When the little men in the big office buildings downtown first started talking about E-Commerce, this was the kind of enterprise they fantasized about.
End User sits at computer. Smiles. Points mouse. Click. Orders. Spends more money. Click.
Webvan delivers groceries and other common items you'd find at your local supermarket to consumer homes in several major American cities, including the San Francisco Bay Area. A nationwide system of distribution centers is planned, making this web based retailer a legitimate threat to go the distance. Skeptics argue web-based grocery stores have very little chance of ever matching regional chains for convenience or usability.
Why would somebody ever order something online when they can run down to the local Vons and pick up the same item on the spur of the moment?
The answers may have to do with two constants in e-commerce, inventory and selection. If webvan can provide consumers with selections that outclass what they'll find at the local market and can improve delivery times, the sky is probably the limit.
For the time being, however both webvan's inventory and the areas the company delivers to are quite limited. It's hard to imagine that anyone living in a urban area couldn't find the merchandise the company stocks at a fraction of the effort required to log onto the company's site.
A whisper for Webvan CEO -
In it's first year of operation Buy.com sold enough merchandise to make Jeff Bezos mildly jealous, nearly $115 million dollars worth, according to published reports.
This Alieso Viiejo, California-based company employs a controversial business model which critics claim is unlikely to ever make Buy.com profitable. Unlike other web-based retailers who offer surfers modest discounts on retail goods, Buy.com slashes prices dramatically, selling products at or below cost. The company relies on increased advertising revenues to generate income.
For example, a Compaq Presario 5726 with 19 GB of memory, 6xDVD player, internal Zip drive and 56.6k modem which sells for $1,699 at Egghead.com, is sold at Buy.com for $1,396 plus shipping.
However, sudden success has had its price. The realities of running a popular e-business have stung Buy.com more than once. Earlier this year the company made the news when a programming glitch caused some shoppers who used credit cards to pay for small purchases to be overcharged.
In November, an Orange Country, California attorney filed a multi-million dollar class action suit against Buy.com for failure to deliver merchandise it had promised customers.
The company had already billed customers for the 19" Hitatchi monitors before it realized a clerical error had resulted in the items being listed for almost $400 less than the correct price.
With all of the competition on the net for your shopping dollars this holiday season, it can be difficult sorting out all of the contenders.
An option you may want to consider in the season of giving - using a shopping service that donates some of the profits from online sales to good causes.
That's exactly what iGive.com is counting on. This web site has brokered deals with hundreds of shopping site and charities, making it easy for you to give money to causes you care about.
The process is simple. You visit the web site and choose the online store where you'd like to shop. Then select the charity you'd like to give to. Choices run the gamut - from the conservative Accuracy in Media, the Washington-based media watchdog - to the invisible - as in the 24 Carat Ferret Rescue and Shelter of Las Vegas, Nevada.
The exact amount that goes to the charity varies, depending the arrangement iGive works out with the cause. Typically the donation will be between 8 and 15% of the price of your purchase, less an unspecified administrative fee.
Donors concerned about where their money is going will appreciate one feature. iGive publicly posts a complete listing of all the checks it mails out, a level of accountability that other non-profits would do well to take not
This is the same sort of thinking that's made shoppers clubs like Sam's Club and Costco successful.
The idea is simple. Use the web to band consumers together into powerful buying groups. Then go to online sellers and ask for volume discounts. The higher the number of buyers, the lower the price. It's hard to argue with the logistics of the plan.
This is a strategy which can benefit both consumers and sellers. Consumers get the advantage of lower prices and sellers get volume sales. The idea is perfect for the web. Look for similar strategies to make a real impact on the Net economy in coming years.
Wouldn't it be nice if somebody was considerate enough to start universalhealthcare.com?
This being the United States of America, we may have to wait awhile. For the time being Drugstore.com is a step in the right direction. The site's deal with Rite-Aid lets customers enter prescriptions online and pick up orders at a local store. It's unclear what sort of stance government will take toward regulating the online pharmacy biz.
Strict regulations on the state level could hamper sites like Drugstore, at least temporarily.
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