Now that our companies know how to use an online business, how can they effectively use it? From a technological standpoint, the most important thing to do is maintain your server. The last few years have observed an explosive growth in online business. As the number of internet users in the world continues to grow, so does the amount of online businesses. As of 2004, there were 945 million people around the world that have internet access, and online retail sales grew to $168 billion in 2005. However, a possible cause of slowing in this market is congestion of the servers. As alluded to before, to be successful, you must have the server space.
One such popular website was YouTube, which was not the first of its kind; however it was the first that offered enough bandwidth and server space in order to accommodate the massive amount of videos posted to its site each and every day. (Liedtke 2006) YouTube gained popularity because of its ability to keep from crashing. YouTube and other servers must avoid their site crashing due to wasted space used by consumers. On YouTube it might be a person posting the same video 3 times, or on retail sites it might be the approximate 66% of all online shopping carts that are abandoned. Those searches aren’t discarded instantly; rather they are saved on the server. With studies done in the late 1990’s, nearly 28% of all abandoned shopping carts came due to slow server speed. Every one of those abandoned carts is a loss of a potential sale.
One solution found to solving the problem of server speed is to divert internet traffic in different directions. Instead of having all commands go through one computer, it divides information into separate servers, and therefore improves response times. The initial web server (which in reality could be a collection of individual computers) handles front end tasks, such as browsing, comparing products, searching, and placing items in the shopping cart. Other servers will then handle checkout activities. With the two servers working separately, but together, much more is accomplished in the same amount of time. The faster your servers, the more profit will be made.
Tan, Y., Moinzadeh, K., & Mookerjee, V. (2005). Optimal Processing Policies for an e-Commerce Web Server. INFORMS Journal on Computing, 17(1), 99-110.
One such popular website was YouTube, which was not the first of its kind; however it was the first that offered enough bandwidth and server space in order to accommodate the massive amount of videos posted to its site each and every day. (Liedtke 2006) YouTube gained popularity because of its ability to keep from crashing. YouTube and other servers must avoid their site crashing due to wasted space used by consumers. On YouTube it might be a person posting the same video 3 times, or on retail sites it might be the approximate 66% of all online shopping carts that are abandoned. Those searches aren’t discarded instantly; rather they are saved on the server. With studies done in the late 1990’s, nearly 28% of all abandoned shopping carts came due to slow server speed. Every one of those abandoned carts is a loss of a potential sale.
One solution found to solving the problem of server speed is to divert internet traffic in different directions. Instead of having all commands go through one computer, it divides information into separate servers, and therefore improves response times. The initial web server (which in reality could be a collection of individual computers) handles front end tasks, such as browsing, comparing products, searching, and placing items in the shopping cart. Other servers will then handle checkout activities. With the two servers working separately, but together, much more is accomplished in the same amount of time. The faster your servers, the more profit will be made.
Tan, Y., Moinzadeh, K., & Mookerjee, V. (2005). Optimal Processing Policies for an e-Commerce Web Server. INFORMS Journal on Computing, 17(1), 99-110.
1 comment:
Do you think it's a combination of faster servers and peoples' increased reliance on the Internet that has allowed for businesses to thrive online? It seems like people these days are more prone to purchase online without the hassle of going out of their homes or offices...or is it just that broadband speed has made it so efficient and easy to purchase?
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