You’re only hurting yourself, goes the old saying. The massive shift by major retailers to accommodate people who want to shop for pajamas in their pajamas is costing more than the e-commerce evangelists promised. As the likes of Walmart, Target and Kohl’s rush to catch up with Amazon in the online marketplace, those big companies are starting to learn why Amazon has been slow to create big profits for investors: online retailing is expensive!
The Wall Street Journal says costs for e-commerce operations–much of which must be outsourced–are suffocating. “Kohl’s Corp. says its profitability online is less than half what it reaps in its store,” according to the Journal. One of the reasons? The shipping, logistics and infrastructure don’t benefit from the customer’s help. From a company’s perspective the traditional customer was practically an employee, doing a lot of the things online customers don’t do. They drove themselves to the store, packaged and delivered their own goods, and came back to the retail outlet to process their returns. The online customer does none of that, sitting in his or her pajamas.