- The Washington Times - Monday, November 6, 2000

Sorry on-line retailers, the time has passed to prepare for the upcoming holiday season. At least according to Paul Strzelec, vice president of marketing for Mercari Technologies (www.mercaritech.com).
The company, whose name is derived from Latin meaning "to trade," works to help business better understand consumer buying habits and purchasing trends. Using their proprietary software, they compare consumer merchandising trends with the retailers' merchandising practices, supply-chain planning, and category and financial management.
In simpler terms, they help retailers recognize demand and meet expectations.
"We may already be in the middle of execution of this year's holiday season which began sometime during mid-October," said Mr. Strzelec from his D.C. office. "But it is not too late, or early, to begin thinking about next year and begin collecting information about your customers and their buying habits."
With Forrester Communications predicting that the number of on-line consumers will double over last holiday season, and with an optimistic expectation of $10 billion in e-commerce sales, retailers may be wise to start categorizing on-line consumer habits quickly.
Mercari Technologies' Web-based InitiaLink solution helps retailers anticipate customer need and optimize retail space by filling it with the most profit-leading, or best-selling, items. The program connects manufacturers and retailers with customers using consumer feedback collected by the retailer.
InitiaLink features the group's NeoCtex Optimization Engine that uses mathematical tools to help forecast future consumer purchases.
This is done by considering consumer survey responses before stocking shelves and determining how a retailer manages product categories. The end result is that the products on the shelves are targeted toward the shopper's wants, boosting a company's bottom line.
The melding of "real-world" consumer behavior to the retailers' merchandising plans also helps to reduce lost profits that result when a consumer's needs are left unsatisfied.
"Consider an item such as the new Sony PlayStation2, which is going to be one of the hot buys this season," Mr. Strzelec said.
"If a retailer does not have the system in stock, the consumer will not only go to another store in search of that new gaming system, they will also be purchasing additional controllers, memory cards and games from that other retailer. The result is that you have lost the sale and you have lost that person's shopping cart, possibly for good."
In the on-line world, where a competitor is only a mouse click away, Mercari Technologies' ability to help retailers recognize product trends may become vital to e-commerce retailers.
The Web-based application has helped clients like Pillsbury keep its shelves stocked with its baked products, increasing freshness while reducing consumer disappointment.
"If you look at the total working capital of any retailer, there is a limit to the dollars they have to invest in inventory," Mr. Strzelec said. "The goal therefore is to develop the broadest and deepest assortment of inventory items that the retailers' identified consumer base wants."
A deeper issue for on-line retailers is the process of providing a service promise to the consumer that will create the good will necessary for them to return. This promise includes having the products that consumer wants in-stock and ready to ship in the best possible manner.
"On-line retailers need to be able to identify between core and noncore items," Mr. Strzelec said. "This holiday, certain name retailers, such as Amazon.com and Toys 'R' Us are going to get the bulk of the on-line sales. But that does not mean that those consumers, unable to find in stock at the name retailer, won't go searching elsewhere."
Unlike the mall where you have to trudge from store to store, the Internet provides the smallest of on-line retailers a level playing field when they have correctly identified and stocked their shelves with the products consumers are most interested in purchasing.
Mr. Strzelec said retailers should remember that consumers buy on line when the item has the most competitive price and the company offers the highest level of service, from gift wrapping to free shipping.
It is also important to make sure that your cyber-shelves, or Web pages, are neatly arranged and easy to navigate.
Have an interesting site? Write to Joseph Szadkowski at the Business Browser, The Washington Times, 3600 New York Ave. NE, Washington, D.C. 20002; call 202/636-3016; or send e-mail (joseph@twtmail.com).

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