Dot-comradery can exist between old and new

A healthy coexistence between the "old" and "new" economies was the vision of the future agreed upon at the conclusion of Internet World last week.

After an impassioned but amicable debate on the subject of online pure-play versus hybrid marketing strategies, six of Australia's foremost e-business players finally agreed that no singular product branding strategy will prevail.

An affirmative panel advocating the pure-play, consisting of Wishlist CEO Huy Truong, Shopfast's Justin Punch and E-Store's Stephen Spilly, was pitted against a pro-hybrid negative panel, comprising Sanity.com's Andrew Begg, f2's Ms Dale McCarthy, and independent e-business consultant Tom Velevski.

The debate drew a barrage of statistics, and other anecdotal evidence, on the pros and cons of internet marketing.

The jousting of statistics arrived early in the debate when Velevski quoted a Gartner estimate that "98 per cent of dot-coms will fail".

This was promptly shot down by Spilly, however, who cited a general small-business failure rate of 80 per cent. All of these will fold within three years, he added.

Velevski then cited an estimated average company cost of $42 per online customer -- almost double that of per-customer rates in the offline economy. "The cash is beginning to run out," he said.

But Spilly was again able to out-stat Velevski. He estimates that E-Store spends an average of $3 on advertising for every customer. Other e-tailing companies spend as little as $2, he claimed.

Moreover, Spilly was scornful of figures surrounding the local e-tailing industry's first Christmas in 1999, which suggested that the average online expenditure in December was less than $50 per customer. Spilly said the average E-Store customer spent $750 online.

Sanity.com's Andrew Begg questioned the ability of most e-tailers to satisfactorily fulfil customer orders. Sanity itself struggled to deliver product orders within Australia, even though it had 240 retail outlets, he said.

"How can you do it from one store in the US?" he asked. "The store experience is one of the most potent customer experiences you can have."

This point was agreed with by team-mates Velevski and McCarthy, the latter describing offline shopping as "social" and "entertaining". "Bricks-and-mortar shopping is part of being a human being," McCarthy said.

The debate became less pointed when Truong, arguing in defence of online marketing, conceded that only 20 per cent of a customer's purchasing experience was directly related to the web.

Truong and McCarthy, both third speakers for their teams, agreed that the most successful retail companies of the future would be those that were marketed and branded in both the online and offline worlds.

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