Online sales climbed 24% year over year, while Best Buy’s overall sales were flat.
Online retailing is entering a new age of customer-engaging, interactive technology across multiple channels, keynoter Thomas McInerney, executive vice president and CFO of IAC/InterActiveCorp, said this week at the Internet Retailer 2006 Conference.
Online retailing is entering a new age of customer-engaging, interactive technology across multiple channels, keynoter Thomas McInerney, executive vice president and CFO of IAC/InterActiveCorp, told attendees this week at the Internet Retailer 2006 Conference & Exhibition in Chicago.
“As we look back five or six years, there’s been a paucity of innovation,” McInerney said. “The major, core innovative things done in online retail, like online auctions, we can trace back to ’98 and ’99.”
But recent and ongoing developments in e-commerce-including broadband Internet access, new technologies like AJAX that provide for faster online shopping experiences, and the merging of the web and TV-are presenting exciting new opportunities that retailers need to be aware of, McInerney said.
McInerney’s Keynote Address kicked off The Internet Retailer 2006 Conference & Exhibition June 5-7 in Chicago. The conference drew 3,300 total attendees who heard 80 speakers in 45 sessions and viewed technology and services from 189 exhibitors in the 70,000-square-foot exhibition hall.
Attendees also had the chance to win a Jaguar in the “Win the Wheels” sweepstakes, which required attendees to visit 32 sponsoring exhibitors and collect color-coded adhesive dots on a game card. The winner of the car was Jay Allen, web marketing manager for apparel retailer Cutter & Buck.
The lack of innovation, McInerney said, has kept retailers from truly capitalizing on multi-channel integration and from realizing the promises of personalization techniques in marketing and merchandising on a one-to-one level with customers. But that’s changing, McInerney said. Personalization, for example, is becoming more of a reality, he said. “Connecting one-to-one with customers is something we think about every day,” he said.
IAC’s HSN.com, the online sister of the TV-based Home Shopping Network, for instance, is learning new ways to capitalize on the “incredibly complementary” interaction of the web and TV, McInerney said. While TV has proven its strength over the years in its ability to show details of products featured on the Home Shopping Network, the medium is severely restricted by its linear nature. “There’s only so much time,” McInerney said.
But broadband capabilities-along with the spread of broadband to more than half of U.S. households-are enabling HSN to show more of its TV programming on HSN.com. The web strategy will range from live showings of full TV programs to online recordings of complete shows or segments that focus on particular products. Combined with web site search, this will let HSN shoppers view material on TV, then go online to search for a particular show segment and product, McInerney said.
Web sales account for about 40% of total top-line retail sales of about $3 billion at IAC, which is No. 23 in the Internet Retailer Top 500 Guide to Retail Web Sites. It boosted its retail business last year with the acquisition of Cornerstone Brands, whose several brands include Smith & Noble and Garnet Hill. But IAC is primed for continued growth through its multi-pronged e-commerce strategy, including offering more consumer retail sites as well as more ties between TV and Internet retailing, McInerney said.
IAC acquired footwear retailer Shoebuy.com earlier this year and expects to build on its base with additional consumer products sites, such as the recently established Bagsbuy.com, McInerney said. “We have other properties to come,” he said.
IAC also has emerging businesses with Gifts.com and Pronto.com, a comparison shopping tool that runs in a shopper’s web browser and can alert the shopper when a product she wants gets to a preferred price level.
Other important trends to watch, McInerney said, are how brands can leverage the power of social networking sites like MySpace.com, and how retailers of all sizes are using the web and global-positioning systems to connect with local customers.
Meantime, IAC will continue to look for ways to leverage its presence in online retail and TV programming while taking advantage of Internet-enabled TV. “With 500-plus channels, the cable operators are desperate for content to fill those channels, and some of them will be retail,” McInerney said. “Ultimately, we think IPTV can enable the HSN show to be a front door to other services.”
A consumer watching the HSN show on an IPTV connection, for example, could click to on-demand content created by IAC on other channels, he added.