She's not worried about competition from click and mortar giants either, she says, because of her company's niche focus. In the department stores, women's hosiery is only 2 percent of their market. National players will dominate online retail using barriers of technology, brand and scale, the report says. That's down from 9 percent of sales today. Smaller sites lack audience reach.
Big players are willing to spend lots of money on branding.
Few small or local merchants can afford multimillion-dollar portal deals for access to consumers. Companies like DVD Express, The Fragrance Counter and HealthQuick have paid millions for premium placement in AOL's shopping channel. Driving customers to an e-commerce site is a much more complex process today, agrees Gartner's Labatt. That includes the availability of tools to develop sites, manage the client experience and harvest data about those clients. On the other hand, it has raised the bar for new entrants to be able to provide that custom consumer experience that savvy Internet consumers are beginning to expect.