June 27, 2017


















Article 8.1

CONCLUSIONS ABOUT E-BUSINESS 1998

Many survey reports on e-business activity for 1998 were released in January 1999. Due to a Christmas shopping rush, consumer web sales were up "more than expected" from around $1 billion for 1997 to $3 to 8 billion for 1998 depending upon the definitions and assumptions of different surveys.

As many as 20 million US citizens had bought something via the net at Thanksgiving time and another 5 million made their first cyber-buy experience by Christmas day. The 25 million total is 12.5% of the adult population of the US and a much higher percent of the general populationís total - education, wealth and business influence. Will the e-shoppers that work for our best commercial customers start requesting B2B (business-to-business) web shopping options (power) from us? If we offer a web site, will it have the same performance and features that our e-shopping customers have already experienced from etoys.com, amazon.com and fedex.com? What are the specs and total cost of creating such an extranet? Who would build it and staff it? How would we finance and justify it?

E-Christmas reports suggest, incidentally, that a lot of e-shopping occurred at work where a lot of people have their internet access. This is stealing time from the employer, but it could also be teaching some employees about why they will have to reorganize their jobs around escalating digital expectations from both company suppliers and customers in the near future. If a company is going to see and successfully become part of the digital networked economy that will parallel, control and reshape the physical value-chain that they currently are apart of, shouldnít all employees be educated to see it? Why not go with the flow and assign key employees to review sites that are both within our industry and that have serious implications for how our industry might be changed?

Internet skeptics might point out that $8 billion in e-consumer sales was only 1% of the total retail sales for 1998. But, e-tail activity is somewhat of a distraction from the main event - B2B sales and customer support activities which exploded in volume during 1998. Cisco, all by themselves, sold $8 billion of internet hardware through their web site in 1998 and saved almost $600 million in total operational savings by rethinking their business around the internet. If we add in Intelís $1 billion per month in web site sales, up from zero in July 1998, and Dell Computerís $3.5 billion annual web site selling rate, these three firms did 3 times the high-end estimate for e-tail sales. How much more B2B activity is taking off?

On-line sales numbers suggest that the concern for "security" is waning and that sufficient, commercial solutions are available. A flood of new, better books and reports on "best practice" and "improvement opportunities" for web selling for both B2B and e-tail have been published since November 1998. The exponential growth rates for all e-business ingredients is continuing. What percent of B2B channel executives do you think have a good grasp on their digital transformation strategy and action steps for 1999?

Merrifield Consulting Group, Inc. Article 8.1