Bigger is better—so promoters of super-sized fast-food meals, cinematic lizards, and Viagra would have you believe. Now it appears the latest to equate success with size are Internet commerce sites.
Last month Amazon.com added music to its well-known “bookstore,” boosting the overall number of products it offers to more than 3 million; video and software are expected next. Competitor Barnes & Noble (www.barnesandnoble.com) has quietly integrated a software store. Books.com is one of several entry points for parent company Cendant’s all-in-one shopping site NetMarket. These are in addition to Web-only supersites for music (CDNow, Music Boulevard), videos (Reel.com), and computer products (Inter-net Shopping Network, Cyberian Outpost, NECX), all emulating Amazon.com’s model for breadth and depth of selection in their particular category—without, hopefully, emulating Amazon.com’s current model for profitability.
But like the hungry pet in the children’s book A Fish Out of Water, some sites that have been gorging themselves on new categories may find they should be fed “just so much, and no more.”
Web superstores need look only to the world of physical superstores for their cautionary tale. Offering broad selection in one or more product categories, cavernous “big box” retailers have been the shopping story of this decade. First it was their threat; later it was their well-publicized failures (remember Silo and Incredible Universe?). Other chains have slowed their growth, and a few have consolidated, as when CompUSA acquired Computer City last week.
As the dominant Web superstores plan to do now, so did some physical superstores hope to leverage their all-important traffic in one category to generate sales in another. But they ran into what retail analysts call the “overstoring” of America—too many shops chasing too few shoppers. It doesn’t make a lot of difference whether that overstoring occurs in brick-and-mortar or packets-and-pixels. There are only so many shoppers for a given item at a given time.
Indeed, virtual superstores trying to grow into new categories could be at a disadvantage to their physical counterparts, despite their much-vaunted selection and convenience: Where a physical superstore has a captive audience once a consumer has driven there, parked, and stepped through the front door, the barrier to exit for a shopper is much lower on the Web. Offering everything in one place isn’t much of a differentiating factor online when a consumer views that “one place” not as a single site, but as the entire Internet.
Online superstores moving out of their core categories might do well to consider the namesake of Earth’s biggest bookstore: Even the 3,900-mile-long Amazon River doesn’t appear to have a business plan to transform itself into an ocean.
Software deliver-e
Several hundred software execs got an earful of advice in San Jose last month at the Electronic Software Distribution Forum, run by the influential industry newsletter SoftLetter (www.softletter.com). Among the tips offered to companies struggling with Internet business models and marketing: Seymour Merrin, president of Merrin Information Services and legendary computer retail consultant, noted that when it comes to designing an e-commerce site, “The cuter you are, the lower your sales.” And for those Type A personalities who won’t put a commerce site up on the Web until it’s perfect, Netscape Software Depot manager Jay Moore advocated a launch-and-modify approach: “It’s not going to hurt you. If it doesn’t work, apologize and send out a T-shirt.”
Tanked
Memo to Intel: Better make those “Intel Inside” stickers harder to remove from PCs. Reader Keith Gormezano reports on one seen under the flush lever of a Macintosh user’s toilet.
E3arly warnings
A few forthcoming products to put on your “things to do after summer vacation” list, previewed at the Electronic Entertainment Expo in Atlanta:
Kids may get a kick out of the late fall release of two interactive play sets from Hasbro Interactive, Tonka Workshop and Star Wars Millennium Falcon Playset. Both combine activity software with a 3-D, plastic play set that straps over the computer keyboard to either emulate a physical workbench with building activities, or the interior of the Millennium Falcon‘s cockpit for Star Wars adventures. What’s neat is not the concept (several products, including Compaq’s ill-fated Wonder Tools, had a similar software and play-set combination) but the price. Each will cost about $40.
Adults who think like kids will get a kick out of Disney Interactive’s late-September release, Walt Disney: An Intimate History of the Man and His Magic. Of the rare multimedia biography variety, the $40 Windows 95 CD-ROM includes documents, cel art, and home videos, and doesn’t neglect criticism—many included essays are designed to illuminate, and not flatter.
And a company that should be kicked for the most convoluted reason for a new kid’s product is the Learning Company’s Creative Wonders division. When asked what made the new Madeline 1st & 2nd Grade Reading different from all the other reading titles available, the Creative Wonders rep claimed that since it contained the character Madeline, it was the only product designed to teach girls how to read. At last check, reading words from left to right was pretty much gender-neutral.
Frank Catalano, a Seattle-area analyst for computer industry companies and the co-author of Marketing Online for Dummies, can be reached at catalano@catalanoconsulting.com.
