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Retailers Flocked to Internet, But Where Were Shoppers?

Christmas sales slowed by fuzzy graphics, concerns about security

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THIS holiday season, retailers hit the Internet, hawking everything from specialty cheesecakes and women's wallets to books and records.

But despite all the hype about the global computer network - and apparently slow sales by traditional retail channels this Christmas - consumers did not flock to the "virtual malls" of cyberspace. And they probably won't next year, either, marketing analysts predict.

"They are not perceiving a clear benefit to shopping on-line yet," says Karen Burka, analyst with SIMBA Information Inc, a Wilton, Conn., firm that tracks sales on the Internet and other on-line services.

Cyberspace retailing isn't taking off because of consumer concerns about security and technological limitations. Analysts predict it will take at least two years to sort out these issues. So annual on-line sales aren't expected to top $1 billion until 1998 - still a blip in the $2.2 trillion retailing industry in the United States.

For the most part, retailers don't seem to mind the delay. "We don't have any perceptions that it's an overnight process," says Stuart Spiegel, vice president and general manager of QVC's new interactive shopping service, called iQVC. "You'll see some serious business in five years."

In the meantime, retailers are learning the sometimes surprising rules for how to sell in cyberspace. For example:

*Ignore women; sell to men. Although more women buy from catalogs, the Internet and other on-line services are for now a male domain. So the mainstays of catalog shopping - such as clothing and fashion accessories - usually don't sell well in cyberspace. Computer software, electronics, and gadgets do.


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