Yes, the dominoes are falling. But will online sales grow to the sky? No, they’ll plateau eventually. E-commerce sales will continue to grow at a double-digit pace for the rest of the decade, reaching 4.3% of total sales by 2010 (Global Insight). But the rate of year-over-year growth will likely decline from 24% last year (Jupiter Research), to 20% this year (Cowen & Co.), to below 10% by 2011. The reason? The industry is maturing; most of the people who are going to spend money online are already logged on and shopping. There are no new fish coming into the pond (or, at least, rates of population and consumer growth are declining). But the influence of the Web on retail sales will continue to grow this year, next year, and every year beyond. That is because use of the Internet for pre-shopping, comparison shopping, browsing and choosing a store destination is growing more important, not less, even (or especially) if the purchase is not completed online. Therefore, even though online sales will eventually plateau, retailers… Read more »

I am still undecided about where I see the e-footwear industry going. On the one hand, consumers are getting used to trusting the online world for a good chunk of its products and services. On the other hand, I just don’t see myself buying shoes with “kicking the tires” a bit. Even with the promise of free returns, seems like more of a hassle than anything else.

Unless a consumer is absolutely, 100% sure of their foot size, I just don’t see the viability of the model as a whole.

Zappos and other online shoe retailers can afford free freight, excellent customer service, and the high cost of acquiring new customers because their margins are decent. Shoe manufacturers don’t like to sell to deep discounters. They protect their full-line retailers. If shoe retail margins were as low as electronics or appliances or toys, none of the online shoe retailers could ever make any money.

My points on this one are speculative as I have no answers to evidence but British people have been accustomed to catalogue shopping for a very long time and often don’t mind the need to occasionally return merchandise that isn’t quite right. What I don’t know, and would be interested in finding out, is whether the same people who have been shopping by catalogue are now shopping online. My hunch is that they are not, that we are talking about a different batch of people, economically and technologically. There will always be some people who will buy whatever they can online and not mind having to occasionally return but shoes are a category that I still do not envision having a huge market. Apart from anything else, the post office over here is closing outlets left, right and centre, making returns much more tedious and time consuming.

With this unprecedented growth in shoe sales online, we should understand the brands’ products being sold by their manufacturers and the private sale of shoes through a number of other avenues. Given this, it is noted that such corporations like Nike have their own web sites as do their competitors. And we find the upscale shoes–Johnston-Murphy, Cole Haan and their competitors also have web sites.

Interestingly, in the past, web sites were used to see what is new and the product benefit(s) comparison vs. competition; followed by price.

So one then asks, do these shoe sales include sales from the department stores and other type outlets? One might speculate, these sales are more privately sold e.g.: eBay; and through factory outlets. Maybe even the less expensive shoes–like sneakers–through discounters!

Details of these shoe sales would be pertinent! Hmmmmmmmmmm

Perhaps the biggest consumer “win” is the access to extended sizes. (One of the other commentators mentioned the traditional “size runs” used by many shoe manufacturers shipping to bricks-and-mortar retailers, which leave many customers disappointed.) There is a well-documented trend toward larger sizes in women’s shoes especially among the generation of shoppers most comfortable with online shopping. As long as the online shoe retailers master the challenges of no-hassle return–which should not be rocket science today–there is a lot of upside here.

I see several lessons here: 1. No one can predict the future, not even industry analysts and experts. “Online shoe sales will never work.” “Apple Computer is dead.” “The PDA will be the next telephone.” Etc. But oh, how we love to try to predict the future! Maybe trying to makes us look like we can? 2. Many shoes are no longer made/sized with the specificity they once were. Some dress shoes still are true to “9 and a half B,” but casual shoes said to be a “9” are sometimes up to a full size off in either direction; also, they may be simply “wide,” which could be a C, D, or even E. Personally, I can fit in shoes with a number of different sizes, and with an insert here or there, get a great fit. 3. Even if we are industry experts, consumers in that industry may not feel the way we do. We may hate or love online shoe sales, or any other thing, but that doesn’t mean we speak for… Read more »

I admit to having used Zappo’s and also admit that on one pair of shoes, I “guessed” wrong on my size for the style that I ordered. But, what a painless experience it was to return and reorder and the entire experience just reinforced my desire to stay as a customer. I guess I could have gone to brick and mortar, waited for a sales person, or hunted for my size, which for some reason always seems hard to find, then waited on line at the checkout.

Zappo’s, for example, just made me feel that they were there to solve my problem and offer solutions for my shoe of choice; good businesses always seem to grow.

The success of online shoe retailing is one of the many delights of the quickly changing state of direct marketing. It says more about the failures of the conventional shoe retailers than anything else. How many times have you selected a style at a local shoe store, only to find it out of stock in your size? The sales clerk dutifully comes out of the back room with three other boxes for you to try. But they are not what you want. How many times have you go to replace your favorite pair of moccasins, loafers, or running shoes, only to find that that your model has been discontinued? Again, three suitable substitutes are presented. But they are not your favorites. Shoe retailing has been stocking its stores with size run pre-packs for decades. The size runs are based on rates of sale, not considering all the folks that walked out of the store because they were out of stock. Over time, it is a recipe for business failure. Into this big void steps Zappo’s… Read more »

The shoe industry is yet one more example of a business where the meaning of service and convenience has been entirely redefined by the internet. Historically, service in the footwear industry meant good selection, friendly and efficient staff, the ability to walk in the shoes before purchase, enough speed that the kids don’t break anything in the store, and the chance to return the shoes as long as they weren’t worn outside. Zappo’s changed that game. Convenience online now means ordering 20 pairs of brown shoes without guilt, the chance to try them on with the desired outfits in the privacy of our own closets, knowing exactly what is in stock, shopping 24/7, and returning what doesn’t work without returns charges or that sneer from a sales person who’s trying to keep the sale. Many other industries are seeing the same surprise redefinition of service. Who would have predicted that online pharmacy would be not only cheaper than bricks & mortar but easier, faster and driving greater patience compliance and elevated standards of care? Or… Read more »

Online retailing is here to stay in footwear, just as it is in most other product categories. Zappo’s, in particular, has done a great job of emphasizing service and they do a great job managing the experience. What I struggle with in shopping online–and in catalogs for that matter–is what to do when you are considering a new brand you have not worn before. Fit is what all footwear manufacturers struggle with more than anything else, and it is very inconsistent across brands. Despite the free shipping and easy returns, it still seems inconvenient to deal with the hassle. Not sure how the broad audience of shoppers feel about this, but I know fit is important, so that makes me lean toward this channel growing more slowly over time.

Online shoes sales will grow as much as the traditional shoe retailer allows it to grow. Shoe buying, especially for females, is still viewed as a shopping experience that is enjoyed by women. The challenge is for the retailer to provide their customers with the shopping experience that is impossible to get online. Retail stores, as much as they try, will never be able to provide the consumer with availability of sizes the internet can, which means they have to make the shopping experience their point of difference.