Appendix 3 Demographics and online shopping trends

 

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E-Business – Nøkkelområder

E-Business – Sjekkliste Strategi


E-Business – Sjekkliste for IT Infrastrukturen


E-Business – Sjekkliste Innhold


E-Business – Sjekkliste for E-Handelssystemet


E-Business – Sjekkliste Marketing


E-Business – Sjekkliste Kundeservicesystemet
 

E-Business – Online Community

The E-Business, the E-Customer, their Relationship and Interactivity

 

 

KunnskapskildenE-Business –
E-Business, E-Customer, Relationship and Interactivity

 

Dissertation
The E-Business, the E-Customer,
their Relationship and Interactivity 

Jan Vig

 

Dissertation  av Jan Vig om E.Business, E-Customer, Relationship and Interactivity  (286 sider) i forbindelse med Masterstudie i Information Technology and Communication Juni 2000.

 

The E-Retailer Business, the E-Customer,
their Relationship and Interactivity

Table of Contents

Chapter One Introduction to the study

Chapter Two Business in Cyberspace

Chapter Three E- Retailer Commerce

Chapter Four E-Customer, Relationship and Interactivity

Chapter Five A Successful Case study – Amazon.com

Chapter Six The Future, Critical Success Factors, E-Business Strategy, Results and Conclusion

Appendix

 

7

Appendix 

 

 

Appendix

Appendix 1 Search Strategy Internet
Appendix 2 Key words E-Commerce and one to one Marketing/CRM

Appendix 3 Demographics and online shopping trends
Appendix 4 Opportunities and benefits, barriers and treats, challenges
Appendix 5 Online Promotion Possibilities
Appendix 6 Letter from Jeff Bezos Founder & CEO Amazon.com

Appendix 7 Questions Concerning E-business strategy
Appendix 8 Checklist for evaluation of an E-commerce Web site

 

Appendix 3

Demographics and online shopping trends

 

Who is Online Procentage
Under 18
18,5%
19 – 29
17,3%
30 – 49
31,4%
50yrs.+
12,8%
Source: http://www.internetstats.com/

 

 

 

How many online August 1999
August 1999 March 200
World Total 195 million 304 million
Africa 1.72 million 2.58 million
Asia/Pacific 33.61 million 68.9 million
Europe 46.39 million 83.35 million
Middle East 0.88 million 1.90 million
Canada & USA 107.3 million 136.86 million
South America 5.29 million 10.74 million

Source: Various; Methodology Compiled by: Nua Internet Survey 

 

 

 

 

Leading Languages online People
English 92 million
Japanese 9 million
French 7.1 million
German 6.9 million
Chinese
1 million
Swedish
3.3 million
Korean
3.3 million
Source: http://www.internetstats.com/

 

 

Top 10 Web sites  
Yahoo 31.50
AOL.com 25.79
Geocities 24.90
MSN.com 23.61
Passport.com 18.88
Netscape 18.64
AOLSignon.aol 17.52
AOLWelcome.aol 17.08
Microsoft.com 17.06
Lycos.com 16.56
Source: http://www.internetstats.com/

 

 

 

What do you primarily use the Internet for?
[ 2960]  80.0% – Communication/keeping in touch[ 2937]  79.4% – Research[ 1868]  50.5% – Education[ 1842]  49.8% – Games/Entertainment[ 1811]  48.9% – Get the latest news/financial information[ 1193]  32.2% – Online chatting

[ 1023]  27.6% – Newsgroups

[  999]  27.0% – Online shopping

[  960]  25.9% – I have a personal web page

[  903]  24.4% – Meeting new people; sharing interests

[  856]  23.1% – Employment/job searching

[  826]  22.3% – Political/social causes

[  766]  20.7% – ‘Adult’ (sexual) activities

[  679]  18.4% – I’m involved with an Internet-based business

[  344]   9.3% – To generate additional revenue; explore entrepeneurship

[  238]   6.4% – Promotion of a non-Internet related business

[  117]   3.2% – Video conferencing

 

Survey.net – Internet Shopping Habits Survey Results Survey started: July 12, 1998 Total Respondents: 2594

http://www.survey.net/inet2r.html

 

 

Electronic Commerce
  • 81% of Internet Consumers say they will shop online in next 12 mths    (IntelliQuest Information Group)
  • On-line retailing to reach $13 billion in 1999 – growing 200% per year    (Boston Consulting Group)
  • 53.5 million US adults use Internet   (Mediamark Research)
  •  72 million have access – up 16% in 3 months    (Mediamark)
  • At home usage now exceeds workplace by 28%    (CyberStats)
  • Almost 25% of consumers going online from Jan – June 1998 made an on-line purchase    (Nielsen Media)
  • Corporate spending on Internet: $85 billion in the US alone in 1999, $203 billion by 2002
  • Business-to-business e-commerce alone was $43 billion in 1998
  • Forecasted to rise to $109 billion (1999) and $1.3t in 2003
  • 4 million Web sites, with 235,000 sites added each month

 

 

 

What is happening on the Net
  • Online advertising expediture of top 25 industries  – Up 92% (Intermedia Advertising Solutions)
  • 68% of top 124 largest companies advertise on Internet
  • Average advertising spending tripled in 1 year       $450 million
  • US online retail market growing 200% per annum     (Shop.org)
  •  Australian E-Commerce revenues projected to grow from $127.3 million last year to $16 billion in 2002    (IDC Australia)

 

 

Reasons why the E-Retailer can not ignore the Net
  • People increasingly shop online for information (16% of Americans shop online  for information before going to car dealers)
  • Consumers armed with information will have higher expectations
  • Unbiased information is provided to consumers- biased information ignored- push medium
  • Vendor inventory can be kept to minimum
  • Consumers can have input over production E.g. Dell computers ($6m sales/day on Net)
  • Easy comparison shopping-cheapest prices-even moving to bidding by vendors
  • Geographically barriers gone- more competition and choices- offline stores face stiff competition from online stores globally
  • Search time faster online- in some cases faster than going to local departmental store
  • Consumer’s time and place (consumers may be willing to pay more for having products when and where they want it)
  • Offline stores have high fixed costs, even a small number of customers leaving could have a profound impact on profits
  • Online companies are smaller, more flexible and are more in touch with customers; Big offline companies need to go through lots of red tape just to get things changed: who’d win?
  • Online companies have shorter learning cycles- happier customers
  • Word of mouth powerful online- happy customers multiply fast

 

Different E-Commerce Tendencies of

Men and Women Percentage of Internet Purchasers 

Computer                                                      Software Clothing  Computer                                                                  Hardware Electronics 
Males  28.6% 6.6% 18.7% 7.7%
Females  9.7% 26.4% 8.3% 1.4%
Source: The Strategic Group June 4, 1999

 

 

 

Different E-Commerce Tendencies of Men and Women Percentage of Internet Purchasers 
Computer                                                      Software Clothing  Computer                                                                  Hardware Electronics 
Males  28.6% 6.6% 18.7% 7.7%
Females  9.7% 26.4% 8.3% 1.4%
Source: The Strategic Group June 4, 1999

 

According to Strategis consultant Matt Page, this shift away from technology-oriented men as the mainstream Internet user should serve as a wake-up call to companies doing business over the Internet. «Companies advertising online and doing e-business will fall behind unless they understand how this shift toward more females and more mainstream users overall will affect them,» Page said.

April/March 200 NRF/Forrester Online Retail Index
Category Total Spent
in April

(in thousands)
Total Spent
in March

(in thousands)
April Index
Results

(Mar/April)
Small-Ticket Items
Software $112,732 $102,530 1.10
Books $155,894 $139,016 1.12
Music $117,899 $121,098 0.97
Videos $104,855 $73,444 1.43
Office Supplies $100,058 $93,162 1.07
Apparel $173,938 $142,939 1.22
Footwear $49,427 $33,028 1.50
Jewelry $61,745 $47,311 1.31
Flowers $54,593 $39,508 1.38
Linens/Home Decor $48,973 $45,918 1.07
Health and Beauty $112,117 $122,206 0.92
Small appliances $34,018 $34,272 0.99
Toys/Video Games $90,795 $86,561 1.05
Sporting Goods $61,135 $45,615 1.34
Tools and Garden $44,454 $28,735 1.54
Big-Ticket Items
Computer hardware $317,116 $317,726 1.00
Consumer Electronics $133,008 $181,779 0.73
Appliances $13,593 $23,038 0.59
Furniture $30,432 $36,916 0.82
Food/Beverages $124,497 $130,813 0.95
Air Tickets $607,981 $509,719 1.19
Car Rental $124,526 $108,059 1.15
Hotel Reservations $274,045 $278,341 0.98
Other $347,879 $272,391 1.28
Total Spending $3,295,709 $3,014,128 1.09
Number of Shoppers 12,865 11,959 1.08
Average Spent per Consumer $256.18 $252.04 1.02
Source: NRF/Forrester

 

 

PCs Used for E-Commerce Activity (number of PCs in millions)
January 1999  January 1998  Percent Increase 
E-commerce purchases  20.1 11.6 72%
Electronic commerce activities(including financial transactions)  26.0 16.3 60%
Shopping activities only  29.7 21.8 36%
Electronic commerce and related activities(including shopping)  37.2 26.4 41%
Source: InfoBeads

 

 

 

Top 10 Problems Experienced by Internet Shoppers
Problem Percent of
Internet Buyers
Gift wanted to purchase was out of stock 64
Product was not delivered on time 40
Paid too much for delivery 38
Connection or download trouble 36
Didn’t receive confirmation
or status report on purchase
28
Selections were limited 27
Web site difficult to navigate 26
Web site didn’t provide information
needed to make purchase
25
Prices not competitive 22
Site didn’t offer enough gift ideas 16
Source: Andersen Consulting

 

How Internet Compares to Other Shopping Channels
Internet Catalog Stores
Offers most competitive price 21% 10% 13%
Everything from one source 12% 7% 13%
Convenience 59% 41% 12%
Saves time 62% 33% 3%
Source: Andersen Consulting

Books, the first product category to be sold en masse on the Web, remain at the leading edge of e-commerce. Experienced Web users bought more books online than in stores this holiday season. In fact, according to the survey, books and videotapes were the only categories in which more online shoppers made more online purchases than in stores or via catalogs.

Source of Gift Purchases
Type of Gift Percent purchased via
Internet Catalog Stores
Toys 48 33 57
Books 47 15 34
Music 42 15 34
Videotapes 35 17 30
Clothing 29 41 81
Computer Hardware/
Software
25 10 29
Collectibles/Candies/
Knickknacks
23 26 48
Household items/
Appliances
17 12 34
Consumer Electronics 17 10 25
Cosmetics/Personal Care 16 29
Sporting Goods 14 16
Greeting Cards 13 35
Food/Wine 11 10 17
Gift Certificates 9 6 38
Flowers/Gardening Items 9 5
Pet Gifts 6 21
Periodical Subscriptions 5 4
Jewelry 3 24
Other 13 11 8
Source: Andersen Consulting

 

 

When asked which type of product or service feature would increase the likelihood of purchasing more products or services over the Internet in the future, respondents cited free delivery, on-time guarantees, and no sales tax most often.

 

Features That Will Drive E-Commerce
Feature Percent of
Internet Purchasers
Free product delivery 98%
On-time delivery guarantees 95%
No sales tax 91%
Coupons/promotions 83%
Toll-free customer assistance 68%
Live, online customer assistance 62%
Customers reviews or recommendations 62%
Helpful hints for colors, sizes, etc. 58%
Free gift wrapping 58%
Gift suggestions 46%
Source: Andersen Consulting

 

Total online retail sales during 1999 are expected to reach $66 billion, according to Activ Media Research, and the buying of consumable products will lead the way into the next century.

 

Projected Total Web Revenues
For Consumer Products

(Billions US)
1999 2000
Health/beauty 0.8 1.9
Healthcare/medical 1.1 2.6
Pet supplies 0.3 0.8
Groceries/household 0.9 2.2
Gourmet 0.7 1.6
Total consumable sales 3.8 9.1
Total online retail sales 66.0 160.00
Source: ActivMedia Research, LLC (194)

 

 

 

Reasons for Not Shopping Online
  Dec. 99 July 99
Can’t see and touch 41% 56%
Can’t easily return 32% 47%
Shipping charges 33% 39%
Source: Greenfield Online

 

 

 

Barriers to Online Purchasing
Pricing 77%
Potential return hassles 67%
Credit card concerns 65%
Privacy issues 58%
Navigation difficulty 35%
Time to receive orders 25%
Source: The Intermarket Group

 

 

Why Shop Online?
Saves time 64%
Stores/malls too crowded 56%
More convenient hours 52%
Less driving 37%
Items cost less 16%
Able to shop
earlier in season
14%
One click shopping 12%
No sales tax 12%
Better selection 11%
Better availability 9%
Able to shop
later in season
4%
Gift wrapping/shipping
done by retailer
3%
Turnoffs for Online Shoppers in 1998
Shipping costs too high 51%
High prices 45%
Need to try on for fit 38%
Not appropriate for
large items
36%
Not appropriate for
luxury items
26%
Want to see/feel item 23%
Desired Improvements*
Lower shipping costs 63%
Lower/more competitive pricing 61%
Easier to find Internet site 22%
More choices/selections 21%
Guarantee of credit
card security
20%
More information about products 16%
Faster shipping 16%
Toll-free telephone support 14%
* Among those planning to buy in 1999
Source: Ernst & Young

 

 

 

Top 20 Web Retailers Among US Home Internet Users
E-Tailer Rank E-Tailer October Buyers
(000)
Reach
(%)
Unique Users
(000)
Buy Rate
(%)
Oct. Sept.
1 1 amazon.com 1,178 18.5 12,080 9.8
2 4 buy.com 389 3.9 2,545 15.3
3 5 ticketmaster.com 360 3.8 2,506 14.3
4 3 barnesandnoble.com 324 8.0 5,199 6.2
5 7 mothernature.com 253 2.9 1,888 13.4
6 2 drugstore.com 221 2.2 1,456 15.2
7 26 smarterkids.com 218 2.5 1,618 13.5
8 9 Planetrx.com 214 2.6 1,709 12.5
9 19 etoys.com 181 4.5 2,911 6.2
10 14 gap.com 164 1.9 1,267 12.9
11 10 gateway.com 161 3.7 2,445 6.6
12 8 enews.com 120 4.4 2,850 4.2%
13 20 staples.com 112 1.5 957 11.7
14 11 cdnow.com 97 7.9 5,149 1.9
15 24 fogdog.com 97 1.9 1,263 7.7
16 21 1800flowers.com 90 1.2 795 11.3
17 15 bigstar.com 88 2.2 1,411 6.2
18 12 chipshot.com 84 1.0 677 12.5
19 17 yahoo.com 74 56.2 36,733 0.2
20 27 compaq.com 55 2.0 1,320 4.2
Source: PC Data Online http://www.pcdataonline.com/  (200)

A study from Danish E-Commerce Association  found out that the five most important reasons to shop on the Web was:

Easy to place an order 83%
Large selection of products 63%
Cheaper prices 63%
Faster service and delivery 52%
Detailed and clear information about what is being offered 40%
No sales pressure 39%
Easy payment procedures 36%

 

 

When asked what kind of information the E-customer looked for in the buying process the respondent gave the following answers(213)

Detailed information about the product itself 82%
Price comparisons 62%
Detailed information about the vendor 21%

 

 

Download Dissertation

 

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