Quick, where do you buy car insurance? And where did you reserve your last airplane flight?

If you’re like most people using the Internet, you did these things online. Recently, online sales for things like insurance and car rentals surpassed sales for the same items offline. More people are shopping online for items that are troublesome to shop for in person, and they’re saving money doing it.

Not all traditional companies were quick enough to respond to the quick rise in shopping on the Internet, which is a big part of what gave young upstarts like Geico the chance to become powerhouses by selling online.

And not only do online services sell things as effectively as traditional businesses, they’re more convenient, more efficient for you and for themselves, and they are almost always cheaper. Other unique offerings, like simple price comparisons or loan calculators, can’t be matched by traditional bricks and mortar businesses.

Customers love this new trend, and they’re showing it with their checkbooks. The older businesses are starting to respond to the new online market, but they’re far too late to stop many of the new innovative companies that have sprung up. And that’s a good thing.

Innovation Is For The Young

In every generation where revolutionary change occurs, another really nice thing happens: goods become cheaper as efficiencies come about through innovation. The large, established companies don’t have any reason to innovate; they have loyal customers. But smaller new companies are almost always the source of innovation in revolutions.

That holds true today. Though many of the small companies that started innovating are huge today, just a few years into the revolution, the revolution did not start with established banking companies, or insurance companies that have been in business for years. Instead, it started with small companies with venture capital, or with small companies who came up with innovative ideas for reselling products.
This is very good news for those looking into starting online businesses. It means that you have plenty of room, if you just have a good idea. If you know how to market well, or if you have a really excellent idea for comparing prices on, say, mortgage products, or if you have a great website with information that customers can’t get anywhere else about renting cars, you might be able to develop the next Amazon.

Products that are doing extremely well in online sales include insurance, loans and mortgages, software (especially downloadable software), and anything dealing with travel, including airline flights, car rentals, and hotel reservations.  The common thread between all these items is that they deal with intangible items, or with items that are easily transferred electronically. Insurance, for instance, is an intangible. Software can easily and quickly be downloaded, and airline flights today often allow paperless tickets, meaning that you pay online, show identification, and never have to deal with a ticket at all.

Other businesses that may follow suit in the near future include things like music downloads and electronic books. More and more items are being produced that can be transferred electronically, particularly with the growing storage capacity of shrinking electronic devices. Currently, there is no end in sight to this trend, but now would be the best time to jump in, before someone else has your great idea.