NFIB

Clicks and Bricks
03/ 28/ 2002

Just because dotcoms took a bashing last year, don't give up on the idea of extending your established retail business into cyberspace. A recent Reuter's analysis, says that "a presence on the Net is becoming a must for retailers of every sort." In today's Workshop, Jeffrey Moses critiques this analysis.

According to the Reuter's analysis, Ernst & Young recently reported that more than 7,200 customers and retailers believe that online retailing is a "business requirement." The poll found that consumers are still concerned with shipping costs and overall product price, but are continuing to buy online in increasing numbers and are purchasing in a greater range of merchandise categories. About 75% of the U.S., German and UK consumers polled had made an online purchase in 2000.

Books, CDs, computers and electronic equipment continue to lead the list of products purchased online, the report said. But other products are beginning to make an impact.

Conspicuously absent from the poll were concerns about purchasing safety when buying online. It seems that most online shoppers are fairly confident that established e-tailers offer as much safety regarding credit card and other financial information as traditional companies taking credit-card orders on the phone.

Established retailers should not put off investing in the development of their own e-stores. The recent collapse of dotcoms should serve as a guide for procedures of development, rather than as a warning to abandon the concept. Learning from past dot com failures can help new e-tailers avoid potential pitfalls. General guidelines would include such safe-and-sane concepts as:

1. Develop your Web presence with financial prudence. Don't spend all your funding on development of the site: ongoing marketing both online and to your existing customer base is essential.

2. Before beginning Web site development, visit as many comparable sites as possible. Your research should be extensive and specific. Have examples ready to show your Web developer.

3. Select your developer carefully. For more information, please see the former Workshops: "How To Choose a Website Development Firm When You're on a Budget, parts I and II."

4. Realize that the new "click" division of your business will take time to develop profitability.

5. Cut costs. Cut costs. Cut costs. This is the best way to prevent your new site from going the way of unfortunate dotcoms that overspent on everything from personnel to hardware to marketing.

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