Aust businesses waste $2.85 bill on e-comm

Australian businesses are wasting billions of dollars on e-commerce according to consultant Hugh MacFarlane.

MacFarlane, former internet business manager for Digital Equipment, examined more than 300 e-commerce sites in Australia over the last four years, and claims less than one in 20 Australian e-commerce initiatives are backed by sound business strategy and effective customer communication.

"With Australian companies spending around $3 billion a year on e-commerce, that's as much as $2.85 billion going down the drain," he said.

MacFarlane said the majority of businesses setting up an e-commerce site did not establish an effective plan to make the most of their online initiatives.

"You can't blame the technicians, and you can't blame the web developers. Businesses who are planning to establish an e-commerce site have to think about what they want their site to do for them before they spend the money.

MacFarlane was speaking at the launch of his new internet consultancy firm, Panopera.

Panopera is the result of a merger between e-commerce management and strategic marketing firm, B2b, and design firm Nelmes Smith Ashton.

"Businesses have to use e-commerce as a method to make relationships with their customers deeper and more relevant. Then they should use those same methods to attract and keep new business," he said.

While MacFarlane refused to name any e-commerce sites he believed were under-utilised, he said many of the most successful sites operated on a restricted basis and were only accessed by a particular company's customers.

According to the latest figures from online research company www.consult, the Australian e-commerce industry is worth over $3.5billion. MacFarlane said he would like to see some of that money re-invested more economically.

He also said he believed the IT and telecommunications, financial services, and media and entertainment industries would lead the way in establishing successful e-commerce businesses.

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