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Subject: Re: UKNM: Toys R US - site, outdated - who does it???
From: Ray Taylor
Date: Thu, 28 Jan 1999 17:40:05 GMT

Ian Betteridge <ianbatwell [dot] com> said:
>The basic, unpalatable truth is that their business is going to be eaten by
>online stores, and if that's going to happen you might as well eat your own
>sales, rather than have a competitor eat them for you. It's all a question
>of timing.

No, no, no! We have seen this all before. When video came along the film
companies complained like hell that it would put them out of business. But
what happens? Video sales boom, royalties back to film companies soar, more
money pumped into film production, distribution, etc., then they spend a few
million dollars smartening up the cinemas to make them fit to eat popcorn
in, and everyone watches a whole lot more movies more times over, rents the
video, buys the video for Christmas, buys the book, the over-priced toys,
the Big Macs, etc, etc. It's just another channel, another route to market,
another opportunity to buy. Just like web shopping.

Shopping by walking/driving around high streets and malls is here to stay,
though some borderline real estate may have to go, which is great. There are
too many out-of-town shopping nightmares in this country, causing traffic
jams, air and visual pollution. People like to shop (not my idea of fun).
Mail order has been around a long time without abolishing the real thing.

Some retail channels will suffer, because they will not adapt. Obvious
example being automobile dealerships where restrictive practices keep prices
artificially high in the UK. Ever tried getting a brochure for a new car via
one of these fancy new car manufacturer's web sites? Don't bother, they send
the enquiry to the local dealer (if they send it anywhere) and it goes
straight in the bin. And it's without doubt a deliberate policy to try to
put a spanner in the works, unlike Toys-R-piled-high-and-left-there, which
merely lacks employees who are old enough to have binned the Clearasil.

My prediction is that in 1999, out of the 10 most successful UK retail
sites, most will have been set up by established high-street names. All of
these will post better financial results (sales, profit, share price) than
rivals that have not made a serious commitment to the internet. If anything,
in-store sales will rise not fall for those that get the web channels right.

Implementation of internet channels is about streamlining business, cutting
overhead, exploring new market opportunities, but above all improving
customer service (which to the uninitiated means _increasing_ sales and
profits). It is not about fighting a rearguard action against new

Ray Taylor
+44 181 639 0015
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