Traditional stores make inroads with Internet retailing

Associated Press

Last year, Jo-Ann Beltramello and Rhoda Segerstrom shopped at online retailers such as Buy.com. This holiday, they will do most of their Internet shopping on Web sites tied to big brick-and-mortar retailers, like Talbots and Crate &amp Barrel.

"There is a certain comfort level with traditional companies," said Beltramello, 33, of Georgetown, Mass. "You can also return merchandise to the stores."

Segerstrom, 40, from Winchester, Mass., is shopping online at Lands’ End and at other traditional companies because she is "a little leery about some of the smaller sites."

What a difference a year is making in holiday shopping on the Web.

In 1999, Internet-only companies clearly dominated online shopping, with most major retailers in a wait-and-see mode or still building their sites. But that was before the dotcom shakeout, which has seen financing for many Web ventures dry up. Now many major retailers are moving in to win a larger share of the market.

The online-only businesses contend they have the expertise in handling Web transactions, and see the new interlopers as Internet novices, no matter how many years they’ve been selling on Main Street or at the mall.

What the Web sites with ties to traditional stores say they can offer is more options: Shop online or browse catalogs, make returns over a counter. Big chains such as Kmart Corp. and Best Buy Inc., are setting up Web kiosks in their stores, and promoting their varied avenues for shopping in major TV advertising campaigns.

"Pure Internet companies had a first mover advantage," said John Kristie, chief technology officer at Online Retail Partners, a New York consulting firm. "But this year, the big retailers are catching up. Consumers want the best of both worlds."

Since the holiday season began, chain-related sites have seen a 67 percent surge in traffic, compared to 42 percent for Internet-only firms, according to Nielsen/Net Ratings, an Internet research firm. During the seven days ending Nov. 26, which includes the busy Thanksgiving weekend, many purely online firms such as Buy.com, Kbkids.com, Egghead.com and eToys.com actually saw their traffic decline from a year ago, while plenty of store-related sites experienced hefty increases. Amazon.com, which had a 41 percent increase, attracted 6.21 million visitors.