E-Commerce Strategies and Their Performance Measurement
Ghandour, Benwell and Deans in their journal article highlight on the effectiveness of performance measurement of e-commerce strategies by businesses (2011). They note a lack of an appropriate measurement model that will assist owners of the business judge the effectiveness of their websites. They highlight that mainly financial measures and customer satisfaction measures are used to evaluate website performance. Website designers are the most beneficiaries of the use of customer satisfaction measures such as user friendliness and ease of website navigation. The designers are given information on how to improve their website design. The owners however lack a model on how to evaluate the effectiveness of their websites in the marketplace. Measuring website performance requires a measurement model that has multidimensional parameters and the measurement of the parameters at different levels (Ghandour, Benwell & Deans, 2011).
The researchers proposed a performance measurement model that was based on three base measures which are website usage, profitability usage and owner satisfaction. Website usage had measures such as number of visitors and repeat visitors while profitability usage contained website sales and cost reduction measures. Owner satisfaction had measures such as search engine ranking and the extent to which the website had strengthened the business competitive advantage. The researchers conducted an online survey of businesses that had been operating websites for a considerable length of time. They were able to collect data on the three main base measures. The data was used to come up with a model of measurement from the owner’s perspective. They recommended businesses to abstain from using single measures of performance and rely on multi measures which reflected a more objective and realistic measurement.
Featherman, Thatcher, Wright, Zimmer and Pac in their journal article appreciate the importance of e-commerce (2011). They note that the e-commerce accounts for 80% of the US economy. The E-commerce option in businesses has gone a long way in strengthening the business-customer relationship and experience. However, the benefits of e-commerce have certain risks and benefits. Customers in interacting with different companies through websites are more cautious when buying products as they do not have the opportunity to tangibly test the product, an option in the traditional forms of marketing (Featherman, Thatcher, Wright, Zimmer and Pac, 2011). The authors reviewed the relevant literature on e-commerce benefits and risks. Secondly, the authors developed a hypothesis on the model of customer evaluation of e-commerce options. They stated that a business that engaged in highly interactive demonstration of e-services on their websites served to lessen the customer perceived risks in online payments. This translated to higher customer sales than a website that had no interactive features. A laboratory test was conducted with two simulated website platforms with online bill payment options, one with interactive demonstration of products while the other one did not have any demonstrative features at all. The results showed that the interactive platform had higher levels of customer usage or involvement and bill payment transactions. The authors suggested that businesses should invest in interactive demonstrative website models to increase their sales.
The two articles are relevant as e-commerce is one of the ways a business can develop strategic competitive advantage. A business should be able to objectively measure its website performance. Secondly, it should ensure that it works to assure customers of the authenticity of their website products in order to reduce risks associated with online billing or purchases systems.
Featherman, M., Thatcher, J., Wright, R., Zimmer, C & Pac, P. (2011). The Influence of Interactivity on E-service Offerings: An Empirical Examination of Benefits and Risks. Transactions on Human-Computer Interaction, 3(1), 1-25.
Ghandour,A., Benwell, G. & Deans, K.(2011) Measuring the Performance of eCommerce Websites– An Owner’s Perspective. Pacific Asia Journal of the Association for Information Systems, 3(1), 1-27.