US Ecommerce Drivers

The success of e-commerce in the US has been driven by the latent desire of people to shop from the comfort of their homes. With life becoming more hectic by the day it was natural for a common customer to shift from normal routine of going to a shop to buying the same things from the internet from the comfort of their couch.

Below you will find some of the technical aspects which have made e-commerce such a huge success. If you are not interested in learning about the logistics of e-commerce which made is such a huge success in US you can skip this section.

1.  Demographics such as high gross domestic product and large population

2.  Favorable long-term economic environment for growth in a free economy

3.  Telecom infrastructure that makes the US the most wired country in the world

4.  Digital Divide narrowing

5.  Highest Internet user population on the world

6.  Ubiquitous availability of broadband access for both consumers and businesses

7.  Governmental support of the emphasis on Ecommerce growth and the Internet as a learning tool in schools

8.  B2B and B2C revenue expected increase significantly over the next 5 years

9.  Expanding of infrastructure expected taking place to support the advent of new B2B business models

10.  Wide use of credit cards for consumer purchases

Ecommerce Readiness

Globally, the US has been the quickest to develop and adopt new Ecommerce business models. This assertion can be explained in terms of its overall societal tendencies towards collaboration and community, the nature of its consumers to engage in liberal credit card spending limits fear of the risks inherent in Ecommerce, its established role as a leader in the IT industry, as well as its superior telecommunications infrastructure.

First of all, the Internet is by nature a social tool utilized to share information and experiences as well as for conducting business. The US is a highly social/interactive country as evidenced by its emphasis on consumers social interaction and team-oriented collaboration in the workplace. It therefore follows that one of the primary points of emphasis in the design of Internet products and services is their ability to facilitate interaction.

In the US Ecommerce society, examples of this nature abound. Online communities such as Yahoo, Excite and Geocities which focus on sharing experiences and information, social buying forums such a Amazon.com which foster interaction and deliver content and services in addition to goods, B2B marketplaces and exchanges such as Arriba and Commerce One which promote a high degree of interaction between business, and groupware/collaborative business tools such as Lotus Notes are all examples of the commerce-oriented use of the Internet in a highly interactive and social fashion which the US has embraced on a large scale.

Second, US consumers have a higher propensity to engage in liberal spending, especially with the use of credit cards. A report issued by Metagroup states that per capita, the US ranks in the top four countries with respect to the number of credit cards issued. Of those issued, the US has the top ranking in credit card utilization. This is highly significant when considering the fact that nearly all consumer online spending requires the use of a credit card. Furthermore, according to Forrester Research, the average American who is utilizes the Internet for Ecommerce spends more than 250 dollars a month online.

Third, according to a report by Cahners In-Stat issued in March of 2000, US consumers are more prone to tolerate the security risks that online shopping and B2B Ecommerce entails. Even in light of recent individual and corporate level attacks by hackers on Ecommerce sites which have caused denial of service, theft of personal information such as credit card numbers, and widespread virus infection, healthy Ecommerce growth continues to occur and is projected to do so into the foreseeable future. The report also went onto state that US Internet users tend to be much more liberal with the divulgence of sensitive personal information in the Ecommerce process. This is a key point when one considers the fact that the availability of this information is a key to the effectiveness of most Ecommerce sites.

The bottom line is that the society and economy of the US is still positioned very well for long-term success in Ecommerce. However, a more thoughtful perspective on this subject has evolved. Concerns regarding the establishment and maintenance of trust between customers and Internet-based companies have emerged, focusing mainly on security and privacy. Many companies are placing privacy policies on their web sites in hopes of assuring customers that personal data about transactions are safe from disclosure or abuse.

Non-profit organizations such as the Better Business Bureau Online and TRUSTe now grant seals of approval to companies who verify their privacy policies. The World Wide Web consortium, a group of companies and others promoting use of the WWW, have been working on the Platform for Privacy Preferences Project (P3P) (http://www.w3.org/P3P/), an effort to create a standard wherein consumer preferences are automatically matched to a site's privacy policy.

The rating service Consumer Reports has started an online e-ratings service to consider privacy policies in their rankings of commercial sites. New innovations in security, smart cards and biometrics for identification, are being explored to add an extra layer of identification in Internet-based transactions.