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Internet sales remain marginal for many retailers

  • After almost two decades of Internet shopping in which Amazon has become a behemoth, many major bricks and mortar retailers are still struggling to take advantage, as new correspondence with the SEC shows.
  • Target (TGT), for example, told investors last week that its digital sales have grown by double digits, but when pressed by the SEC, said they're an "immaterial amount of total sales."
  • Fifth & Pacific (FNP) has told investors that it's "ravenously growing business in e-commerce," but then said that providing a specific figure wasn't "relevant to investors."
  • The SEC has also queried the claims of Wal-Mart (WMT), which now predicts 2013 online revenue of $10B vs consensus estimates for total sales of $481.52B, and PetSmart (PETM).
  • Retailers argue that because customers use the Internet and stores to make purchases, in the words of Target's Casey Carl, "it doesn't make sense to delineate between whether it's an online or in-store sale."
Comments (4)
  • Randal James
    , contributor
    Comments (2326) | Send Message
     
    Interesting data point as many retailers such as Target and WalMart offer lots of things online that you cannot find in stores. One would almost believe that the geographic advantage alone (no Target for 100 miles) would boost that online percentage.

     

    I wonder if online has been better for retailers who are mainly catalogue dependent, such as Bean or Lands End.
    28 Aug 2013, 08:57 AM Reply Like
  • jtmonrow
    , contributor
    Comments (54) | Send Message
     
    Of course the bricks and mortar guys would say "it doesn't make sense to delineate between whether it's an online or in-store sale." It is now trite to say that internet selling is the future -- it's here. I very, very rarely buy anything in a store; that has been true for half a decade. The exception would be small, speciality shops. I look at Barnes & Noble stores and shopping malls and think of the gigantic burden of those real estate tombs -- whereas Amazon makes digital sales, uses third party sell throughs and strategically placed [for speedy delivery] warehouses. How can bricks and mortar survive?
    28 Aug 2013, 09:04 AM Reply Like
  • Randal James
    , contributor
    Comments (2326) | Send Message
     
    jtm

     

    Last year my GF wanted a Barefoot Contessa book for her daughter and I stopped by the local B & N. They had the book but because it was in the store it was $8 more than it was online. What?!

     

    Well the online price is to better compete with Amazon even though you'd pay freight and you could get it less expensively if you were a B & N club member. I am sure I'll go to B & N again because there are sometime book emergencies. But they can count on me not using their stores for anything else.

     

    I like stores, enjoy shopping (generally). Aside from groceries and hardware, a disproportionate share is online. Oddly enough, stores have not helped themselves. Used to be that a motivated salesforce did provide an interesting experience and might have coaxed a customer into purchasing items related to the initial visit. Now they just wait by the checkout counters, waiting to go off shift.
    [A generalization. Visit Kohl's and tell me it is different than described.]
    28 Aug 2013, 09:20 AM Reply Like
  • Esekla
    , contributor
    Comments (2287) | Send Message
     
    I agree that the two are complimentary. I'll often comparison shop online, but pick up in a store, as I did recently with sandals. There's often no substitute for having the item right there in front of you. That said, retailers could get better about integrating the two. Showing store by store inventory in real-time should be the norm.
    28 Aug 2013, 09:45 AM Reply Like
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