Phil,
Thanks for the excellent analysis. You hit the business issues squarely on the head. All things being equal, the vast majority of consumers buy based on price and not on service. I have seen people say time and time again on this board that if their LDS had competitive prices, they would not have a reason to shop online. The problem is that most LDS don't seem to get that. They continue to operate under the outdated paradigm of "high margin/low volume", which is exactly why so many of them are failing.
As you pointed out, most of the successful online retailers started as a "bricks and mortar" LDS, and continue to operate a retail location. I know for sure that this is the case with ScubaToys, as I recently heard Larry interviewed on a Bottom Time Radio podcast. He had a good business to begin with, but expanded it by going online. His basic philosophy never changed -- providing quality equipment and top-notch service at the lowest possible price.
Thanks for the excellent analysis. You hit the business issues squarely on the head. All things being equal, the vast majority of consumers buy based on price and not on service. I have seen people say time and time again on this board that if their LDS had competitive prices, they would not have a reason to shop online. The problem is that most LDS don't seem to get that. They continue to operate under the outdated paradigm of "high margin/low volume", which is exactly why so many of them are failing.
As you pointed out, most of the successful online retailers started as a "bricks and mortar" LDS, and continue to operate a retail location. I know for sure that this is the case with ScubaToys, as I recently heard Larry interviewed on a Bottom Time Radio podcast. He had a good business to begin with, but expanded it by going online. His basic philosophy never changed -- providing quality equipment and top-notch service at the lowest possible price.