E-SHOPPING: from Christmas into 2000

The pre-Christmas frenzy

• Customer service- The experience of Christmas 1998 demonstrated that good customer service is vital to attract and retain customers. Email customer service was put under the spotlight at Christmas 1999, with automated, untailored responses attracting particular criticism.
• Demand- E-tailers were urged to ensure that their distribution channels and server capacity were in place to cope with increased demand. Compatibility with information systems of suppliers, financial partners, and shipping and customs partners was essential.
• Abandoned shopping- Concerns about customers abandoning their shopping before completing a purchase were raised, highlighting that e-tailers must display all added costs clearly, make the site easy to navigate and acknowledge orders immediately via email.
• Incentives- Competition between online retailers was significant and many e-tailers offered free packaging and delivery, along with discounts on products and entry into competitions. In the US, toy retailers battled it out with coupons and cross promoted their web sites and physical stores (if they had one). Other start-ups cross promoted with partners who had a physical presence.
• Security- Users were concerned about security when making purchases online and this heightened the importance of retailer online accreditation schemes.
• Last minute shopping- E-tailers keen to cash in on the last minute spending spree took chances and guaranteed to deliver presents purchased within a few days of Christmas - some failed miserably. Meanwhile, e-tailers began their sales early, mirroring activity on the high street.
• European e-shopping- Europeans have less credit cards than their US counterparts and this may have held back e-commerce in Europe. The EU distance selling directive will eventually mean that consumers can refuse additional delivery charges if they are not disclosed at the point of sale.

The post-Christmas calm

• Abandoned trolleys- Consumers abandoned their trolleys due to items being out of stock, high delivery prices and slow internet connections. Which?Online reported that several UK e-tailers had not met their own customer service guarantees.
• Successful e-tailers- UK e-tailers have been reluctant to release spending figures for Christmas 1999, but the US appears to have had a successful season both in terms of traffic and sales. Amazon was the undisputed ?winner? in the US.
• Lessons for e-tailers- E-tailers need to solve their infrastructure problems and improve their customer services. They should avoid falling into the trap of offering continual discounts and freebies.

E-shopping in 2000

• E-tail developments- Small e-tailers are likely to consolidate this year, particularly where there is a cluster of synergetic content. European e-tailers should beware the US e-tailers with pan-European business models and use their local market knowledge to secure their positions.
• Customer services and delivery mechanisms- Customer services will have to improve to avoid losing customers. Consumer choice will grow exponentially and e-tailers will have to provide reliable and fast services. In the US, the FTC is tackling delivery issues and wants to ensure that customers are notified and kept up-to-date if orders are delayed.
• Protection for online shoppers-TrustUK has been launched to offer consumers protection when buying online. The hallmark of the scheme will appear on web sites from May. Which?Online will continue to provide its Web Trader accreditation scheme.
• Bargains on the internet-If e-tailers cannot sustain low pricing levels and free packaging and delivery, consumers will increasingly turn to shopping bots to identify the best deal. Concern has been raised by e-tailers that such sites could weaken their brand and erode revenue from b