Online Escrow, Essay Example

Online escrow will definitely effect my organization and my consumer patterns in very important ways. Online escrow services offer a capability or resource that is nothing short of foundational for e-commerce: trust (Reynolds, 2004, p. 58). Trust is “the intermediary element” between buyers and sellers: where it does not exist, sales are not possible (p. 58). Online escrow services offer trust between buyers and sellers: an online escrow service “acts as an impartial trusted third party that facilitates buying and selling” (pp. 58-59). The existence of online escrow services allows customers to make the payment to a trusted third party, which holds the payment until the buyer gives “confirmation that the goods are as expected” (p. 59).  Without online escrow services like PayPal, e-commerce would be much more limited. B2B portals like Alibaba.com also offer escrow services: Alibaba.com began as “a huge posting place for classified ads” but is now “moving toward becoming a trading exchange” (Turban et al., 2010, p. 223). The advantages of Alibaba.com are considerable: it offers free tools and services—though suppliers must pay for membership—and 44 different industry categories of merchandise (pp. 224-225).

Peer-to-peer (P2P) or consumer-to-consumer (C2C) e-commerce is, I believe, an outstanding way for customers to find merchandise from other customers. For example, Kingsnake.com (www.kingsnake.com/) is an e-commerce site for hobbyists of various reptiles and amphibians. Sellers pay for ads on the site’s classifieds section, where they can provide buyers with contact and payment information, and pictures of the animal(s) being sold. Kingsnake.com offers no third-party services in the transactions, however. eBay is a far more popular example, offering online auctions (Turban et al., 2010, p. 329). While P2P sites might take some business away from larger vendors, they can also offer advertising exposure, which can be targeted by keywords entered as search terms (p. 329).