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Commentary: The Web is a mainstream retail channel

Neither the absolute level of Internet sales nor the growth rate tells the whole story, but this year e-commerce has become a mainstream retail channel.

By Adam Sarner, Gartner Analyst

Neither the absolute level of Internet sales nor the growth rate tells the whole story, but this year e-commerce became a mainstream retail channel.

You don't have to look far to find reasons for pessimism, however: a sluggish economy, the aftershocks of Sept. 11, and the problems of particular Web retailers. And even if consumer e-tailers don't post big numbers during the holiday shopping season, Web retailers have done a lot of work behind the scenes to make the Internet a viable channel overall.

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E-tailers have made great strides in addressing the problems that turned off consumers in the early days of the industry.

Web commerce now has a more reasonable set of expectations. Many a dot-com company boasted that it would put traditional stores out of business. Remember Web grocers? Like many of their dot-com peers, those who went it alone folded or were consumed by traditional grocers. Now, the once independent Web grocers make up the online channel for retail supermarkets.

Likewise, e-tailers seldom think of themselves any more as the entire sales channel--but that doesn't mean they are disappearing altogether. Instead, they now form one part of a larger selling strategy.

Not only has the Web channel become mainstream, but it has helped make a multichannel approach more effective. A customer can buy a sweater online, then return it at the store. Or a customer can try that same sweater on in the store but buy it online. An online presence improves the shopping experience for consumers, while retailers benefit from the different points of interaction with potential customers.

Finally, retail Web sites have done a better job at fulfillment, especially when dealing with tricky problems such as merchandise returns. Sites have also gotten better at delivering on promises. This year, you probably won't see as many people complaining that the toys they bought for Christmas haven't shown up or that orders were duplicated. Customer relationship management technology has helped sites manage customer concerns and improve relationships with customers.

So don't fall for the head-shaking this season over online retail. Business-to-consumer e-commerce is more than just here to stay--it's here now.

(For related commentary on Gartner's assessment of how better Web usability can boost sales, see Gartner.com.)

Entire contents, Copyright © 2001 Gartner, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.