by Philips Consulting in 2016 revealed that virtually all respondents (97%) shopped online at least a few times per year, up from 2014’s value of 75 per cent. The wide range of internet usage has made online shopping a trend in recent years.
Online shopping is a form of electronic commerce, which allows consumers to buy goods or services directly by a buyer from a seller over the Internet by using a web browser and the introduction of the internet, has really encouraged the use of online shopping in Nigeria and thus, Internet usage among Nigerians keeps increasing. In fact, this process of searching for and purchasing goods and services over the Internet with a web browser in Nigeria cannot be over emphasized in recent times.
As Marshall Mcluhan, a Canadian professor, philosopher and public intellectual would have it; the world is becoming a “global village”. In 2018, Nigeria had 92.3 million internet users and this figure is projected to grow to 187.8 million internet users in 2023. Nigeria is one of the most populous countries worldwide using modern gadgets like computers, mobile phones etc. because in Nigeria, there are over 172 million mobile subscribers, accounting to a penetration rate of 87% of the population.
According to Nigerian Communications Commission (NCC), Internet users in Nigeria increased marginally to more than 114,752,357 million in February 2019. The NCC made this known on Monday in its Monthly Internet Subscribers Data for February posted on its website. The data showed that overall internet users increased to 114,725,357 in February from 113,875,204 recorded in January showing an increase of 850,153 new subscribers.
According to the data, Airtel and MTN gained more internet subscribers during the month under review, while 9mobile and Globacom were the big losers. The breakdown revealed that MTN gained more with 607,462 new internet users in February, increasing its subscription to 46,538,633 as against 45,931,171 in January. See the below figure:
Source: PM News July 13, 2019
It further showed that Airtel was second, gaining 430,990 new users in the month under review, increasing its subscription to 30,891,518 in February as against 30,460,528 in January 2019. It said that Globacom lost 114,268 internet users, decreasing its subscription in February to 27,486,271 from 27,600,539 recorded in January 2019.
The NCC data further showed that 9Mobile also lost 74,031 internet users in February with 9,808,935 as against 9,882,966 recorded in January 2019.
However, Online shopping in Nigeria has attained its highest pick and this can be seen from Nigeria Business Communities survey of 2016, which revealed that three quarters of the Nigerian respondents use the internet for online purchases (food, clothes, phones etc.).
2.3 Is it Safe to Shop Online?
The biggest benefit of online shopping is ‘convenience’ as it can be done from anywhere, at any time and even from our phones as all you need to do is to have a decent internet connection and you will not face problems like the shop is too far or it might be closed. There are several safety precautions that you do need to keep in mind once you start making online purchases with your mobile device, computers etc. and when it comes to online shopping, your credit/debit card details are your most crucial assets because they facilitate your transactions over the internet.
However, never ever, ever buy anything online using your credit card from a site that does not have SSL (secure sockets layer) encryption installed—at the very least; You will know if the site has SSL because the URL for the site will start with HTTPS—instead of just HTTP. Do not give anyone your credit card over e-mail. PayPal, however, is still a good, safe way to make a payment. In addition, before you effect a transaction online, check out the below tips to help you enjoy safer online shopping:
Shop at websites you trust. …
Check out the business. …
Beware rock-bottom prices. …
Avoid public Wi-Fi. …
Use a VPN. …
Create strong passwords. …
Check out website security. …
Watch out for email swindles, frauds or scams.
2.4 Risk of online shopping
Dealing with fraudulent escrow sites set up to capture your information.
Doing business on sites that are not encrypted which can leave your information open to anyone.
Fall a victim of a swindle, scam or fraud by unscrupulous sellers that will sell goods to you and will never send it to you.
One of the risks of online shopping is becoming a victim of fake e-commerce sites. Fraudsters create fake sites with the motive of capturing your information which they will use for identity theft or hack your account. Often these sites will offer an incredible deal that is hard to pass up, and then disappear a few weeks later.
Scams by international sites that are not secure or don’t have reputable sellers.
Swindlers, scammers, fraudsters or unscrupulous sellers can convince or defraud you to paying more than you expected because of hidden charges, duties or shipping.
2.5 The Pros and Cons of Online Shopping
The internet can be a great way to shop with variety of choice of ways to buy or sell with voluminous advantages for both the seller and the buyer. In fact, it is a great resource for shoppers looking to expand their choices of products to buy and is an invaluable way to save money. However, below are the Pros and Cons of Online Shopping:
2.5.1 The Pros of Online Shopping:
Many online retailers allow shoppers to post reviews about the products that they purchased.
Many online stores sell products at low prices because of the lack of money spent on overhead. Local stores have operating costs like rent, staffing, water, heat, and air that are figured, at least partially, into the mark-up of the products.
Online sales representatives often have more flexibility with making decisions such as applying coupons, meeting competitors’ prices and expediting shipping at no extra charge.
Online sales representatives often receive more intensive product training than those at the local stores.
Online shoppers do not have to wait in long lines to check out.
Online shoppers rarely have to deal with aggressive salespeople.
Online shoppers save on gas.
Shoppers can shop in their pyjamas.
The stores are almost never closed.
There are more choices for buying refurbished products.
There are no annoying crowds.
There are no parking hassles.
2.5.2 The Cons of Online Shopping:
It is sometimes easier to get money refunded locally when the item purchased drops in price within the guaranteed price period.
Items ordered online are sometimes back-ordered, but shoppers may not find out until weeks later. This is particularly problematic when buying gifts.
Online shoppers do not always know if a site is a legitimate retail store and if is safe to shop.
Online shoppers do not get to take advantage of seasonal statewide tax-free shopping events.
Online shoppers do not have the ability to physically inspect or try on the items being considered for purchase.
Online shoppers often do not have a person (or the same person) to talk to when dealing with a problem.
Online shoppers sometimes lose the power to negotiate the price and payment terms that may exist in local stores.
Online stores advertising free products will sometimes increase the cost of shipping so that they profit from the purchase. For example, shoppers may get three free software programs, but paying $14.95 in shipping or handling charges is higher than what would normally be charged and likely covers the cost of the three items plus shipping.
Restocking and shipping costs are often charged on returns.
Online shopping is referred to as electronic commerce or electronic business that gives consumers the privilege to buy and sell products (goods, services and ideas) on the internet with the use of mobile phones, tablet or a computer. Online shopping is done completely on the internet and, therefore, customers do not have to go to shops to get the products they want to purchase, whereas in physical stores, customers must go to a shop to get the desired products, which can be stressful.
The many benefits of online business include global access, 24 hours a day, 7 days a week, improved client service through greater flexibility, cost savings. In addition, it reduces your expenses, offer lower prices, as opposed to offline stores, as well as offer various bargains that help save even more money because the easiest way to pay less is to compare prices. Online shopping platforms have different products available to consumers, unlike physical stores in which a wide variety of products may not be sold in one place. Consumers must move from one shop to another, which is time wasting.
As spelt out earlier online shopping is faced with disadvantages of delay in delivery, lack of significant discounts in online shops, lack of touch and feel of merchandise in online shopping, lack of interactivity in online shopping etc and this are few among others.
Finally, shoppers will save money and frustration by taking the time to learn the policies of both online and local stores before making a purchase. Sometimes there are hidden charges like restocking fees at some online and local stores.