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Make or break? Hardly!
by Scott Bradner
I was listening to one of the local news shows last night. The news anchorman told his listeners that this Christmas season was a "make or break" one for on-line shopping. Even in the context of what news anchors usually say this is a remarkably silly thing to say. Actually I guess I should not take it out on the anchor - I expect he was just reading what some supposedly knowledgeable analyst had written.
The first reports do show that this is going to be a pretty good season with an estimate of as many as 23 million people buying at least something over the Internet. The Wall Street Journal estimates that on-line shopping will be about $6B this year, out of a total of $184B in Christmas sales. At a bit over 3% the net part is not all that big a percent but $6B is quite real money and it compares rather well to the $57B total, not just Christmas, mail-order business.
That the percent is that high at this stage in the development of e-commerce should wake up some people in the retail business. That customers are ready to spend $6B over the net in spite of the privacy fears, the fears that your credit card will get ripped off and the fears that you are dealing with a kid in some basement rather than a real company is quite impressive.
This is also in spite of the fact that most Internet shopping sites are not easy to find or use or that reliable. For every Amazon.com (www.amazon.com), the definitive e-commerce site or Williams-Sonoma (www.williams-sonoma.com), a very nice site in spite of having no privacy statement in evidence, there seem to be a hundred sites that seem to have gone to extra effort to make it hard to find what you want or crashes on a whim. A good, if that be the right term, example of this is the Netscape home page where it is counter-intuitive at best to find how you download a new browser.
Levi Strauss &Co.'s recent decision to get out of on-line sale shows that even very well established companies can fail at the on-line business. Looking at the current web page I can easily see why it failed - I was totally confused and could not figure out what to do. But extending a failure of a site to the whole Net is like claiming that playing real country music on the radio can not get an audience when the only local attempt to do so is hosted by two of the dumbest announcers I've ever heard.
On-line retailing is not going to succeed or fail based on this year's experience. Anyone who thinks it will shows an impressive misunderstanding of the inexorable creep of the Net into our lives.
disclaimer: I could say something about Harvard and creeps but I won't - the above view of the Net's future is mine.