Online sales more fulfilled this year, study says

E-tailers demonstrate that they've learned from last year's mistakes, this year giving shoppers a 92 percent chance of success with their Web orders, according to a study.

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"Ghost of Christmas Past still haunting consumers"
David Daniels, analyst, Jupiter Research

E-tailers are demonstrating that they've learned from last year's mistakes, this year giving shoppers a 92 percent chance of success with their Web orders, according to a new study.

Online holiday purchases are a better option for shoppers this season than last, when only about 75 percent of attempted Web orders were successful, according to a study released Thursday by management consulting firm Andersen Consulting.

The study, which was conducted for the first time during the 1999 holiday season, found that U.S.-based online retailers have invested heavily to beef up their order-fulfillment and supply chain capabilities in preparation for the 2000 season.

"E-tailers are being very careful to make sure consumers are more aware of deadlines, even at the risk of losing a sale," Andersen partner Robert Mann said in a statement. "The majority of the Web sites surveyed in the 2000 study indicated that lead times for standard shipment modes are averaging nearly 10 days, compared (with) claims of about 5 days last year."

Internet researcher Gomez says that shoppers looking to get gifts to their destinations by Christmas need to place their orders by this weekend.

After some of last year's online shopping disasters, several sites including Toysrus.com and Macys.com were fined in July by the Federal Trade Commission for failing to notify customers of shipping delays during the season.

The FTC alleged that the online stores did not give shoppers enough notice of impending shipping delays or that they continued to promise deliveries they could not make during the holiday shopping crunch.

In the wake of last year's holiday shopping mishaps, many online stores zeroed in on problem areas such as order fulfillment, inventory control and customer service. Some 51 percent of online stores recently surveyed by researcher Jupiter Media Metrix put new fulfillment systems in place this year, 46 percent expanded their fulfillment staff, and 37 percent expanded their distribution centers.

Along with improvements in order fulfillment this season, Andersen's study also found that shoppers will see a brighter side to customer service over the Web this year, even among traditional retailers and catalog companies. The study said that traditional retailers have gained ground to close the service-level gap with their Web shop counterparts.

According to the study, consumers are spending 25 percent less time placing their online orders, 17 percent more sites are providing customers with an expected delivery date, 23 percent more sites are providing email confirmation of orders, and 24 percent more cybershops are giving customers a shipment confirmation.

And while order fulfillment and customer service seem to be much improved from last year's gift-buying season, some analysts have said that consumers could still be turned off by the lack of customer service being provided by companies. At a time when most e-tailing sites have called it quits or trimmed their staffs to save money and reduce operational costs, some companies have reduced expenses in crucial areas such as customer service hiring.

Instead, a number of cybershops have been boosting spending to either implement or enhance so-called self-service help solutions. By directing consumers to these online pages for frequently asked questions or Web help, the companies save money by not having to hire additional customer service staff.

The inability to reach a human being, though, has been a frequent roadblock for shoppers on the Internet. Analysts have said that despite the efficiency some self-service help tools can offer customers, people still want a human being to respond to some of their customer service needs.

To conduct the survey, which took place over a seven-day period, Andersen researchers attempted to place 563 orders at 97 different Web sites. Results showed that Andersen participants were able to complete 517 of the orders placed, meaning that 8 percent of the purchases made were unsuccessful. Still, Andersen said that figure is a significant improvement over the 25 percent failure rate reported last year.

Participants in the survey attributed failure to a number of issues, including Web sites that could not handle the traffic, had crashed, were under construction or were otherwise inaccessible.