Page 400 - Introduction to Electronic Commerce and Social Commerce

388 12 Implementation Issues: From Globalization to Justification, Privacy, and Regulation

A global electronic marketplace can be an attractive Globalization and Social Networking
opportunity in an EC strategy. Going global means access to
new and possibly larger markets, opportunity to minimize Globalization of EC has benefitted greatly from social net-
taxes, and flexibility to employ a less expensive workforce working. For example, there are about five times more inter-
anywhere. However, going global is a complex and strategic national Facebook members than in the USA. Furthermore,
decision process for several reasons. Geographic distance is companies such as Amazon.com, Google, Groupon, and
an obviously important issue in conducting business glob- Yahoo! are very active globally.
ally; however, frequently, it is not the most important issue.
Cultural differences and political, legal, administrative, and
economic issues must be considered. This section briefly Barriers to Global E-Commerce
examines representative opportunities, problems, and solu-
tions for companies that are going global with EC. Despite the benefits and opportunities offered by globaliza-
tion, there are several barriers to global EC. Some of these
barriers face any EC venture but become more difficult when
Benefits and Extent of Global Operations international impacts are considered. These barriers include
authentication of buyers and sellers (Chapter 10), generating
A major advantage of EC is the ability to conduct business at and retaining trust (Chapter 9), order fulfillment and delivery
any time, from anywhere, and at a reasonable cost. These are (Chapter 11), security (Chapter 10), and domain names.
also the drivers behind global EC, and there have been some Others are unique to global EC. In this chapter, we will dis-
incredible success stories in this area. For example: cuss only some of these barriers.
iGlobal stores (iglobalstores.com) and Alibaba.com offer
suggestions on what to offer international customers: country-
• eBay conducts auctions in hundreds of countries specific checkout experience, up-to-the-minute currency
worldwide. conversion and foreign settlement, global fraud and risk and
• Alibaba.com (Chapter 4) provides B2B trading ser- its protection, calculation of duty and tax, and integration
vices to millions of companies worldwide. with existing information systems.
• Amazon.com sells books and millions of other
items to individuals and separate retail websites for Cultural Differences
13 countries, including the USA, the UK, France,
and Brazil. The Internet is a multifaceted marketplace made up of cross-
• Small companies, such as ZD Wines (zdwines. cultural users. The multicultural nature of global EC is impor-
com), sell to hundreds of customers worldwide. tant because cultural attributes (such as social norms, local
HotHotHot (hothothot.com) is a success story habits, and spoken languages) determine how people interact
from the past. The company is no longer in busi- with companies, agencies, and with each other. Cultural and
ness. Global sales now are done via HotSauce.com related differences include spelling differences (e.g., American
service. versus British spelling), information formatting (e.g., dates can
• Major corporations, such as GE and Boeing, have be mm/dd/yy or dd/mm/yy), graphics and icons (e.g., mailbox
reported an increasing number of international ven- shapes differ from country to country), measurement standards
dors participating in their electronic RFQs. These (e.g., metric versus imperial system), and so forth. Many com-
electronic bids have resulted in a 10–15% cost panies are globalizing their websites by creating different sites
reduction and more than 50% reduction in cycle for different countries, taking into account site design elements,
time. pricing and payment infrastructures, currency conversion, cus-
• In 2013, the NFL opened an e-commerce shop for tomer support, and language translation.
the Chinese market (nfl.tmall.com), which partners
with 25 regional TV broadcasters and digital media Language Translation
outlets across China (see PR Newswire 2013).
• By recruiting online via social networks (e.g., Although the world population is over 7.4 billion (2016),
xing.com and linkedin.com), many international only about one billion people speak English as their native
corporations have considerably increased their or second language. In contrast, more than 1.5 billion peo-
success in recruiting employees to work in interna- ple speak Chinese. In their study of 1000 top websites,
tional locations. Sargent and Kelly (2010) found that more than 72% of
consumers would be more likely to purchase a product with