Semester February Session 2023/ 2024

ARS 3053
RETAIL TECHNOLOGY
TUTORIAL 3
WHAT IS INTERNET ?

GROUP NUMBER : GROUP 4

No. Student Name Matrix No.

1. QU FAZLINAEMYSA BINTI MOHD FADZLI A21A3041

2 NOR SHAFIQAH BINTI ABDUL LATIF A21A2733

3 AN-NUR HAZIRAH BINTI HAPIZI@ HAFIZI A21A2396

4 MARLYNA BINTI NURULLAJI A21A2567

5 AYU NAZIRA BINTI ABDUL GHANI A21A2421

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INTRODUCTION

The internet is one of the global networks that can connect more than one user from all over the
world. The internet includes various services including e-mail, websites and online banking.
Nowadays, the internet allows internet users to exchange information with each other through the
internet network. The internet provides many benefits to users to get information about things
that are less known. society will also obtain information faster and faster by just going through
the internet. Apart from that, the internet also benefits traders who want to offer and promote
their products online. The internet allows buyers to make transactions using credit cards or
electronic money. The internet is something that benefits society, especially traders who want to
expand their business.

1. Explain the role of the internet in the realm of e-retail.

- Connected between sellers and buyers:

E-retail is the process of buying and selling products or services electronically over the Internet.
This term refers to all trading activities carried out online. So the Internet is very important in the
field of e-commerce in every aspect of the sales process from purchase to delivery. Among the
roles of the internet in the field of e-commerce is to connect sellers and buyers more easily. This
e-retail exists providing a platform to connect sellers with buyers directly through this. This will
make it easier for customers to ask questions about something or give views if necessary to
improve the existing system. It also allows sellers to reach buyers all over the world without
geographical restrictions.

- Buyer Data Analysis:

This e-retail platform can collect data on consumer behavior, purchasing preferences, as well as
market trends. With the advent of the internet, it makes it very easy for sellers to know the
consumer and consumer methods before choosing the products offered by the seller. So it's very
important information for sellers as they can use this information to upgrade their e-retail. This

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can provide an opportunity for sellers to improve marketing strategies, advertising online, and
others. The Internet is very convenient for sellers in the field of e-retail.

- Global reach:

The Internet has greatly facilitated businesses that want to expand the reach of markets and
customers as it eliminates geographical reach, allowing e-retail to reach customers around the
world. This wide reach has opened up new business morning opportunities to open up new
markets and opportunities for businesses to expand beyond their local territory.

- Cost saving:

With this internet, e-retail can save a lot of costs compared to opening a store directly. This is
because if a business has a shop it will increase many costs such as rental costs, employee fee
cost, and bill costs. So this is going to increase the cost of the product. That's why if buying on
the internet it would be cheaper than if it went straight to the store.

2. Discuss how the Internet has revolutionized the way businesses operate and consumers
shop.

- Businesses operate:

Technology is always evolving, and this is also happening in the growth of the internet in various
industries, especially business. The expansion of the Internet around the world facilitates
business access to a wider market. Small businesses may use this facility to help them grow
quickly as it allows them to target customers both domestically and internationally. Furthermore,
the COVID-19 outbreak has forced businesses to adapt their operating methods. Online
platforms are used by businesses to offer their goods and services. Businesses are starting to
realize that selling products online reduces their overhead. E-commerce platforms are growing
rapidly during the pandemic.

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 - Consumers shop:

Additionally, users get extensive access to a wide variety of global items. On the internet
platform, customers can compare the cost of products from hundreds of retailers. The Internet
offers consumers a new way to shop online: in addition to local goods, they can now buy goods
from abroad without physically traveling to the country. Also, product reviews help customers
make better decisions. While some consumers may not buy something online, reading other
consumers' reviews on online platforms can persuade them to buy a product when they visit a
physical location. Discounts are often offered by online platforms to help users manage their
spending.

3. Describe the key components of e-retail infrastructure enabled by the Internet, including
websites, marketplaces, payment gateways, and logistics networks.

- Websites:

Websites are the primary digital storefronts for e-retailers. Just like a physical store, a website is
an online platform where businesses display their products to customers. Websites are used for
branding, marketing, and selling products. Visitors can quickly go through a website’s product
catalog to check product details and complete a purchase using a user-friendly interface.
Websites provide additional functionality such as search options, filtering, and personalized
recommendations which improve the shopping experience for customers and help them quickly
find their desired products. Websites may also include other components like customer reviews,
product ratings, and a customer support chat window to promote trust between businesses and
customers. A website is thus an e-retailer’s digital storefront and the most crucial component of
an online la retail business.

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 - Online Marketplaces:

Online marketplaces are centralised platforms that link buyers and sellers. They provide
customers access to a large variety of items from different vendors in one location and help
companies reach a wider audience. Customers may peruse a wide range of items on these
marketplaces, compare features and pricing from various vendors, and shop with ease and
choice. Online marketplaces provide companies the chance to grow their clientele, raise their
profile, and reach a wider audience without having to spend a lot of money on infrastructure or
marketing. Online marketplaces facilitate companies by streamlining the purchasing and selling
process with features like order management, secure payment processing, and seller tools. In
general, online marketplaces are essential to the architecture of e-retail since they allow for
transactions. Overall, online marketplaces play a vital role in e-retail infrastructure by facilitating
transactions and fostering a dynamic and competitive marketplace environment.

- Payment Gateways:

Payment gateways are safe internet systems that let companies securely and effectively take
payments from customers online. To prevent fraud and unauthorised access, these gateways
encrypt critical financial data, including credit card numbers, before processing payment
transactions. Payment gateways improve the checkout experience by providing a variety of
payment choices, such as digital wallets, bank transfers, and credit/debit cards, that suit a wide
range of customer preferences. Furthermore, payment gateways are essential for streamlining the
payment process and enabling companies to take payments swiftly and securely, which boosts
conversion rates and customer satisfaction. Payment gateways provide organisations the tools
they need to handle payments securely and reduce risk thanks to sophisticated features like fraud
detection, tokenization, and PCI compliance. Overall, payment gateways are essential

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components of e-retail infrastructure, enabling businesses to accept payments seamlessly and
securely in the digital marketplace.

- Logistics Networks:

The foundation of online retail operations is provided by logistics networks, which are in charge
of receiving, storing, and shipping the goods that customers request. These networks include a
wide range of tasks to guarantee that goods are delivered to customers promptly and effectively,
such as order fulfilment, inventory management, shipping, and delivery. Logistics networks
operate in conjunction with last-mile delivery companies, fulfilment centres, and shipping
carriers to provide a variety of shipping choices and delivery services catered to the needs of
individual customers. Logistics networks improve productivity and profitability by streamlining
processes, cutting costs, and optimising supply chain operations. This allows organisations to
promptly and correctly complete orders. Furthermore, logistics networks are essential for
enabling real-time tracking, order updates, hassle-free returns and exchanges, and overall
customer satisfaction. Overall, logistics networks are essential components of e-retail
infrastructure, enabling businesses to deliver products to customers seamlessly and reliably in the
digital age.

4. Analyze the advantages and challenges associated with conducting business transactions
online, such as global reach, cost-effectiveness, customer convenience, security concerns,
and competition.

- Global reach:

The advantage is a wide global reach that is by reaching customers all over the world without
geographical limitations. This opens up opportunities for rapid growth and market
diversification. In addition to the low cost compared to traditional business, conducting online

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transactions usually has a lower cost that can indirectly avoid overhead costs such as physical
premises rent, massive inventory, and additional work.

The challenge is having various International regulations and taxes, which means having to
comply with different trade and tax laws in various countries can be complicated and
time-consuming. Next, customer trust and information security by ensuring customer trust in
online transactions is a very important matter and related to information security issues such as
credit card fraud, data breaches, and false identities can damage business reputation and reduce
customer trust.

- Cost effectiveness:

The advantage is lower operating costs ie online businesses often have lower operating costs than
traditional businesses. This is due to the lack of need for expensive physical premises, large staff,
and massive inventory. These costs can be reduced and optimized digitally. In addition to deep
data analysis by conducting online transactions, it will be able to collect valuable customer data
and analyze their purchasing behavior. This allows premises to create more effective marketing
strategies, target customers more accurately, and improve overall cost effectiveness.

The challenge is that the online market is often highly competitive, with hundreds or thousands
of competitors competing for customer attention. This can make it difficult to develop a position
in the market and maintain a healthy profit. Next is the importance of information security with
increasing concerns about online information security, especially related to customer data and
financial transactions, it is important for businesses to protect themselves from cyber attacks and
data theft. Managing information security is not only a moral responsibility but can also be a
technical and financial challenge at times.

- Customer facilities:

The advantage is choice and reliability with online, that is customers can easily find the product
or service they want from various sellers just at the tip of their fingers. This gives them access to
a wide range of options and allows them to compare prices and quality before making a purchase
decision. Next, convenience in the various payment processes, i.e. online transactions allow
customers to use a variety of different payment methods, including credit cards, e-wallets, online

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banks, and others. This gives them flexibility and comfort in making payments according to their
choice.

The challenge is the issue of security and privacy where customers often worry about the
security of their personal and financial information when making online transactions. This lack
of trust can be a huge obstacle in attracting new customers and retaining existing customers.
Next is the management of delivery and returns even though customers enjoy the convenience of
online shopping, a slow delivery process or problems with delivery such as damaged or missing
items can spoil their shopping experience. Efficient delivery management and an easy return
process are essential to meet customer expectations and build trust.

- Security concerns:

The advantage is a secure payment selection process that online business platforms often offer a
variety of secure payment methods, including credit cards, e-wallets, or online payment systems
that have been tested and verified. This gives customers the assurance that their transactions are
done in a secure manner. Next, increased security awareness, which is online security concerns,
has increased customer awareness of the steps that need to be taken to protect themselves when
transacting online. This allows customers to be more cautious and tend to choose business
platforms that offer a high level of security.

The challenge is continuous cyber attacks because online businesses are often the target of
continuous cyber attacks such as hacking attacks, malware, or credit card fraud. Increasing
security awareness and protecting business platforms from cyber attacks is a constant challenge.
Next is data theft ie the risk of data theft is a big challenge in conducting business transactions
online. If customer data is misused or accessed illegally, it can damage a business's reputation
and lead to significant financial losses and may even be subject to legal action.

- Competition:

The advantage is innovation and flexibility, i.e. online businesses often allow faster innovation
and more flexible implementation of product changes or marketing strategies compared to
traditional businesses. This allows premises to more quickly adapt to changes in the market and
customer demand. Next is a wider market access that is through an online business platform,

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premises can reach customers around the world without geographical limitations. This opens up
opportunities to reach a wider market and attract customers from various backgrounds and
locations.

The challenge is the fierce competition that is the online market is often very competitive, with
thousands of sellers competing for the attention of the same customer. Next is the decrease in
profits which means that in an effort to attract customers and compete with prices, there is
pressure to keep prices low. This can result in decreased profit margins and reduced income
potential for online businesses.

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CONCLUSION

In my opinion, the use of the internet in the retail business is something that will help the
business to move forward. This is because the use of the internet in retail business is very
important nowadays in order to be able to seize wider opportunities in increasing sales as well as
being able to increase accessibility. The use of the internet as an e-commerce platform will allow
retail businesses to sell their products directly to customers by simply using the internet. It can be
seen that the use of the internet plays an important role in strengthening the business position and
increasing profits.

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