Local Shopping Search Stalks E-Commerce

Bob Tedeschi’s NY Times e-commerce column today discusses a number of companies, NearbyNow, GPShopper, Krillion, ShopLocal and StepUp seeking to make the online-offline shopping connection. The article’s hook is wireless shopping tools from NearbyNow and GPShopper.

All these companies, and others, to varying degrees are trying to bring offline inventory information into online databases to meet consumer demand for information about “Where can I buy it today?” Indeed, there are two principal areas of growth for online shopping: social and local/offline. There’s ultimately much more demand for locating goods in physical stores in-market than there is for e-commerce, which will continue to grow but flatten.

According to the U.S. Commerce department, e-commerce is about 3% (or so) of total U.S. retail. Jupiter Research recently forecasted that e-commerce would slow to single digit growth by the end of the decade but that Internet-influenced offline shopping would gain dramatically (reaching a trillion dollars by 2011). That number is a bit outrageous — a trillion dollars in four years — but see it as a kind of metaphor for the fact that more and more local shopping is going to be driven by the Internet and, eventually, wireless.

According to a recent survey of Japanese cell phone owners, shopping is the most popular service on mobile phones. Mobile shopping will eventually grow in the U.S. but will be tied in to local very directly, with e-commerce as a kind of “back up.”