Fishing for Names
Businesses search far and wide to reach new customers. Among the best ways of securing names of prospective clients, according to a survey by E-Commerce Market Reporter, is by attending conferences and using direct mail. Over 16 percent of e-business executives and marketers surveyed said
each of these two methods were the easiest way to troll for new customers.
More Spending On Advertising Predicted
Analysts from Jupiter Communications Inc. estimate that online advertising revenue will hit new highs by 2005, exceeding $16.5 billion. "Over the past two years, we have seen overheated off-line advertising
spending by access, commerce, and content companies that were willing--even eager--to pay hundreds of dollars to acquire new customers, seemingly without regard for the lifetime value of the customers," said a senior analyst with Jupiter. "With a renewed focus on accountability and efficiency, marketers turn toward more quantifiable media, such as the Internet. The battle within this cluttered environment will be to capture the attention of online users."
Additionally, analysts learned that marketers plan to increase Internet advertising spending at a higher rate than in any other medium. Nearly 73 percent of advertisers said they would increase their online advertising spending in the next 12 months. In comparison 43 percent said they would increase their magazine spending and 37 percent plan to increase their cable-TV budget. These plans could propel the Internet to fourth place as an advertising medium --behind that of broadcast-TV, radio, and newspapers, and would represent almost eight percent of the total US advertising market by 2005.
There's one drawback to all of that advertising: With so many advertisements spreading across the Web, Internet users are likely to be inundated with ads. Within five years, Jupiter analysts believe that the
rapid growth will lead to explosion in clutter, with users receiving in excess of 950 Internet-based marketing messages per user, per day.
www.jup.com
Watching TV and Surfing the Net Becomes a Joint Activity
Yet another study shows increasing simultaneous usage of television and the Internet by Americans. Showtime Networks Inc. reports there are approximately 25 million U.S. households that simultaneously use online services and watch television, a huge increase over the previous year. In addition, the SNI findings show:
- Fifty-five million households in the U.S. own at least one personal computer, an increase of 22 percent from January 1999.
- Online penetration jumped to 45 million households, an increase of 36 percent.
- With more households online, there is a 39 percent increase in online/TV co-usage from January 1999 to January 2000. The number of convergent homes went from 18 million up to 25 million.
- Interest is still high in joining the PC/online world, especially among premium television subscribers. For example, 51 percent of premium television subscribers that currently do not own a PC plan to buy one within the year.
- Approximately 63 percent of premium subscribers who already own a PC, but do not currently have online access, say that they intend to subscribe to an online service. Additionally, many households intend to purchase an additional PC for their home, which will increase the opportunity for co-usage.
- Teens are more likely than adults to simultaneously be online while watching TV, with 48 percent of teens admitting to simultaneous usage.
- Adults aged 18-49 fall in the 30 percent range, while only 15 percent of adults over 50 are co-users.
- There is a strong interest in developing "one box" technology (Internet and TV combined) especially among young consumers. All ages prefer the TV to the PC.
- Co-usage occurs most often among three programming types:
- news (31 percent)
- sitcoms (30 percent)
- sports (30 percent)
More than Half of US Households are Wired
Internet usage has reached critical mass in the U.S., with 52 percent of the home population surfing the Web in July, according to Nielsen//NetRatings July 2000 findings. Nearly 144 million people in the
U.S. had access to the Internet from home, compared to 106.3 million a year ago in July 1999, a 35 percent increase over the past year.
A spokesman explained, "Lower prices for personal computers and competitive rates for high-speed Internet access has increased the demand for Internet use. Internet access is growing dramatically each day due to cheaper access, making it possible for the mainstream consumer to log on."
The report also showed some unusual trends. For example, U.S. Internet users spent nearly ten hours a month online, an increase of 26 percent over the past year, while page views have doubled over the past year from 353 to 709 page views per month. Unique sites, however, have declined from 12 unique sites visited in July 1999 to 10 unique sites visited in July 2000.
"While Web usage has increased, the number of sites people visit has dropped in the past year. This means that the barrier to entry is higher for new Internet ventures as companies vie for surfers' attention. This underscores the power of branding online, as companies like Amazon.com have effectively leveraged their brand to amass a captive and loyal audience," the spokesman added.
Relationship Between Income Levels, Internet Usage Found
While the number of American Internet users with annual household incomes under $25k have grown nearly 50 percent, outpacing the growth of total users, they still only represent 9.7 percent of the overall Internet using population, Media Metrix reports. The group also found that lower-income Web users, new to the Internet, tend to be less experienced surfers and spend more time online--about 13 hours per month-- viewing more unique pages of content (over 700 pages in June 2000). Higher-income users, on the other hand, tend to be more experienced surfers, spending less time--just over nine hours--and viewing less content (about 550 pages per month). Household income also appears to influence Internet category preferences with lower-income groups visiting career and auction sites, while higher-income audiences flock to hobby-leisure, auto, sports and travel sites.
"A recent combination of declines in computer prices and increased Web access in academic and business environments has made the Web more readily available to people, regardless of their household income," said one Media Metrix analyst. "Because Internet users with higher household incomes were
among the earliest adopters of the net, they are more likely to have already established their online
preferences, thereby streamlining their sessions. Because many lower-income users are new to the Internet, and therefore less experienced, they are likely to spend more time and view more content online as they get acquainted with the medium."
www.mediametrix.com