Backtalk

How Have Internet Sales Affected Your Business?

The Internet-enhanced global village is becoming more like a global shopping center. It's remarkably easy to get information, compare product prices and attributes, and buy and sell goods online. What with the Internet now available on your digital phone and coming soon to a kitchen appliance near you, it is certainly a sales force to be reckoned with. Cellular phone maker Ericsson and household appliance manufacturer Electrolux, both based in Stockholm, Sweden, have joined forces to create "networked homes." Soon, they say, appliances will "communicate with consumers, with other appliances and with the outside world through the Internet." Although customers cannot yet order dinner ingredients via a touch screen on the refrigerator, they can—and do—order supplements and much more online. So how will e-commerce affect natural products businesses?

"I see that retailers and manufacturers of natural products who are actively selling with a good and appropriate e-commerce solution are very successful. One of the clients we built a solution for already is receiving 20 percent of their mail-order sales from the Web and has seen a double-digit growth in total sales in the last nine months. The client would attribute it to the site and promotion surrounding it. It can
be done, but it's not just the e-commerce tool that brings online sales success. The trick is how to create the store experience over the Web and compel the shopper to purchase the item."

Dale Manning
Director of Internet Services
Koopman Ostbo
Portland, Ore.

"We have had a retail Web site for two and a half years. It pays for itself, plus the Web is a good tool for me to find things such as packaging material, airline tickets and other products. Wholesalers don't necessarily buy on the Web—consumers are the ones who are buying. We do much better with Internet sales when we also use print advertising."

Janice Janis
Owner
Eye of the Day
Boulder, Colo.

"I think that the Internet is a far superior way to purchase natural products than any other channel of distribution. It will eventually take over a significant market share. If you look at how people shop in a store you'll see why: they often have to look up private health conditions in books and take notes into the store. The Internet allows the research and purchase to happen seamlessly with minimum embarrassment."

Michael Barach
President
MotherNature.com
Concord, Mass.

"In terms of our position to date, we have a very limited e-commerce option for our customers. It is limited to private label, and sales are minimal at this point. We are evolving a more comprehensive strategy, and we think, in the long term—meaning in the next year to three years—we'd like to totally integrate the store with e-commerce and be able to extend the reach of the store through various partnerships with other e-commerce folks. We want to widen the selection of the store effectively by having an e-commerce option within the store and also ultimately be able to add a home delivery component.

"My view on the Internet, or the e-commerce aspect of the business, is that it is going to be an integral part of everybody's business, but from our perspective we think we need to integrate it into the bricks-and-mortar and make it a complementary effort as opposed to spinning it out and making it a separate business in its own right."

Mike Gilliland
CEO
Wild Oats Markets
Boulder, Colo.

"We have a mail-order Web site that has steadily grown over the last year or so. Only about 2 percent of our sales are over the Web now, but that is growing. I expect sales over the Web will grow faster than sales through our distributors, but the bulk of our sales will stay with traditional channels."

Dennis Gilliam
General Manager
Bob's Red Mill
Milwaukie, Ore.