Business-to-consumer (B2C) e-commerce has become synonymous with the purchase of apparel, books, flowers, gifts and groceries through the Internet. Although not limited to these goods, online shopping, enabled by advances in e-commerce technology, has provided consumers with interactive shopping experiences for the past few years.

Recent research by World Wide Worx indicates that online sales in the SA retail sector totalled R341 million (US$58 million) during 2003. Although this was only 0.1 percent of the total SA retail market it is nonetheless a significant market share when compared to the 3.5 million users (7.1 percent of the total population) of South Africans online for the same period. The expected e-commerce figures for 2004 predict a steady growth in online sales, despite a telecommunications infrastructure hampering consumer access to high-speed bandwidth.

According to James Flower, MD of ASP, ShopDirect, the SA e-commerce market is poised for growth in 2005. ShopDirect is geared toward local companies, in particular SMEs, that wish to use the online channel to promote and sell their goods to grow their businesses on the Internet -- both locally and internationally.

Flower sees software solutions like those of ShopDirect enabling companies to position themselves to benefit from e-commerce. "If you stimulate Internet e-commerce more people will buy using this channel. The net gain is: more sales efficiency for retailers, increasing service benefits to consumers, and a lowering of transaction costs for both parties."

"There are a number of reasons for the renewed optimism in e-commerce in this country," says Flower. "One of the most important is that we now have a telecommunication infrastructure that enables e-commerce more so than even during the heydays of the Internet revolution. Consumers now have access to more bandwidth in their homes and businesses due to the introduction of ADSL and wireless Internet service. This is a far cry from the constraints and costs of dial-up connectivity."

"And, due to the liberalization of telecommunications, the deployment of an e-commerce solutions is made more affordable to SMEs as the cost of bandwidth is driven down," he adds.

A further factor stimulating e-commerce in SA is that there is virtually a zero-rate for the fraudulent online purchases. This, says Flower, "demonstrates positive consumer behavior reinforced by a regulated environment in which financial security is matched by secure e-commerce technologies facilitating online payment."

Consumers themselves have matured over the years, he adds. They have become more technology-savvy, are seeking ways to save themselves time in making purchasing decisions, and are open to the use of online transactions to purchase goods. These purchases are usually informed buying decisions due to the availability of product and pricing information on the Internet. The increasing consumer demand for online services is reflected in World Wide Worx"s South African 2004 Online Retail Report, which found that Web retail sites have increased from 215 in 2001 to nearly 720 in 2003.

Flower however does note that some businesses are more "e-commerce ready" than others. "Those companies that sell products to consumers who have computers should look to e-commerce marketing as the logical extension of their existing sales effort."

"An online presence enables customers to locate a business -- in many cases, new customers that a company may never find on its own -- and many consumers are using the Internet rather than the Yellow Pages to find the business that meets their needs," he concludes.