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Online Business

Currently online business is gaining more and more popularity; there are a number of online shops which do not have a certain physical location, and ordering virtually any item through the Internet has become a common thing for people familiar with computers. However, it cannot be stated that brick and mortar business is losing popularity. Many shops have successfully launched online departments as the extensions of traditional business model (Heinemann & Schwarzl, 2010). The purpose of this essay is to research whether different age groups prefer buying online or going to ordinary stores, and whether there is a preference between books or software in their online purchase patterns.

I have interviewed three persons: Joe (21 year old), Mary (35 years old) and Patrick (52 years old). The questions I have asked them were the following ones:

  • How many online/instant purchases of books or software do you make monthly?
  • How many times per month do you purchase books or software going to a bricks and mortar establishment?
  • What do you most often purchase online – books or software?

Joe’s answers: approximately 12 purchases of books/software online and 0.5-1 purchase of books/software in the traditional stores, preference both for books and software online.

Mary’s answers: approximately 5-6 online purchases of books/software and 2-3 purchases of books/software in the traditional stores, preference for software purchases online and for book purchases in bricks and mortar establishments.

Patrick’s answers: approximately 2 online purchases of books/software and 3-4 purchases of books/software in the traditional stores, preference for software purchases online and for book purchases in bricks and mortar establishments.

Judging from these answers, it is possible to make the following conclusions with regard to online and bricks and mortar business. Young people (18-25 years old) are likely to be active online customers, prefer the product to be delivered immediately (software or electronic texts) or to have the product delivered (paper books). Middle age category of 26-45 years old is a little more conservative: people of this age group mostly prefer choosing the books in book shops, where they can “sense” the book and select it in more comfortable environment (Haugtvedt & Machleit & Yalch, 2005). The same can be stated with regard to book purchases by people above 46 years. However, both middle age group and older-age people prefer purchasing software online, and despite their less active consumer behaviour in online environment, these people can form an additional target group for software companies.

The above-mentioned interviews have several applications for sellers of books and software. Since there is a clear customer preference for purchasing the software online, the sellers should launch software-focused online shops instead of selling software directly, and provide fast and convenient payment options. In this case selling software products might become a significantly more profitable part of business.

For book sellers, both business directions – traditional and online – are important. Interviews have shown that although young people will focus on online purchases, other categories of customers still value paper books and traditional way of buying them. The arrival of iPads might decrease the demand for paper books (Atiyah & Adams & MacQueen, 2005), but it is likely that the segments on paper and electronic books are favored by different categories of customers and should develop simultaneously. Thus, surveys indicate that online business is not a substitute to common bricks and mortar establishments but is rather a complementary direction of sales.

 

References

Atiyah, P.S. & Adams, J.N. & MacQueen, N.J. (2005). Sale of goods. Pearson Education.
Haugtvedt, C.P. & Machleit, K.A. & Yalch, R.A. (2005). Online consumer psychology: understanding and influencing consumer behavior in the virtual world. Routledge.
Heinemann, G. & Schwarzl, C. (2010). New Online Retailing: Innovation and Transformation. Gabler Verlag.