Beyond a shadow of a doubt, the rapid pace of technological change and the global economy have resulted in hyper-competition as the nature of today’s competitive landscape. In recent years, regarding the popularity of e-businesses, various businesses have been found online due to the comparatively low barriers to entry and a large number of entrepreneurs have found the courage to conduct all of their businesses online. According to the Internet World Stats website, about 1/3 of the world’s population uses the Internet and the number of users is skyrocketing. Many companies are struggling to survive in a highly competitive market using the Internet, as intensifying competition and the ongoing globalization process have led to extensive use of the Internet as a complementary business tool.
As Professor Michael E. Porter, known for his strategic system, mentioned in an article entitled “Strategy and the Internet” (in 2001), the Internet should be seen as a complement to the conventional method of competing. Although Internet use should be considered a blessing in disguise, it can turn into an outright disaster. Since there is a relative lack of reliable market signals and due to distorted market behavior, the online market must be interpreted carefully to set strategic goals.
Internet as the most powerful business weapon
After the Industrial Revolution Period (18th and 19th centuries), there has been a marked shift from “mass production” to “mass customization” over the last few decades and the Internet made the customization process easier.
In terms of marketing, the online data collection process (quantitative and qualitative data) is less complex and the measurement of customer satisfaction can be easily done through online surveys and opinion polls. In other words, the Internet provides marketers with a comparatively easier way to identify customer needs and improve customer satisfaction. Relative to online analytical tools, identifying needs, wants, demands (core marketing concepts) and targeting markets is relatively easier online. Also, internet advertising is quite cheaper as compared to offline advertising.
The rise of social networking services (SNS) as a sophisticated online business tool and the evolution of Internet marketing, along with social media marketing, never cease to amaze researchers. Thanks to the Internet, employees and customers (users) can be in instant contact at any time, with anyone and anywhere. The Internet can be explained as a worldwide network that allows computers to share different information with each other, as well as share databases, transaction and communication resources. Through the use of the Internet in organizations, red tape is eliminated and the layered bureaucracy is reduced so that everyone is accessible within the organization.
On the one hand, the Internet lowers the barriers to entry, which is highly desirable for setting up a business, since large capital investments and sales forces are not needed. On the other hand, the Internet paves the way for other companies to enter the market, leading to increased threats of substitutes. As a result, by maximizing and minimizing the switching costs of buyers and suppliers, the Internet changes the bargaining power of buyers and suppliers. There are some features of e-commerce, which is a subset of e-commerce, such as ubiquity, global reach, richness, personalization, and personalization that make it clearly distinguishable from traditional commerce. In addition, the Internet, which influences strategic positioning (E.Porter, 2001), can be used to achieve competitive advantages.
There are several advantages such as connectivity, comfort, standardization, lower costs, highly customizable services and speed that Internet provides to Organizations. By making comparisons, it is easy to understand how the Internet has an impact on the structure of the industry and it is very clear that the advantages outweigh the disadvantages. That’s why an overwhelming majority of organizations go online and so many do all of their business on the Internet.
To conclude, in light of the popularity of digital goods and the digital market, it is reasonable to assume that the Internet can be considered the most powerful commercial weapon in today’s business world.