E-shops short on bargains

By CHRIS BARTON

Last week I asked local e-tailers to prove me wrong and tell me some numbers that would show Kiwi web shops are alive and kicking.

One of the first responses was from a local porn site claiming 40,000 visitors a month, which sounded pretty good.

I won't name the site because this is a family newspaper, but I can say it was a dotcom and had the word "sensible" as part of the address.

In the interests of research I took a look. It was a quirky mix of weird news and well ... porn. The site is open to all-comers but asks for registration, which includes giving an e-mail address. I guess this means you'll be peppered with all manner of invitations. Just the sort of thing good e-tail sites do.

Access to the archives is by account log-on only, and after a certain time users are required to make "donations" by credit card. It's hard to see how it could make much money, although there were a lot of links and advertisements, so I guessed some revenue was coming from "click-through" payments.

Fortunately the site didn't display the aggressive web design features that are the hallmark of porn merchants - an endless cascade of pop-up pages making it impossible for the hapless visitor to leave.

But the site - like many of its ilk - does display a good grasp of web basics, sadly lacking on many local sites.

It had not just the fundamentals, such as being fast to download and having intuitive navigation, but also the understanding that to keep the punters coming back for more, web pages have to change regularly, both in content and the way they are presented.

Boring, static web pages - even in the world of porn - are a turn-off.

The 40,000 visitors a month sounds impressive, but not when you put it in the global context of 513.41 million internet users. That's the market BeautyDirect (www.beautydirect.co.nz) is targeting.

Chief executive Bronwen Evans says the site gets 50 per cent of its visitors from overseas - visitors who aren't measured by web stats company Hitwise.

Thanks to our New Zealand dollar doldrums the site is becoming a bargain hunter's paradise for overseas buyers.

Ms Evans says monthly sales are growing by 10 per cent. But, like so many, she won't give customer numbers, citing the competitive nature of the industry and supplier nervousness over online trading and cross-border selling.

But she agrees that when visitor and sales numbers do come out - usually in the due diligence process - they often fall well short of the hype.

She views the internet as just another distribution channel, but one that offers customers something they don't get elsewhere.

In BeautyDirect's case that's the convenience of "shopping when you want, product information at your leisure, no pushy sales people, a good loyalty scheme and delivery to your door".

Next up was Regency Duty Free (www.regency.co.nz), which gets an average of 10,000 user sessions, 250 new registrations and 350 orders a month.

Regency's internet and statistics coordinator, Gareth Lathey, says the figures may seem quite low in comparison to Woolworths or FlyingPig, but set-up and site development costs were small, which has made it a profitable venture.

Hooray! I think that's the first time I've heard an e-tailer utter those words. Not a bad effort either, considering the site has only 4000 registered users.

But, as Mr Lathey points out, they're regular travellers and use it to pre-order duty free goods online to pick up on arrival or departure.

Sounds Music Stores marketing manager Amanda Wilson says her company's site (www.soundsnz.com) has consistently high visitor rates.

Last month it had 18,892 visitors and the month before 21,378. Sales are 100 per cent up on last year. Excellent, but is it profitable?

The best numbers award goes to Dick Smith Electronics (www.dse.co.nz). IT manager Greg Clare says the site receives more than 100,000 visitors and direct local sales of around $50,000 a month.

But as Mr Clare points out, the true level of success for established "bricks and mortar" retailers is not just in virtual sales and traffic, but in real increased traffic and sales in its stores. One of the main reasons for establishing the website was to make it easier for customers to find information on the extremely broad range of Dick Smith products, which exceed 9000.

Anecdotal evidence seems to indicate that's exactly what a lot of customers are doing before coming to the stores to make their purchase.

So it's good to see some local e-tailers are doing well. But I'm surprised that with the exception of BeautyDirect's overseas buyers, and Regency Duty Free buyers who get a 5 per cent discount for shopping via the net, no one is mentioning the "b" word.

That's bargain, and everyone loves one. Surely the net should be a "distribution channel" where bargains abound. But finding them - especially on local e-tail sites - is as rare as hen's teeth.

In many cases, by the time you've added the delivery charge, buying online tends to be more expensive. I reckon the lack of online steals on the local e-tail scene is the biggest reason web shopping hasn't taken off.

* Prove me wrong. Tell me about your online bargains - chris_barton@nzherald.co.nz