What advantages do the traditional brick and mortar establishments in Europe have over the emerging dot com companies in America? '

One would think that, since America went first into the void, that Europe would have the advantage of seeing their mistakes and avoiding them. Not so. E-commerce turns out to be a lot more difficult than the major bricks and mortar retail establishment's thought.'(Pringle;2000)

Though today it is thought that it is an advantage that America is the leading Internet power actually, this head start means that other nations can learn from America's mistakes and thus, establish a stronger Internet system as can be seen in the case of Europe. Two years after retailers went online in America, European retailers entered the race. But unlike their counterparts, they knew the pitfalls.

One advantage of being a online retailer in Europe is the lack of competition (this reason will soon become invalid.) When Karstadt-Quelle AG a department store started an online shopping mall in October 1996, Germany's retail industry thought that it was a sure loss. At the time Germany had only about 750,000 Internet users and out of those most it is believed were teenagers. Yet, by the end of 1997, five million Germans were online, according to Jupiter Communications, a New York-based research group. Thus, the market had reached out for the potential and won. The company tried to intervene in all the areas where they had seen US retailers fall and so they managed to avoid many of the problems.

Another advantage of this unexplored market was that the audience was not as sophisticated. The retailers could start slow and study the market reaction and change accordingly. The Americans retailers had no such luck. There audience was large and developed and wanted convenience and technological advancement so that the retailers had to deal with cutthroat competition while making their sites and services accessible to all. Brick-and-mortar companies in Europe have maintained a strong position in the dot com market. Mr. Sawyer at Forrester claims that the traditional retailers have easily caught up with the initial retailers, as the pace of growth was slow. So that they may lag behind in the international market but in their own area they are competitive as any one else. On the other hand the US retailers are still trying to catch up with the Internet startups who are far ahead of the slower entrants in the field.

Nevertheless, the real test will come once the European brick and mortar companies who have dot com presence enter the International market. Once they have the capacity to compete at a global level will it be seen whether they have actually learnt from the mistakes of the American counterparts of is it all a false sense of bravado. Sure the greatest asset they have is that they are slow developers and thus they have less failures. They analyze the problems and then grow according to the needs of society. However, they need to turn this advantage to a profit if they are to survive for as the web continues to grow they will soon realize that there greatest asset has become a white elephant to their business.

Reference · E-Commerce (A Special Report): Industry by Industry --- A Head Start: European retailers learned from the mistakes of their U.S. counterparts; But it didn't do them much good Wall Street Journal; New York; Apr 17, 2000; By David Pringle;