E-Commerce to Go Increasingly Global

Merchants who have tackled the international aspects of e-commerce have
found a brave new world of opportunity that can help them bring their
products to the world or the world to them.

“People are going online looking to buy stuff, and buckets of it,” said Nick
Jones, general manager of Canadian book site Chapters Internet. “Credit
cards are burning holes in their pockets.”

Jones, along with Alessandro Naldi, founder of the Italian tourist site
Weekend a Firenze and Doug Galen, vice president of business development at
online banker E-Loan (EELN), participated in the Going Global session Tuesday
afternoon at Fall Internet World ’99.

“There is a staggering amount of money to be made here,” Galen said.
Global e-commerce succeeds for a number of reasons. Galen says that people
are receptive to online loans due to a general dissatisfaction with local
banks. Jones said Chapters is able to leverage Canadian editions of books
and music, along with superior service that customers may not find in their
own country. And Weekend a Firenze is able to market unique goods from a
popular Italian region as it makes it easier for visitors to beat the museum
lines.

Jones said that a number of issues need to be addressed before taking on
international e-commerce, including shipping, customs, and taxation.
Shipping is perhaps the most complicated, and requires that the company
estimate the cost for shipping packages to every corner of the world.

After research, Chapters came to a simple conclusion: They would make money on shorter distances, but break even or even lose money on shipments to remote areas.

Chapters chose not to worry about the other two for now. They charge no tax for international shipment, and contract the customs responsibility to
Federal Express or another third party vendor.

“This was so reassuring,”
said Jones. “It was such a relief to have someone else handle this for us.”

Jones said e-commerce succeeds for Chapters because it is an extension of
the company that exists in all levels; from the CEO on down. For instance,
a book sent through e-commerce channels can be returned to a Chapters retail
store, if the customer so desires.

Naldi said his Web site began as a way for tourists to acquire unique
Florentine goods, that were not readily available to people who visit the
usual spots. It then added a reservation system to prestigious local
museums, visitors who spent a few minutes online will save several hours of
waiting on line.

Naldi, who apologized several times for his English, said that e-commerce sites depend on “mouth to mouth” support for their products. The audience and panelists were too polite to correct him, and Jones finally cited this as an improvement to the clichid “word of mouth.”

“I love that expression,” he said. “That’s exactly how it works.”

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