Barclaycard, a British credit card company, will launch an online shopping portal by mid-December to tap into the growing European online shopping market.
Barclaycard has signed deals with 50 European clicks-and-mortar retailers and pure plays to sell products on the site and is looking to add 300 more retailers before the end of 2001. The company would not disclose any names of the new partners.
The portal, which has not been named yet, will be divided into 14 shopping categories, including clothing, gifts, computer products and music. Though the site will accept purchases made with all credit cards, Barclaycard will create incentives and promotional offers specifically for its own cardholders.
“Eighteen percent of Internet transactions in Europe are done by credit card. We see this online portal as an opportunity to exploit this spending growth,” said Bob Potts, chief executive at Barclaycard, North Hampton, Britain.
Barclaycard has 10 million cardholders in Britain and 1 million others throughout the rest of Europe, Potts said.
“We can market this online portal directly to our customer base, eliminating the need to build awareness through extensive brand advertising,” he said.
The company plans to market the Web site through customer statement inserts, independent direct mail pieces targeted to a portion of its customer base, banner advertising on the Barclaycard Web site at www.barclaycard.co.uk and other Web sites. Barclaycard's customer base is slightly skewed to males age 30 to 40 with high incomes, Potts said.
“Many of our core customers are reluctant to buy on the Internet for security reasons but may decide to purchase on the portal because of the security associated with the Barclaycard name,” he said.
The credit card company will establish revenue sharing agreements with all merchant partners that sell products through the portal. Also, the company plans to sell advertising space on the site to supplement revenue.
Barclaycard is investing $20 million to develop the site. Nomura International, the overseas arm of Japanese investment bank Nomura Securities, is funding an additional $10 million.