Pure-Plays Are Profitable

Dec 08, 2003
George Anderson

By George Anderson

A Wall Street Journal piece says something unusual has happened on the heels of the dot-com bust.

A number of pure-play specialty retailers are not only making money, they are growing at the expense of their brick and mortar counterparts. The Journal piece said retailers
"in categories such as jewelry, shoes and luggage are profitable and growing far more quickly than their offline counterparts."

Spending online, while still only a small portion of overall retail sales, is growing exponentially as consumers become more accustomed to ordering goods over the Internet. Forrester
Research is predicting an increase of 42 percent in online sales for this holiday season compared to last.

Moderator’s Comment: Does the success of pure-play e-tailers suggest that the promise of the Internet as a retailing vehicle is finally being met? What
do you think will be the next big developmental stage in consumer direct e-commerce?

The Journal piece pointed out that Mother Nature may have a hand in the transfer of sales from stores to the sites this year. The East Coast blizzard this
weekend kept many people away from the stores. We are personally aware of two consumers who went shopping online for the first time this weekend because they didn’t feel
safe driving to the mall.
Anderson – Moderator

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