Are you ready to catch the wave?
By Jack Love
The evidence is mounting. It’s in the comments of vendors at retail industry
trade shows, many of whom report that their business outlook has taken a decided
turn for the better. It’s seen on Wall Street, where the Dow has jumped 21%
since the onset of the war in Iraq and the tech-laden Nasdaq has grown at an
even healthier 34% clip during that period.
It’s in the comments of retail economists, such as the NRF’s Rosalind Wells,
who expects retail sales in the second half of this year will grow at twice
the 2.2% rate of the first half, itself a remarkable performance in light of
the unsettling distraction of the Iraq war. It is in the forecasts of such respected
research organizations as IDC, which earlier this year released a report predicting
that retail IT spending would grow at an annual compounded rate of 5.4% through
2007 to about $30 billion—a complete turnaround from last year, which witnessed
a 3.4% decline in retail IT spending.
And closer to home—our home at Internet Retailer—it’s in a 40% increase in
advertising revenue during the first half of 2003. The second half looks even
better. Indeed, the first issue of this half—the 2004 Buyers Guide that you
are now reading—sets a new single-issue record for advertising for our 4-year-old
publication. With 118 paid classified listings and 18 display advertisers, this
year’s Guide has more than double the ad revenue of last year’s Guide.
Tech development never sleeps
It is time to declare the recession in retail IT over—and to prepare for a
new round of investment in Internet-based retail technology solutions. Retailers
who fail to do so will surely be at a competitive disadvantage to those who
spend. The free market may forgive those who are cautious during a lull in the
economic cycle; it is not at all forgiving of foot-dragging in the midst of
a nascent recovery that should get the competitive juices flowing. Making the
transition from a robust economy to a sick one can be a daunting task, but failing
to catch the wave of reinvestment in a market can be fatal.
That is particularly true when it comes to Internet-based solutions which
are raising the retail technology bar. While investment in such solutions languished
following the bursting of the Internet investment bubble in mid 2000, development
of that technology has raced along. The Internet retailing solutions and services
offered by the vendors in this year’s Buyers Guide are an order of magnitude
better than those marketed in the roaring economy of late 1990s. And they go
well beyond the limited scope of first-generation e-retailing technologies,
which focused largely on the novelty of web-based merchandising.
Today’s vendors of e-retailing solutions offer web-based systems that automate
the supply chain, track customers at every touch point with the retailer, develop
a one-to-one marketing relationship with each customer, provide real-time data
on individual store sales, track store inventories to provide just-in-time replenishments,
provide Internet access at the store level to fulfill customer orders even when
the store is out of stock, and for the first time offer all retailers an efficient
way of integrating sales of all channels into a seamless collection of merchandising
entities that present one branded image, espouse one merchandising philosophy,
deliver one marketing message, and rely on one supply chain. And, of course,
the vendors offer a broad array of web merchandising solutions that make each
new generation of retail web sites vastly superior to what they replaced.
Changed rules
The Internet has dramatically altered the ground rules for competition among
retailers. Retailers that embrace the web in every phase of their operations
will become the leaders of the emerging multi-channel retailing market. Those
who postpone investment now, just as positive economic signs appear, will surely
suffer loss of market share to those who have a better sense of the market’s
direction and invest in the future today. In short, the decisions retailers
make now about IT investments in 2004 will determine whether they ride the wave
of new technology or are engulfed by it.
For retailers and catalogers who are ready to take the leap into a new round
of web-based technology investment, Internet Retailer’s 2004 Buyers Guide can
be an extremely useful shopping tool. With 667 separate vendor listings, conveniently
organized in 54 product and service categories, the Guide is the most comprehensive
directory of resources available on the Internet retailing market. In addition,
the Guide highlights 10 technology categories that deserve special editorial
treatment because of the significant impact they are having in shaping this
relatively new industry. For each of these, our editors have prepared separate
editorial reports describing the application of the technology, the impact it
is having, and the trends that herald future developments.
The printed Guide is intended to be a desktop reference to be used throughout
the coming year. By the first week of September, the Guide will also be available
online at our web site, InternetRetailer.com, where technology shoppers will
have the ability to click on a paid listing and be taken directly to that vendor’s
web site.
Reaching the decision makers
While the increased size of this year’s Buyers Guide is partly a reflection
of the improving economy for all things related to e-retailing, it also reflects
the dedication of our staff. Two people in particular should be recognized for
their Herculean efforts in putting this year’s Buyers Guide issue together.
Judy Dellert, our classified advertising sales director, worked tirelessly for
three months contacting every vendor in the market to insure they were included
in the Guide, either with a free basic listing or paid enhanced one. Judy’s
persistence, attention to detail and dedication to serving her clients have
made this year’s Guide an invaluable shopping resource for retailers.
I would be remiss if I did not also recognize the contributions of Tom Chambers,
our production director, whose skills in desktop publishing are evident in each
issue of this magazine and particularly in the annual Buyers Guide. Fully half
of the classified listings in this Guide were created by Tom to meet the client’s
specifications, a phenomenal achievement given the number of enhanced listings
in this year’s Buyers Guide issue and the fact that this annual task is incremental
to his already crowded schedule of production activities.
Finally, I wish to express my gratitude to the vendors who advertised in this
year’s record-breaking Buyers Guide issue. Our list of regular advertisers has
grown dramatically in the last year, as more retail IT vendors recognize the
important role the Internet now plays in retailing and the equally important
role Internet Retailer has in providing objective, comprehensive and insightful
reporting on the growing use of the Internet in the retail industry. Since we
uniquely reach the decision makers in retail chains, catalog firms, direct-TV
and other call center merchants, web-only merchants and manufacturers with direct-to-consumer
marketing arms, we trust that advertiser loyalty to this magazine will be rewarded
with an increased share of the retail IT market.
Jack@verticalwebmedia.com
