Hope we don’t get stuck in the bandwidth
The number of people using wireless data technology is expected to surge from about 170 million subscribers worldwide in 2000 to more than 1.3 billion by 2004.
More than 1.5 billion handsets, PDAs and Internet appliances will be equipped with wireless capabilities by the end of 2004, according to technology market research firm Cahners In-Stat. Messaging will be the core application driving the growth of the wireless data market. The report estimates the number of wireless messages sent per month will jump from 3 billion last December to 244 billion by December 2004.
Family values
Online advertisers are targeting families more so than children, and recognizing the sensitivity of this market by making ad content easily distinguishable from site content.
Despite significant growth in online advertising by businesses targeting families and children in the first quarter of this year, advertisers are moving their focus from children to the family, according to AdRelevance, a division of Media Metrix. Between May 1999 and August 2000, online advertising by businesses targeting families grew 96 percent, while children-specific advertising dropped 56 percent. Key findings show that most ad impressions for child and family-focused advertisers run on only portals and children and family sites.
These sites are important for online advertisers targeting children, as they receive just 4.6 percent fewer ad impressions than portals, while family-focused advertisers place children and family sites a distant second to portals, receiving 22.5 percent fewer ad impressions.
Start with some customer service
Web sites are beginning to use tools to help build loyal repeat customers, but according to research from Activmedia Research, online businesses can still improve.
The report found that consumers see availability of merchandise as a key factor in deciding which Web site they buy from. Near real-time inventory data on the Web site is also considered a vital requirement for online shoppers at the time of purchase. Consumers also respond to availability of in-stock information and real-time shipping data.
The report notes, however, that many Web sites fail to provide these things. According to more than 1,000 Web executives surveyed in an earlier report, only one in four Web sites is capable of displaying inventories online.
Hype about the Internet?
The anticipated growth of e-marketplaces has been greatly exaggerated, according to a report from market researcher IDC, which describes calls for thousands of such e-markets by 2004 as “overzealous.” The report claims that only several hundred e-marketplaces will exist by that time.
According to some analysts, e-marketplaces are only one aspect of the business-to-business sector. Many of the e-marketplaces announced will not be built, and many of those built will not survive. Of those that do, many will merge into super e-marketplaces.
An e-marketplace is defined in the report as an “Internet-based broker of goods or services within a community of sellers and buyers.” Furthermore, it should have an open structure and a level playing field for all participants.
Stop blaming the kids
Teens spend less time online than adults, and contrary to widely held beliefs, do not dominate the use of the family PC. Teen-agers have fewer online sessions, and spend less time online during each session, according to research by Jupiter Communications and Media Metrix.
Data show that teens spend an average of 303 minutes online per month, adults, an average of 728 minutes; and that teens, depending on gender, gravitate toward different Web sites.
Ad nauseum
The average online banner runs for four weeks and uses heavier advertising earlier in the month, with more than 60 percent of all impressions in the first two weeks, according to a new report from AdRelevance.
Automotive marketers schedule their ads to run for an average of 7.8 weeks, nearly twice as long as the average duration for hardware and electronics ads, which last 4.1 weeks. Consumer goods used the most targeted ads, advertising just 40 percent of their impressions on portals, search engines and community sites.
So what’s your return?
U.S. companies are serious about using the Web as a business tool, with firms investing as much as 20 percent of their total IT expenditure on Internet-enabling services, personnel and solutions.
An estimated 70 percent of the U.S. work force has Internet access at work, up from 63 percent in 1999. This should rise to 85 percent by 2004, according to In-Stat Research. Firms with more than 1,000 full-time employees use the Internet mainly as a cost-effective communications tool to connect employees, partners, customers and suppliers. Virtual supply chain integration will become a more common feature with such firms by 2002, as they improve their e-commerce services.
Organizations with 100 to 999 full-time employees were troubled by the increasing fragmentation of e-commerce as they must connect a growing number of distant locations and employees to centralized resources.
Small businesses (five to 99 full-time workers), however, are rapidly adapting to the new Internet climate, with Internet penetration above 80 percent in 2000. These firms are expected to invest almost $7 billion in application services alone by 2004.
More e-commerce, less talk
Business-to-business e-commerce in the United States is set to become a $4.8 trillion market by 2004, up from $1.2 trillion in 2000, according to the Boston Consulting Group. Price negotiations and online collaborations must still make the transition online, however.
By 2004, Internet purchasing in the B2B sector will represent 40 percent of total purchasing, but just 11 percent of all purchases will involve online price negotiations. Price negotiating online is a necessary step for many companies if they are to establish wider and deeper buyer-seller relationships over the Internet.
Nearly half of the 260 buyers and sellers surveyed said that offline communication was nearly always necessary in order to complete online transactions. As the B2B e-commerce market matures., sellers expect price pressures to increase. Only 25 percent of suppliers experienced increasing price pressure, but an additional 50 percent are expecting pressure in the near future.
E-santa and his elves
The online shopping season is predicted to begin early this year, as worldwide online Christmas sales are forecast to be worth $19.5 billion. Online Christmas sales were worth $10.5 billion in 1999, according to Gartner Group; projections show an 85 percent increase this year.
Massive growth in Internet access outside North America explains some of these figures, with strong demand for Western goods in Asia, and support from governments, retail banks, card companies and national portals to bring all countries online.
Does anybody clock out anymore?
About 83 percent of American workers who had more than seven days vacation since April remained in contact with the office, according to a survey from Andersen Consulting.
The survey was conducted by telephone, and respondents were full-time workers with household incomes of $75,000 or more.
Mobile devices were popular with holiday seekers, with 60 percent bringing one on vacation. Cell phones (56 percent) were the most popular of these, followed by laptops (16 percent) and pagers (13 percent).
Of the workers that brought cell phones, 61 percent left the number with somebody at work; of those, 39 percent received work-related calls while on vacation. Workers who brought laptops also checked work-related e-mail; of those who checked, 83 percent responded while on holiday. Workers who did not came back to an average of 37 e-mail messages per week of vacation.
Voice mail was also popular with workers on holiday. About 33 percent of those surveyed checked their voice mail while on vacation. More than half of these — 54 percent — checked at least once a day. Of those that checked, 62 percent responded.
Small devices, big money
Sales of personal digital assistants (PDAs) in the United States are likely to double by the end of this year, with sales for the first six months of 2000 already nearing total sales figures for all of 1999.
U.S. sales of PDAs in 1999 amounted to 1.3 million. June 2000 sales showed an increase of 190 percent over June 1999 figures, according to NPD Intellect. Total dollar sales of PDAs reached $436.5 million for 1999, while $406.9 million had already been reached by June of this year.
Palm continues to dominate the market with a 65.4 percent share. Handspring, which did not exist in June 1999, is second to Palm, with a 21.6 percent share.
NPD also found in an earlier report that Internet-ready cellular phones are selling exceptionally well, and 48 percent of cell phones sold at retail over the second quarter of 2000 were Internet-ready devices.Prices for Internet-ready cell phones have also dropped. They retailed at $164 in the second quarter of 2000, compared to $211 a year ago.
Internet and profit in the same sentence
Internet retailers have marginally improved their performance while taking steps to increase their overall profitability, according to a survey.
The survey, based on 66 North American online retailers, found that customer acquisition costs are declining from a high of $71 in the fourth quarter of 1999 to $40 by the second quarter of 2000. The reduction is partly due to a move from relatively expensive television advertising to Internet advertising and marketing, according to The Boston Consulting Group. Online retailers are also allocating more of their budgets to customer retention, and focusing less on pure brand awareness.
Broadband for the masses
Broadband Internet access will accelerate, with access growing sixfold to 32 million users by 2003, according to an eMarketer report.
In the past, broadband deployment was hindered by the inability of Internet service providers to roll out broadband services quickly, and this was worsened by high access costs, which led to the slow adoption of such services.
Cable modem broadband access has taken an early lead over DSL adoption, but DSL will overtake cable modem access by 2003, with a projected 10.95 million subscribers. The two together will constitute approximately two-thirds of all broadband deployment.
The fiber optic market will be driven mostly by business usage (90 percent). There were 3.49 million business users of broadband in 1999. This is projected to reach 11.3 million within three years as companies exploit cheaper broadband access methods like DSL and wireless broadband.
In 1999, broadband Internet access accounted for 14.6 percent of all U.S. subscribers, or 5.43 million users.
Online savings are expensive
A report from Activmedia Research projected that more than $22 billion will be spent by businesses trying to establish or maintain an Internet presence, equal to 17 percent of the $132 billion generated by e-commerce revenue.
The study, “Real Numbers Behind Web Hosting and Development,” found that almost half of all development dollars will be driven into B2B vendors, with $10.7 billion being estimated for costs in operating, maintaining and developing such Web sites.
While business-to-consumer businesses make up about half of Web sites today, they only constitute one in three global dollars, with $7.5 billion projected for the cost of hosting and maintenance. The report found that most of these sites are simplistic from a design perspective, and are usually developed by small companies.
Online content sites are usually heavy users of multimedia and video and tend to be sophisticated. About $2.1 billion is the estimated amount required for maintenance, operation and development of high-end sites. Only one in 10 development dollars will be spent, however, by Internet service and support businesses, which the report found to be under continuous pressure to increase efficiency and reduce costs.
Poor performers
While the number of U.S. lower-income households online has increased by 50 percent, those households still represent only 9.7 percent of overall Internet users, according to a report from Media Metrix.
Media Metrix found that lower-income Web visitors (households earning less than $25,000) spend more time on the Web, usually about 13 hours per month, and tend to access more unique content pages than other income groups. Higher income users are usually more experienced in using the Internet, and have stronger preferences and more consistent sessions. They spend less time online than lower income groups, about nine hours per month.
The study notes that lower-income households visit career and online auction sites, while higher income groups, with more disposable income, swarm to the hobby-leisure, auto, sports and travel sites.
I have carpal tunnel from Web surfing
The online health industry is showing popular growth in the United States, with 40.9 million adults, or 54 percent of Internet users, using the Web for health care, according to a study from Cyber Dialogue.
The study reveals that 14.6 million adults are shopping for health and beauty products on the Web; 4.6 million of these have bought goods in this category. Through online health, patients are becoming more involved in health care management, with 25 percent of adults who visit health sites asking their doctors for specific brand-name prescriptions.
Patients also want more online interaction with their doctors: just 3.7 million U.S. adults e-mail the doctor’s office, but 33.6 million said they would like to do so.
Pops is worried about his Visa
Online shopping experienced a satisfying up-period in the second half of 1999, but the number of new shoppers on the Web has decreased in 2000, according to a recent study. The Christmas season may have been the reason for an eight-point jump late last year.
The ABC News study found that online shopping is least common among older and low-income adults. Only 6 percent of people age 65 and older have bought goods online; of those with household incomes below $25,000, only 11 percent have purchased online. Just one-third of young adults (18-34 years old) have bought anything on the Web.
Online purchases peak in two groups: those with $75,000 or more in household income (52 percent), and those with a college degree (47 percent).
