Csjumia
Csjumia
1. Introduction
Internet is the third revolution after agricultural and industrial revolution and it has
become an essential platform for selling and buying of goods and services, this
happens between organizations and consumers and vice versa. This has brought e-
commerce to an entirely new level of doing business from the traditional methods
(Barnes et al., 2001a). It is Important to mention that as much as e-commerce is
growing at a faster rate, there are challenges that consumers experience with e-
commerce that cannot be left unanswered. Therefore this paper will discuss on trust,
privacy and security of a consumer on vendors’ websites for better business
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relationships on e-commerce in Kenya previously cited as challenges (Kinuthia,
2014). Also it will subsequently propose measures to address challenges.
Several research have been done on this area, though has left a gap of not
addressing the issues on the part of the online business, as well as the consumers,
how they could measure up to these challenges and remain viable in the business.
For this reason a case study is done on Jumia online company how it has addressed
the above concern. Therefore this paper will do a review on these issues to ascertain
available information on these critical areas and address them, showing how Jumia
has been able to overcome the challenges and manifested success on online
business. Internet can help company establish and build better relationships with its
customers to benefit of both companies and the clients (Almeida, 2013).
Customers are offered an improved service while the companies can achieve better
targets in the marketing communications by applying global ethical relationships
standards in e-commerce. E-commerce is the second most widely used by big
number of individuals who do buy goods online. E-commerce is a concept that goes
beyond just buying online but a holistic strategy of redefining business models with
the aid of technology, in order to gain benefits for the consumers and maximum
profits for the company. Companies taking concept of familiarity of trust with their
clients also boost e-commerce (Gefen, 2003). According to Jarvenpaa et al., (2000)
e-commerce was created with aim of creating a fair environment between large scale
and small scale retailers. New start up online business would require to build trust
with their customers to be able to prevail in e-commerce which highlights the
importance of relational ethics as cited by (Creed, 2009); (Kennedy, 2001). Jumia
an online market company has a good return policy and independent products
reviews by previous consumers that also refer other buyers for the same product
which increase confidence with this online mall.
2. Literature review
Electronic commerce can be defined as the transmission of funds via internet for
buying and selling goods and services. Laudon et al., (2008) defined e-commerce
as the exchange of information, buying and selling of goods, transportation and other
management activities across electronic computer networks within an organization,
between businesses (B2B), between businesses and consumers (B2C), or between
public and private sectors (B2G) whether paid or unpaid. Stefansson (2006) stated
e-commerce as, all economic activity of buying and selling of goods and services
are offered or provided remotely or by electronic means. There is no limit to services
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such as providing, online information, commercial communications, research work
or tools, access of data, retrieval, dissemination and communication of such
information for commercial purposes. (Laudon et. al (2008) also defines electronic
commerce as use of electronic and technology to conduct commerce which includes
sales, purchases, transfer, exchange and information in the scope within business
interactions. According to Laudon-Traver (2008), e-commerce is the use of internet
in a formal way which can be either the transfer of information or doing business on
the website between companies and consumers. Rosen (2002) stated that E-
commerce would mean carrying various activities over the internet for commercial
purposes or gain between the interested parties, which can be large or small,
international or local instead of visiting the actual shops. Similarly E-commerce can
also be termed as a way of exchange of copy rights from one organization to other
or from individual to organization making the payment by internet means. Walczuch
(2004) stated E-commerce involves the undertaking business transactions of buying
and selling of goods online, which can be dissemination of information, logistics,
processing and ensuring consumers are most satisfied in the long run by gain trust
needed. Recently the CEO of Jumia was interviewed said that, “most people in
abroad buy products from US and UK, and hold them in some place waiting to get a
friend who will be traveling back to Kenya to be able to bring them but Jumia being
in place now there is no need to wait that long, a consumer can contact Jumia
company which will do the logistics to their customers in any part of Kenya”.
Featherman et al., (2010) states, Business to Consumers is where the big
organizations are involved in the production of goods and sell to consumers directly
without involving middlemen. In return will reduce the prices of goods which leading
to increase of sales. A major benefit to the company and less cost to the buyer. E-
commerce growth is relative to market size as it is depicted by Alibaba’s exponential
growth in the greater Asia in China (Trappey, 2001). Most of the SME’s in Kenya do
not embrace e-commerce due to lack of trust. Similarly small medium enterprises
may not have the ability to do their logistics and therefore they engage other
companies doing logistics to do on their behave to reduce cost of operations (Song,
2000). Online business have to build trust especially within their consumers and
other online companies to create a conducive environment to foster proper business
relationships (Tan, 2002). When the consumers accept and put trust on e-commerce
in online business, it means that the merchants are taking care of the issues of trust,
privacy and security into good consideration (Pavlou, 2002).
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consumer. It is an opportunity to carry out business activity for two different
individuals in different locations connected via internet. For instance a musician who
puts his music in the internet and his fans download at a fee to listen (Ochola, 2013).
It can be seeing clearly that Jumia has established a network in every part of the
country and the main towns, therefore reach even the interior locations. Jumia is a
typical online enterprise. It sells products and services directly to the consumers, via
internet and qualified staff that have a functional, operational and managerial
competencies (Haddad, 2017b). Jumia do logistics on how to deliver goods to the
consumers by use of motor vehicles and motorbikes depending on the size of the
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product (Figure 1) shows the sectors that Jumia company deals with during 2015-
2016
2016 2015
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3. Methodology
The purpose of this paper will be to understand the current and future position of the
e-commerce, benefits, and challenges and suggest solutions to avert the challenges
on the online business. Like Haddad (2017a) a research review will be used and
secondary data collected, analyzed from the websites of different online businesses.
Other information has been collected from periodicals, different articles published in
different journals and thus is limited to the information provided through various
online platforms.
4. Analysis
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(Ochola, 2013). This will not only translate to transformation of e-commerce but also
be a game change in the business world. Consumers can shop around the world
with the believe that no one is working schemes to steal the financial information.
Almeida (2013), pointed out once the consumers gain the confidence and trust
dealing with online business, it will open more opportunities and such business boom
very fast. This will be the success of online businesses.
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4.3 Security
This is a matter of concern for every online business and consumer. Even though
people confuse security and privacy, there is a clear distinction between the two,
although they are interrelated. Privacy as seen in the above discussion is associated
to law enforcement. Security is defined as ensuring that consumer and company
information is safe guarded by protecting it from access by unauthorized individuals
(Roman, 2007). Studies done before indicate that security is the most important
ethical factor in the online context (Gefen, 2003). Without dealing with the security
issue, it will pointless to have e-commerce application that enables online business
to have private e-mail, purchasing, transmission of payment information and work
flow automation (Flavian, 2006). However security breaches are occurring every day
in online transactions, giving a lot worry to the consumers. As a result security
continue to be a major threat to the online businesses providing services on e-
marketing platform. This issue of security must be evaluated and resolved to reduce
the risks that online business and consumers are facing. Otherwise it will a waste of
time to safeguard only the business website and not the consumer.
Companies can guarantee security to consumers by protecting their information by
use of encryptions and firewalls. Management should employ technical personnel
that are acquitted with the knowledge and technical capabilities on handling
consumer protection on security. In the technical part the organization should also
include measures like encryption in the transmission, storage of data in a secure
places, under lock and key safes and the use of username and password that will
keep audit trial record on who accessed information and what it was used for.
Security will be achieved if the information send will reach the other party without
alteration, distortion or manipulation.
In Kenya, cyber security is a major concern, as the recent reports indicate that the
country is losing into a turn of more than 2million USD annually to cybercrime
activities in online ventures. This necessitates the need to come up with better
measures, appropriate policies and laws to govern balance between individual rights
to privacy and the collective, good of the economy and its citizens. The government
should intervene by directing the department of ICT to address the security issue
(Litondo, 2013). The government through the Communication Commission of Kenya
has established a responsive unit that is to monitor all the online business
transactions, part funded by International Telecommunication Union, that puts
together the government agencies likes of Central Bank of Kenya, and others to
ensure security on data from cyber-attacks is eliminated as to and when they occur
(Souter et al., 2012). Research shows that for lack of proper polices, legislation and
by laws, the criminals who perpetuate these cybercrimes go scot free. This will give
assurance to the online business are safeguarded. Finally, government of Kenya has
taken up a legal approach and established amendments in the constitution act 2014
to give the authority to Communication commission of Kenya that will work in respect
to the industry of trade and commerce to enforce and deal with matters relating to
cyber-crime and security issues. Specifically this mandate entail promoting and
facilitating efficient management of critical internet resources and development of
framework for carrying out investigations and prosecution cybercrime in Kenya
(Communication Commission of Kenya, 2014).
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5. Conclusion
Internet revolution and penetration in Kenya has seen online business grow rapidly.
Change in technology has brought more business opportunities despite of the
challenges discussed. This is attributed by both the consumer and companies not
able to resolve the issues of trust, privacy, and security amicably. Trust is a major
factor to be considered by any consumer, who would want to trade online. These are
the issues that consumers want the online enterprises to guarantee and therefore it
will be of great importance if they set up measures to address trust, security and
privacy of online consumers. E-commerce has been widely accepted in the world
but researchers have found the above variable being a big down fall of e-commerce,
especially with developing countries like Kenya. Therefore with increase in the
development of technology at the same cybercrimes are increasing at alarming rate.
Continuous research should be carried out to curb the challenges. In order for the
companies to ensure trust, security and privacy to the online business, has to work
with the government to enact policies and regulations that support e-commerce.
Consumers will need protection against fraudulent, misleading and unfair business
malpractices and when things go wrong there should be a mechanism to be able to
get redress. Equally it will be of importance to periodically review the regulatory
framework put in place by the government as the technology keeps changing, to
tighten up, any loop hole. Companies also will need to adapt international standards
to protect consumer privacy, as a way of supplementing the legal framework.
6. Recommendations
Kenya, having rapid growth and spread of internet everywhere the business
structure is changing from the traditional online shopping. In the interest of this
research, the following recommendations are made for the development and growth
of e-commerce. The importance of addressing trust, security and privacy of online
business. Government of Kenya to direct CCK to enact polies that will protect
consumers on issues of trust, security, privacy in online shopping. Moreover, online
companies to apply the international standards to curb on beaches of ethics on
security. Also, Government to prosecute the cyber-crime activities in court.
The government should support the Communication Commission of Kenya
infrastructure and put up a framework that will ensure safety. Furthermore, online
malls to work together with the government in support of e-commerce by facilitating
continuous research as technology keep changing. Lastly, online business can adopt
the cash on delivery payment as Jumia does to a certain trust on consumers.
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