Does Internet Decrease Corporate Profits?
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Before you read this new story, please do me a favor and read a previous post called Online Sales to Exceed $200 Billion in 2006.
According to a recent market study on 174 major retailers, 2006 online sales (including travel) are expected to rise 20 percent (comparing to 2005) to $211.4 billion!
And continue:
"... More customers use Internet to compare prices, find gift ideas, and research products. So retailers rely on their web sites not only to sell merchandise but also to increase sales at their stores."
Even more:
"... 22% of offline sales are influenced by the web!"
Now here's the funny part of this story. Today I stumble to something that make me laugh. Lauder and a lot!
I won't reveal the source of the information because it came from a very reputable company and I'm not sure if they will not sue me!
But the information can be accessed through search engines(Y!)... this is how I land on the funny article.
At the top of the article I found this ...
"Is the Internet... short-circuiting America's economic recovery?"
Well, an economist from a prestigious US university believes that Internet may be one of "the most important profit-killing innovations in years".
Wow!
I won't go into details and dissect his theory but according to this man, the sectors affected in the near future includes hotels, airlines, cars, PC's and wireless industries!
For these sectors, the Internet will mainly "erodes companies market power and hits their bottom lines".
Now compare these information with the latest 2006 online sales predictions:
- travel: $73 billion
- computer hardware and software: $16.8 billion
- autos and auto parts: $15.9 billion:
- apparel, accessories: $13.8 billion
And the master wizard continue: "What's good for consumers could be bad for business".
Oh really?
He finally claim:
"It is going to take time to really flush this thing out!"
Just in case it's something you do not understand: the "flush"... well, if think it's related to what we call today e-Commerce.
I don't know about you folks, but this article make my day. I have a lot of fun reading the whole story.
BTW, it was written in 2002!!!
Can you imagine this?
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According to a recent market study on 174 major retailers, 2006 online sales (including travel) are expected to rise 20 percent (comparing to 2005) to $211.4 billion!
And continue:
"... More customers use Internet to compare prices, find gift ideas, and research products. So retailers rely on their web sites not only to sell merchandise but also to increase sales at their stores."
Even more:
"... 22% of offline sales are influenced by the web!"
Now here's the funny part of this story. Today I stumble to something that make me laugh. Lauder and a lot!
I won't reveal the source of the information because it came from a very reputable company and I'm not sure if they will not sue me!
But the information can be accessed through search engines(Y!)... this is how I land on the funny article.
At the top of the article I found this ...
"Is the Internet... short-circuiting America's economic recovery?"
Well, an economist from a prestigious US university believes that Internet may be one of "the most important profit-killing innovations in years".
Wow!
I won't go into details and dissect his theory but according to this man, the sectors affected in the near future includes hotels, airlines, cars, PC's and wireless industries!
For these sectors, the Internet will mainly "erodes companies market power and hits their bottom lines".
Now compare these information with the latest 2006 online sales predictions:
- travel: $73 billion
- computer hardware and software: $16.8 billion
- autos and auto parts: $15.9 billion:
- apparel, accessories: $13.8 billion
And the master wizard continue: "What's good for consumers could be bad for business".
Oh really?
He finally claim:
"It is going to take time to really flush this thing out!"
Just in case it's something you do not understand: the "flush"... well, if think it's related to what we call today e-Commerce.
I don't know about you folks, but this article make my day. I have a lot of fun reading the whole story.
BTW, it was written in 2002!!!
Can you imagine this?
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Posted by Valeriu Popescu at 2:49 PM
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