Not an industry - but a medium (The Future of the .com Industry)

Member Name: MichaelR

Product:	The Future of the .com Industry
Date:	08/04/01 (11 review reads)
Rating:

Advantages: Convenience, savings

Disadvantages: Financial incompetence. Poor products

It always amuses me to hear talk of the dot com 'industry'.

What everyone seems to have failed to realise is that there is no such thing. E-commerce (which is what is often meant by 'The dot com industry') is just another way of doing business, and is most successful when combined with existing business operations and brand names.

There is car-making industry, there is farming industry etc, there is NOT a dot com 'industry' and this is a part of the reason why so many on-line traders are going to the wall.

When a lot of these companies started up, they seemed to be more in the business of selling the Internet than selling a product or service. Of course this is extremely poor business practice. You should attempt to market and sell your product rather than your medium. A great many people invested money in the 'dot com revolution' because the e-commerce pioneers managed to convince investors that they were in the Internet business when they were actually in the business of selling clothes, or cars, or jam, or fluffy slippers or whatever. It seems to have been the case that one only had to say the word "Internet" in order to be presented with a blank cheque, as the average investor was totally ignorant of what this word meant...

Of course now it is all starting to fall apart, as the backers of dot com traders realise that e-commerce businesses are just the same as any other business - or at least they should be.

I say they should be, because the directors of most of these dot com businesses have exhibited extraordinary levels of financial incompetence and poor business sense (or perhaps it was just naivety). Let me clarify what I mean:

Joe Average sets up fluffyslippers.com he doesn't consider these major points:

- How many people want to buy fluffy slippers?
- How many potential purchasers of fluffy slippers own computers?
- Will people be willing to
buy fluffy slippers over the internet?
- How much will it cost to set up fluffyslippers.com and what happens if no fluffy slippers are sold?

and many more factors. No, because it is on the Internet, it will automatically be a huge success, right?

So Joe goes to John Moneybags, who finances the business, expecting huge returns from this exciting new company. Of course after a month, no one has bought any fluffy slippers and the company is in trouble. What to do? hmmm, obvious isn't it? blow £1 MILLION on advertising! Mr. Moneybags finances this, because it's on the Internet, therefore it is good!

And this continues of course until Mr Moneybags runs out of money, as is beginning to happen now.

The fact is, that there are only certain things you can sell on the Internet.

Rubbish is still rubbish no matter how you try to sell it, and no one wants to buy a useless product or service.

You can also not sell things like clothes over the net, as people obviously want to try them on before buying... the things best suited to sale on the Internet are books, CD's etc - things that one would walk into a shop and pick up off of the shelf.

I personally believe that the future of e-commerce is closer integration between dot com's and shops - as is already beginning to happen. It would be a good idea, I think, if high street stores could be used more like 'showrooms' where people could come and try out products that could then be purchased on-line at their convenience.

E-commerce undoubtedly has a future, for several reasons.

Firstly, because the Internet is not the future, it is the now (you're reading this aren't you?)

Secondly, because it allows one to perform tasks at anytime of the day or night. I could take a quick trip over to Tesco.com and buy some groceries now if I chose to do so (and it is presently 1:55AM) I am also going to visit NatWest.com t
onight to pay my credit card bill - even though my bank is shut. The Internet never closes, and this makes it an attractive medium to many shoppers.

Thirdly, because there are obvious savings to be gained from operating a business on-line. These can be passed on to consumers, who of course love a bargain.

In order to succeed, e-commerce needs to evolve and be managed in a more business-like manner. It needs to become more mainstream, and remember that it should appeal to shoppers - not techies, and it needs to realise that it has to actually have decent products to sell!

Signs are that this is happening though. If only on-line trading stocks can be separated from technology stocks (they are NOT the same thing! technology companies to me are people like AOL, BT, etc) then the future will look much brighter...

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