Byline: Dick Silverman

NEW YORK — The chorus keeps getting louder.
Growing numbers of research studies are hammering home the point that as consumers eagerly accept the speed, wide selection and ease of buying online, e-tailing will redefine the retail landscape.
Brick-and-mortar retailers that do not adapt may soon start crumbling under the weight of mounting e-business, the reports continuously warn.
The studies, by groups such as merchant banking firm Thomas Weisel Partners, research firm Pricewater-houseCoopers, Internet researcher Greenfield Online, The Boston Consulting Group working with online analyst Shop.org, and Internet analyst Jupiter Communications, all concur profound change is imminent.
And apparently retailers are getting the message, as more and more find their way onto the Internet.
Moreover, as the Thomas Weisel study observed, the apparel market is particularly suited for web sales, since it has extensive product selection, relatively low shipping costs and large potential market size.
Revenue estimates for online sales in coming years vary widely, with researchers throwing out mind-boggling projections. Here are some key points made in these studies, all figures pertaining to the U.S. market unless otherwise noted:
Online buyers are increasing their spending dramatically: E-commerce revenue per buyer in 1995 was just $99, according to Thomas Weisel. This year it should increase to $1,615. By 2000, it should elevate to $2,240.
Internet retailing is cutting into store traffic, according to Greenfield Online, which found 39 percent of people surveyed with access to the Internet said they go to stores and malls less now that they can shop via the web. “These results are significant to retailers, since Americans who use the Internet hold 60 percent of the buying power of the total U.S. population,” said Rudy Nadilo, ceo of Greenfield Online.
Internet users are attractive marketing targets, with incomes averaging $55,000 and 30 percent being college graduates, according to PricewaterhouseCoopers’ principal Thomas Rubel. North Americans add up to 51 million users, or 67 percent of the global Internet market; Western Europeans represent 14 million users, or 18 percent, and Asia accounts for 8 million or 11 percent. Other areas make up three million or 4 percent. European online retailing, which is just beginning, could reach $13 billion by 2003, he projected.
Female shoppers are becoming the fastest growing market on the web, signaling potential hikes in online apparel sales. In 1996, 58 percent of web users were men and 42 percent were women, according to Thomas Weisel. By 1998, men dipped to 52 percent and women had risen to 48 percent. Internet analyst Jupiter Communications contends 34 million women will log on the web for the first time in the next 1 1/2 years, making female shoppers an even more significant force.
Online shoppers will grow to 80 million by 2003 with online spending rising to $35 billion, predicts Thomas Weisel. It expects online retail sales to eventually reach $500 billion.
A study by Shop.org and the Boston Consulting Group is considerably more optimistic, forecasting that 1999 online sales will top $36 billion, up more than 140 percent over 1998. It further noted that the number of online orders soared 200 percent in 1998.
More baby boomers are surfing the web, and their sizable disposable income carries major potential. According to Thomas Weisel, in 1996, 48 percent of those surfing the web were 18-34 and 52 percent were 35 and older. By 1998, 42 percent were 18-34 and 58 percent were 35 and older.
The global market for web purchases soon will explode, as European and Asian Internet use rises. European online households are expected to almost quadruple between 1998 and 2002, rising from 10.2 million to 37.5 million, according to Jupiter Communications. Asia and Pacific Rim homes with online access will nearly triple, rising from 6.8 million in 1998 to 16.4 million in 2002.
While some traditional retailers still are hesitant to move online, insiders warn it may be now or never.
“We believe the economic consequences of ignoring this opportunity will be devastating,” declared a report by Thomas Weisel.
“The risk of not being there is greater than the risk of being there and not doing it right,” stressed Nancy Stahl, vice president of business development, Sony Online, speaking at a recent Internet seminar. “The web gives a one-on-one relationship with consumers unlike any other media ever presented. People will always shop in stores, but web sites can enhance the process.”
According to PricewaterhouseCoopers’ Rubel, the top 10 online retailers generated revenues of over $3 billion in 1998 (see accompanying list). And in one of the most optimistic projections, Rubel forecast that online retailing could rocket to $108 billion, or 6 percent of all retail sales, by 2003.
“This is a forecast that spells the doom of a lot of retailers,” he said.
Further underscoring the potential impact of the Internet, researches point out that e-tailers can service time-restricted consumers 24 hours a day, seven days a week. “The Internet changes everything,” Thomas Weisel maintained, and as consumers grow more comfortable shopping online, e-tailing will expand significantly.
Few e-commerce companies have fully exploited “the power of dot-com,” according to Weisel. One of the web’s greatest strengths is it offers alternatives for consumers frustrated with traditional retail experiences. By supplying good pricing, selection and in-depth product information “anytime, anywhere,” e-tailers will carve revenue by grabbing major market share.
Nevertheless, in this race to the Internet, Weisel pointed out, retailers selling both online and through traditional methods have an advantage since they are experienced with order fulfillment — “the nuts and bolts of serving the customer” — a new concept to online-only retailers.
“The harsh reality for online retailers is that if they are unable to get it right, customers will move elsewhere.”
Yet not everyone agrees that in-store merchants have a systems edge when they go online. Says the Shop.org study, “The operations for online and in-store are so different that the two cannot economically be accommodated by the same systems and processes.”
However, several researchers concurred that catalog retailers that sell online, like J. Crew, L.L. Bean and Lands’ End, have done well in fulfillment due to their familiarity with delivery systems.

The Top Online Retailers

NEW YORK — According to PricewaterhouseCoopers, the top 10 online retailers in 1998 in descending order, were :
Dell, computers and computer hardware.
Amazon.com, books.
Onsale, electronics, travel and sports.
Micro Warehouse Inc., electronics.
Egghead.com, consumer electronics.
Buy.com, books, video and electronics.
NECX, electronics and video retailer.
Cyberian Outpost, electronics and software retailer
Barnes & Noble, books.
Lands’ End, apparel.