SUBJECT: BCM4113 E-COMMERCE

NAME: NOR IKHMAL BIN ABD HAMID

MATRIC NUMBER: M101815013
LECTURE NAME: MOHD ZAKI BIN SHAHABUDDIN
 CONTENT

NUMBE SUBJECT PAGE

R
1 INTRODUCTION 1
2 IMPLICATIONS OF E-COMMERCE IN 2-3
MALAYSIAN ECONOMY
3 WHO ARE THE KEY PLAYERS (IT CAN BE 4
GOVERNMENT OR PRIVATE BODIES) AND HOW
THEY PROMOTE TO DEVELOPMENT OF E
COMMERCE IN MALAYSIA?
4 WHERE IS MALAYSIA’S E-COMMERCE TODAY 5-7
5 CONCLUSION 8
6 REFERENCES 9
1.0 INTRODUCTION
e-commerce is an activity that distributes, sells, buys, markets products (goods and services),
using the Internet as a telecommunications network. Next, e-commerce is a business
transaction activity by creating, transforming and redefining relationships between sellers
and buyers through information processing technology and digital communications. After
that, e-commerce is an electronic activity connected to an internet screen intended for the
purpose of a transaction of buying and selling goods, services or transmitting funds or data.
However, e-commerce is the use of computers as a liaison for the business transaction
process when buyers and sellers buy or sell various products electronically from one
company to another according to Loudon (1998). Next, according to Kalakota and Whinston
(1997), the purpose of e-commerce is to use the Internet and transactions through digital
money transfer in online shopping. After that, e-commerce is an electronic system of buying,
selling, marketing of goods and services online according to Jony Wong. Finally, researchers
can see that e-commerce is an online activity such as buying, selling, trading and sending
information. therefore, the question is whether factors affect e-commerce in Malaysia.

1
2.0 IMPLICATIONS OF E-COMMERCE IN MALAYSIAN ECONOMY
First implications of e-commerce in Malaysia economy is low cost. According to (Peattie,
1997) distribution is quite successful in connecting end users with users directly over the
internet. therefore, agents and distributors in international marketing can traditionally reduce
the role of intermediaries. The benefits can be clearly seen as it can reduce the unnecessary
costs of manufacturers in marketing their products and thus lower prices for consumers rather
than through intermediaries. furthermore, the cost of rental, warehouse or business premises,
insurance, rent control services and other costs such as storage costs in the transfer of goods
and services may be eliminated or reduced through e-commerce. In addition, labor costs can
be saved, with no more provisions to pay workers' wages, and utility bills such as water and
electricity. This causes the business to enjoy profits. Finally, advertising costs are also
reduced due to the availability of internet networks according to Hamill (1997).

Second implications of e-commerce in Malaysia economy is direct contact with users. Online
activities will enable businesses to connect with consumers directly without engaging third
parties. This activity is faster and easier. For example, the questionnaire between seller and
buyer can be resolved immediately. therefore, everything can be repaired immediately.
According to (Keen et al. 2004) consumers who experience a positive experience every time
they buy using online shop service can be assured by the business. According to Arnott and
Bridgewater (2002), the internet has potentially created interactions with users on a global
scale. therefore, marketing performance is expected to increase with interaction with users.

Third implications of e-commerce in Malaysia economy is Easy to make changes. Changes in

the form of advertising, pricing and other things from time to time will be made by some
businesses. after that, the latest information on new products will be available delivered to
consumers quickly and accurately through e-commerce medium. Then, traders can more
easily manage their business, whether at home or anywhere. Christodoulides and
Michaelidou (2011) state that consumer satisfaction can be enhanced and value added to the
shopping experience if a business offers online sales service.

2
Fourth implications of e-commerce in Malaysia economy is broad prospects and marketing.
e-commerce presence has led the marketing area to expand from village to global. In
addition, marketed products are expanding and there are innovative products that can
increase consumer satisfaction. For example, goods or products can only be found in stores
or mini markets but now only online can users obtain goods with e-commerce. Then, the
development of e-commerce online also enables entrepreneurs to grow rapidly. This is
because technology is also enabling entrepreneurs to think of something new such as
providing a platform for consumers such as lazada and shopee for example.

Fifth implications of e-commerce in Malaysia economy is saving time. The advent of e-

commerce enables buyers and sellers to save time in the sale and purchase process. In
addition, entrepreneurs can also market new products they create. the product being created
is likely to respond faster. Entrepreneurs are also quick to advertise their products faster than
ever before. Entrepreneurs need to print advertising papers and disseminate to consumers so
that consumers are aware of new products marketed by entrepreneurs. Then, payment
arrangements like electricity bills and water for furniture or shop houses can be paid off
quickly. Therefore, e-commerce is the best platform today.

3
3.0 WHO ARE THE KEY PLAYERS (IT CAN BE GOVERNMENT OR PRIVATE
BODIES) AND HOW THEY PROMOTE TO DEVELOPMENT OF E COMMERCE
IN MALAYSIA?
1) GOVERNMENT
According to a government researcher, the ETP is one of the 'Virtual Mall' projects, which is
a separate Virtual Performance Management and Delivery Unit (PEMANDU). government
to build an Internet-based retail market, benefit from higher usage of Malaysian population,
better bandwidth services and increased mobile devices in the country”. This initiative is
supported by the National E-commerce Strategic Road Map, with the primary aim of
Increasing e-commerce use by sellers, accelerating e-procurement by businesses, using non-
tariff barriers (domestic e-commerce, e-commerce-commerce, e- payments, consumer
protection), redefining existing economic incentives, strategizing strategies at major e-
commerce firms and promoting Malaysian businesses to enhance cross-border e-commerce.
2) NON- GOVERNMENT

As we saw above, Shopee and Lazada dominate Malaysia’s ecommerce landscape, but it’s
unclear what share of their respective revenues are attributable specifically to grocery
purchases. Next, supermarket chain Tesco attracts the greatest number of monthly visits to its
website compared to other dedicated grocery players in the country, but data from
SimilarWeb suggests that the site’s traffic is still relatively low, with fewer than half a
million visits per month. After that, fellow bricks-and-mortar players Jaya Grocer and Mydin
also enjoy moderate online success, with each brand’s website attracting more than 100,000
visits each month. However, with Statista’s data showing that almost 20 million people in
Malaysia already buy consumer goods online, these traffic numbers seem quite low,
especially given the average frequency of grocery purchases.

4
4.0 WHERE IS MALAYSIA’S E-COMMERCE TODAY
By 2018, Malaysians will spend more than US $ 6 billion on consumer goods purchases
already surpassing travel expenses, according to Digital Market Outlook Statista survey data.
Next, 51 percent of total e-commerce spending includes the US $ 3.1 billion Online
consumer goods category in 2018. After that, 27 percent of total consumer goods purchases -
Electronic purchases contributed the largest category. However, with an annual expenditure
of US $ 771 million on fashion and beauty products, they make up about a quarter of the
entire online consumer goods market. However, for online consumer goods purchases in
2018, the average Malaysian e-commerce buyer spent only USD $ 159. This is significantly
lower than the global average of USD $ 634. After that, with national internet users spending
over US $ 2.7 billion on online travel purchases in 2018. This is because Travel purchases
are still an important component of the Malaysian online economy.

Consistent with other countries across Southeast Asia, however, the market for digital
content remains small in Malaysia. Purchases of video games, digital music, on-demand
video services (e.g. Netflix), and digital news and magazines caused Malaysians to
spend US $ 236 million last years. Although, this figure shows that Malaysians are the
second largest per capita for digital music in the region, behind Singapore digital music
alone is $ 30 million of that amount. It's also interesting to note that Scribd.com also
ranked it on Similar Web’s ranking of the top ten transaction websites in Malaysia by
the number of monthly visits. This shows that the internet users of the country are safe
enough to use digital content.

Overall, aggregate spending in all sectors increased 24 percent last year as Malaysia's e-
commerce sector experienced strong growth, according to Statistics data. The tourism
sector is still strong enough to generate an additional $ 400 million in revenue compared
to 2017 as the tourism sector grew 18 percent more modestly. However, the online
consumer goods market is growing at a rapid rate, although the sector already accounts
for more than half of the e-commerce market in the country. apparel, electronics, toys,

5
furniture, and groceries are 30% online product sales in 2018. This increase is more than
US $ 730 million compared to 2017 spending. In the consumer goods category, all
sectors grew at least 25 percent year on year, with three sectors growing more than 30
percent in just 12 months. Reflecting the situation, we have seen in all other countries in
Southeast Asia, the country's online retail sector has grown at a rapid rate, with an
impressive annual purchase value of 39 percent in 2018. That puts Malaysia in second
place in Statistics as the fastest growing retail market in the world in 2018, with only
Singapore seeing a year-over-year increase.

This isn’t just good news for the country’s online grocers, either. As we explained in a
previous article in this series, food and personal care items account for some of our most
frequent purchases, and as an increasing share of this purchase activity moves online,
shoppers become increasingly familiar with online shopping. Provided these regular
grocery experiences remain positive, this increased familiarity should drive greater
confidence in online shopping as a whole, which in turn may lead to increased
ecommerce activity across all categories. So, given the potential significance of the
grocery category for the country’s ecommerce industry as a whole, it’s worth exploring
Malaysia’s online grocery sector in more detail.

6
For online retail purchases in 2018, increasing US $ 135 million compared to 2017
spending, Malaysians spent US $ 483 million. View full size annual Growth in Online
Grocery Expenditure by Country January 2019 Data Reportal. This figure means that
online grocery accounted for 2.3 percent of Malaysia’s US$21 billion total grocery
market in 2018 (factoring both online and offline sales). Based on data from e-Marketer,
that may mean that Malaysia is already ahead of the US when it comes to moving
grocery spends online. However, research firm IGD predicts that online shopping will
still account for roughly the same share of Malaysia’s total grocery spends in 2022,
suggesting there are still significant differences across estimates and forecasts for the
value of Malaysia’s online grocery market.

Despite these discrepancies, the overall story seems consistent: Malaysia will continue
to enjoy strong growth in online grocery spend over the coming years. IGD Asia predicts
that online sales value will increase at a compound annual growth rate (CAGR) of more
than 60 percent between 2017 and 2022, compared to a CAGR of 4.1 percent for the
grocery market as a whole between 2018 and 2023.

7
5.0 CONCLUSION
In conclusion, researchers have found that Malaysia is growing rapidly in the digital age. In
addition, the increased use of e-commerce is due to the presence of the Internet. The
researchers also found that as more and more successful entrepreneurs are born as a result of
this e-commerce, their products can be advertised for 24 hours without interruption. Lastly,
researchers recommend that this e-commerce platform exist in the student portal so that
students can improve their skills with e-commerce use.

8
6.0 REFERENCES
Amanz (2020). Kajian SKMM: Pengguna Lebih Gemar Membeli Barangan Di Atas Talian
Berbanding Di Kedai Fizikal. Retrieve 29 april 2020 from https://amanz.my/2019207364/

Harry Handley (2016). An Introduction to e-Commerce in Malaysia. Retrieve 29 april 2020

from https://www.aseanbriefing.com/news/an-introduction-to-e-commerce-in-malaysia/

Maxmanroe (2020). Pengertian E-Commerce. Retrieve by 29 April 2020 from

https://www.maxmanroe.com/vid/teknologi/internet/pengertian-e-commerce.html

Zulfamy Mat Udi and Mohamad Fazli Sabri (2017). Kebaikan, kelemahan dan isu semasa e-
dagang. Jurnal Pengguna Malaysia. volume 5, 67-69. Retrieve 29 April 2020 from
http://macfea.com.my/wp-content/uploads/2018/11/Artikel-5-JPM-Jilid-26-Jun-2016.pdf