PRINT THIS STORY:

CHANGE TEXT SIZE:

GROCER LOSSES GROSSER AND GROSSER

News from the Internet grocery store front has been especially grim lately. Webvan has been burning through $100 million a quarter and shut down its delivery service in Dallas. Peapod, the No. 2 U.S. online grocer, reported its biggest loss yet ($23.8 million in the last quarter of 2000), prompting it to ask for a $50 million infusion — it got $30 million — from its majority owner, Dutch supermarket giant Royal Ahold. And Balduccis.com, which delivered groceries for upscale New York City grocery Balducci’s, has quit altogether. However, the quest for success continues, as grocery stores roll out their own Web sites. Supermarkets are much better positioned to succeed than Internet-only operations because they already have a relationship with their customers, nearly all of whom only want to use the Web to supplement their in-store grocery shopping, Jon Hauptman, vice president of Barrington, Ill.-based retail consulting firm, Willard Bishop Consulting, told SCT. Moreover, they don’t need to spend millions building giant warehouses — they can supply consumers from their existing stores.

PROFIT WARNING

A recent quote from Buy.com announcing the replacement of its CEO and CFO succinctly summed up the state of e-tail: “We’ve proven our ability to attract customers and sell product; now we need to prove that we can make money,” said interim CEO James B. Roszak, a board member at Buy.com. Shares at Buy.com, billed as the “Internet Superstore,” reached $22 in the past year, but have since dropped to well below a dollar. The company has been bought by the John Lewis Partnership, the British department store chain.

BACK TO THE FUTURE

Kozmo.com, one of several online companies that epitomized the brave new world of Internet commerce, has announced a new old strategy: The online delivery service is sending out about 400,000 catalogs to consumers and also will begin taking telephone orders. And to drive home the message that it has become much, much more than a mere dotcom, Kozmo, which serves nine markets, has dropped the dotcom suffix from its name.

 

VIRTUAL STATISTICS

Customers with questions at Tesco, the British-based supermarket chain, won’t have to go hunting anymore for elusive store assistants — who might not have the answers anyway. The supermarket is introducing what it calls “virtual shop assistants” — screens placed throughout the stores that provide information when product bar codes are swiped past them. The devices inform shoppers on products’ ingredients, instructions for use, dietary tips and a host of other information.

CYBERSNIPING

So just what are they saying about your company on the Internet? Arlington, Va.-based Cyveillance pledges not only to keep you appraised of what they’re doing to your brand, but also offers advice about what to do about it. Has someone set up a Web site dedicated to dissing your store? Is one of your “exclusive” vendors selling elsewhere? “We provide intelligence,” Julie Kennon, the company’s director of publications, told SCT.

STORES TELL STORY THE BEST

When it comes to marketing Web sites, bricks go further than clicks, Walmart.com has concluded. The company has laid off 24 people employed in online marketing and merchandising, and will rely on Wal-Mart stores to promote the Web site instead. Walmart.com also has eliminated some low-price merchandise that was costing more to ship than to buy.