Digitell Blog The importance of e-commerce

The exponential growth of Amazon, coupled with its rapid diversification of products has in a way mirrored the online habits of the broader population. As more and more of public life moves online, Amazon has commensurately morphed from an online book retailer to unquestionably the biggest e-commerce site in the world.

Success, however, does not occur in a vacuum. In the wake of this unbridled expansion, several physical retail sectors have been maimed or outright extinguished. Why has this model become so effective, and what makes its use so important for businesses? Here are a few reasons to explain this massive consumer transition to e-commerce transactions.


The principle of convenience has served arguably as the bedrock for the massive success seen in the e-commerce model. A chief issue traditional retail businesses face is a dramatic waste of consumer time. Physically travelling to stores and negotiating with salesmen becomes an increasingly laborious task when the whole process can be curtailed through online purchasing. Furthermore, purchases are open at any hours the consumer sees fit, and not merely the hours that the stores find convenient.

This is compounded by the fact that the in-depth cataloguing of e-commerce sites has made it increasingly easier to isolate products of interest. Consequently, businesses which use an online model are often very good at suggesting products of interest based on browsing history, and consumer algorithms are becoming optimised to the point of necessitating continued purchase.

This increase in convenience is also of direct benefit to the businesses themselves. By reducing the need for physical stores to market their products, businesses effectively cut out the middlemen, thus reducing their financial overhead. This bleeds over into consumer benefit, as it allows businesses to market products at prices that retail stores can’t compete with.


The universal reach the Internet naturally has at its disposal is a crucial factor in the success of e-commerce. Though restrictions on international postage are prevalent in nascent businesses, major e-commerce sites like Amazon remain relatively unfettered by these concerns. Transactions are opened up to an international market, whilst physical stores remain relegated to whatever corner of the world they exist in.

This concept is particularly underscored when the marketing of digital goods and services like video games and music comes into play. The sole advantage retail stores have over their digital counterparts are that customers don’t have to suffer through laboured postage periods. However, this concern becomes immaterial when discussing digital goods, as they are now delivered instantaneously, removing any and all incentive to visit a retail store.


Though brick and mortar stores have the opportunity of fostering a relationship from consumer to salesman, the degree of consumer understanding generated by e-commerce analytics is virtually unparalleled. An optimized e-commerce algorithm will not only track conversion rates, browsing and purchase history, but will even keep track of the amount of time individuals spend on specific pages. Data points from millions of individuals are averaged, and marketing strategies and search algorithms are constantly altered and refined to increase the profit margin. This feature is only further consolidated by the immediacy to which this data can be acted on, and in which new marketing strategies can be enacted. By contrast, retail stores are limited to a comparably miniscule pool of marketing data to base their decisions on, and can only enact change after a sizeable amount of time.

The Inevitable

It is projected that by 2019, e-commerce sites will have 20% of the total market share of the retail business. With the degree of advantages it holds over brick and mortar stores, this share is likely to see exponential growth in the coming years, ultimately surpassing its physical counterpart. For a business to thrive, this coming change is not to be maligned, but rather embraced, and e-commerce to be used to a businesses’ advantage.


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