Abstract
We have studied historical development of e-commerce business, e-commerce companies, online payment options, goods delivery service and its forms and selected certain indicators for unification. Two hypotheses were stated within the research: e-commerce companies in Mongolia have successfully implemented online payment methods; and also goods delivery services. The purpose of the research has been to cover all companies operating actively in e-commerce market that have B2C, i.e., Business to Customer model. In total 70 companies were selected based on the analyzed information from official sources. Regarding the result, the companies are offering 24 types of tangible and intangible goods and 20% of them are selling e-goods. Researchers have found out that there are 13 traditional and electronic payment methods in Mongolia as of today and all companies have implemented at least 1 online payment methods, the maximum amount is 12 methods, and the average is from 5 to 6 methods. Three goods delivery model exists and 56 from 70 companies are offering tangible goods. 84% of them has already solved the issue of goods delivery. 72% of those 56 companies have their own department or employee for delivery service, and remaining 28% are using domestic or international postage services. Half, i.e., 50% of those 56 companies use local transportation for their goods delivery to rural areas. Therefore, regarding the results we assume that hypotheses are proved and the relevant conclusion was made.
1 Introduction
E-Commerce activities have been studied internationally in enough amount but in case of Mongolia the development of e-commerce is in its early stage and has not been studied enough. The textbook about behavior analysis and its results from 2008 to 2011 of Mongolian Internet users by Ganbat Ts. and other researchers was published. Themes such as e-commerce statements, e-commerce fundamental functions, user’s behavior concepts, theoretical analysis of statements and behavior attitudes, their models, analysis of foreign countries’ practices, statistical information, behavior attitudes analysis on e-business, services, and some technologies and its results are included in the book. The book has been taken as fundamental basis for our research.
The purpose of study. We aimed to identify e-commerce companies with B2C model operating actively in Mongolia, to analyze their payment options and their use, goods delivery issues.
Hypothesis. The hypothesis of the study proposed as e-commerce companies have implemented enough options of payment methods; goods delivery issues of e-commerce companies have been solved.
Methodology of the study. The survey methodology was taken over from international web analytical system, the companies were selected based on their social network sites visits, merchant contract with bank or other official finance service providers. The classification of payment methods and goods delivery were processed based on the research paper issued internationally and on information provided by service providers. We used statistical descriptive methodology on our collected data.
2 Methodology
We have researched historical development of e-commerce, e-commerce business models, influencing indicators, research model and hypotheses, online payment and goods delivery system.
2.1 E-Commerce
Even though there are a lot of definitions of e-commerce from different researchers depending on their context, we have selected 3 definitions for our study:
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E-commerce is a component of e-business that is providing selling services of tangible and intangible products using Internet-based technology [6].
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E-commerce is selling of goods and services using computer technology and network [7].
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E-commerce is a complex activity of buying and selling goods and services based on data exchanging principle [15].
2.2 Payment Issues
Nowadays common payment methods of customers are cash, check, debit and credit cards, money transfer, and other modern fintech methods such as Qpay, Lend.mn, etc. Online payment is a type of payment executed electronically.
The advantages of online payments are reduction of money transaction costs, lower the price of goods and services, elimination of corruption and criminal activities, regardless the time and place.
2.3 Goods Delivery System
As a result of rapid development of e-commerce, demand for companies that deliver goods, and solved logistical issues is increasing. One of the biggest challenges for entrepreneurs and companies is to solve logistics issues of delivering goods to end users/customers. Delivery and distribution operations are the main factors that are influencing market of modern supply chain. Goods delivery services are organization of logistics services of a supplier or a shop to deliver goods to customers. Currently there are 3 models of goods delivery, i.e., traditional, individual, and global [5] (Fig. 32.1).
The traditional model is about the delivery process of goods from producers using the service of logistics company delivering to wholesalers and retailers and finally to buyers [5].
Delivery process model of independent model that does not uses delivery services of other companies and executes it by themselves based on the customer order. Companies, that buy goods from foreign market, use the model [5].
Chinese logistics infrastructure is revolutionizing last 10 years. Companies that buy their products from China and resell it in Mongolia have implemented global model.
3 Current State of E-Commerce in Mongolia
We have defined in this part e-commerce companies, payment methods, and goods delivery issues. Their analysis results were processed using basic statistical methods.
3.1 Data Collection and Data Analysis
We have contacted State Registration Agency as an official source to gain official information about the companies that are operating on e-commerce market, however the result unsuccessful. Requested information about the operations’ type is not registered systematically in any state organization. Therefore, by using Internet we have found out the list of companies that have merchant contracts with Mongolian commercial banks. Also, we have collected information reports published by international research and analytical companies.
From such collected certain amount of data, we have listed websites of 105 e-commerce companies as of today regarding listed below indicators.
Hereto:
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1.
Business model of e-commerce is B2C.
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2.
Number of website visitors must be high (for detail, see Sect. 32.2.3).
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3.
Must be active on their social network sites (Facebook likes, YouTube subscribes, etc.).
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4.
Must have merchant contract about having online payment methods (QPay, MostMoney, and other commercial banks).
105 companies, which were filtered by above-described indicators, were sorted by each indicator and 35 were excluded from the study after visiting and analyzing websites of all companies and due to not having active operations permanently, small number of visitors, or website was not active (blocked).
Finally, after the clearance of list, totally 70 companies, that met all criteria and are operating actively, have been selected for further detailed analysis.
Companies
Firstly, in this part we have researched whether e-commerce business is the main business operations of 70 researched companies. Afterward visitors’ number and their social network sites’ positioning indicators on international analytical websites were analyzed. Then each website of 70 companies was visited and types of goods and services they offer to customers were analyzed in detail.
Figure 32.2 shows the result and only 19, i.e., 27% of companies have e-commerce business as their main operations. However 51, i.e., 73% of the total amount of companies have it as supporting business to their main business operations (Fig. 32.3).
We used two international analytical websites, /www.alexa.com, www.similar.com/ to analyze and to describe the ranking of 70 researched companies by their indicators in Fig. 32.2. Each company was analyzed on these analytical websites. As graph 32.2 shows 24 of 70 companies are ranked in 1st to 1000th ranking place, next 24 of 70 companies in 1000th to 3000th place, and remaining 22 are placed in insufficient ranking place, i.e., in more than 3000th place. We have included in our study only 14 companies that are ranked in more than 5001st place based on their active engagement on their social network sites.
It can be summarized that some of the Mongolian e-commerce companies are operating successfully and are making progress in their development.
It is assumed that the more visitors on the social network sites of the company the more publicly accepted is the company as a service and a product provider. There are 12 companies in Mongolia that have more than 200,000 likes and followers and 9 companies with less than 10,000 likes and followers. See Fig. 32.4 for more detail.
70 e-commerce companies deliver as duplicated amount of 24 types of goods and services to their customer. Figure 32.5 shows number of companies sorted by type of goods and services they offer.
Payment Methods
We have found out that traditional commercial and e-commerce companies operating in Mongolia use below listed 13 methods as their payment system.
Here to:
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1.
Cash
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2.
POS /Card from any bank can be used/
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3.
mPOS /Mobile phone, Tablet/
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4.
e-Commerce system for Retail business
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5.
Money transfer /through ATM, SocialPay, Internet banking, etc./
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6.
Transaction /MoneyGram, Western Union, etc./
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7.
Lend Wallet
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8.
Candy /Electronic money = 1Candy/
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9.
QPay /payment, money receipt, money transfer using QR code/
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10.
Most money
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11.
Own electronic wallet /shoppy.mn/
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12.
Royalty /GG, Redpoint or own coupon points/
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13.
Other payment platforms /PayPal, American express, etc./
We have researched whether 70 e-commerce companies have implemented these 13 payment methods mentioned above.
We have researched payment methods and described below results were released.
In Fig. 32.6 we have shown payment methods ascending sorted from down to top, from basic to advanced methods used by e-commerce companies. As a result, we can see that companies are implementing modern new technologies for their payment system.
Regarding the researched international (inter countries) payment methods, the result shows that “e-commerce payment system” and international money transfer is used relatively in fewer amount.
A company offers from 5 to 6 payment methods on average.
e-Commerce websites such as www.shoppy.mn, www.bsb.mn, and www.mmarket.mn, etc. are offering enough amount of payment methods for customers. 20% of those 10 companies do only e-commerce business.
Goods Delivery Services
Goods delivery services of 70 companies that took part in the research were analyzed and classified by goods delivery model. The result is shown in Fig. 32.7.
56 of total 70 researched companies sell tangible goods. It means that it is required from them to deliver the goods to customers. Remaining 14 companies sell electronic goods such as movies, telecommunication services, and entertainment services. From the result, we have found out that 9 companies from total 56 that requires delivery services do not have it.
4 Conclusion
The results of research are concluded in 3 parts: e-commerce companies’ research, online payment research and goods, and delivery service research.
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1.
E-commerce companies’ research: There are 105 e-commerce companies using B2C model in Mongolia as of today. 70 (66%) of them are operating actively.
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2.
Online payment research: Regarding the result of the research nowadays there are 13 payment methods in Mongolia. 8 of them are new advanced tool for online payment.
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A company offers 5–6 methods on average.
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Hypothesis 1 is proved.
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3.
Goods delivery service research: 56 of total 70 companies assumed to have goods delivery services. 47 (84%) of them already delivers goods to customers, but 9 (16%) of them do not have any delivery service.
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Totally 47 companies have goods delivery service. 34 (72%) of them have department/employee for delivery, 10 (22%) of them cooperates with delivery company, and remaining 3 (6%) of them uses goods delivery services of international courier companies.
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19% of companies use Mongol Post where state figures as shareholder and 23% of companies use local transport for taking the goods along in case of goods delivery in rural areas
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Hypothesis 2 is not proved.
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We need and assume that it is required to enrich operations of e-commerce companies by evidence-based information and indicators, to reflect changes annually, research factors that are influencing development, to maintain database of e-commerce companies’ information and collected data of companies that are using B2C models in their e-commerce business.
References
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II. In English
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III. Online Sources
www.similarweb.com- 70 companies were searched on the international analytical website, e.g. information about www.shoppy.mn was found on https://www.similarweb.com/website/shoppy.mn
www.alexa.com- www.shoppy.mns were searched on the international analytical website, e.g. information about KhanBank.com was found on https://www.alexa.com/siteinfo/khanbank.com
Websites of 70 companies taken part in the research
Websites of 14 commercial banks in Mongolia
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Delger, O., Tseveenbayar, M., Namsrai, E., Tsendsuren, G. (2020). Current State of E-Commerce in Mongolia: Payment and Delivery. In: Pan, JS., Li, J., Tsai, PW., Jain, L. (eds) Advances in Intelligent Information Hiding and Multimedia Signal Processing. Smart Innovation, Systems and Technologies, vol 156. Springer, Singapore. https://doi.org/10.1007/978-981-13-9714-1_32
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