India is the fastest growing market for E commerce sector. E-commerce in India has been seeing a growth continuously and is expected to surpass the US and become the second largest e-commerce market in the world by 2034. According to e Marketer’s forecast eCommerce sales in India will climb to 31.0% to reach $32.70 billion till the end of year 2018. Firms like Amazon, Flipkart, and Paytm Mall are expanding into new sector including grocery. Increase in internet users and rise in digital literacy rate has become the gateway for the huge investment in e-commerce firms.
E commerce has been successful in attracting more customers from cities and towns where people living have less access to brand stores but have higher aspirations. People get more attracted towards eCommerce store as they get variety of products to choose from, cheaper price, can buy things from just sitting at home, can do easy returns, etc. Customers don’t need to go out of the house in crowd for shopping. E commerce sites allows to choose the product they want and the product is delivered at their doorstep.
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Why are people moving towards E commerce :–
E commerce allows people to carry out business from any place and at any time. One can log in to their store any time whether it is day or night and purchase or sell anything.
- You can get cheap deals and better prices on eCommerce stores as they directly purchase products from manufacturer without any middleman involved. Many online shops offers great discounts in festival seasons.
- You can get variety of brands and products at one place. You can look for the latest trends going in the market. You don’t need to wait for the fashion to arrive in your town and cities which may take months to arrive.
- E commerce provides the cheapest mode of doing business. One don’t have to look for stores which costs them lakhs of rupees.
- Many of us don’t like to stand in crowd while shopping. Crowd forces people to buy things in hurry most of the time. In online stores you get facility of shopping at your chosen time.
- E commerce is ideal for niche products. Customers for such products are usually few. But in the huge market place .i.e. the Internet even niche products can generate huge volume.
- There is less paper work and requires no staff to handle the online store. Electronic selling reduces the chance of error and is more faster and convenient for the visitor.
Increase in eCommerce popularity has also increased risks associated with it. People have also faced severe incidents which sometimes holds back them to purchase online.
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Let’s look at some negative impacts of eCommerce store:-
Negative impacts of E commerce Business:–
Every eCommerce site asks for personal details while shopping, and thus it is easy to collect personal details of any user. All the transaction carried out are stored at the server. This history of user is used to target other advertisements by local and major firms.
E commerce site Security:-
Online transactions are more insecure than those conducted through cash because there is no way to guarantee that the money is going to land in safe hands. Also there is no way to ensure the person making payment through card is the owner of the card. Most of the sites use third party payment gateway which if not protected with proper security measures, can leak cards information to unauthorized persons.
E commerce site Returns and complaints:-
Shopping online always has more number of return rates than purchasing in person. This is because customers haven’t seen products in physical before purchasing, sometimes they change your mind by the time product reaches their door. A bigger firm would not have much problem in accepting the return product but it becomes highly disruptive with small firms which in turns affects consumers.
E commerce site Lack of Personal Touch :-
People buying from eCommerce lacks for personal touch. They cannot touch the products physically.If you want to buy any garment you won’t be able to touch the fabric of the garment. If you want to buy shoes you cannot check how it feels on your feet. You just have to click on Buy Now button and that’s it, product is booked for you.
eCommerce site Delay in Service Delivery:-
Usually orders takes some days to get in your hands. Even if you choose express shipping you will get the delivery of product next day from the day you order. There are some products which people will want immediately. Suppose you want a pen to write something, you cannot wait for some days to get it delivered from an ecommerce site. Likewise if you want an candy to eat you cannot wait for the ecommerce site to deliver.
If we keep negative impacts and then look at eCommerce more darker side can be seen. People are targeted though various scams online. Frauds are on the rise with the rise in eCommerce segment. Fraudsters are becoming more sophisticated in their malware use to tackle online banking through phones, tablets, computer using stolen bank details.
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eCommerce site Impact on Retail Business Industry:–
Although ecommerce sector has become a boon for the consumers in India, there is a totally opposite side as far as the retailers see it. Now they don’t only need to compete with other retailers but they also need to compete with huge ecommerce firms which are much more larger in financial terms.
As per a recent research, it has come in to light that about 80% of enterprise has gone down from last two or three years. This is very disturbing situation and also discouraging for the local retailers. Local retailers and enterprises had set up their business from many years and now this newly came ecommerce is destroying their business like never before.
Most of the retailers have decreased their profit margin due to increasing competition with ecommerce stores as they need to attract more customers. This has brought up the situation of do or die.
The customer base is also getting shifted towards the online stores. E commerce stores provides number of items to choose at one place. One can get everything they need in their life from online stores. They have number of brands to offer. One single retailer cannot store such a huge collection at store. Retailers can only store some fixed amount of products at their store.
As the days are passing eCommerce is emerging. We can see its positive aspect in economy as well as in business industry. E commerce has taken internet by storm. Most of the people purchase goods online which needs their personal details to be shared online. This details are somehow hacked by the criminals and used for their own benefits.
Types of Fraud involved in E commerce Business :–
eCommerce site Identity theft :–
The most common fraud in eCommerce industry is Identity Theft. Credit cards are the most common target as it does not need much to carry out fraud using them.
Identity theft involves criminal carries out transaction using someone else’s identity. To order products online they use someone else’s name, their credit card information or by debiting another person’s account. On the other Phishing is used to collect personal sensitive data through sending text messages, emails to the victim.
Hackers attacking on e-commerce providers and stealing customer data also fall under this fraud category. ‘Man in the middle ‘is the sophisticated way of Identity theft. This involves hackers spoofing one to one communication between customer and merchant.
eCommerce site Friendly Fraud:–
In this method customers orders products or services and pay for it using credit card or debit card. Then they ask for charge back from merchant telling them that there card was hacked or stolen. They get the charge back but keep goods with them. Friendly fraud also combines returning or re-shipping of products.
eCommerce site Clean Fraud :-
Clean fraud involves using the stolen or lost credit card details to make purchase in such a way that they avoid alerting the fraud detectors. In this process criminal steals enough information about the card holder that they can easily pass the transaction process as a real customer.
eCommerce site Affiliate Fraud :-
Affiliate fraud does not focus on the payment process. In this the criminal manipulates the data collected by the affiliate link given to them by retailer to make the retailer pay more than they owed. This can be achieved by an automated process or can be accomplished by realm people using fake profiles.
eCommerce site Merchant Identity fraud :–
In Merchant fraud criminal set up an online store and attracts to customers to purchase from there. They show up giving the products vat very low price. After the customer has made payment they disappear and never ship the item. This kind of fraud also exists in wholesale purchase.
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eCommerce site Triangulation fraud :–
In this fraud is carried out using three points. The first point is fake online store which offers goods at very low price. They also use different schemes which says that the goods will only be shipped immediately if the payment is done through credit card.
The second point involves the stolen credit card data and the name collected to order goods at real store and ship them to original customer.
The third point involves using the credit card data to make more purchases. the order data and credit card data now are almost to connect , so the fraud remains undiscovered.
E commerce is growing than any other industry in the country. There are positive as well as negative aspects of it. We need to analyse both the situations and take some major steps for the welfare of the business industry and its people. We cannot be blindfolded by the harm eCommerce industry is causing. Retail business is facing an heavy competition with eCommerce sector. Even the people need to be aware with fraud schemes while shopping online. Never share your personal information online with unknown person.
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