NEW YORK -- As electronic retailing continues to grow at a steady rate, supermarket retailers need to forge an on-line selling presence to gain a competitive edge over other retailers already creating on-line sales volume.
The selling power demonstrated by on-line retailers featuring grocery, apparel, gift and electronics on their Web sites could eclipse direct catalog sales, according to retailing experts.
"On-line retailing is finally here, and we believe it will quickly overtake the mail-order retailing business," said Jeffrey Tauber, chairman and chief executive officer for on-line retailer CyberShop International, Jersey City, N.J.
Traditional supermarkets are discovering the benefits of conducting business with consumers on-line, including the opportunities of direct marketing, timely promotions and the ease of changing product selection. Furthermore, as retailers face competition from a growing number of third-party companies, supermarkets are using the power of their brand to retain customer loyalty and additional sales through the electronic medium.
CyberShop's Tauber, Nicole Vanderbilt, group director of digital commerce for Jupiter Communications here, and Brian Sugar, director of new media for J. Crew here, presented a session on Internet retailing at the annual National Retail Federation Convention, held here Jan. 17 through 20. The Washington-based NRF sponsored the conference.
One aspect that is prompting consumers to turn to on-line retail venues is the wide variety of products available, according to Tauber. "Consumers also seem to like that we can freshen up our products almost on a daily basis, as opposed to the mail order business that has to print and circulate catalogs. New products are not seen until a few months later," he said.
Convenience and product selection seem to be equating to sales volume for the electronic medium, according to statistics presented by Jupiter's Vanderbilt.
"Based on a survey we conducted, consumers spent $3.1 billion on-line during the November and December 1998 holiday season," she said, noting that this figure included dollars spent on travel. Jupiter's results are based on surveying 2,300 on-line users in the United States. Jupiter is a market research firm that analyzes how the Internet is changing traditional consumer industries.
J. Crew agreed there are benefits to having an on-line presence. "We use targeted follow-ups after customers purchase an item on-line," said Sugar. "We immediately e-mail a confirmation of the order, and give them an [additional] exclusive offer."
The retailer does not agree that a web presence will overshadow its catalog sales, according to Sugar. "We want to be able to offer both services to our customers, and allow them to shop the way they are comfortable."