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Cyber business booms


2008-03-11

Cyber business booms as customers flee surly sales staff and traffic jams

Surly sales staff and heavy traffic are having an unexpected benefit for retailers in cyberspace, as more consumers try online shopping rather than endure the real world experience.

Some online retailers reported a surge in sales in January and last month to 65% higher than a year ago.

For electronics website Digital Planet that was the biggest sales swell since the 1999 internet boom, said MD Neil Watson.

Business is also blooming for online store NetFlorist.

“While most retailers are experiencing negative growth, NetFlorist’s revenue grew 35% year on year for January,” said MD Ryan Bacher.

“Time-poor consumers will increasingly shift to online purchasing as online offerings improve and the cost of doing it yourself is higher than the delivery fee.”

Bacher expects many women to step up online buying habits. Today’s most popular online items are male-oriented gadgets such as satellite navigation systems, Playstations and iPods.

High-speed broadband access is still expensive by global standards, so Watson suspects the popularity of online shopping has little to do increasing access and a lot to do with real-world fatigue.

Fears about credit card security and paying for deliveries are becoming less important than coping with a fast-paced lifestyle.

“Online shopping provides a better alternative to shopping at retail stores as it eliminates the normal frustrations such as traffic, long queues and poorly trained sales staff. This shift in mindset has had a direct impact on our business success.”

Analyst Arthur Goldstuck of researchers WorldWideWorx reckons online retailers in SA raked in R929m last year. That excluded sales of air tickets, with local airlines generating online sales of more than R3bn.

iBurst increased its customers more than a third in the past year, said CEO Thami Mtshali.

Broadband access took the hassle out of shopping as the pages downloaded rapidly. Goldstuck expects broadband users to top 1-million this year, and said faster access was driving growth in online shopping, coupled with the number of people who were fully confident after being online for years.

“More than 3-million people have been online for more than five years, and that dictates how many people do things such as shopping and blogging that require more experience.

“This is the year of critical mass.”

Source: My Broadband
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