Another report, issued by the Internet consulting firm Forrester Research Inc., concludes that most retailers operating exclusively online will likely be out of business by 2001. The study said intense competition, the ongoing selloff in dot.com stocks and a drying up of venture-capital money will cause a rapid rise in buyouts and bankruptcies in the coming months.
WEB EXCLUSIVE: Trends Watch: Reports Say ‘E-Tailing' Industry Appears Headed for Big Shakeout’
Industry experts are predicting that the majority of Internet retailing businesses will be switched off in the next year, done in by oversaturation of a marketplace crowded by some 30,000 online sellers. A study issued by Columbia Business School and The Wharton School at the University of Pennsylvania found that most consumers do very little comparison shopping online, sticking mostly to the sites they know. Shoppers tend to stay with their favorite sites because it's too much trouble to find their way around new ones, the study said. The report concludes that consumers are attracted to the largest and best-known sites, such as Amazon.com, and sites linked to high-profile, traditional retail chains. Also enjoying success are sites offering niche products - something unique that consumers may not be able to find in stores near their homes. The thousands of sites that fall in between may be doomed if they don’t find a way to stand out, experts say.