Life just got more difficult

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NYT: INTERNET SALES IN 'DRAMATIC SLOWDOWN'
Sat Jun 16 2007 12:46:20 ET

Since the inception of the Web, online commerce has enjoyed hypergrowth, with annual sales increasing more than 25 percent overall, and far more rapidly in many categories. But in the last year, growth has slowed sharply in major sectors like books, tickets and office supplies, the NEW YORK TIMES will report on Sunday, newsroom sources tell the DRUDGE REPORT.

In Page One leads, the paper claims: "Growth in online sales has dropped dramatically in such diverse categories as health and beauty products, computer peripherals and pet supplies. Analysts say it is a turning point and growth will continue to slow through the decade."

Full Story

** Story literally a cut and past from Drudge Report, main article not published yet.

Comments

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This supposed almost story is so full of holes... I would not know where to start.

The NYT is looking at huge losses, maybe even going out of business directly because of the Internet.

Gee I wonder why they would spread false rumors that the end of the Internet as we know it is near, very near...

No to be believed

My kid needed size 14 shoes so I just bought a pair of New Balance from a Facebook Cashback Store, ShoeBuy.com (an IAC property).
No tax or shipping $49.00, offline $65 + tax. Wife buys books online, kids buy games online. So maybe a slowing in some verticals but this is a case of the NYTimes hyping readership for their flagging print division.
IMO

The NYT Story

I gotta say that after reading the full story, I was right.

This is nothing but a trash the internet and hope the internet goes away kinda story.

I think anyone that has been in this business for a while can tell you that summer is the slow period for internet sales.

Quotes in the NYT like "...noting that online shopping is more a chore than an escape."

and

"...when she needs to buy something for her Macintosh computer, she prefers visiting a store. “I trust it more,” she said."

Are just showing how desperate some newspapers are getting.

The internet is killing some of the News Papers, they don't understand it and it just won't go away...

If the news papers like the NYT really understood the internet they could become so much more than they are, but they don't, so they will continue to try to convince people the internet is bad and then hope and pray the internet goes away...

My rant for the day.

http://www.nytimes.com/2007/06/17/technology/17ecom.html?ex=1339732800&en=60dbe8c18b8fec6f&ei=5089

It does make you wonder

Hitwise is reporting spikes in traffic to online shopping sites, small businesses are actually taking their business online to stay afloat, the Discovery Channel is closing its bricks-and-mortar shops because their online store is reporting huge increases in sales and yet the NYT is reporting that the sky is falling?

Of course there may be a decline in sales - the economies of some countries are definitely in the toilet but perhaps the NYT is clutching at straws.

Most people are already shopping online

There's no decline in sales... it's just a slower increase in sales. Anyway, the article says:

The turning point comes as most adult Americans, and many of their children, are already shopping online.

Why would it surprise anyone that growth slows down as you reach higher market penetration?

Slow Growth?

There's something called the 'saturation point' that anyone that took 5 minutes of high school chemistry understands.

Doesn't mean it's a decline in sales, but they've hit the ceiling of people either willing or capable of shopping online.

Now I would suspect as more people upgrade to new computers and toss old ones, and those computers fall into the hands of people that couldn't afford a computer in the first place, that they're one step away from online shopping just short of a stolen credit card so there is hope for sales growth ;)

Actually, my silly statement above has some basis in fact because there is a large segment of the low income population that maybe has a store credit card, if that, not a Visa or Mastercard, that will never be able to shop online unless they manage to combat that trivial problem of not having any money in the first place.

saturation a long way off still

I think we've got a long ways to go before we see saturation of the internet market. Currently, only a portion of the adult population feels comfortable using their credit cards online and also they have ingrained habits and desires to go brick and mortar so they can touch/smell/taste before buying. When the next generation ages to adulthood, I expect there will be a much higher percentage rate of acceptance for eCommerce.

..

I guess my concern was more about HOW the story was being reported as opposed to the story it's self.

When you review the NYT article, there in not one single positive statement about being or buying online, yet there are several negative statements in the one page article.

I think any Marketer can tell when someone or something is trying to influence how people think. I mean we do it all the time, so we should be able to spot it. :-)

I expect (and I assume the public expects) this kind of thing in advertising, after all, what is advertising but trying to influence how people think about a product or service.

However, when so called news providers use these types of methods against what they perceive to be a business threat to them, I just gotta say something about it.

hard times? hardly

Quote:
Still, Internet commerce is growing at a pace that traditional merchants would envy. But online sales are not growing as fast as they were even 18 months ago ... Forrester Research, a market research company, projects that online book sales will rise 11 percent this year, compared with nearly 40 percent last year.

you have to admire their gumption for trying to get a down spin to stick on those numbers.

The NYT knows better anyway. Arthur Sulzberger, the NYT's owner said in five years the print edition may fold and he doesn't care because the online edition is hugely profitable, and growing:
New York Times Will Abandon Print for the Web

Guys we're all making a killing

because of hypergrowth. SEO is about to get a lot duller as those SERPs solidify and big brands really start to take out whole verticals with inhouse drones.

It happened to advertising as well, after the golden age of the sixties and seventies. Happened to the airline business as well. Commodification.

With slowed growth, it comes our way now. We've got about two more years relative freedom of action.

This is story is notable and this story should worry you.

What about niche tightening,

What about niche tightening, ronsard? SE's continually tighten their targeting to support profits and usability. It will always cost more for big brands to reach specific markets targeted by smaller specialists. Along with that added cost they are practically forced to standardize their brand offerings, which just enables those specialized little guys to educate the market nit picky bit by bit.

Look at all of the effort invested in training the consuming public on cultural consumerism (TV, press insertions, Malls, government propaganda, "lifestyle" media, etc). They then sold into that. The Internet rather suddenly allowed everyone else to sell into that as well, even if they hadn't contributed to the infrastructure. So now that's changing. It had to happen, right?

I don't see the commoditization as a threat, but an opportunity. Please commoditize everything, because then I can compete on marketing the message and conversion and customer service, instead of brand. I'm looking forward to un-brainwashing the consumers as part of my conversion funnel... with no sales force, no mall properties, no lobbyists, and few profit-sharing partners.

Of course I don't believe it will go that way. I believe government will interfere on behalf of those same big interests, and the public will be misled by significant PR distortion efforts. Just. Like. Before.

I think as things are

I think as things are commodified brands will be one of the few things that remain that allow people to be profitable.

Think of it this way...even if you have lower overhead, better conversion, etc...it all doesn't matter if quality scores (or equivalent) charge you extra to stand a chance. Even rougher when those offline business interests start pushing more shadow brands and promoting them for free in their own media outlets.

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