May 2000
IDC #22220
Volume: 1
Tab: Users
IDC Opinion
What do leading ecommerce sites behavior and plans tell us about
key strategies for online business success?
Key findings from an IDC survey of executives responsible for their
businesses ecommerce initiatives reveal:
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x
x
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Executive Summary
In one of the most comprehensive surveys undertaken among highlevel Internet executives, IDC honed in on the creation of successful
ecommerce strategies. Some of the more significant findings are as
follows:
x
Leaders are moving sales volume to the Web faster than you
think. The average company in IDCs Internet Executive ePanel
currently fulfills 40% of its products and services sales over the
Web. Business-to-consumer (B2C) businesses and those that sell
to both businesses and consumers (B2BC) are further along
than business-to-business (B2B) in shifting business to the Web.
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reported that a third party hosts their Web site. For B2C
businesses, almost 60% are using a Web hosting service. This is
over twice the rate of outsourcing of traditional IT systems. IDC
believes this is due to both a short-term skills crunch as well as
a long-term shift toward a business view of IT as an
information utility.
x
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goods and services through the Web, indicating that our epanelists
are experienced Web marketers and represent a segment of Web
business more Internet-proficient than the mainstream. Companies
that market to both businesses and consumers via the Web are well
ahead of the B2B marketers but only slightly ahead of B2C
marketers in terms of the percentage of their business that is run
through the Web (see Figure 1).
Figure 1
Mean Revenue Share from Internet Sales, 1999 and 2000
Note: Results are based on respondents who sell over the Web.
Source: IDCs Internet Executive ePanel version 1.0, 2000
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Table 1
When Online Operations Will Be Profitable by Type of Web Selling
(% of Respondents)
Total
B2B
B2C
B2BC
Already profitable
27.3
29.3
22.2
32.8
2000*
46.7
49.5
41.2
54.9
2001*
59.1
65.5
52.3
67.6
2002*
63.2
68.7
63.4
71.9
2003*
64.4
69.2
65.0
73.9
After 2003*
66.4
70.3
66.6
76.6
21.0
18.1
12.7
12.4
Dont know
12.4
11.7
20.6
11.0
N=
651
188
63
299
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Table 2
How Profitability of Internet Operations Will Compare by Type of
Web Selling (% of Respondents)
Total
B2B
B2C
B2BC
44.1
49.5
39.7
50.0
Same margins
12.4
19.4
11.1
8.1
Lower margins
12.4
8.1
17.5
11.7
Don't know
19.8
15.1
12.7
15.8
11.3
8.1
19.0
14.4
N=
646
186
63
298
Higher margins
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Figure 2
Method of Promoting Web Site by Business Model
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Table 3
Activities Currently Available on Web Site, 1999 and 2000
(% of Respondents)
Total
B2B
B2C
Both
Online ordering
43.8
35.1
71.4
55.6
Customer service/support
57.5
60.1
57.1
59.9
Customer/member registration
47.3
48.9
44.4
53.3
Personalized pages
24.5
26.1
27.0
25.8
9.9
6.9
12.7
12.3
1999
27.1
20.2
34.9
27.5
Classified advertising
13.7
10.6
23.8
15.9
Auctions
4.4
3.7
4.8
6.0
N=
553
188
63
302
Online ordering
76.8
72.3
92.1
92.1
Customer service/support
87.7
87.8
87.3
93.7
Customer/member registration
79.7
78.2
81.0
87.4
2000
Personalized pages
63.1
59.0
61.9
70.9
29.0
21.8
30.2
36.8
Community features
54.1
45.7
55.6
59.9
Classified advertising
27.1
19.1
31.7
35.8
Auctions
18.9
10.6
25.4
25.8
N=
553
188
63
302
Online ordering
33.0
37.2
20.7
36.5
Customer service/support
30.2
27.7
30.2
33.8
Customer/member registration
32.4
29.3
36.6
34.1
Personalized pages
38.6
32.9
34.9
45.1
19.1
14.9
17.5
24.5
Community features
27.0
25.5
20.7
32.4
Classified advertising
13.4
8.5
7.9
19.9
Auctions
14.5
6.9
20.6
19.8
19992000 Growth*
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Figure 3
Plans to Implement Services/Sites for Broadband Access
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Figure 4
Plans to Implement Services/Sites for Non-PC Access
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Table 4
Perceived Importance of Web Site Characteristics and Self-Ratings
on Execution (Mean Score)
Type of Web Business
Total
B2B
B2C
B2BC
4.4
4.4
4.2
4.4
4.5
4.4
4.5
4.6
3.8
3.7
3.7
3.9
4.4
4.3
4.4
4.5
Entertaining (9)
3.1
2.9
3.2
3.2
Interactive (5)
3.6
3.3
3.4
3.8
Personalized (7)
3.4
3.2
3.2
3.5
Service-oriented (6)
4.1
4.0
4.2
4.3
Localized (8)
3.3
3.2
3.1
3.4
Multimedia-rich (10)
2.6
2.4
2.6
2.7
N=
390
131
50
209
Fast (2)
3.9
3.8
3.8
3.9
Secure (1)
4.2
3.9
4.3
4.3
3.2
3.0
3.1
3.3
3.7
3.5
3.6
3.8
Entertaining (7.5)
2.6
2.3
2.7
2.6
Interactive (6)
3.0
2.8
2.9
3.1
Personalized (7.5)
2.6
2.5
2.4
2.7
Service-oriented (4)
3.5
3.2
3.4
3.7
Localized (9)
2.4
2.2
2.2
2.6
Multimedia-rich (10)
2.3
2.0
2.2
2.5
N=
386
129
50
207
Notes:
Importance scores are based on a scale from 1 to 5, with 1 being not important
and 5 being very important.
Execution scores are based on a scale from 1 to 5, with 1 being executing very
poorly and 5 being executing very well.
Source: IDCs Internet Executive ePanel version 1.0, 2000
The biggest gaps in ratings of perceived importance versus selfratings occur in speed (fast) and ease of use (easy to navigate).
This is troubling in that these are rated very high (tying for second
place) by Internet executives and, along with security, would be the
most highly rated factors by users (see Figure 5). Indeed, IDC
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N = 390
Source: IDCs Internet Executive ePanel version 1.0, 2000
Conclusion
When it comes to making incremental investments in your Web site,
it is quite likely that most of the investments you make are
necessary to maintain your marketplace position. As the percentage
of business coming in through the Internet increases, both for your
business and for your industry, how that investment is spent
becomes more critical to monitor. Investments to help target
appliance and broadband users are now viewed as essential, not as a
luxury. A critical aspect of competitive intelligence today stems from
assessing the Internet capabilities of your competitors and matching
or exceeding those capabilities in your own business. Without this
crucial analysis, you are likely to miss out on the emerging and most
rapidgrowth portions of the Internet economy. With that in mind,
take the following investment recommendations into account for
site development:
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Document #: 22220
Publication Date: May 2000
Published Under Services: Internet and eCommerce
Strategies; Consumer eCommerce: Core; Online Financial
Services: Core
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