Developing and selling products: e-retailing
E-retailing is selling physical products via online channels.The purchasing, and often
payment, takes place online and delivery of the good via postal services. An option for
cultural heritage institutions is to combine e-retailing with a membership scheme, e.g.
with special items and prices only for members.
museumshop.com,The National Geographic Store, <http://www.museesdefrance.com>
(Réunion des Musées Nationaux)
E-retailing in commercial terms seems to be only an option for institutions that are potent
enough to establish a brand (e.g. large and well-known museums). For example:The Metro-
politan Museum in New York, with 5,5 Million visitors in 2000, sells its items with the
slogan "A gift from the MET is a gift to the MET." <http://www.metmuseum.org/store/>
To establish a brand will necessarily include to develop and produce - together with
specialist companies - items that are based on their collections or related to their activities
(e.g. gift shop articles, cultural CD-ROMs).Yet, in order to develop for example cultural
CD-ROMs most institutions will need creative and commercial partnerships. Developing
multimedia products is still a risky and largely a costly business. Returns from most off-line
multimedia products have shown to be very limited, profit often being not more than 1-3%,
with many products not reaching the break-even point. After the experiences of the last ten
years in the multimedia market, the willingness of cultural industry players to put money
into such projects will be limited. (Council for Cultural Co-operation, 1999: p. 11)
Ideally, a museum e-shop would offer only unique products based on objects held in the
museum collections. For the big e-stores that draw all of their products from merchandisers
(e.g. post cards, posters, calendars), competition is very high, meaning that the range of
products offered, responsiveness (e.g. telephone support), gift wrapping, shipping etc. need
to be top-end.
Generally, what the really big names under the e-retailers, e.g. Amazon.com, have learned
is "that building a retail brand costs a fortune"; and that you need the scale of millions of
loyal customers,"to make up for the damage that shipping costs wreak on your margins".
(Jackson, 2001) There are, of course, many small institutions involved in e-retailing in the
cultural heritage field. On Yahoo! Store in October 2001 with the search term "museum"
one could find 672 stores! Yet, for most of these institutions e-retailing can only be seen as
an add and the revenues to be expected are far from impressive (e.g. break-even).The
situation might even be worse, because engaging in e-retailing can lead to a channel rivalry.
In a study on the 36 non-departmental public bodies (NDPBs) sponsored by the UK
Department for Culture, Media and Sports the authors write:"E-commerce can expand
revenue streams, tap into new markets through sales to non-traditional customers, and
reduce costs of transactions and fulfilment. However, trading plays only a very small part of
the core business for many NDPBs, suggesting that for these organisations the potential for
e-commerce is low. Furthermore, unless new markets can be tapped, online sales may
simply be displacing those through traditional channels, creating a channel rivalry with the
potential to increase rather than reduce costs." (QUEST, 2000, 40)