You don't have to pay an Armani-suited IT consultant thousands of pounds to know that the Internet will revolutionise how you buy PCs from dealers and resellers - the so-called channel. In the UK, people aren't selling computers online because they say it is important to have face-to-face contact, brochures you can mull over and attractive shrink-wrapped boxes of software delivered to your door.
The channel has acknowledged the Internet. But it can't really see why it should offer you the chance to connect to its database, browse its stock and order computer equipment. This doesn't mean the channel's not thinking about it; it's just that it realises that many people will lose their jobs because customers will order equipment directly from suppliers' databases.
The channel also knows how risky it is to provide such an online service at the same time as giving a normal service to the bulk of customers who don't care about buying goods electronically.
Companies had a similar approach to selling directly over the phone until the late 1980s. But, largely due to companies like Direct Line Insurance and First Direct Bank, it became clear that you could lose market share by not having such a service.
In the UK, it seems to be less a question of whether online sales of computer hardware and software will take off, but when? It only needs one market player to make a major investment for others to feel that subtle mixture of fear and greed that changes 'shall we' to 'we'd better do it fast'.
But who will be that market catalyst, and what kind of service will they need to run to attract your digital interest? One company in the US is attracting interest for being just such a player. Necx Direct has a background of making information available via bulletin boards. In the last year it has put its catalogue onto the Web so people can order goods online.
It claims a turnover of more than #600,000 a month from Web sales.
So what's the secret? First, let's get the situation into perspective.
Necx Direct is a #15m-turnover company. But the Web business accounts for about 4 per cent of sales. It is the scale of the company's operations on the Web that is significant, with more than #300m worth of stock listed on its site with details of over 20,000 items. Most importantly, it estimates that 60 per cent of its revenue comes from customers who gather information on the site, even though the ultimate sale may be over the phone.
Another interesting feature of the operation is that Necx chose not to advertise in print, preferring to promote on the Net. This made Necx one of the biggest Internet banner advertisers in the US this year.
The UK industry will have to study Necx and others that follow carefully.
It will realise that being successful is a combination of having online and database experience, or buying it in; providing a huge volume of accurate and timely information; providing alternatives such as phone sales and print catalogues; and advertising the service extensively on the Internet.
The margins in the computer business make online sales an obvious next option. All that is needed now is for one of the leading players to strike a blow and the battle will commence. Once again we are likely to see established players being upstaged by new online 'Netrepreneurs' with a lot less to lose.
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