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Today, traditional retailers are realizing that they need a virtual presence on the Internet as clear and compelling as a Gap storefront. After all, as commerce goes online, so does the business-consumer relationship. And, Shiva argues, “e-mail is the ultimate relationship builder.”

Ninety-three million Americans sent a total of 335 million e-mails per day in 1999, according to Jupiter Communications. Personal e-mail has grown 50 percent per year, a surging tsunami of messages that’s outstripping even the Web, whose users have grown just 21 percent per year, says Jupiter. And 23 million Americans used e-mail to order goods from corporate Web sites, accounting for much of the $20 billion consumers spent online in 1998. That figure’s set to top $140 billion by 2003, according to Forrester Research, while business to business online sales grow from $109 billion to $1.3 trillion.

If the medium for e-commerce is e-mail, small wonder that General Interactive (which, at 4 years old, is already the granddaddy of intelligent e-mail response) is now feeling heat from competitors who share Shiva’s belief that the key to the future of online retailing lies in electronic “customer relationship management.” Rivals include other startups such as Brightware and Kana Communications, and also titans of the 1-800 call business such as Lucent Technologies. The field of intelligent e-mail response did $75 million in sales in 1998, and is expected to grow to $340 million by 2003 according to International Data Corp.

Although intelligent e-mail response is a small industry, observers believe its innovations could have a far greater impact by helping to determine winners and losers in e-commerce’s frenzied grab for market share. The swift emergence of giants such as Amazon.com and eBay has sounded the drumroll for big brick-and-mortar firms now venturing online. “In three years there won’t be that many giant consumer retailers online. There will be lots of consolidations and shakeouts,” believes Shelley Taylor, president of the consulting firm Shelley Taylor & Associates. And after surveying the 1,000 largest companies’ online prospects, Taylor believes those who succeed “will win due to the quality of their communication.”

So far, about 25 of the biggest names in corporate America-including Allstate, IBM and Procter & Gamble-have delivered at least part of their online persona to the care of Dr. E-mail.

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