Off Topic: how will rising gas prices affect e-commerce?

11 Jul 2008 - 5:49pm
6 years ago
10 replies
679 reads
Angel Anderson
2010

A friend is a writer for an LA-based appeal newspaper and he was wondering
what the folks in the Interaction Design community might have to say about
this question: how will rising gas prices affect e-commerce?

Comments

11 Jul 2008 - 8:37pm
Dave Malouf
2005

Actually, not that far offline. I think it all depends on how you
define e-commerce. If you literally mean online shopping and
financial transactions directly online, I'm pretty torn. It depends
on if shipping costs increase the way commercial passenger costs have
increased. If UPS, USPS and FedEx start raising rates, it might make
"going to the store" more tolerable.

On the other hand, going to the store means driving and paying for
gas.

In the end all products are going to cost more due to increases in
logistics costs.

Now, if you generally mean IT development. I think this is a good
thing for us especially in collaboration software. Since so much has
been invested in distributed teams, and the costs of getting people
together are so high, it will be even more important to have the
right tools and services to make telepresences practical across all
sorts of organizations (size & type).

That's my initial thoughts.

-- dave

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Posted from the new ixda.org
http://www.ixda.org/discuss?post=31262

11 Jul 2008 - 9:53pm
.pauric
2006

Great question Angel, I believe bricks & mortar commerce and
e-commerce are closely coupled under the banner of general consumer
spending. While I think we might see a shift to online shopping in
the short term, as the price index of core goods increases we will
see both online and real world luxury item spending decrease.
I'm a bit of a pessimist so take what I'm about to say with a pinch
of salt. I believe we are just at the start of a major correction in
the model of unlimited 'economic' growth. The concept of peak-oil
has been preceded by a dramatic increase in global demand for fuel
and petroleum based products. Demand has, and from here forward,
outstripped supply on a finite resource. There will be no return to
cheap petrol.
To underline the impact on the US economy, at $2/gallon the average
household spent around 10-12% on petrol, at $4/gallon we're spending
around of a 1/4 of our disposable income. Those figures are not going
to improve.
Now, a little out of left field but I highly recommend watching this
ted talk on why the US is going to have an extraordinarily hard time
adjusting to higher petrol prices.
http://www.ted.com/index.php/talks/james_howard_kunstler_dissects_suburbia.html

While I'm a pessimist and the direct answer to your question is a
forecast of tough times ahead for anyone in the consumer space I
would like to turn the issue around to; how are we part of the
solution, what has the general realization that we cant continue
#$%ing the planet over got to do with interaction design?
http://designersaccord.org/about/da_dd.html

"At this cultural inflection point ... we need to do more than play
corporate catch-up or throw our hats into the ever-enlarged PR ring
of greenery. We need to stimulate mass change.

In the same way that we approach design challenges - not by
purporting to have all of the answers, but instead by assuredly
asking the right questions - we must recognize that we don't have
the solution yet because our formula has been wrong. Our addiction to
sweeping change has hobbled us from seeing the most obvious
opportunities for improvement ... Our first green products must be
ourselves."

Who do you work for? Why? Is you work going to leave the world a
better place for your children?

/pauric

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Posted from the new ixda.org
http://www.ixda.org/discuss?post=31262

12 Jul 2008 - 1:45am
Steve Baty
2009

Angel,

There is no meaningful answer to that question: the economy is too complex;
and there is simply no way to pick one factor at play and ask "how will this
affect *some other thing*". A lot of things *may* happen. As Dave pointed
out: higher delivery costs may cause people to buy less online; or the lower
cost of buying online versus driving to buy it in person might work the
other way. People might start to car-pool and head to the mall with their
neighbours, which might mean instead of all buying smaller cars we buy one
large passenger car, but use it less.

I should also point out that while you ask about the effect of gas prices on
the economy, the fact is that, at the moment, the largest impact on the US
economy is coming from the fall-out of the sub-prime mortgage farce. You're
also ignoring the effect of a booming economy in China and India; a very
large appetite for primary resources in those countries as a result of huge
spending on infrastructure projects; a growing demand for manufactured
imported goods from the US and Europe; etc etc etc.

One last thing I will say about gas prices: what you pay for your petrol at
your local gas station has bugger-all effect on your economy. A much more
direct impact is the effect those prices have on the cost of transporting
goods from one city to another; one state to another; and one country to
another. They're the effects driving the price of the goods that you
purchase, and you have no control over those. On the other hand, your gas
price for your car can be reduced by driving less or being more careful
about your driving.

Regards
Steve

2008/7/12 Angel Anderson <angel.j.anderson at gmail.com>:

> A friend is a writer for an LA-based appeal newspaper and he was wondering
> what the folks in the Interaction Design community might have to say about
> this question: how will rising gas prices affect e-commerce?
>

--
----------------------------------------------
Steve 'Doc' Baty B.Sc (Maths), M.EC, MBA
Principal Consultant
Meld Consulting
M: +61 417 061 292
E: stevebaty at meld.com.au

UX Statistics: http://uxstats.blogspot.com

Member, UPA - www.upassoc.org
Member, IA Institute - www.iainstitute.org
Member, IxDA - www.ixda.org
Contributor - UXMatters - www.uxmatters.com

16 Jul 2008 - 12:40pm
Angel Anderson
2010

Thank you all for the insightful comments. I've forwarded your remarks to
my writer friend who is most appreciative. Like many questions we pose in
this discussion list, the answer is "it depends." We'll have to wait and see
how the complex web of factors plays out in the global economy but the times
they are a-changin'.
Pauric, thanks for sharing Kunstler's TED talk. I want to be a good citizen
in this brave new world ;-)

On Sat, Jul 12, 2008 at 12:45 AM, Steve Baty <stevebaty at gmail.com> wrote:

> Angel,
>
> There is no meaningful answer to that question: the economy is too complex;
> and there is simply no way to pick one factor at play and ask "how will this
> affect *some other thing*". A lot of things *may* happen. As Dave pointed
> out: higher delivery costs may cause people to buy less online; or the lower
> cost of buying online versus driving to buy it in person might work the
> other way. People might start to car-pool and head to the mall with their
> neighbours, which might mean instead of all buying smaller cars we buy one
> large passenger car, but use it less.
>
> I should also point out that while you ask about the effect of gas prices
> on the economy, the fact is that, at the moment, the largest impact on the
> US economy is coming from the fall-out of the sub-prime mortgage farce.
> You're also ignoring the effect of a booming economy in China and India; a
> very large appetite for primary resources in those countries as a result of
> huge spending on infrastructure projects; a growing demand for manufactured
> imported goods from the US and Europe; etc etc etc.
>
> One last thing I will say about gas prices: what you pay for your petrol at
> your local gas station has bugger-all effect on your economy. A much more
> direct impact is the effect those prices have on the cost of transporting
> goods from one city to another; one state to another; and one country to
> another. They're the effects driving the price of the goods that you
> purchase, and you have no control over those. On the other hand, your gas
> price for your car can be reduced by driving less or being more careful
> about your driving.
>
> Regards
> Steve
>
>
> 2008/7/12 Angel Anderson <angel.j.anderson at gmail.com>:
>
>> A friend is a writer for an LA-based appeal newspaper and he was wondering
>> what the folks in the Interaction Design community might have to say about
>> this question: how will rising gas prices affect e-commerce?
>>
>
> --
> ----------------------------------------------
> Steve 'Doc' Baty B.Sc (Maths), M.EC, MBA
> Principal Consultant
> Meld Consulting
> M: +61 417 061 292
> E: stevebaty at meld.com.au
>
> UX Statistics: http://uxstats.blogspot.com
>
> Member, UPA - www.upassoc.org
> Member, IA Institute - www.iainstitute.org
> Member, IxDA - www.ixda.org
> Contributor - UXMatters - www.uxmatters.com

17 Jul 2008 - 9:02am
Benjamin Ho
2007

Late to chime in..

I've always been a believer of e-commerce. A well-executed site
with near-perfect logistics will outperform brick and mortar commerce
solely by the time it saves. Time of going to some place built in the
70's, time of fighting traffic, gassing up your vehicle, and time of
looking for a parking space.

Other than "wanting it instantly" or to entertain yourself out
there in the malls, there's really no reason to head out to stores
to buy something. I believe this applies mostly to hardware,
although software like clothing can be considered the exception in
some cases.

E-commerce is the equivalent of mail order - just that payment and
seeing products in different perspectives is much better. E-commerce
is here to stay.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Posted from the new ixda.org
http://www.ixda.org/discuss?post=31262

17 Jul 2008 - 2:21pm
jrrogan
2005

I think the trend is that higher gas prices this will help ecommerce, as the
cost to find and purchase items is not affected by increases in gas prices,
(note shipping is a factor, but this is often offset by lower prices online
and discounts eaten by the retailer via shipping promotions).

A few years back I worked with a large fulfilment co. and I believe even
back then the conventional wizdom was that high gas = more internet
purchases.

--
Joseph Rich Rogan
President UX/UI Inc.
http://www.jrrogan.com

18 Jul 2008 - 8:42am
Michael Micheletti
2006

I think there's a wishful side of us all that hopes business picks up,
whatever our businesses may be. But Citibank just posted a net loss of
2.5 billion dollars from people having trouble paying home, auto, and
credit card debt. The effect of high gas prices on e-commerce may be
just a blip compared to the effects of job losses, hiring freezes,
empty storefronts, and foreclosures. I'm pretty sure that people will
continue to buy food and gas and other necessities. Readers will
continue to buy books - they can't help it. Internet services, like
online banking, will endure. But consumer luxuries purchased online?
Ouch.

Michael Micheletti

On 7/11/08, Angel Anderson <angel.j.anderson at gmail.com> wrote:
> A friend is a writer for an LA-based appeal newspaper and he was wondering
> what the folks in the Interaction Design community might have to say about
> this question: how will rising gas prices affect e-commerce?

18 Jul 2008 - 12:47pm
Robert Reimann
2003

One piece of the energy equation that people don't always take into account
with online services is the cost of the IT infrastructure required to do
business. Giant server farms like Amazon's or Google's require enormous
amounts of power to run and keep cool. There's a reason why the Pacific NW
is a home to many of these server farms: Washington state is 80% powered by
hydroelectricity, and Idaho uses 100% hydro power.

Robert.

On Wed, Jul 16, 2008 at 11:40 AM, Angel Anderson <angel.j.anderson at gmail.com>
wrote:

> Thank you all for the insightful comments. I've forwarded your remarks to
> my writer friend who is most appreciative. Like many questions we pose in
> this discussion list, the answer is "it depends." We'll have to wait and
> see
> how the complex web of factors plays out in the global economy but the
> times
> they are a-changin'.
> Pauric, thanks for sharing Kunstler's TED talk. I want to be a good citizen
> in this brave new world ;-)
>
>
--
Robert Reimann
IxDA Seattle

Associate Creative Director
frog design
Seattle, WA

19 Jul 2008 - 5:16am
Chauncey Wilson
2007

The New York Times has an article on the impact of gas prices on e-commerce.

To Save Gas, Shoppers Stay Home and Click
http://www.nytimes.com/2008/07/19/business/19shop.html?ref=technology

Robert makes a very important point -- many of the tips about sustainability
don't take into account the total cost of ownership and often neglect to
include cost like IT infrastructure or other hidden costs. I'm work at a
company that makes architectural software and have discovered that "being
green" is often very complex with many interactions between actions,
materials, and energy. When you buy a vehicle, for example, you have to
consider gas mileage, but also the recyclability of the materials in the
green calculation. A high mileage car with a lot of exotic materials may
not be a recycleable as a big old pickup truck so in the long run, you will
need to consider the total energy costs including the energy to replace that
vehicle and recycle the old one.

Chauncey

On Fri, Jul 18, 2008 at 2:47 PM, Robert Reimann <rmreimann at gmail.com> wrote:

> One piece of the energy equation that people don't always take into account
> with online services is the cost of the IT infrastructure required to do
> business. Giant server farms like Amazon's or Google's require enormous
> amounts of power to run and keep cool. There's a reason why the Pacific NW
> is a home to many of these server farms: Washington state is 80% powered by
> hydroelectricity, and Idaho uses 100% hydro power.
>
> Robert.
>
> On Wed, Jul 16, 2008 at 11:40 AM, Angel Anderson <
> angel.j.anderson at gmail.com>
> wrote:
>
> > Thank you all for the insightful comments. I've forwarded your remarks
> to
> > my writer friend who is most appreciative. Like many questions we pose
> in
> > this discussion list, the answer is "it depends." We'll have to wait and
> > see
> > how the complex web of factors plays out in the global economy but the
> > times
> > they are a-changin'.
> > Pauric, thanks for sharing Kunstler's TED talk. I want to be a good
> citizen
> > in this brave new world ;-)
> >
> >
> --
> Robert Reimann
> IxDA Seattle
>
> Associate Creative Director
> frog design
> Seattle, WA
> ________________________________________________________________
> Welcome to the Interaction Design Association (IxDA)!
> To post to this list ....... discuss at ixda.org
> Unsubscribe ................ http://www.ixda.org/unsubscribe
> List Guidelines ............ http://www.ixda.org/guidelines
> List Help .................. http://www.ixda.org/help
>

19 Jul 2008 - 7:21am
.pauric
2006

Related to Robert's comments, there have been a number of reports on
Google buying up land surrounding both Hydro plants in the NW as well
as 2 massive sites in North Carolina

PBS's Robert X. Cringley wrote a piece on their activities..
"Why would Google need two data centers in a state with only four
million residents? Why would they need to buy 520 acres in a Goose
Creek industrial park when that's probably 100 times as much land as
any conceivable data center would require? Google is building a LOT of
data centers. The company appears to be as attracted to cheap and
reliable electric power as it is to population proximity. In Goose
Creek they bought those 520 acres from the local state-owned electric
utility, which probably answers the land question posed above. By
buying out all the remaining building sites in an industrial park
owned by an electric utility, Google guarantees itself a vast and
uninterruptible supply of power, much as it has done in Oregon by
building a data center next to a hydroelectric dam or back here again
in Columbia by building near a nuclear power station."

So while I agree with Robert that the increasing cost of electricity
product is going in impact those in Data Infrastructure, Google are
investing for the future and I suspect their foresight will result in
a significant competitive edge in the near future.

It says something when you need a Nuclear plant to power your
operations (o;

Its also worth noting that the google founders are early investors in
Nanosolar which plans to produce plastic sheets you can lay out on the
roof of your house and harvest solar power:
http://news.cnet.com/8301-10784_3-5749586-7.html

/pauric

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Posted from the new ixda.org
http://www.ixda.org/discuss?post=31262

Syndicate content Get the feed