Make or break? Hardly!
By Scott Bradner
Network World, 12/06/99
I was listening to one of the local news shows last night. The news anchorman told his listeners that this Christmas season will be a "make or break" one for online shopping.
Even in the context of what news anchors usually say, this is a remarkably silly thing to tell viewers. 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 very good season for online shopping. As many as 23 million people will buy at least something over the Internet. The Wall Street Journal estimates that online shopping will account for about $6 billion out of total Christmas sales of $184 billion this year.
At a bit more than 3%, the 'Net part is not all that big a percentage. But $6 billion is real money, and it compares rather well to the $57 billion in sales expected for mail-order businesses for the entire year.
That the percentage is so high at this stage in the development of e-commerce should wake up some people in the retail sector. It is impressive that customers are ready to spend $6 billion over the 'Net in spite of fears regarding privacy, that your credit card will get ripped off or that you are dealing with a kid in some basement rather than a real company. This is also in spite of the fact that most Internet shopping sites are not easy to find or use and are not that reliable.
For every Amazon.com, the definitive e-commerce site, or Williams-Sonoma (www.williams-sonoma.com), a very nice site despite not having any privacy statement in evidence, there appears to be a hundred sites that seem to have taken the extra effort to make it hard to find what you want or make your computer crash on a whim. A good, if that is the right term, example of such a site is the Netscape home page, where it is at best counter-intuitive to find out how to download a new browser.
Levi Strauss & Co.'s recent decision to get out of online sales shows that even very well established companies can fail online.
Looking at Levi Strauss' current Web page, I can see easily why the company 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 cannot get an audience when the only local attempt to do so is hosted by two of the dumbest announcers I've ever heard.
Online 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 Internet's future is mine.