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The Empire That is E-Commerce

What is it about eCommerce that has triggered such expenditure? Why have people become so obsessed with shopping online? By Tami Ben-David July 3, 2014
How to Diversify Your E-Commerce Strategy
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About the Author

A British ex-pat, Tami been writing and content-strategizing for Israeli tech start-ups for the last 5 years. When she's not writing nerdy content, you can find Tami on open water charity swims or traveling to far-flung countries.

At the end of last year, global eCommerce sales topped the $1.25 trillion mark, with Amazon securing a whopping $74.45 billion across their sites. These figures are absolutely sky-rocketing and prove just how powerful online shopping has become.

What is it about eCommerce that has triggered such expenditure? Why have people become so obsessed with shopping online?


Shopping online is just so easy. Whether from the comfort of your home, office, or as you’re commuting on the bus, there is no doubt about it that eCommerce is certainly making the lives of millions a whole lot easier.

Amazon, for example, recently introduced fresh produce and groceries services. Who would have thought that an online international marketplace that sells books, electronics, items for the home and other useful, yet non-urgent merchandise, would one day be able to ship you fresh cucumbers and milk to your front door?

Yes, online grocery shopping has existed for a while but Amazon is revolutionizing the market. Prime Pantry household essentials can be delivered to you anywhere, regardless of location, and Amazon Fresh brings many local stores together to provide the best fruit, vegetables, meat and bakery goods.


Over time, people have learned to really trust certain sites, online marketplaces and stores.

If, ten years ago, someone would have said that in 2014 you’d be able to purchase exclusive fine art on Amazon, very few people would have believed them. These things are reserved for art galleries and art dealers, they would have said. Paintings can’t be sold online; they must be authorized and verified and handled carefully.

Yet, in the summer of 2013, Amazon launched its new portal, Amazon Art, enabling people to purchase a wide variety of paintings even crazy expensive ones with the click of a finger. If you browse today, you’ll find an authentic John Atkinson Grimshaw painting for a mere $495,000 (with free shipping, of course!).

And the reason people might just be willing to buy such an expensive item without even having seen it, is because they trust Amazon. They trust the site and the way it works, and they trust in the brands that are featured. They also have confidence that the prices they see for both expensive and less pricey items are competitive.

Dynamic pricing

What the Internet did was to break down doors in comparison shopping by allowing consumers to compare prices easily, which in turn drove prices down. Why get ripped off, when you can get a product for a better price somewhere else?

This phenomenon has its roots in dynamic pricing, which is a blanket term for any shopping experience where the price of an item fluctuates based on current market conditions. A retailer might change the price of an item based on consumer demand, price fluctuations at a competing retailer, or even the time of day and weather conditions.

Dynamic pricing keeps the competition fair for everyone. Not only does the customer benefit because they can easily price match, but the seller can learn to adjust prices to maximize profits. Due to complex algorithms and fancy pricing solutions, a retailer can know exactly how much to increase revenue by in both high demand and low demand situations.

Although dynamic pricing was utilized before the Internet most notably within the realm of airline tickets it was eCommerce that made it much more widespread. And as the Internet becomes even more sophisticated, new opportunities to leverage dynamic pricing present themselves.

So, with eCommerce on fire, and with sales set to hit $1.5 trillion by the end of 2014, who knows if anything can extinguish it?


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