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Industry Insight
17 January 2001
Brighter future for online retailers
BY
BASHEERA KHAN
[
17 January 2001
] -
South African e-tailers could prosper in 2001 – if they recognise and adapt to several key patterns emerging in the online retail industry.
These findings, the result of the Global Online Retailing report released yesterday byErnst & Young , point to a multi-channel strategy as both a key to success and a driver for future developments.
In addition, the report urges e-tailers to realise that consumers who have traditionally bought in real-world stores are now buying online. As such, consumers are increasingly expecting the same merchandise, brand and product quality, and shopping experience across all channels.
This in turn will lead to consumers pushing companies to make their online offerings work in precisely the fashion users want it to work.
The survey was conducted across 4 400 online buyers in 12 countries, including the US, the UK, Brazil, Spain, Canada and Australia. South African respondents numbered 139.
Although books, CDs, computers, tickets or reservations, and apparel top the worldwide purchase categories, SA and Switzerland are the only countries in which financial services feature strongly.
The major inhibitors to a leap in the number of online consumers remains constant – South Africans seek personalisation of products, they're deterred by shipping costs, and are still concerned about credit card safety.
Grant Brewer, director of e-commerce at Ernst & Young, believes other impediments are SA's inherent literacy and access issues. Brewer says another obstacle could well be South African business's tendency to follow the US lead, rather than choosing to find more creative solutions to attracting new online customers.
The trend for this year, he predicts, will be traditional companies with trusted brands experiencing successful online ventures. Ian Catt, Ernst & Young's director of retail and consumer products, agrees.
“By 2005, it could represent 10% to 12% of sales in such categories as apparel, accessories and toys. In some categories, such as books, music, software, videos and consumer electronics, it could represent as much as 25% of sales.”
These findings, the result of the Global Online Retailing report released yesterday by
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This in turn will lead to consumers pushing companies to make their online offerings work in precisely the fashion users want it to work.
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Although books, CDs, computers, tickets or reservations, and apparel top the worldwide purchase categories, SA and Switzerland are the only countries in which financial services feature strongly.
The major inhibitors to a leap in the number of online consumers remains constant – South Africans seek personalisation of products, they're deterred by shipping costs, and are still concerned about credit card safety.
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The trend for this year, he predicts, will be traditional companies with trusted brands experiencing successful online ventures. Ian Catt, Ernst & Young's director of retail and consumer products, agrees.
“By 2005, it could represent 10% to 12% of sales in such categories as apparel, accessories and toys. In some categories, such as books, music, software, videos and consumer electronics, it could represent as much as 25% of sales.”
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