E-commerce flourishes this holiday season
Jay Brooks, a 43-year-old pathologist from Houma, La., knows what he likes: books, CDs, and citrus fruits. And he knows where to buy them online — as do 21 million other consumers. Yes, e-commerce is booming, a result of the Net’s growing popularity and irresistible incentives. And it’s not just the early adopters thrill-shopping with mouse clicks; it’s everyday Joes, soccer moms, and their kids. That adds up to a total of $5.8 billion in sales by the end of 1998 — up from $2.6 billion last year, according to a Jupiter Communications study.
Historically, the main lure has been the potentially limitless selection of online products. ”If I went to a record store locally to find something by Nick Lowe, it probably wouldn’t be there,” explains Brooks. ”And if [I wanted an] Elvis Costello [CD], it would probably be some greatest-hits package.” But, online shops can easily offer hundreds of thousands of items — and the wares don’t just sit idly on shelves. At bookstore Amazon.com, you can read reviews, browse through related book suggestions, catch up on the best-seller lists, and find out when paperback editions are due out.
Some online shops also charge less than retail stores, although shipping and handling charges can absorb the savings. Nonetheless, credit-card transactions, once an online security issue, are now perceived as another Internet shopping advantage. ”In the last 12 months, consumers have gotten more comfortable with the notion of purchasing in the online channel,” says Nicole Vanderbilt, a chief analyst at Jupiter Communications. ”And there’s been a proliferation of marketing and positioning by players like AT&T, IBM, Visa, and Amazon.”
But these features don’t necessarily add up to success. It comes down to the holiday season: More than 40 percent of all online sales occur during the last three months of the year, says Vanderbilt. The bulk of these hover around Christmas and Hanukkah; those Tickle Me Elmos really add up.
If you’re worried that Elmo’s passe or you’re not sure what to get your niece, don’t worry. That’s why most shopping sites — including toy stores like eToys (www.etoys.com) — offer registries, reminder services, gift wrapping, and personalized cards. ”Simple things [make a difference], like being able to ship to an address that’s different from your billing address — something some merchants didn’t have last year,” adds Vanderbilt.
For instance, CDnow (www.cdnow.com) allows you to designate the CDs you’d like as gifts; friends can then type in your e-mail address and access your personal wish list — so you don’t end up with Black Eyed Peas when you really wanted Korn. You can also make your own musical mix, since CDnow offers a custom compilation program (starting this month) that lets you choose any 10 holiday tunes and combine them on a disc for as little as $15.
It’s that kind of online exclusive that has brick-and-mortar merchandisers growing nervous. ”I was at the mall on Friday with my wife,” Brooks says. ”And I went by a CD store and didn’t even go in. I do most of that online now.” The lesson is clear: Music stores, beware. Barbers need not worry.