In my mind, failing to invest in ecommerce is akin to neglecting one’s brand. Crazy, given the rise in adoption of internet technologies and how quickly those technologies change. And “When the rate of change outside the organization is greater than the rate of change inside the organization, the organization is in trouble.” -Jack Welch

Certainly there is channel shift occurring, but consumers are voting with their wallets. And while online and offline work best together, the fact remains that e-commerce businesses provide a better return on investment in the current economic climate than capital spent on new or existing real estate. The head of ecommerce knows this; the CFO and CEO do not. While the upfront capital costs may be more than opening a single store (or even multiple stores), that investment pays returns the equivalent of 5, 10, or 20 stores. It also scales more easily and is more easily adaptable to meet consumers changing tastes. Margins are generally better, inventory costs are generally better, economics are generally better.

Sure, brick and mortar won’t go away, but with an over-stored retail landscape, it simply makes sense to a.) invest in the best locations, b.) shutter the worst locations, c) divert capital to growth and return. For item c), you have to argue e-commerce is the right investment ESPECIALLY in a challenging environment.

Julio de Villasante
President
EVT Solutions
http://www.evtsolutions.com

Whether it is a feature, an approach, a program, etc., in this economy teams need to stay focused on retail execution vs. treating their business as a perpetual series of project roll-outs. E-com leaders and their teams traditionally spend an inordinate amount of time on building vs. running their stores. Could you imagine if offline store managers did the same? What if a good offline store manager was not the person who had maniacal focus on pricing vs. the local competition, the store’s inventory levels, taking care of customers, etc. but instead was spending meaningful time on the rollout of new “talking price tags,” reevaluating the opaqueness of the store’s windows, and so on? My comparison is a bit extreme, but only a bit. Hopefully the necessity of a shift to efficiently running our businesses will stick with us even when things turn around. That will be the difference in a tough climate to having investments payoff.

Local search is the way to go. At Krillion, we have that proprietary technology. Check out our whitepaper: http://www.krillion.com/xA-manufacturer

While some of our etailers saw a drop off in holiday sales from 2007, you are right that many including ProFlowers, B&H Video and Photo, and Birkenstock saw increases for the many reasons you discussed.

I think what our clients saw as important was figuring out how to get the greatest ROAS when using adwords/keywords on both general search engines and many consumer shopping engines, as Shopzilla, Proton, Like.com, etc…

One our clients was able to send their product catalog feed using our Web-based tool to over 15 marketing channels and saw a dramatic increase in ROAS, as they managed the data feeds and corresponding SKU level bidding each week from a simple tool…so that helped a lot. I think ecommerce will certainly grow and don’t forget about mobile commerce (mcommerce) as our wireless devices get more sophisticted! We saw tremendous growth there too and our products support mobile ecommerce stores too.

Best –
Chip Arndt
co-founder, http://www.MerchantAdvantage.com
“Take Control of your Marketing Channels”

http://www.everestsoftwareinc.com