March 24, 1997
The Secret to Electronic Commerce is no further away than the bank
By Bob O'Donnell
Have you bought anything online yet? If you're like most people, the answer is no,
although you may have researched products that you ended up buying through more
traditional methods, such as in a retail store or over the phone. That's the conclusion of
a recent survey conducted by CommerceNet and Nielsen (the TV ratings people).
The groups surveyed the general U.S. population and found that although the number of
people who had searched the World Wide Web for information about products had jumped from
19 percent to 39 percent over the last 18 months, only 15 percent of the individuals
surveyed actually bought anything online. I'm sure the numbers would be much higher among
the technically sophisticated InfoWorld Electric readership, but I'm also sure
they're nowhere near as high as they can and should be.
The reasons for these relatively low numbers are fairly well known: security fears,
inconvenience, and poor commerce tool implementations. If you're in charge of creating or
overseeing a Web commerce site for your organization, these are probably the issues that
keep you up at night.
The sad truth is, most Web commerce sites are unpleasant to use and, despite advances
in security standards, don't instill a lot of confidence in the safety of the transaction.
Even worse, most are cumbersome -- it is far simpler to pick up the phone and dial an 800
number. And that's a big problem. Why should I bother browsing through poorly designed
catalogs, fill out long online forms, and then miss out on the satisfaction of talking
with a real person who can confirm my order and its ship date? Online commerce, whether
it's business-to-consumer or business-to-business, needs to be fast, fun, and easy. In
many cases, though, its frustrating, fear-filled and exasperating.
Of course, there are certainly some important success stories for Web commerce. Dell Computer does more than $1 million of business a day
(See details of Dell's online business in Mark Tebbe's Between the Lines column). In Dell's
case, it's easy to see why: The site let you easily create custom-configured computer
systems and automatically calculates prices for you. It's not fancy, but it works well.
And even more importantly, it's a process that works much better online than talking to a
person on the phone. Even with Dell's success, though, many people do their research
online, but still call the 800 number to actually place an order.
And that gets to the crux of the problem. Online commerce was supposed to make the
sales process more efficient and therefore reduce the costs of selling. So, my question
is, why aren't these savings passed on to me, the buyer? If a company can save money by
reducing the number of telephone operators it employs, for example, shouldn't I enjoy at
least some of those savings as well?
If companies really want online commerce to succeed they need to make it appealing to
the most important aspect of any transaction: my wallet. Make an online purchase 3 percent
to 5 percent cheaper than the same purchase made over the phone, and the concerns that
most people have about buying online will quickly disappear.
There's no question that online commerce will become a way of life for businesses and
consumers over the next few years, but there are still lots of questions about how quickly
it will actually achieve that goal. Priming the pump with online savings, in my opinion,
is the secret to making electronic commerce an "overnight" success.
©
Copyright 1997, by InfoWorld Publishing Corp., a
subsidiary of IDG Communications, Inc. Reprinted from InfoWorld,
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