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Sunday, 2 January, 2000, 16:05 GMT
Online stores learn lessons

shopping Online shopping boomed for the Christmas period


Online sales in America soared at least three-fold in the Christmas shopping period - heralding a new era in electronic retailing.

Early surveys among shoppers indicate that total traffic doubled.

One survey, by the Boston Consulting Group and Shop.org, a trade association of online retailers, showed that revenue from e-commerce during the holiday season quadrupled since last year.

Leading electronic retailers continued to benefit most - especially Amazon.com.

But traditional, well-known retailers, such as Wal-Mart, The Gap and Toys 'R' Us, also seemed to be major gainers.

Wal-Mart is set to challenge the e-tailers by launching an expanded website in the New Year, rivalling Amazon.com.

Lessons to learn

It was a season in which retail websites spent millions advertising on television in order to stimulate business.

All learned a few lessons: the main one being ensuring they could meet the demand for Christmas deliveries.

Big names such as EToys, Toys 'R'Us and Macys all struggled to meet deliveries on time.

Another lesson was that their sites must be easy to navigate, and must not end in frustrating delays for users.

One of the biggest, Value America, announced a major restructuring, sacking half its workforce, after admitting it had found it difficult to fulfill Christmas orders.

Many e-shoppers abandoned their PCs, and took to the high street, after being frustrated by delays on sites and difficulties in placing orders.

A survey by Enamics, a US-based IT consultancy company, said as many as one in four US users trying to shop online gave up.

And a separate survey in America showed that even one in ten experienced online users gave up on plans to make a purchase because of delays.

Many users also reported being unable to contact customer representatives by phone.

Not so profitable

Now, retailers are beginning to learn that unless they act swiftly to improve online services, they will lose sales.

In the long run, e-commerce companies may not find business as profitable as at first sight.

After hooking in online shoppers by offering free delivery, they could find they are stuck with that system, according to research.

If they charge for packaging, postage and shipping, they could find customers leaving in droves, according to Forrester Research.

Sales over the internet in the US account for between 0.3% and 3% of all retail sales.

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See also:
30 Dec 99 |  Business
Web retailer in trouble
06 Dec 99 |  Business
America's E-Christmas boom
15 Dec 99 |  Business
Online service disappoints
11 Oct 99 |  The Company File
Amazon seeks its place in history

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