E-commerce and digital communication

AQA also says:

Spec content: E-commerce; Digital communication.

Students should be able to: understand the impact of the changing use of ICT and how it influences business activity. E-commerce to access wider markets. Digital communication changing the way businesses communicate with stakeholders. Students are expected to know relevant examples of digital technology and communication.

E-Commerce

E-commerce is the buying and selling of goods and services over the internet. It has transformed how businesses reach customers, how markets operate, and what is possible for businesses of all sizes — from a sole trader selling handmade jewellery on Etsy to Amazon operating one of the world's largest retail operations.

Benefits of E-Commerce for Businesses

  • Access to wider markets — a business is no longer limited to customers who can physically visit a shop. E-commerce enables national and international reach, dramatically expanding the potential customer base without the cost of physical expansion.
  • Lower costs — online operations avoid the rent, rates, and staffing costs of physical retail premises. Overheads for an online-only business are typically far lower than for an equivalent bricks-and-mortar retailer.
  • 24/7 trading — a website never closes, allowing customers to browse and purchase at any time without additional staffing cost.
  • Customer data — online platforms capture detailed data about purchasing behaviour, browsing patterns, and customer preferences that enables more targeted marketing.

Challenges of E-Commerce

  • Requires investment in website development, security (payment processing), and logistics/fulfilment infrastructure.
  • Intense online competition — customers can compare prices instantly across multiple retailers.
  • Customers cannot physically inspect products, increasing returns rates and associated costs.
  • Cybersecurity risks — data breaches can damage customer trust and result in regulatory penalties.

Digital Communication

Digital communication refers to the use of electronic and internet-based tools to communicate with stakeholders — customers, employees, suppliers, and investors. Technology has transformed communication speed, reach, and cost.

Key Digital Communication Tools

  • Email — fast, cheap, and documented. Standard for formal business communication between employees, suppliers, and customers.
  • Social media (Instagram, X/Twitter, Facebook, LinkedIn, TikTok) — enables direct, two-way communication with customers at scale. Businesses use social media for marketing, customer service, brand building, and crisis management.
  • Video conferencing (Zoom, Microsoft Teams) — enables face-to-face communication without travel, reducing costs and enabling remote working.
  • Business websites — primary point of contact for many customers; combines information, e-commerce, and customer service functions.
  • Instant messaging and collaboration tools (Slack, WhatsApp Business) — enable rapid internal communication and team coordination.

Impact on Stakeholder Communication

Digital tools have fundamentally changed the relationship between businesses and their stakeholders. Customers can now communicate directly with businesses, leave public reviews, and share both positive and negative experiences instantly with thousands of people. Businesses must monitor and manage their digital reputation proactively. Employees collaborate across sites and time zones. Suppliers and partners share real-time data to manage supply chains more efficiently.

 Key Takeaways

  • E-commerce enables businesses to access wider markets, reduce costs, trade 24/7, and collect valuable customer data — but requires investment in technology, logistics, and security.
  • Digital communication tools (email, social media, video conferencing, websites) have transformed how businesses communicate with all stakeholders.
  • Social media gives customers a powerful public voice — businesses must actively manage their digital reputation.
  • Technology has reduced the cost and increased the speed of communication, but has also created new risks (cybersecurity, misinformation, reputational crises).
Students should understand the impact of the changing use of ICT and how it influences business activity. E-commerce to access wider markets. Digital communication changing the way businesses communicate with stakeholders. Students are expected to know relevant examples of digital technology/communication.