• Physical retail stores in Taiwan are struggling to maintain their sales performance, as local consumers have become more cautious on their spending amid the economic downturn. • According to the current statistics released by the Ministry of Economic Affairs (MOEA), during the first half of 2009, the revenue of the retail trade declined 3.26 percent to US$48.17 billion, compared with same period in 2008. •Taiwan consumers have become more rational and less impulsive about purchases, buying with shopping lists in hand. The consumers also tend to spend their money on fresh foods and daily necessities and avoid high-prices items on the shelves. •Faced with this trend, hypermarkets have introduced various promotional programs to try to stimulate sales and are presenting their products in smaller packages to cater to consumers’ smaller budgets. •In contrast to the hardship experienced by physical retail channels, online virtual retailers have not been affected, as they...