E-commerce is a really hot business since a decade ago, everyone is trying to be in this business, regardless of their industry, from a small, medium, to a giant company, they all are trying to sell their products online.
Unfortunately, building a reliable and good looking website is not affordable for many small businesses, that is when e-commerce shines by providing market place. A place where small to medium businesses reach more market, get more consumers, increase their revenue, and finally, the snowball effect is to grow the economy of a country.
E-commerce offers many advantages to both sellers and buyers. For sellers, they have a place to sell their product, reach more potential buyers, free and easy promotion. For buyers, they have access to a product which has better quality at lower prices, easy comparison between products, and free shipping for certain quantity purchase. Sounds like a wonderful world does exist in the marketplace, a symbiotic mutualism.
The chain of traditional trading is consisting of producer, large distributor, small-to-medium-size distributor, and consumer. Initially, the marketplace was designed to help medium to small distributors to expand their market, as well as help consumers to find better products easier and of course cheaper. The only thing who suffer at the time is the laggard distributors who were still insisting on selling products offline, and only offline.
At first, the big offline stores are complaining about the drop in their sales because of the consumer's behavior are changing, consumers find it more convenient to do online shopping than offline shopping. The big offline stores are starting to complaining, and how they trying to resolve it is to ask for the government to create rules, the conventional way from a conventional business model. Old guy does the old tricks. The next thing that happened is the government creating some rules, basically, the government also wants to participate in the profit, so they call it a tax.
Nothing much that conventional stores or government can do against consumer behavior that already changes to the new era of online shopping. As time goes by, somehow finally things are settled by itself when the numbers of online and offline consumers reach the equilibrium. There are products that can be purchased both online and offline, but some are still purchased only offline.
The other problem raised, now in the market place of almost every e-commerce there is a seller entitled with “Official Store”. What the heck does it mean? Who will be categorized as an Official Store? What is it for? And most importantly why does it exist?
The main role of e-commerce is to provide a reliable place where sellers and buyers can meet virtually, it is expected that e-commerce can give a sense of a secure place for all transactions. E-commerce stands between the sellers and buyers, being objective and to facilitate the payment is the important thing. Having more people do transactions on the platform meaning bigger profit for the e-commerce company.
Official Store is sellers who have a good reputation, have sold lots of products on the platform, or just simply an official producer who sells their products, literally official. Sellers with official store status will have some kind of a mark on the store so that buyers can differentiate them from the rest. The one who will get more advantages obviously is the consumers, but what about the small-to-medium-size distributors? If the consumers can buy directly from the producers then we don’t need any distributor. In shorts, with the existence of official stores, does it mean that e-commerce has the possibility to erase the distributor at some points? Now, is it a good thing or a bad thing? Before that, let’s see what is the vision and mission of e-commerce.
Last but not least, just to be clear here, we will only take a look at the biggest unicorn which originally made by Indonesian people.
Have you read the writing in the pictures above? How does it sound?
For me, it sounds like they want to help the small-to-medium-size businesses to develop their business. It did, and it still does. In fact, many people were helped by them, both sellers and buyers. Both Tokopedia and Bukalapak have a good reputation and well known in Indonesia. They are living proof that Indonesian e-commerce is reliable and provides very good services.
It is normal these days that a company will have a core business and then diversify to other businesses. Both Tokopedia and Bukalapak have formed many partnerships with big brands to provide more services such as ticketing, gold, electricity, telecommunication, and so on. It is easier, secure, and reliable for consumers.
As mentioned earlier, not all big companies provide their own online stores. Some of them already made one, which is not really popular or known by people, the others are just not ready yet to maintain the portal. This is where e-commerce will have a strategic position to provide the service. Their existence solves the companies' problem and making them (e-commerce) have more reliable sellers at the same time.
Official Store is a one way for consumers to buy directly from producers, it guarantees the originality, the e-commerce guarantees the payment and handles the shipping option. One party that we left out is the small-to-medium-size distributor.
A few years ago, consumers only can buy from small-to-medium-size distributors instead of the producers. Producers only sell in big quantities, which is by grocery stores, not retail. But now, with the existence of the producers’ store in e-commerce, consumers can directly buy from them, and it is with the amazing free shipping. So, why bother buying it from the grocery stores when you can buy it from your smartphone.
Slow but sure, the impact of this mechanism will wipe out some of the distributors, instead of speeding up the economic growth, it will create more economic problem. To be fair, the existence of e-commerce seems like the old fashion business must take initiative to turn things around before it is too late.
The current condition in e-commerce which originally stated that wanted to help small businesses seems to start to change the course over time. It is clear that not all companies have a clear sense of why and stays holding on it till the end. In the end, most companies, or should I say, people, will follow where the money is. Don’t you think so?