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Shop with your mouse - Times of India (Feb 21, 99) |
Shopping took on a whole new meaning for Karlton this Christmas.
He started his shopping at 2 a.m. in the morning, sitting in his
Dadar flat in his pyjamas. Within fifteen minutes he was through
with his list - the "Chicken Soup…" series
for his mum, Celine Dion's latest CD for his brother, a box of
Fantasie chocolates for his Dad's sweet tooth, and Andrew Grove's
"Only the Paranoid Survive" for himself. He put
his Indian credit card back into his wallet, logged out of the
Internet, shut down his computer, and rolled into bed. The smile
on his face as he went to sleep was partly in anticipation of
the reaction at home on Christmas day, and partly from the fact
that he got everything at a discount - in fact, his book cost
him less than half the retail price!
Karlton's purchases were just a drop in the ocean of worldwide
online purchases this Christmas that have been estimated between
US$ 2 billion - 3 billion. And that's just the Christmas holiday
season revenue we're talking here! According to estimates by Boston
Consulting Group, online shopping revenues were about $13 billion
for 1998, with 1999 revenue projections of $30 billion to $40
billion. 1998 will be remembered as the year Internet commerce
expanded beyond veteran Net users and hit the mainstream.
Strictly speaking, electronic commerce is the process of conducting
business transactions enabled by Internet technology. But the
e-commerce everyone is so excited about today has come to mean
online shopping - buying and selling products and services on
the Web. Which, for you and me, would translate into buying products
like books, music, or chocolates through a website and paying
online for your purchases with a credit card.
Keeping in mind that the Net is still largely US-centric, the
typical e-commerce customer is a 30-something white male earning
US$78,000 per year, according to a survey of more than 1,000 online
shoppers conducted by Binary Compass Enterprises. The vast majority
- about 70% - of e-commerce buyers are men, but the number of
women shopping online is growing quickly.
What makes online shopping so attractive is the sheer convenience
offered on the Internet. Virtual stores have very customer-friendly
business hours - 24-hours-a-day X 365-days-a-year, and have the
potential of offering an unparalleled range and depth of products,
since space is not a restricting factor on the Internet. Technology
today allows a customer to touch and feel a product and make a
purchase with a few mouse clicks, pay online using a credit card,
and have the product delivered to his doorstep saving time, effort
and energy. Add to that the fact that the Internet is like the
world's largest ongoing sale with huge discounts and it's not
difficult to see why e-commerce has caught on like it has.
Not wanting to let go of the opportunity of a lifetime, almost
every vendor wants to jump onto the e-commerce bandwagon and start
selling his products and services online. But this golden goose
takes unusually long to start laying its golden eggs. And though
people see Amazon.com, the e-commerce icon boasting of an annual
revenue run rate of US$1 billion, what people don't talk about
is the fact that the virtual bookstore - now into its third year
of operation - is still running up losses by the millions. Selling
online is not easy - aggressive pricing, customer service, logistics,
infrastructure investments and marketing all ensure that a retailer
looking for short-term profits will be in for a big disappointment.
The numero uno deterrent to e-commerce is customer apprehension
about the safety of giving his credit card information over the
Internet. But in real life, the same person would happily hand
over his card to an unknown waiter, to an unknown voice at the
other end of the telephone, or even through post. Compare the
scope for fraud in the above instances with that on the Internet
where secure server technology is used, information is encrypted
and a hacker would find it difficult to tap the transaction. Consumers
still take their time believing experts who attest the fact that
e-commerce transactions are safer than ordinary credit card purchases.
Activity on the e-commerce front in India is just starting to
heat up with corporates seriously considering using the Internet
to sell their products and services. Rediff On The Net became
the first Indian website to enable Indian credit card transactions
online when they opened shop in August 1998. Today customers can
buy books, music, chocolates, flowers, and make hotel reservations
online with the assurance of secure technology. Another site that
jumped into the fray, Indishop has more to offer from toothbrushes
to computers, but does not employ secure servers. By the end of
this year, there will be scores of websites offering everything
from groceries to white goods for sale online.
Virtual is reality. It's safe and convenience is its middle name.
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A few words of safety advice to Internet users planning to shop
online for the first time:
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