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The Best of Online Shopping:
The Prices' Guide to Fast and Easy Shopping on the Web

The Best of Online Shopping

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Excerpt: Attention, Online Shoppers!

Web stores are transforming the way we shop. Online sales seem poised to bring about as big a transformation to the retail business as mail-order catalogs and department stores did; because of the rapid growth of Web sales. A Harvard historian, Nancy Koehn, expects that Web stores will outsell mail-order catalogs within three years.

Why do people shop the web?

Recent surveys show we’re all getting cozy with the concept because:

• You can shop after-hours. A lot of people do. The latest figures from America Online, for instance, reveal that 40% of electronic shopping takes place between 10 pm and 10 am, when most physical stores are closed. You don’t have to venture out of your cocoon to buy.

• You save time. You can browse a half dozen virtual stores in less time than it takes to park at a busy mall on a weekend.

• You save headaches and foot pain. No sweat. You can shop in your pajamas, and you don’t have to carry any packages down the miles of mall corridors, and across the hundred-acre parking lot. Services like FedEx and UPS bring your goodies to your door, within a day or two.

• Your neighbors are doing it, too. 48 million of us use the Web regularly now; according to New CommerceNet/Nielsen Media Research, which claims that repeat Web shoppers have reached a critical mass, at which they begin to influence each other, around the country.

• Even grandparents are getting into the habit, when shopping for their grandchildren (10% of grandparents who browse for toys and kids’ software make a purchase—a phenomenal percentage for a group normally thought to be averse to computers).

• Books, flowers, clothing, beverages, travel, and autos are the categories pulling people beyond the original focus, which was computer equipment and software. The mix of shopping is beginning to approximate the discretionary spending patterns of the population as a whole.

• You also save money, because you can shop around and settle on the best deal without getting waylaid by sales people or crowds. 45% of Web shoppers said they were saving money by going online, according to a survey by Ernst & Young for the National Retail Federation. How is this possible? Because electronic stores do not need to pay rent for showrooms, hire sales clerks, or, in some cases, run a warehouse, they can keep their costs 20 to 45 percent lower than a physical store, while increasing revenue by 10 to 20 percent, according to Andersen Consulting.

• You get what you want, because in many stores, all sizes are available, and more products appear online than on the shelves of an average department store. For combination products like computer hardware, you can put together your own configuration, rather than having to accept the version on the store shelf.

The trend is up!

People are pouring into the online stores. 81% of Web users plan to shop online during 1999, and, given the amounts they intend to spend, Intelliquest estimates that annual revenues will triple for these stores. By 2003, consumers may be spending $108 billion shopping online, while businesses will be shelling out $1.3 trillion, according to estimates by Forrester Research.

Certainly a booming U.S. economy has accelerated this trend, as have secure online transaction safeguards, and endless publicity. But the biggest change is that consumers are starting to feel safe about shopping online, and are coming to regard it as a convenience, like salad bars and delis in supermarkets, or 24-hour ATMs.

More people are shopping online

Here are some details on the growth of online shopping.

• Online shopping in 1998 more than doubled from a year before, according to Jupiter Communications, Boston Consulting Group, and Forrester Research.

• More than half of online shoppers are women, according to Media Matrix.

• 77% of buyers go online with a specific purchase in mind, and 79% visit several different shops before making a purchase, according to Cyber Dialogue.

• Revenues just for holiday shopping in 1998 soared to $3.14 billion, according to Jupiter.

Fortune calculates that the online stores’ revenues rose during 1998 by huge percentages:

• 150% in clothing

• 210% in household goods

• 230% in computer hardware and software

• 250% in travel

• 290% in books and music

• 310% in toys

• 340% in gifts.

Stunning increases like those brought the total of consumer sales online in 1998 to more than $13 billion, by conservative estimates (from the Boston Consulting Group). To put that figure in perspective, though, it represents about 1% of total retail sales in the U.S., although, in certain periods, the percentage spiked to 4% (in the spring), and 10% (right after Thanksgiving), according to Marketing Corporation of America.

In addition to purchasing online, people are doing research on the Web, then going to a physical store to buy. Automakers estimate that in the first half of 1998, they sold $10 billion in cars to consumers who chose a dealer on the Web.

But people still have some trouble shopping online

Unhappiness has grown. In mid-1998, only about 12 percent of shoppers said they felt dissatisfied. But during the 1998 holiday season, that figure rose to 26% of all online shoppers, according to a survey by Jupiter and NFO Interactive. Asked why, Nicole Vanderbilt, an analyst at Jupiter, said, "They quantified what we suspected, which is that with the unbelievable and, in many ways, unexpected growth in the amount of business online, quality suffered as a result of quantity." Echoing that opinion, a survey of 33,000 online shoppers by BizRate showed that the most unhappy customers were those who ordered between December 4th and December 22nd, because they experienced delays in delivery from stores that had not anticipated the sudden volume of traffic.

There are a lot of stores out there, but only a few are well run. The majority are inconvenient for most consumers , because the owners have not put enough effort into informing visitors, helping them around, and making shopping easy. An Internet market analyst, Shelley Taylor, recently surveyed 50 online stores in a cross-section of industries, and came away convinced that many stores make it hard to find products, hard to move from one department to another, hard to find out how to order. About a third of her sample told the consumer almost nothing about the products. Her report, at http://www.infofarm.com confirms our own analysis of almost 8,000 sites, most of which we rejected as sub-par, or downright annoying. (Our book picks out the best stores, so you can skip the mediocre and crummy sites.)

The biggest hassle for consumers is threading their way through the giant search mechanisms, which yield so many hits that the average person gives up after trying only the first ten or twenty. We remedy this situation by culling out the businesses that we think you will really want to visit. Using our book, we contend, will help you get over the Alta Vista blues, avoiding 9,999 dud hits, and zipping to the right address right away.

But once you reach an average, or worse-than-average online store, you still face a lot of challenges:

• The store may not offer a search mechanism to its products.

• There may be no information, or almost none, about how to order, what shipping rates might be, or what the return and privacy policies are.

• There may be skimpy or no information about the products.

• The screen may be hard to read, the pictures are blurry and small, or the pages take forever to load.

• You can’t easily order.

• You can’t order at all, because the site turns out to be a catalog or brochure, but not a Web store. (Just come on down to our store at the mall in downtown Norfolk.)

• You can order, but the store does not offer secure online ordering.

• You can’t tell what the shipping charges are going to be until you have filled out a long order form.

• You don’t get a confirmation of your order.

• There is no easy way to contact the store for customer support or order tracking.

The other leading constraint on online shopping is nervousness about using a credit card online. Only 52% of the current shoppers felt completely confident about that, according to a recent Ernst & Young study. We devote some of our Answers to Frequently Asked Questions to security, to show where the problems could lie, to highlight efforts that online merchants have made to secure transactions and to point out that statistically, shopping in a local small business puts you at far greater risk than shopping on the Web.

Our book guides you to the best Web stores

No more duds. No more brochures pretending to be stores. No more sleazo discounters. We have gone to more than 8,000 sites, and rejected most of them. We have picked the best stores, using a tough set of criteria. We favor a store if it offers most of these services:

• The store offers a secure area for ordering, to protect your personal and credit information.

• The store guarantees that it will not pass along your personal information to any other company. Period.

• The site offers a fast and accurate search system.

• The site lets you find products by looking through categories, without having to plunge down, down, down through a lot of levels.

• The store actually sells the items it says it does, and they’re easy to locate on the site.

• The product descriptions are rich, with components such as good photos (small and large), lists of features and benefits, pricing, shipping information, manufacturer’s name and warranty, samples, suggestions for add-on products, reviews by critics and customers.

• Prices are easy to determine.

• Prices are low to mid-range, and if the store does not offer serious discounts, there is a reasonable explanation, or compensating value on the site (extra information, super service, free shipping).

• The store offers extensive instruction on how to order, how to pick shipping, how to return products.

• The store posts its customer service phone number and email prominently, so you know how to get in touch with them.

• The ordering system is easy to find and use.

• Shipping choices are visible early on, on the product description or in the shopping cart before you order.

• Orders are immediately confirmed with a detailed page or email, or both.

• You can opt out of receiving email announcing their sales.

• Return policies are clear and reasonable.

• The layout looks good.

• Navigation is easy.

Of course, not every site in our book manages to do all these things well, but to qualify for our book, a site has to be outstanding in many of these areas.

So, welcome to our book! We hope we can help you find great products online, explore some fascinating sites, discover amazing bargains, and get what you want, fast. Oh, and one other thing: With these stores, we think you’re going to have a heck of a lot of fun!

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