E-Commerce Times Talkback
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All hail King Harry. When Harry Potter and the Order of the Phoenix was released, Amazon.com shipped out more than a million copies, making it the largest one-day distribution of a single item in e-commerce history. Taking into account the tech bubble's burst, not all e-commerce records are positive, but most of today's milestones show that e-commerce is here to stay and is growing at a strong pace. What are some of these notable statistics?
Itís great that some of the Net's large sites are setting records, but I don't think that the sector itself, in terms of its overall performance, is performing anywhere near the level that it could be.
While relatively large companies like Amazon, Apple and PayPal certainly deserve to be commended for their terrific performance, we shouldn't ignore the fact that the vast majority of the Web's e-commerce sites are still struggling to stay alive. That begs the question why?
In my view, it's because the Internet public is and has always been reluctant to engage in credit card purchases with small, unfamiliar sites. Your readers may disagree with me, but I firmly believe that the public's worries about the safety aspects of online credit card transactions was the primary factor that wiped out most pure-plays during the Dot.com crash. Most analysts still blame the crash on the Net's so-called "reckless entrepreneurs," but no analyst has yet presented any evidence to support the validity of that theory. There is, on the other hand, plenty of evidence to show that the pure-plays' poor performance was seriously affected by the public's "online shopping phobia," at least much more so than any of the Net's analysts have ever suggested.
If the Net's top execs finally come to terms with the seriousness of the public's mistrust of the online shopping process, there isn't a doubt in my mind that the entire e-commerce sector will start setting growth records like no industry has ever achieved. That's fact, not hype. - Jim Pflaum
I am sick and tired of people referring to the credit card security issue as the main cause of eCommerce failure. Surveys are biased. Security is the easy and obvious answer for anyone. Anybody, if asked about it, will say that they worry about someone misusing their credit card.
The point I want to make is that even though credit card security is important, people forget about it if they see other advantages. Here are 2 examples.
In Canada, a gas station introduced a system to speed up the paying process. You just need to insert your credit card into the gas pump to pay for your fill up. No signing, no checking, not even a person to identify you. Which means that anybody with a stolen credit card can use it to buy gas. It does not stop people from using the Speedpast system even though it is one of the most unsecured ways of paying. People use it because it is convenient.
Look at these facts: figures are from the Direct Marketing Association's 2002 annual report.
1. The at-distance shopping market (which includes ecommerce) sales are projected at 2 trillions in 2002. Many sales will be with not well-known merchants.
2. Telemarketing account for $660 millions in sales.
3. 40% of Americans already shop at-home.
So giving their credit card # at distance is not the issue for 40% of Americans.
What businesses have to realize is that to be successful, you must target the right consumers. One way is to target the consumers that already liked or can be easily converted to shop at home instead of trying to sell to people that prefer shopping in stores.
Stop talking about the credit card security issue, and start talking about how we can make it more convenient for people to shop online. That is the only way at-distance shopping will reach the 60% that still need convincing.