Bricks and clicks slow to connect - E-Commerce - retailers using online services to sell product

By the start of 2001, bricks-and-clicks had emerged as the winning business model of online retailing. Traditional retailers, such as Target and Wal-Mart, had proven themselves to both customers and pure-player predecessors with an incredibly successful online holiday selling season. They, along with the survivors of the "dot-bomb" era, helped bring a renewed practically to the alternative sales channel, one rooted in old-fashioned business principles.

But multichannel retailers doing business online had little time to rest on their laurels. Customers had become fairly comfortable with the online buying process and, therefore, demanded a consistent experience in all channels--which posed great challenges for traditional retailers that were ill-equipped to deliver a full range of products. And in as little time as the channel took to gain popularity, bricks-and-mortar retailers went from telling themselves, "Hey, we can do this," to asking themselves, "Do we really want to do this?"

When the Internet economy began to implode, retailers responded by shifting their focus to tighter integration and seamless customer service. Those that had spun off their Internet divisions--such as Staples, Kmart and Wal-Mart--in the hopes of lucrative IPOs, slowly began to reel them back in under the corporate umbrella.

The real headaches of achieving integration and customer service involve streamlining different systems, technology and databases. A typical retailer could have anywhere from seven to 30 consumer databases, making it virtually impossible to recognize a customer across all channels, said Forrester Research retail analyst Carrie Johnson. Smaller tactical issues, such as how to effectively collect customers' e-mail addresses at the store, have yet to be resolved.

Scott Silverman, executive director of Shop.org, the online arm of the National Retail Federation, told the story of how one retailer attempted to solve the problem with a contest to see what store associate could gather the most e-mails at the point of sale. The woman who took first prize won by copying e-mail addresses from her husband's address book. The unsuspecting persons contacted by the retailer were outraged by the rash of unsolicited e-mail promotions.