B2C Electronic commerce: development in Eastern Europe, risks and effect of Institutional Displacement

: pp. 122 - 130
Kyiv National University of Trade and Economics
Kyiv National University of Trade and Economics

The goals. The formation of the global information economy is closely linked to the emergence and growth of the e-commerce market. So, the goals of the article are to identify the main trends in the B2C e-commerce market in Eastern Europe and to characterize potential risks as a result of its further growth. To achieve the goals, it was planned to determine the essence of the concept of “electronic commerce”; to characterize the historical stages of e-commerce development; to make a comparison between e-commerce systems like B2C, B2B, and B2G; to identify the benefits of e-commerce from the positions of different stakeholders’ groups.

Main results. Analysis of various sources has shown that there are several approaches to the definition of “e-commerce”. The definitions, where e-commerce is viewed just as one of the forms of trade, are too limited. It was recommended to pay attention to the fact that it includes trade and financial transactions carried out using computer networks, specific information technologies, etc.

The period of consolidation of efforts in the development of e-commerce began in the 70’s of XX century with the unification of the standards of electronic data interchange between organizations. In the 90’s of XX century Web technologies appeared and internet store emerged. The development of the Internet in the last decades of XX century has also led to the emergence of various e-commerce systems:B2B; B2C; C2C; B2G; G2C. The stage of e-commerce development from the beginning of XXI century and so far it was proposed to be conventionally named as the stage of convergence or synergy of traditional and e-commerce trade.

The expansion of the B2C e-commerce stimulates the development of trade, giving it a new innovative impulse, but in the strategic perspective, it can lead to a decrease of traditional wholesale and retail channels. This redistribution is a vivid example of the “institutional displacement” effect.

E-commerce B2C development is directly related to the depth of the Internet penetration. The share of Eastern Europe in the European e-commerce market in 2018 was 6,37 %, which is 0,2 % more than in 2017. The B2C sales figures in Eastern Europe have huge potential for growth, as there is a clear tendency to increase the level of Internet access and the number of online population. The share of e- buyers in Ukraine stands at 44 % now (for comparison, in Romania — 16 %, Bulgaria — 26 %, Serbia — 31 %).

It has been identified that business owners (including small) get an opportunity to be present in the markets of different countries and actually conduct their business on a global scale. Managers and employees of B2C e-commerce companies have the ability to respond quickly to changing market conditions, etc.

Conclusions and perspectives of further research. The conducted research allowed to reveal positive tendencies in the development of B2C e-commerce in Eastern Europe. At the same time, the actual evidence that every 10% of penetration of fast and high-quality Internet can provide the economy with GDP growth by 1,4% per year, leads to the conclusion that it is necessary to intensify the development of e-commerce in Ukraine. It is argued that e-commerce development involves hidden risks. The presented results of research in the future can be used to study: the relationship between the development of e- commerce and the spread of virtual self-employment practice; the role of e-commerce and Internet technologies in the process of facilitating the development of small businesses, etc.

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