Retailer lowers web ambitions

By SIMON HENDERY retail writer

The flying pig may have crashed and burned but some of the lessons from its brief flight live on.

When appliance chain Noel Leeming launched its new website last week, it was as if the ghost of former e-tailer FlyingPig had briefly stirred from its grave.

Born in the dotcom mania days and modelled on Amazon.com, FlyingPig's original investors included entrepreneur Eric Watson.

After the technology bubble burst, Noel Leeming's parent company, the Watson-controlled Pacific Retail Group (PRG), bought FlyingPig and immediately sold it to IT Capital, retaining some intellectual capital and $6.5 million worth of tax losses.

In 2000, new PRG chief executive Peter Halkett said the retailer would take a fresh tack on its internet strategy, focusing on store-specific websites rather than the e-megastore concept of FlyingPig.

The launch of the Noel Leeming website is the latest step in PRG's internet strategy, which Halkett said was very conservative.

The group's Computer City chain has had a less sophisticated site operating for about three years.

"One of the many advantages we now have over FlyingPig is that we are leveraging all our infrastructure," Halkett says.

"When people go to the [Noel Leeming] site they are looking at products that are also available in our stores at the same pricing.

"You can get Fly Buys. Basically you can experience our brand on the internet."

He expects the site to be profitable within two years but says it will have more immediate indirect benefits for the company from customers who browse the internet before going into a store to make a purchase.

"The internet is not really about the website itself and the pretty pictures.

"It's actually about all the logistics that underpin that - the customer service you receive, the delivery you receive, the ability to contact someone if you have a problem.

"There's something about having a physical presence that is very tangible to customers."

PRG is merging Computer City into the Noel Leeming chain and expanding its other computer store brand, Big Byte, which it launched last year.

Big Byte's stable of two stores (Christchurch and Palmerston North) will be boosted over the next three months with the opening of stores at Botany Downs in Auckland and in Dunedin.

Halkett said once Big Byte had a sufficient nationwide network of stores, PRG would launch a Big Byte website to replace the Computer City site.

Noel Leeming

Computer City