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Wal-Mart carts retail online

One of the largest retailers in the physical world opened shop on the Internet.

For those shoppers who have grown sick of incessant Muzak filling their stores, there is hope: One of the largest retailers in the physical world today opened shop on the Internet.

Wal-Mart Stores launched Web sites for Wal-Mart and Sam's Club that allow users to buy merchandise ranging from video tapes to office furniture. All credit card transactions are encrypted using Secure Sockets Layer (SSL) technology, and customers can have merchandise shipped home within 48 hours by United Parcel Service.

Although Wal-Mart is confident about expanding its business into cyberspace, the type of merchandise it sells represents a small piece of the online shopping market. Forrester Research estimates that online shopping sales in 1996 will amount to $518 million for retailers, with apparel, toy, and other Wal-Mart mainstays accounting for only $46 million. Computer products, on the other hand, will account for roughly $140 million in sales in 1996.

Online sales are expected to top $6.6 billion by the year 2000, Forrester estimates.

"The kind of products Wal-Mart offers like apparel take a lesser piece of online revenue," said Karen Epper, an analyst at Forrester. "One of the big hurdles to online shopping is the psychographic desire to see and touch what you're buying. The mail order catalogs have made progress this area."

But online shopping technology needs to improve before users can get an equivalent or better experience than mail order catalogs, Epper said.

Last February, Wal-Mart announced its online shopping efforts in conjunction with Microsoft, which said it would provide a number of retailers with its Merchant Server. Since then, Microsoft has acquired an electronic commerce developer, eShop, to speed up its Merchant solution development efforts. A Wal-Mart spokeswoman said today that Microsoft collaborated with the company on development of payment standards, but she could not say if the software giant ended up providing server software for Wal-Mart.

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