Buyers Drive The Process Online But The Lowest Price Isn't All They Want

Written by B.L. Ochman

Online buyers' ability to comparison shop -- aided by a vast array of shopping bots -- has turned traditional retailing on its head. But are low prices all customers want? No way!

Some web-wise merchants have responded torepparttar Internet's new retail rules retailers by including comparison shopping on their own sites, others put their heads inrepparttar 109089 sand. Leadingrepparttar 109090 list of slow to get online retailers is Home Depot who, according torepparttar 109091 Aug 16 issue of Fortune, recently issued "a Godfather-esque" directive to its suppliers selling goods online. The gist of it was stop selling online or you won't be selling to us.

"Dear Vendor,"repparttar 109092 May 19 letter began, "It is important for you to be aware of Home Depot's current position on its'(sic) vendors competing withrepparttar 109093 company via e-commerce direct to consumer distribution. We think it is short-sighted for vendors to ignorerepparttar 109094 added value that our retail stores contribute torepparttar 109095 sale of their products....We recognize that a vendor hasrepparttar 109096 right to sell through whatever distribution channels it desires. However, we too haverepparttar 109097 right to be selective inrepparttar 109098 vendors we select and we trust that you can understand that a company may be hesitant to do business with its competitors."

What Home Depot really is worried about is its customers going straight torepparttar 109099 manufacturer and bypassing Home Depot.

Going head to head with Home Depot won't be simple for any company. Stanley Tools, for one, has scrapped its e-commerce plans inrepparttar 109100 face of Home Depot's threat. After all, Home Depot is one ofrepparttar 109101 "category killers" who put thousands of mom and pop hardware stores out of business."Who's to say," Fortune reporter Katrina Brooker muses, "that it can't dorepparttar 109102 same to pesky suppliers with dreams?" Web shoppers, that's who!

Several factors come into play: oOnline shopping does not provide instant gratification. Sometimes, all a customer wants is to buy something and use it right now oPeople are still willing to pay more for superior service, even online oFew retailers will be able (or want) long term, to sustain prices so low they cannot make a profit oAlthough low prices might bring customers to a site, discounts alone won't necessarily keep them there or convince them to return oOnline, a store that provides complete information from a variety of sources can be more valuable than a single site that provides only its own or partial information. Online comparison shopping is available at a wide range of sites. These sites promise "you'll never miss a sale again;" "40 - 60% off retail in 13 categories;" daily or weekly sales updates; and email bargain newsletters tailored to your shopping interests. Some claim to scan 50 million products. Each of these services is powered by shopping bot software. Some even provide shoppers withrepparttar 109103 ability to search, compare and buy in a secure e-commerce environment. The majority accept advertising, but a few, like Price Scan claim to be unbiased and objective because they eschew advertising. Some online shoppers, no doubt, studyrepparttar 109104 information on these price comparison sites before they make a buying decision. Then there is everyone else.

What makes a shopper decide that price isn't all that matters? Extraordinary service --repparttar 109105 very same quality that allows some stores to charge more for their items because they make shopping convenient, pleasant and reliable -- still can win over price. Superior service makes fancy cars, designer duds and luxury travel appealing. It also allows L.L. Bean, Nordstrom's, and a handful of other merchants able to charge more for their products than bargain merchandisers selling essentiallyrepparttar 109106 same goods. And great service is not going out of style any time soon.


Written by Bob McElwain

Peter Drucker believes ecommerce will be torepparttar Information Revolution whatrepparttar 109088 railroads were torepparttar 109089 Industrial Revolution.* To oversimplify,repparttar 109090 Industrial Revolution was a time in which tools were produced that replaced people inrepparttar 109091 manufacture of goods. Inrepparttar 109092 first thirty years, all was devoted to producing known products with machines.

While there were drastic social changes withrepparttar 109093 massive shift from rural to urban living, there was little change inrepparttar 109094 products produced and purchased. They only became more readily available at ever more modest cost.

Only later didrepparttar 109095 Industrial Revolution produce something new -repparttar 109096 railroads. Forrepparttar 109097 first time in history, people could readily move great distances inexpensively. (Hauling freight came much later.) Railroads brought a thirty year boom in Europe, and an even longer one inrepparttar 109098 United States. While many other parts ofrepparttar 109099 world got started somewhat later,repparttar 109100 boom did not end for them untilrepparttar 109101 outbreak of World War I.

What Will Arise From The Information Revolution?

The parallels betweenrepparttar 109102 Industrial and Information Revolutions are astonishing. Thus far computers,repparttar 109103 Web, and information technology have created nothing dramatically new. They have merely changedrepparttar 109104 ways in which information is gathered, managed and reported. And to some extent,repparttar 109105 way in which consumers purchase goods.

Computers themselves have changedrepparttar 109106 way in which products are manufactured, including their design. And a few new spinoffs have come torepparttar 109107 fore. But there has not been anything revolutionary in any of this. Nothing yet has hadrepparttar 109108 impact of railroads onrepparttar 109109 whole ofrepparttar 109110 social fabric.

If Drucker is correct, ecommerce will have an impact equivalent to that ofrepparttar 109111 railroads earlier. Thus farrepparttar 109112 Web has produced less change inrepparttar 109113 way business is done than ore cars running on steel rails effected mining. In short,repparttar 109114 real drama and excitement is yet to be revealed.

Given easy access torepparttar 109115 Web, you and I have been invited to join in. For myself, I don't want to miss a beat.

A Radical Shift Is Upon Us

There appears to be an awesome and exciting shift emerging inrepparttar 109116 way business is done. There are those who feel that if it's good for business, it's good. Period. I hold a different view: If it's not good for people, it's not good.

Many with a business orientation are likely to abandon my thinking here. Those convinced people are sheep born to be shorn certainly will. But whatever your view, enormous changes inrepparttar 109117 way in which business is done are rushing down upon us. Companies who do not embrace them, will be swept away into history.

What Will Customer Service Come To Mean?

For example, automated telephone systems and elevator music will fade away, as willrepparttar 109118 companies that cling to such barriers. People will not be content much longer, with clutching a phone to their ear, trying to accomplish some other task, while waiting forrepparttar 109119 answer they need right now.

"The customer comes first" will remainrepparttar 109120 driving force behind all successful businesses. Today, such phrases mumbled by all are generally mere tokenism. Tomorrow they will come to have an entirely new meaning.

Contemporary companies provide such services at their convenience. The endless round of voice mail and recordings in which busy people respond only to leave yet another message will come to a screeching halt. Successful companies will provide support when a customer requests it. And they will do so quickly.

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