1. Definition on Traditional Markets and Digital Markets4 A. What is Traditional Markets? 5 B.
What is Digital Markets? 5 2. Advantages of Traditional Markets6 3. Disadvantages of Traditional Markets7 4. Advantages of Digital Markets8 5. Disadvantages of Digital Markets9 6. Conclusion10 7. References11 Compare and contrast traditional markets with digital markets Definition of Traditional Markets and Digital MarketsTraditional markets : Traditional market is a physical market brings buyers and sellers together in the same location and a medium that allows buyers and sellers of a specific good or service to interact in order to make an exchange. It is a product-based and formal.
This kind of market is traditionally operating, and countless such markets are still in operation around the whole world.Digital markets : Digital market is a market that do not have a physical operation between the process of buying and selling otherwise using the non-physical markets ( internet or electronic markets) In digital markets, buyers can purchase goods and services through virtual market. In digital market, the buyers and sellers do not meet or interact physically, but the transaction process is done through internet. Examples- eBay , air tickets. What is Traditional MarketsTraditional markets are physical retail markets, and can be local markets or shopping centers and shopping malls, labor markets, international currency and commodity markets, stock markets, for the exchange of shares in corporations, illegal markets such as the market for illicit drugs, arms or pirated products. Traditional markets are preferred by most people because it provide the functions of touch, feel, visual, and more reliable.
For example, importing a car from oversea buyers may like to see whether it has ny invisible damages or conditions though car sales centers( traditional market) allows to test drive and check until satisfied. Traditional market is simple, in exchanging the goods and service with money or goods and service in physically, two parties will be meet or connect physically ( including telephone and emails), the main fact is that two parties interact about the deals physically. What is Digital Markets Digital markets is deviate from the physical market with using non-physical medium like internet. Digital market is start blooming when the information technology become more advanced and secure.Electronic markets make people more easier, save time and money( eg. transportation cost). But it still has a disadvantages like fraud, unseen, spam which can be effect to the trust of buyers and sellers.
Digital market is based on the electronic markets like websites, virtual markets and auctions. Participants needs to have a general knowledge of computer to use well and avoid any incidents, are basically posted about goods and services with picture or sounds followed by price and it is seem similar to put a goods into a shelf in the market. Purchaser will made a payment using online transaction or notes.
Advantages of Traditional Markets ¬The advantages of traditional markets are- Physical: Traditional markets have a physical on the goods and service which can easily seen by the purchasers and persuade. This enable the business to be easily identify by customers. It also helps in building trust with customers by having a physical shop. Trust and user resistance: Consumers do not usually trust an faceless seller which they do not know but traditional markets allow consumers to interact with seller like bargain, choosing and checking the products.Product contact: Traditional markets allows consumers to touch and feel physically, sometime customers like to touch items such as clothes and like to know exactly what they are buying. Social : Participants can be feel and fulfill their psychological needs like shopping with sightseeing, enjoying the environment, socializing with people at market.
Relationships: Usually worked for some time, traditional retailers have that asset that often cannot be bought like relationships between purchaser and seller. Many online retailers have to build these relationships from scratch nd may never be able to match those of the traditional markets Disadvantages of Traditional Markets The advantages of traditional markets are- More Cost: There will be more extra cost depends on the numbers of stuffs that involved to do the work. And that cost will be added to the basic selling price of the goods and service. As the salaries, renting costs, and expense are getting high, it can be a challenge for the traditional market to run in long-term. Less choices: This can be problem because it may not have all the goods and services that needed by consumer in one place. Or may be out of stock.Inconvenience: It will be about the opening hours, size of the market, etc. Example, one want to shop and buy closely in the shop which is only open in his/her working hour, it will become a barrier.
And for disable person shopping around big markets and shopping centers is totally difficult. Offer only in specific place: If the one who is far away from the market wants to shop and buy, this will be a loss for market because he/she cannot make a purchase. Advantages of Digital Markets The advantages of digital markets are- Easy to access: Internet/ websites can be available anywhere, work, home, etc.It enhance the convenience and reduce the shopping cost. Reduced Cost: Significantly cuts down the cost associated with marketing, customer care, processing, information storage and inventory management. Electronic commerce reduces the burden of infrastructure of businesses like physical store setups and raises the amount of funds available for profitable investment Effective: Gives the customers the opportunity to look for cheaper and quality products, consumers can easily research on a product and find out the original manufacturer to purchase a product at a much cheaper price than that charged by the wholesaler.More choices: Online commerce also offers buyers a wider range of products and services to choose from, as opposed to conventional shopping, without the carrying around heavy shopping bags and getting stuck in traffic jams, which likely to be more convenient and time-saving. Reviews: People also reviews posted by other customers, about the products purchased from a particular e-commerce site, which can help make purchasing decisions.
Disadvantages of Digital Markets Security : There are many fraud and spam at internet.Many of visitors will not want to use their credit card to make a purchase. The fear of having credit card info stolen is a clear and present danger in the minds of visitors. No product contact: it is not suitable for goods like food items.
People may prefer to shop in the old way than to use e-commerce for purchasing food products and other products that need to be felt and touched before purchasing. Returning: Returning the product and getting a refund can be even more difficult and time-consuming than traditional market, in case consumers are not satisfied with a purchased product.Lack of trust: People will not feels secure to make a purchase from a dealer who is faceless, unknown identity, no evidence. Internet is not fully used by all people in the world: Internet has still not touched the lives of a great number of people, either due to the lack of knowledge or trust. Conclusion Overall, Traditional and Digital Markets both have their advantages and disadvantages. All of these markets still use all over the world.
And in these days, people are getting used to internet to make their purchases which benefit in saving time by avoid going to the store.Advantages of e-commerce have the potential to be more in the disadvantages. A proper strategy to solve the technical issues and to build customers’ trust in the system can change the present problems and help digital markets adapt to the changing needs of the world. References Blackwell, J. (2007) Overview of Traditional Marketing. [online] Available at: http://ezinearticles. com/? Overview-of-Traditional-Marketing=3741281236 [Accessed: 27 Feb 2013].
Econsultancy (2013) Future of Digital Marketing. [online] Available at: http://econsultancy. om/my/events/fodmdk [Accessed: 27 Feb 2013]. En. wikipedia. org (n. d.
) Market – Wikipedia, the free encyclopedia. [online] Available at: http://en. wikipedia. org/wiki/Market [Accessed: 27 Feb 2013].
En. wikipedia. org (2009) Digital marketing – Wikipedia, the free encyclopedia. [online] Available at: http://en. wikipedia. org/wiki/Digital_marketing [Accessed: 27 Feb 2013].
Jcizzo. com (n. d. ) Traditional Commerce. [online] Available at: http://jcizzo.
com/the-traditional-commerce. html [Accessed: 27 Feb 2013].