Does online buying accrete or dilute store sales?
The Jupiter Communications report Channel Shift (June 1999) came to the startling conclusion that retail sales would grow little because of online buying. Rather, more than 90 percent of new sales would come at the expense of stores and catalogs. This is contrary to the consensus view holding online buying does not impact in-store sales. Jupiter found the Internet represents more of a threat than an opportunity to traditional channels and in the case of consumer electronics online buying would cannibalize store sales dollar for dollar. Merrill Lynch warns retail company investors about online competition. In August, Merrill Lynch downgraded a number of retailers partially due to investor concerns over online competition (WSJ, Thursday, August 26, p. B4). Last March, Merrill Lynch downgraded a group of retail REITs over Internet buying fears. See RREEF report discussed below. The October issue of Shopping Center World (pp. 28-36) featured a story about online buying s growing negative i
