What e-tailers do right

COMMENTARY--It's always irked me that analysts name big offline retailers as the inevitable winners in their battles with dot-com pure plays no matter how poorly designed their sites are or how pitiful their selections. Last holiday season, I typed in "Gladiator" under the movie section of Wal-Mart's redesigned site to get a feel for the store. Instead of the recent Russell Crowe flick on DVD, I got a listing for some boxing movie with Rowdy Herrington. I've yet to return to the site even out of curiosity.

So it was a bittersweet day in February when eToys closed its doors forever, only weeks after Resource Marketing's (www.resource.com) Resource E-commerce Watch 2001 named it the second-best site in terms of overall customer experience. Although eToys' business model had undeniable flaws, the company knew how to treat a customer. A quick look at the rest of the Top 10 list reveals four offline retailers made the cut: Barnes & Noble.com, Borders.com, Nordstrom, and REI.

This proves some marriage between the financially sound practices of experienced retailers and the more consumer-friendly online experience of pure-play e-tailers is in order. Although much has been said about how Amazon needed the clout of Toys R Us to compete in the toy market, bricks-and-clicks behemoths are realizing their sites are subpar. At press time, The Wall Street Journal reported similar talks between Wal-Mart and Amazon had been put on hold. The fact that such talks even took place, though, shows Wal-Mart needs Amazon's formidable online selling formula. It also indicates Amazon is under fire for its financial condition.

While bricks and clicks have foundered, the best e-tailers have made great strides without the benefit of instant gratification, a physical location, or a human being whom you can ask questions. Every product page on 800.com, the top e-tailer on Resource's latest list, offers links to live chat with reps trained on the site's products. It also offers customer reviews, buying guides, and in-stock indicators.

"There's a difference between searching and finding," says Kelly Mooney, chief experience officer at Resource Marketing. "Finding could be the result of a great search engine," he says. "But it can also be intuitive navigation, decision support, and page-load time."

Tim Zuckert, 800.com's chief marketing officer, attributes the company's success at developing the customer experience to in-house control over its Web-site design, authorized-dealer status for every product it sells (many electronics retailers and e-tailers can't say this), ownership of two distribution centers, and its own call center. "Investing in this stuff pays off over the long term," he says. "Not only do we get financial benefits from being authorized, but we have access to inventory and return privileges."

In my experience, 800.com ships much quicker than both bricks and clicks and pure-play e-tailers struggling with virtual distribution. Resource's Mooney says overall on-time delivery for shopping sites of all stripes is still only 92 percent, just 1 percent better than during the busy holiday season.

Chipping away at bricks and clicks
Having retail outlets does provide bricks and clicks with certain advantages, such as making returns easier for customers. But Resource's study found communication gaps between these companies' online and offline divisions.

Wal-Mart and Gap, for instance, miscalculated the amount of money they returned to shoppers in Resource's tests. And although the credit did eventually appear on the tester's charge card, Pottery Barn's in-store reps failed to provide a credit receipt. Cashiers at still other retailers even disputed the existence of a return policy for products purchased online.

Multichannel marketing is still bricks and clicks' biggest strength, but they're going to have to get serious about integrating operations. Best Buy and Circuit City offer online shoppers in-store pickup options. Best Buy merely promises an e-mail with pickup instructions within 24 hours, but Circuit City tells you which stores in your area have the merchandise so you can pick it up the same day.

Like 800.com, Circuit City touts a price-matching policy on its site. But you have to go to the store to exercise this option. All you have to do at 800.com is pick up the phone and call its Price Desk. Also, 800.com lists Web sites whose prices it will match; at Circuit City, the price must be listed with a competing local retailer.

The bricks and clicks that will make it are those that integrate technology and store-level training. Until then, I'm staying with the pure plays, beleaguered as they may be.

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Top 10 Shopping Sites

1. 800.com
2. eToys (now defunct)
3. SmarterKids.com
4. Barnes & Noble.com
5. Nordstrom
6. Cooking.com
7. REI
8. CDNow
9. Amazon.com
10. Borders.com