Net Retail Needs to Leap to the Next Level

 
 
By Peter Coffee  |  Posted 2006-09-04 Email Print this article Print
 
 
 
 
 
 
 

Opinion: What sellers fear most is what they must dare to become.

Like the first attempts at a "horseless carriage," the "Internet shopping" that weve seen so far is only an incremental update of something we already knew and understood—not something fundamentally new.

You can easily imagine a wooden wagon that moves without a horse in front of it, but that wont make you think of the need for seat belts—let alone the opportunity to sell people a box that provides GPS navigation on highways.

Todays online shopping eliminates many nuisances and improves on the physical limitations of brick-and-mortar storefronts, just as the horseless carriage removed undesirable elements of horse-drawn transportation.

However, there are quantum jumps to be made, and marketplace gains await those who make them first.

This thought occurred to me when I received an e-mail newsletter from Lexar, a maker of memory cards for digital cameras. Photographic film affects the objective quality and even the subjective character of the creative product, but the only thing you want from a piece of memory is that it be invisible to your process.
Kudos to Lexar for trying to overcome this problem, but Im not sure that a periodic newsletter on photographic techniques is going to capture market share. However, Lexars approach got me thinking about online selling success.

The feds have cracked down on bank gift cards. Will retail be next? Click here to read more. Sites such as PriceGrabber.com and BizRate have changed the way that I start my purchasing process, with their convenient tabulations of who sells what combined with accessible reports from others who have bought from any given supplier. These sites replace the economics of who does more advertising and who has lower prices with the more nuanced economics of reputation.

Individual buyers now have the information they need to weigh price and availability against the risk of a poor experience. If you disappoint any buyer anywhere, the story can get to potential customers everywhere.

If you sell on the Net, the jump that you must make is to give your customers a forum, right there on your own retail site, where other prospective buyers can be assured of your reputation. If you dont do this, theyll go elsewhere for that assurance—and be exposed to your competitors offerings during that outside research. If youre afraid to let your future customers see what your current customers have to say, you have to solve that problem. You cant make it go away just by making people look elsewhere for those candid comments.

Also of note in online selling is the so-called long tail effect, in which goods that sell in small volume can still be economically stocked and offered to buyers. This merely begins with the fact that Amazon.com, for example, can offer me a wider range of titles—even multiple editions of a title—where a smaller neighborhood bookstore would have neither the space nor the capital to carry that large an inventory. At least as important is the ease with which Amazon.com gives me access to any number of used-book dealers and a nearly transparent way to search among them for a book, compare offerings, purchase the title and then rate the experience.

Amazon.com doesnt carry that used-book inventory, but it makes money from the fact that someone else does. Every supplier should emulate Amazon.coms example by integrating aftermarket suppliers, used-equipment dealers and other members of their ecosystem under their own brands umbrella. If youre afraid to compete against your own aftermarket, you need to confront the reasons for that fear—not merely sweep them elsewhere.

The third leg of the online selling tripod is the product evaluation data thats available from many credible independent sites. I cant imagine buying a camera without seeing whats said about it at DPReview.com; I wouldnt buy a car without a look at Edmunds.com, Autobytel.com or Automobile.com.

Court opinion leaders, make their reviews accessible through your site and make sure they have access to top-quality information. Do all this, and your site will become the No. 1 starting point, rather than just one of many destinations, for the savvy shopper.

Technology Editor Peter Coffee can be reached at peter_coffee@ziffdavis.com.

Check out eWEEK.coms for the latest news, views and analysis on technologys impact on retail.
 
 
 
 
Peter Coffee is Director of Platform Research at salesforce.com, where he serves as a liaison with the developer community to define the opportunity and clarify developers' technical requirements on the company's evolving Apex Platform. Peter previously spent 18 years with eWEEK (formerly PC Week), the national news magazine of enterprise technology practice, where he reviewed software development tools and methods and wrote regular columns on emerging technologies and professional community issues.Before he began writing full-time in 1989, Peter spent eleven years in technical and management positions at Exxon and The Aerospace Corporation, including management of the latter company's first desktop computing planning team and applied research in applications of artificial intelligence techniques. He holds an engineering degree from MIT and an MBA from Pepperdine University, he has held teaching appointments in computer science, business analytics and information systems management at Pepperdine, UCLA, and Chapman College.
 
 
 
 
 
 
 

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