FRAMINGHAM (05/01/2000) - Consumers have already started to use their wireless, Web-enabled phones and personal digital assistants to engage in comparison shopping while strolling around traditional retail outlets. That phenomenon, some dot-com companies and wireless carriers say, could represent a significant shift in buying habits that companies need to be prepared for.
But at least one analyst views the hype over wireless Web shopping as an attempt by dot-coms to use technology to steer attention away from the fact that few of them are making any money - a problem that this shift probably still won't solve.
In fact, officials at large retailers interviewed last week, including Sears Roebuck and Co. and Tandy Corp., which operates the Radio Shack chain, said they welcome wireless comparison shopping and believe they can turn it to their advantage.
Sears, for instance, has a price-match guarantee. "The more information the customers have, the better chance we have at satisfying them," said spokesman Tom Nicholson.
But Amazon.com Inc.'s cellular product manager, Chuck Napier, said he thinks wireless shopping will have a "big impact" on traditional retailers. The Seattle-based online retailer has embraced an "anytime, anywhere, anyplace" strategy since it launched its wireless Web service earlier this year.
Napier said he envisions a future in which consumers will find a title they want in a bookstore, turn on their cellular phones, zip to the Amazon Web site, punch in the book's ISBN code, find a lower price, order the book and then leave the store.
Alan Reiter, an analyst and president of Wireless Internet & Mobile Computing in Chevy Chase, Maryland, said Web-enabled cell phones "will change the face of retailing" because customers will be able to obtain instant access to product reviews and comparisons.
Retail Will Carry On
But Ken Dulaney, an analyst at Gartner Group Inc. in Stamford, Connecticut, said he doesn't believe wireless e-commerce will affect traditional retailers to any revolutionary degree. By 2003, Dulaney said, it's likely that only 10 million of the 70 million users of Web-enabled phones in the U.S. will be conducting wireless e-commerce transactions.
Dulaney said that while wireless comparison shopping "will probably make some retailers angry, it's not going to rescue profitless dot-coms from obsolescence."
Yet some vendors are betting that customers will gravitate to wireless comparison shopping as more services spring up. Sprint PCS Group in Kansas City, Missouri, launched a wireless comparison-shopping service, called E-compare, in February. BarPoint.com Inc. in Fort Lauderdale, Florida, has spent the past year amassing a database of millions of universal product codes that will allow consumers to type - and, soon, to scan - codes into their cell phones and then make a comparison on the company's Web site.
The company "does not want to necessarily help the customer bypass the retailer," said Jim Sass, BarPoint's executive vice president.
"We could help the retailer make the sale by providing it with a more informed customer, because we offer product reviews as well as prices," said Sass. And, indeed, some retailers said they don't feel threatened by the advent of these services.
A spokesman for Best Buy Co. in Eden Prairie, Minnesota, said his company has always had savvy customers. He said wireless comparison shopping is similar to "customers coming into our store with a newspaper insert from one of our competitors."
Mark Stanley, senior vice president for strategic development at Tandy, said the company "likes people coming into [our] Radio Shack stores with a cell phone, because that gives us a chance to sell them a new one." Stanley added that Tandy doesn't intend to ignore the wired or wireless Web and has formed a partnership with Microsoft Corp. to offer its products through the latter company's wireless Web service.
Stanley said retailers that offer service and expertise will do well in selling to wireless shoppers who want more than the lowest price. But, he added, big-box retailers that compete on price with the dot-coms "are at risk....They're going to have a lot of competition."