http://jewishworldreview.com/0208/better_online.php3
Online retailers are delivering the goods and better customer service than traditional stores, according to a University of Michigan study expected to be released Tuesday.

Customer satisfaction with online retail was even with last year at 83 points on a 100-point scale, but surpassed brick-and-mortar retailers by 12 percent, according to the American Customer Satisfaction Index.

“Against a backdrop of weakening consumer spending and talk about recession, e-commerce will continue to be a bright spot for multichannel companies,” said Larry Freed, president and CEO of ForeSee Results in Ann Arbor, which partnered with the university’s Ross School of Business on the survey.

Christmas sales are over and the After-Christmas sales are underway, but the news is already out for online sales. It’s a good news—bad news story.

Good News

The good news is that online sales increased to $29.5 billion, a 19% increase from last year. I haven’t seen any breakdowns on these figures, but I am interested in the answers to a couple of things.

First, how did the online versions of brick & mortar stores perform—Barnes and Noble, Toys R Us, etc.—against internet marketing giant Amazon? What part of the increase came from established retail chains for this year’s shopping? I haven’t seen those numbers yet. Second, how did Internet-only stores’ online sales compare to sales last year … in volume and percentage?

Internet sales figures increase, but rate slows | Chron.com – Houston Chronicle
When the receipts are tallied from this holiday, American consumers will have spent around $29.5 billion at Internet shops, according to projections published by comScore, a market research firm.

“The growth rates for previous years were clearly much higher,” said Andrew Lipsman, spokesman for comScore. The research firm did not have growth rates before 2003, but Lipsman suspected that they were 25 percent or more.

It also is far higher than the rate of growth in offline sales, according to preliminary projections.

Bad News

It seems that no good news is delivered without some caveat of bad news. The only bad news the press could muster this year was the decrease in the percentage of increase of sales. I know the previous sentence needs diagramming, so let me rephrase the statement.

Sales are up! but not as much up as they were up the year before. Got that? While normal retailers struggle to increase sales each year, online sales climbed by double digits.

I wonder how long this trend can continue? As people get more comfortable with purchasing products from online merchants, I think the growth will continue.

What do you think?

Here are five articles well worth reading, reinforcing the Internet to The Future of …

1. Brian Clark at copyblogger wrote a great piece titled How to Become a Heroic Business Blogger.
2. Marguerite Reardon at c|net tells about Shopping from your cell phone.
3. Josh Wolf at c|net reminds us that blogs are like mediums that preceded them.
4. Caroline McCarthy dispenses the details on the huge SecondLife convention that took place in Chicago last weekend.
5. Michael Hyatt of Thomas Nelson Publisher expounds on making buying easier by removing the friction.

Blogging, eCommerce, and the shopping experience are important to us all. As business people, we care about our customers, but often forget what our process looks like through their eyes. It’s important to step back from time-to-time, and consider how our business looks to others.

So what does the future hold? I believe blogging, eCommerce, flags, and social media will continue to flourish and grow, and each will have passionate champions. New media will come along to replace or supplement each, but nothing in the ‘verse can stop the continued march of online businesses toward better communication with their customers. After all, that’s what it’s all about—conversation.

As with blogging (yesterday’s topic), eCommerce is in its infancy. Online retailers are still determining the best approach to selling on the web. From personal experience, I can tell you it is different from brick-and-mortar selling, and I think eCommerce websites can learn a lot from successful catalog companies.

Past

Internet only commerce sites began in the early days of the web, but started gaining recognition in late 1999. That year the federal government began releasing sales figures for online quarterly sales, which amounted to $5.3 billion for the fourth quarter—a small percentage of the $821.2 billion in U.S. retail sales. By the fourth quarter 2004, the number was $18.4 billion for eCommerce out of a total retail amount of $938.5 billion.

As you can see, the trend continues to climb and according to Lead Pile, online sales will pass one trillion dollars by 2012.

Present

Online only stores, such as Amazon and eBay, continue to thrive, growing into profitable businesses over the last few years. They are now recording profits, rather than the huge losses they posted early on. Many brick-and-mortar stores, such as Barnes and Noble and Best Buy, have joined the online market. Their online stores compliment their Main Street stores with additional products and delivery options. They also let the buyer select and purchase items online, then pick up at the nearest available store, combining the two.

Opening an eCommerce website is still a daunting task, but today there is help for those who want to venture into the world of eCommerce. Elastic Path is one company dedicated to dispersing information revolving around eCommerce, discussing both the good and the bad. Marketing help is also available from online resources like Drew McLellan’s great Marketing Minute website.

Future

The numbers for online retail sales will continue to climb as security gets even better, and people get more accustomed to shopping in their pajamas.

So where will eCommerce be in the future?

I think online chat will be huge

 meebo me! and products like it, makes it easy to interact with buyers that have questions. This easily installed widget, allows visitors to see if you are available for a conversation. This and other chat products are available for most blogging platforms, and can be installed directly onto your site.

My friend Scott Ginsberg includes one on his Blogger website to chat with prospects and friends, alike. When you visit Scott’s blog, the meebo me! box tells you if he is available or not. If he is available, you can converse with Scott in real-time.  

I think virtual shopping will be huge

I mean really virtual, not virtual as in you’re there—I’m here. You’ll pick up one of my flags and look at it closely and feel its texture, never leaving your home. You’ll experience the difference between nylon and polyester, feel the stitching and the canvas sleeve, without the need for verbal explanations. You’ll stroll around the virtual store, cruising the aisles, browsing the merchandise much like the physical experience.

We’ll interact face to face … virtually, too.

I think specialty shops will be huge

Amazon and eBay currently sell almost everything, but most of those items are not in stock, and are drop shipped by an independent fulfillment company when an item is sold. The problems show up when the virtual shop is the norm. No one at Amazon can help you with your selection of an American flag because they don’t know anything about them, they know about books.

You’ll come to Flags Bay and be greeted warmly and helped as needed. Your personal assistant will discuss your needs, determine which flag you are looking for, and help you check out. Doesn’t that sound nice? 

Many specialty book shops have come into being because of the touch factor. Using Amazon as the example, they have more books available than a brick-and-mortar store, but there are niche stores surviving and thriving. Consider World War Two Books or Civil War Books. They can offer an experience Amazon can’t touch in their niche. Specialty stores have a passion for the product, they’re not just selling the book.

I think virtual world shopping will be huge

In the virtual world of Second Life, you can walk around and interact with others. You can have conversations and conduct business. I read last week that IBM is opening a retail store in Second Life with the intent of selling products. They will be joining many other real world businesses, competing for real dollars and real customers in the unreal world of Second Life.

The technology for virtual shopping is improving all the time, and the same people who inhabit Second Life will move right into online buying, willingly shopping in my virtual world.

These are some of my eCommerce ideas I contemplated while in bed. Where do you see eCommerce heading in the future?  Share your thoughts and ideas in the comments or drop an email to larry@flagsbay.com. I’m interested.

Over the last few days, I’ve had lots of time to think, although being sick isn’t conducive to clear thinking.

Now that I am better, it’s time to review my drug-induced ideas to see which ones are worth exploring further, and which ones I should just drop.

So what did I think about while horizontal? Was it valuable and worthwhile?

Here are some of the overall themes that went through my mind the last few days.

• Blogging—Its transformation over the last five years
• eCommerce—the present and future
• Flags—flying them like kites and on poles
• The Web and Social Media—how it relates to the future of the Web

I’d like to take each of these and share some thoughts over the next few days, and I’d like your feedback—reactions, and ideas as they relate to these topics. It will help me judge the value of my drug induced thinking, and give you a chance to straighten me out.

Fun for everyone. I like it.