Online Christmas Sales Prove a Bust in Europe
It wasn't for lack of effort on the part of Web merchants. IBM financed a French Website that received 185,000 hits in three months. The yield: a meager 1,400 orders.
Three American heavyweights got behind the E-Christmas site on the Web - UPS, H-P and Microsoft. They expected a half a million visitors over the six week holiday period but only 250,000 showed up. Sales results were worse: some 500 people bought one or several products.
Even luxury goods didn't move on the Web. Monaco Shopping put a dozen companies on line when it started in the summer but they snagged a threadbare 40 customers from among the 6,500 who came to browse.
Efforts to build a Swiss Christmas store on the Web ran into the same problem - a lot of visitors and very few sales. Some 18,000 came to look but fewer than a hundred keyed in their credit card number to buy something.
That seems to be the crux of the problem, the organizers and backers of the Christmas Websites agreed. Europeans are still reluctant to give out their credit card numbers to a machine - computer or telephone.
"Credit card penetration in Germany is pretty deep," one specialist explained, "but we Germans are simply reluctant to give our number over the phone. It's a cultural thing. We just don't do it."
Most of the Christmas Websites have now shut down with the organizers doing their post-mortems. One line is that the whole exercise was a "learning experience" designed to "increase awareness and knowledge of electronic commerce."
But another admitted that a number of errors had been made in launching the Christmas project. Many of the Websites were poorly designed and therefore not easy to navigate around.
Backers did little to promote the new services and like anything else the Web did not sell itself simply by being available.
Equally vexing was the failure to anticipate legal and logistical problems. Sell wine online outside of France and you still have to pay hefty export taxes, for example.
Finally, Europe's network infrastructure performed poorly, proving to be so great an obstacle that German consumers can order faster from a US Website store than from one in Spain.