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To: Victor Lazlo who wrote (107242)	8/17/2000 11:41:31 PM
From: re3	Read Replies (2) \| Respond to of 164684

August 12, 2000 Getityourself.com and other dark tales of e-commerce Peter Foster National Post Last month, real estate company Oxford Properties unveiled an allegedly "futuristic" retail concept. "Canadian consumers," said the corporate release, "will be the first to have access to real people and real places as part of their Internet shopping experience." But wasn't the point of Internet shopping that you didn't have to deal with real people or go to real places? Oxford's scheme, dubbed Empori.com, might also have been called Getityourself.com. Its "innovation" was that you would shop online with a number of Internet retailers such as Chapters and HMV, but then have to go to a central depot to pick up the goods. Grocery orders wouldn't be available until the next day, and most of the e-tailers would still add a delivery charge! This was progress? This strange hybrid points to the main stumbling block in the overhyped world of Internet retailing: how to get the goods to the customer. E-tailing has so far proved to be an exercise in frustration for many e-purchasers, and a licence to lose money for practitioners. Is it any wonder, therefore, that it has failed to take off in any significant way? Statistics Canada reported this week that Internet sales accounted for just 0.2% of Canadian retail sales in 1999. Strangely, the report was greeted with wailing and gnashing of teeth, mostly about how we were "falling behind" the United States, where electronic sales accounted for a massive -- wait for it -- 0.6% of the retail total in the final quarter of last year. The Post's report carried a warning that Canadian retailers had to get online "before it was too late." But too late for what: to climb on a bandwagon going over a cliff? The Post quoted James McQuivey, of Forrester Research, as pointing out that "U.S. category giants such as online bookseller Amazon.com could very easily scoop up the Canadian electronic retail market if Canadian companies sit on the fence too long." The assumption here, of course, is that there is a profitable electronic retail market to be scooped. But surely the experience of Amazon.com should keep retailers clinging to that fence as long as possible. Amazon.com wanted not so long ago to become the Internet's answer to Wal-Mart. More recently, it has been trying to avoid becoming its version of Eatons. The Post yesterday carried a picture of its glassy-eyed CEO, Jeff Bezos, kissing a teddy bear. The bear was being held by John Eyler, CEO of Toys R Us. The occasion was the announcement of a co-branded site that would merge the companies' toy and video game sales. What was Mr. Bezos thinking? Perhaps: "Oh please, bear. Bail me out!" The fundamental problem with Internet retailing is that it has been peddled as a radical new departure when it is in fact merely a version of catalogue shopping. Catalogue shopping was attractive to people who lived in remote places, or who didn't have access to certain types of goods. (It also offered trappers the prospect of seeing women in underwear, which, come to think about it, it still does.) But most people want to touch, feel, flip through or try on prospective purchases before they hand over the money. Automobiles, malls and Playboy helped provide this kind of easy access. In doing so, they also helped sound the death knell for the department store catalogue. The Internet-as-giant-catalogue may appeal to those too harassed, lazy or agoraphobic to shop for themselves, but it doesn't relieve the retailer of the need for inventories or shipping (although it may enable you to discover online that your package is stuck in Memphis). Amazon's relationship with Toys R Us represents, at least theoretically, a partnership that plays to each company's strength. Amazon will deal with site development, shipping and customer service, while Toys R Us will deal with inventory. Toys R Us aroused huge customer resentment last Christmas when it found it didn't have the capacity to fill orders. Bizarrely, the company was fined by the U.S. Federal Trade Commission for its delivery problems. Unfortunately, the same anti-business mentality was on display north of the border this week when Bob Runciman, Ontario's Minister of Consumer and Commercial Relations, declared that he planned to beef up "consumer protection" on e-commerce. One key provision would be the right to cancel a contract if goods are not received within 30 days. This seems only reasonable, but really shouldn't be necessary. Any electronic retailer who makes a habit of taking more than 30 days to deliver goods isn't going to be in business for too long. Moreover, how could the law be enforced against overseas e-tailers? Internet retailing undoubtedly has a future, but perhaps not quite as expansive as once imagined. Far from rushing willy nilly into the fray in the fear of being "left behind," Canadian retailers would do well to learn from the mistakes that are still unfolding south of the border.