Types of online Shopping rewards

Types of online Shopping rewards

Points rewards

It is important to remember that, with the exception of cashback rewards, each rewards program values its points differently: before consumers purchase through one of the point- or mile-based programs, they should compare the points they will earn with the specific reward they choose. In addition, because of the highly competitive nature of online commerce, many of the shopping portals offer coupons or discount offers not available if purchases are made directly through the merchant site: besides receiving points towards a reward, consumers can also save money up front.

Main article: Cashback website

To explain how cashback websites operate, you must be able to comprehend the idea that when someone clicks a link on the Internet from one website to another it is very easy to track where that click originated from. Millions of websites use this to their advantage by joining Affiliate programmes. For example, take a football fan website. As they are going to be getting visitors interested in football, there is a chance they might also be interested in gambling. Therefore that website owner might decide to place a banner for an online bookmaker on their football fan website. Then every time a visitor clicks that banner and then goes on to become a paying customer at the bookmaker website, the football fan website owner will receive a commission – maybe 20%, for example. What the cashback websites do is they gain commission for directing people to buy products/services via their website, and they might offer a high percentage of this commission back to the customers, say 80% for example thus keeping 20% of the commission money to themselves.

Donating to charity

Many rewards websites give users the chance to donate any money you get back to charity. In order to encourage participation this is usually in addition to also offering cashback. This will allow cashback website users the ability to donate to charity whilst carrying out their usual shopping online without any additional cost to themselves. However, many of these websites, unlike the charities that they give to, do not operate as not-for-profit websites.

what is Market Share for online shopping

Market share of eshop

E-commerce product sales totaled $146.4 billion in the United States in 2006, representing about 6% of retail product sales in the country. The $18.3 billion worth of clothes sold online represented about 10% of the domestic market.[45]

For developing countries and low-income households in developed countries, adoption of e-commerce in place of or in addition to conventional methods is limited by a lack of affordable Internet access.

[edit] Convenience

Online stores are usually available 24 hours a day, and many consumers have Internet access both at work and at home. A visit to a conventional retail store requires travel and must take place during business hours.

Searching or browsing an online catalog can be faster than browsing the aisles of a physical store. Consumers with dial-up Internet connections rather than broadband have much longer load times for content-rich web sites and have a considerably slower online shopping experience.

Some consumers prefer interacting with people rather than computers (and vice versa), sometimes because they find computers hard to use. Not all online retailers have succeeded in making their sites easy to use or reliable.

In most cases, merchandise must be shipped to the consumer, introducing a significant delay and potentially uncertainty about whether or not the item was actually in stock at the time of purchase. Bricks-and-clicks stores offer the ability to buy online but pick up in a nearby store. Many stores give the consumer the delivery company’s tracking number for their package when shipped, so they can check its status online and know exactly when it will arrive. For efficiency reasons, online stores generally do not ship products immediately upon receiving an order. Orders are only filled during warehouse operating hours, and there may be a delay of anywhere from a few minutes to a few days to a few weeks before in-stock items are actually packaged and shipped. Many retailers inform customers how long they can expect to wait before receiving a package, and whether or not they generally have a fulfillment backlog. A quick response time is sometimes an important factor in consumers’ choice of merchant. A weakness of online shopping is that, even if a purchase can be made 24 hours a day, the customer must often be at home during normal business hours to accept the delivery. For many professionals this is can be difficult, and absence at the time of delivery can result in delays, or in some cases, return of the item to the retailer. Automated delivery booths, such as DHL’s Packstation, have tried to address this problem.

In the event of a problem with the item – it is not what the consumer ordered, or it is not what they expected – consumers are concerned with the ease with which they can return an item for the correct one or for a refund. Consumers may need to contact the retailer, visit the post office and pay return shipping, and then wait for a replacement or refund. Some online companies have more generous return policies to compensate for the traditional advantage of physical stores. For example, the online shoe retailer Zappos.com includes labels for free return shipping, and does not charge a restocking fee, even for returns which are not the result of merchant error. (Note: In the United Kingdom, Online shops are prohibited from charging a restocking fee if the consumer cancels their order in accordance with the Consumer Protection (Distance Selling) Act 2000.[46])

[edit] Information and reviews

Online stores must describe products for sale with text, photos, and multimedia files, whereas in a physical retail store, the actual product and the manufacturer’s packaging will be available for direct inspection (which might involve a test drive, fitting, or other experimentation).

Some online stores provide or link to supplemental product information, such as instructions, safety procedures, demonstrations, or manufacturer specifications. Some provide background information, advice, or how-to guides designed to help consumers decide which product to buy.

Some stores even allow customers to comment or rate their items. There are also dedicated review sites that host user reviews for different products.

In a conventional retail store, clerks are generally available to answer questions. Some online stores have real-time chat features, but most rely on e-mail or phone calls to handle customer questions.

[edit] Price and selection

One advantage of shopping online is being able to quickly seek out deals for items or services with many different vendors (though some local search engines do exist to help consumers locate products for sale in nearby stores). Search engines and online price comparison services can be used to look up sellers of a particular product or service.

Shoppers find a greater selection online in certain market segments (for example, computers and consumer electronics[47]) and in some cases lower prices. This is due to a relaxation of certain constraints, such as the size of a “brick-and-mortar” store, lower stocking costs (or none, if drop shipping is used), and lower staffing overhead.

Shipping costs (if applicable) reduce the price advantage of online merchandise, though depending on the jurisdiction, a lack of sales tax may compensate for this.

Shipping a small number of items, especially from another country, is much more expensive than making the larger shipments bricks-and-mortar retailers order. Some retailers (especially those selling small, high-value items like electronics) offer free shipping on sufficiently large orders.

[edit] Fraud and security concerns

Given the lack of ability to inspect merchandise before purchase, consumers are at higher risk of fraud on the part of the merchant than in a physical store. Merchants also risk fraudulent purchases using stolen credit cards or fraudulent repudiation of the online purchase. With a warehouse instead of a retail storefront, merchants face less risk from physical theft.

Secure Sockets Layer (SSL) encryption has generally solved the problem of credit card numbers being intercepted in transit between the consumer and the merchant. Identity theft is still a concern for consumers when hackers break into a merchant’s web site and steal names, addresses and credit card numbers. A number of high-profile break-ins in the 2000s has prompted some U.S. states to require disclosure to consumers when this happens. Computer security has thus become a major concern for merchants and e-commerce service providers, who deploy countermeasures such as firewalls and anti-virus software to protect their networks.

Phishing is another danger, where consumers are fooled into thinking they are dealing with a reputable retailer, when they have actually been manipulated into feeding private information to a system operated by a malicious party. On the other hand, dealing with an automated system instead of a population of store clerks reduces the risk of employees stealing consumer information, or dumpster diving of paper receipts. Denial of service attacks are a minor risk for merchants, as are server and network outages.

Quality seals can be placed on the Shop webpage if it has undergone an independent assessment and meets all requirements of the company issuing the seal. The purpose of these seals is to increase the confidence of the online shoppers; the existence of many different seals, or seals unfamiliar to consumers, may foil this effort to a certain extent.

A number of resources offer advice on how consumers can protect themselves when using online retailer services.[48] These include:

* Sticking with known stores, or attempting to find independent consumer reviews of their experiences; also ensuring that there is comprehensive contact information on the website before using the service, and noting if the retailer has enrolled in industry oversight programs such as trustmark or trust seal.

* Ensuring that the retailer has an acceptable privacy policy posted. For example note if the retailer does not explicitly state that it will not share private information with others without consent.

* Ensuring that the vendor address is protected with SSL (see above) when entering credit card information. If it does the address on the credit card information entry screen will start with “HTTPS”.

* Using strong passwords, without personal information. Another option is a “pass phrase,” which might be something along the lines: “I shop 4 good a buy!!” These are difficult to hack, and provides a variety of upper, lower, and special characters and could be site specific and easy to remember.

Although the benefits of online shopping are considerable, when the process goes poorly it can create a thorny situation. A few problems that shoppers potentially face include identity theft, faulty products, and the accumulation of spyware. Most large online corporations are inventing new ways to make fraud more difficult, however, the criminals are constantly responding to these developments with new ways to manipulate the system. Even though these efforts are making it easier to protect yourself online, it is a constant fight to maintain the lead. It is advisable to be aware of the most current technology and scams out there to fully protect yourself and your finances.[49].

One of the hardest areas to deal with in online shopping is the delivery of the products. Most companies offer shipping insurance in case the product is lost or damaged; however, if the buyer opts not to purchase insurance on their products, they are generally out of luck. Some shipping companies will offer refunds or compensation for the damage, but it is up to their digression if this will happen. It is important to realize that once the product leaves the hands of the seller, they have no responsibility (provided the product is what the buyer ordered and is in the specified condition).[50].

[edit] Privacy

Privacy of personal information is a significant issue for some consumers. Different legal jurisdictions have different laws concerning consumer privacy, and different levels of enforcement. Many consumers wish to avoid spam and telemarketing which could result from supplying contact information to an online merchant. In response, many merchants promise not to use consumer information for these purposes, or provide a mechanism to opt-out of such contacts.

Brick-and-mortar stores also collect consumer information. Some ask for address and phone number at checkout, though consumers may refuse to provide it. Many larger stores use the address information encoded on consumers’ credit cards (often without their knowledge) to add them to a catalog mailing list. This information is obviously not accessible to the merchant when paying in cash.

source:wikipedia.com

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Trends and Predictability in Online Shopping

One third of people that shop online use a search engine to find what they are looking for and about one fourth of people find websites by word of mouth. [16]. Word of mouth as increased as a leading way that people find websites to shop from. When an online shopper has a good first experience with a certain website sixty percent of the time they will return to that website to buy more.[17].

Books are one of the things bought most online, however clothes, shoes and accessories are all very popular things to buy online. Cosmetics, nutrition products and groceries are increasingly being purchased online.[18]. About one fourth of travelers are buying their plane tickets online because it is a quick and easy way to compare airline travel and make a purchase. Online shopping provides more freedom and control than shopping in a store.[19].[20].

According to sociological perspective online shopping is arguably the most predictable way to shop.[21]. One knows exactly what website to go to, how much the product will cost, and how long it will take for the product to reach them. Online shopping has become extremely routine and predictable, which is one of it’s great appeals to the consumer.

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History of Online Shopping

Since about 1990, online shopping has emerged into every corner of life, linking people to the culture of capitalism in frequent and daily ways. [1]. It lets us buy what we want, when we want at our convenience , and helps us to imagine ourselves buying, owning, and having positive outcomes by the goods available out there on the web.[2]. Shopping has been a way of identifying oneself in today’s culture by what we purchase and how we use our purchases. Online shopping has always always been a middle to high class commodity since its first arrival on the internet in society.[3]. In 1990, Tim Berners-Lee created The World Wide Web Browser.[4]. A few years later in 1994 other advances took place such as Online Banking, After that, the next big development was the opening of an online pizza shop by Pizza Hut.[5]. In that same year Netscape introduced SSL encryption to enable encryption over the data transfered online which has become essential for online shopping. In 1995, Amazon started up with online shopping, then in 1996, eBay opened up for online shopping as well.[6]. The idea of online shipping pre-dates the World Wide Web for there were earlier experiments involving real-time transaction processing from a domestic television. The technology, based on Videotex, was first demonstrated by Michael Aldrich in 1979 who designed and installed systems in the UK, including the first Tesco pilot system in the 1980s.