THE NATURE OF THE WEB|
For the last couple of years, the chief reason for buying a computer has been Internet access - for email, and access to the 'Web. Those people who needed computers for word processing, desktop publishing, accounting, graphic design, or for their business have bought their computers long ago. Access to the 'Web is the only reason AOL now has over 33 million, and MSN has about 7 million subscribers, for instance. Altogether, 60% of Canadian households (18.5 million people) are now Internet connected (May 2001).
And these almost exclusively middle and high income households go to the 'Web chiefly for information. Although goods purchased over the Internet now amount to over $4 billion annually in North America, it still amounts only to less than 1% of all retail sales.
Instead, people chiefly use the 'Web to gather information, to 'window shop' - and then go to, and buy locally at the store which appeals most to them for a variety of reasons - such as products and selection offered, product availability, any "sale" or "special", price, location, services offered, and so forth.
Since Internet access is still almost exclusive to middle and high income households, this is also the very best market segment any business could hope for. Consequently, the simple fact is that any business which does not have a presence on the 'Web is now at a distinct disadvantage.
WHAT THE 'WEB IS
The 'Web is simply - and hands down - the very best, the cheapest, and the most effective advertising medium there is; period. It is the only medium which offers constant exposure - and at almost negligible cost. For less than a dollar a day, any business can now have the equivalent of a full page, full-colour spread which is there constantly - and always at the time whenever anyone is looking for a product or service. This is priceless exposure - and something no other medium can offer; period.
The 'Web also offers a beautiful opportunity to establish a very favourable and attractive image of your business - when done right - as well as create a sense of 'familiarity' with your business. This is also priceless, since people much prefer the familiar over the unfamiliar.
WHAT THE 'WEB IS NOT
This may be a suprise for a great many people, but a 'Web site is not a store. The 'Web is just the newest incarnation of the traditional mail order business. And it will never amount to anything more. This is the sole reason for the failure of hundreds of well financed and once high flying online stores, and the demise of many thousands of lesser and unknown "dotcoms". Even "E-toys.com", once the undisputed 'King' of all the online retail businesses, had to close its cyber doors in February 2001, and "Webvan", King of online grocery shopping, had to shut down on July 9. 2001. Since then, such former 'giants' of online retailing as "Wine.com", "Kozmo.com", "Pets.com" and "PlanetRX.com" have also shut down in 2001. And even famed "amazon.com" still has not made a single cent of profit.
Since the bankruptcy of "Webvan" is such a powerfully concise illustration of why so many online retailers have failed, and since whether to implement online retail sales or not is such a crucial decision for any retail business, here are all the details and reasons - which will open in a new page. This is a "must read" for any business.
Meanwhile, and nowadays, the standard, but all too true joke of the "dotcom" world is: "We loose money on every sale - but we make up for it in volume".
What these entrepreneurs - starry eyed with the notion that they can have nation-wide sales without any stores, employees and inventory in every city and town, and just do it all with a room full of computers and a central warehouse - haven't taken into account is that people much prefer to shop locally, talk with the proprietor or salespeople, check out the merchandise, handle it, try it on, feel its heft, see how well it is made. And that they like to take it home with them.
[Addendum; Oct. 14. 2002] A few days ago, the well designed, well financed and nationally heavily advertised web site "www.sportchek.ca" has discontinued its on-line sales, due to far greater expenses than income. They have found out the hard way that people "window shop" on the Web, and then go and buy the item, or items, at a local store. The web site now serves only to advertise chosen products, and to direct surfers to their stores. They could have saved themselves many millions of dollars if they had listened to the advice in these pages.
So, and unless you have a one-of-a-kind product, are in the travel industry, or a similar specialty 'niche' market - for whom the 'Web works extremely well - "Lands End" and "Victoria's Secret" are doing extremely well, for instance - don't bother with a cyber-store or adding online shopping to your business. The thousands of dead "dotcoms" now littering the Web are stark and eloquent proof. Besides, it is very expensive to implement and run, you have total liability for fraudulent credit card charges, and despite all assurances to the contrary, it is still very insecure (a waiter in New York stole and used Bill Gates', and other prominent people's credit card information a few month ago). For the great majority of businesses, online shopping costs them far more than it brings in. Instead, and if it is right for your business, just add a simple mail-order feature. This is relatively inexpensive and works very well.
WHAT THE 'WEB IS GREAT FOR
But do show off and advertise your business on the 'Web. A Web site, or a Web page, is not only the most fabulous, the cheapest, and the most effective advertising medium there is - but it has now become just as important and essential as the display window of your store, or the reception area of your office.
There is one major difference though; it reaches into the home of every Internet connected consumer and household - and into the office of every Internet connected business - both locally and around the world.
And just like your display window, or reception area, attractive design is paramount - which is