Failure or Success of E-Business?

¶ … failure or success of e-Business?

The dot.com boom and bust of the 1990s saw the influx of seemingly countless Internet-based companies with short shelf lives. "Back in 1998 and 1999, you got a domain name that sounded cool, raised a lot of money, rolled the dice and hopefully something good would come out of it," whether it was a good business idea or not (La Monica 2005). However, if companies were not able to advertise a clear product or service, and merely had a cool name and advertising campaign, they quickly fell by the wayside.

The more successful Internet companies, including Amazon.com, eBay and the Internet versions of brick and mortar stores like Wal-Mart were all able to survive because they offered tangible services, unique goods, services, or discounts, or added convenience to regular consumer buying habits and patterns. Niche marketers like Pets.com, with its peculiar 'sock puppet' spokesperson who did not articulate why the website was better than tried and true brick and mortar pet stores PetSmart or PetCo drew little revenue-generating consumer traffic. The 17 Internet companies that had clever 2000 Super Bowl advertisements but left consumers shaking their heads 'what are they selling, again' also had little mileage (La Monica 2005)..

What are some of the financial issues that are unique to online monetary transactions?

Safety and security are two primary concerns for consumers buying online, as it is inconvenient to use checks or wire cash online. Using PayPal is one option, but most consumers chose to pay through their credit cards and want some assurance that their numbers are not accessible to illegitimate third parties. Similarly, consumers who access their bank accounts online want to make sure that they and they alone can see the records, and there are some controls to verify their identity. Other concerns for sites like eBay, where sellers are individuals and not reputable corporations, include the fact that the buyers may want to return their merchandise and cancel payment if the goods do not match the product description. (This is the reason for eBay's 'rating' of user reliability). Sellers from all websites want assurance that the credit cards consumers use to purchase goods are legitimate. Finally, in international exchanges, some method of currency conversion, if buyers and sellers do not share a common currency, must be in place.