EXECUTIVES WHO THINK THAT THE DOT-COM collapse, channel conflict, and consumer fears of identity theft have combined to make E-commerce strategy a low priority should think again. Ten years after Amazon.com and eBay made "E-tail" a household word, companies in many industries are taking a second look at E-commerce, and finding ways to overcome old problems and tap new opportunities.
Last year, E-commerce sales hit $69.2 billion, and while that equates to less than 2 percent of all retail sales, it is a startling 23.5 percent jump from the previous year. Analysts believe the online channel may account for 7 percent of all retail sales by 2010. That's a potential increase of nearly $200 billion, which means companies that were turned off or got burned the first time around have plenty of incentive to try again.
And many are. No longer seen as a separate entity (with its own dreams of IPO glory), today's E-commerce effort is framed as an integral part of a multichannel sales-and-marketing strategy predicated on giving customers what they want the way they want it. That means company strategies vary widely. One retailer's Website may sell a fraction of the inventory displayed at its stores, while another may sell quite a bit more. Some see their E-commerce platforms as the carrot enticing customers into their shops--or, if they are manufacturers, into the shops of their channel partners. Others see E-commerce as a way to reach customers who can't, or won't, shop any other way. Rather than build dot-corns because their competitors have them--often the motivation 10 years ago--companies today think deeply about the purpose of their E-commerce effort before giving it life.
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