HOME Technology 2005
On-line commerce goes mainstream
Web way to browse and pay
Around 84 per cent of New Zealanders who regularly use the internet conduct on-line research ahead of making a purchase and at least 30 percent make on-line transactions, according to Nielsen//NetRatings.

Other market research used by Telecom suggests 309,000 people in New Zealand regularly shop on-line. Local and international research looking at on-line buying habits reveal books, music, videos and travel are the most frequently purchased items followed by flowers, gifts, food, drink, electric appliances, computers, toys and games, apparel and accessories.

Books topped the list mainly because consumers felt no need to inspect them closely before buying. Weíve led the world for on-line banking (49 percent) and our use of the internet for information on destinations and accommodation and planning itineraries is among the fastest growing areas. About 40 percent of us make reservations or purchase tickets on the web. Around 50 percent of Air New Zealand customers travelling within New Zealand or on transTasman and Pacific routes book directly on-line.

A Massey University study of internet buying patterns and attitudes published in late 2004 said convenience and saving time were the strongest motivators followed by competitive prices, the wide selection of goods and regularly updated information. Typical on-line buyers are aged between 21 and 39 and well educated. Those who didnít finish secondary school accounted for only 6.9 percent of on-line shoppers.

The biggest impediment to buying was website security and privacy with the study warning e-retailers to adopt advanced encryption technology and post assurances of security on their website. Website design, reliability and customer service also influenced consumers

Many computer companies allow customers to experiment with the configuration of the machines they would like to purchase by matching components on-line and customising to suit their needs. This allows potential buyers to know exactly what they getting before they commit. And thereís a lot of activity in the on-line consumables market with both Corporate Consumables and OfficeRocket among those dealing with mainstream items including toner, ink cartridges, ribbons, CDs, DVDs, removable media, printers, faxes and phones for the office and home.

David Haysom e-commerce manager with newly launched on-line store OfficeRocket has been tracking the statistics and says the growth of on-line technology consumable sales has been quite dramatic in recent months.

"People are finding itís a convenient way to do things. The trust is there now that most of the security issues have been solved. On our site at least, customer credit card information is encrypted and all we see and store is a bank authorisation number." He says a policy of overnight delivery and a guarantee to return of faulty goods helps with credibility.

Mr Haysom says having a nationwide infrastructure with warehouses in Auckland, Wellington and Christchurch means thereís no need to stock and maintain shelf space in dozens of stores so savings are passed on to the customer. "We keep things as simple as possible, only take credit card payment and offer only whatís in stock by free overnight delivery."

Growth in e-commerce is now occurring at a rapid rate, with the popularity of sites such as eBay in the US and the local equivalent TradeMe, helping boost consumer confidence. The launch of Telecomís Ferrit on-line offering, allegedly the biggest virtual retail shopping mall in the country, is likely to boost that perception. Close to 100 retailers with around two million products had committed before the pre-Christmas launch. Customers will be able to compare goods and prices on-line before committing.

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