A Financial Times piece about e-commerce in the U.K. points out that, back in the dot-com boom, there were evangelists predicting that online purchases would represent 25 percent of all retail sales by now. Similar predictions were made on this side of the pond. In reality, e-tail has yet to reach 10 percent of total retail in either the U.K. or the U.S. and the rate of growth slowed as the recession took hold.
Another belief from the dot-com daze was that many pure play e-tailers would emerge as major forces displacing some large brick and mortar operations. In reality, Amazon.com and a few others have hit it big as online only merchants while the major conventional chains have become forces in e-commerce.
Maureen Hinton,
lead analyst at the retail consultancy Verdict, told the Financial Times, "The
trust that you have in brands still needs that physical engagement to begin
with and so [online retail] is more of a complementary channel than a supplementary
channel."
Discussion Questions: How much of the overall retail business will online eventually become? Are there opportunities for more pure-play Amazon.com-like success stories to emerge? What will it take to make that happen?