NONE: ONLINE-ADS>> WEB-AD'98 COVERAGE: 2/20/98 - Show Me The Numbers, rpt. #7
ONLINE-ADS>> WEB-AD'98 COVERAGE: 2/20/98 - Show Me The Numbers, rpt. #7
richard_at_tenagra.com
Fri, 20 Feb 1998 07:34:43 -0600 (CST)
Web Advertising '98 Email Coverage
Show Me The Numbers, rpt. #7
February 20, 1998
This is the seventh in a series of 10 reports from Richard Hoy, who
is covering the Web Advertising '98 conference in New York.
You will receive these reports in addition to your normal Online Ads
posts/digests.
This coverage is archived at:
http://www.o-a.com/webad98/webad98-archive.html
======================================================================
======================================================================
This conference coverage is generously underwritten by:
narrative.com
makers of Enliven
the best way to *Capture Your Audience*
Why? Because only Enliven ads deliver a no-plugin experience of
sight, sound, and emotion to attract users, transaction capabilities
to keep their interest, and near real-time reporting for campaigns
that stay on track.
Try Enliven for FREE! Download from http://www.enliven.com
Visit http://www.narrative.com/whosusing.htm for the latest on
who's using Enliven.
Visit http://www.narrative.com/demos/rptoview.htm to find out why.
======================================================================
======================================================================
SHOW ME THE NUMBERS
Michael Tchong (michael_at_iconocast.com)
"We are growing. And we're growing dramatically," explained
Michael Tchong, founder of the industry insider newsletter
ICONOCAST, in reference to the size of the audience on the
Internet. "What we have here is a tremendous amount of
confidence in the Internet market arena," he added.
In January 1993 there were less than 50 Web sites in
existence. As of January 1998, there are an estimated 1.8
million sites.
"That is tremendous growth by any yardstick," Michael said.
The Typical User
----------------
41.5 million people in the U.S. have used the Internet in
the last 30 days according to Find/SVP. Michael said that
roughly translates into one new user every 1.8 seconds. And
that is the fastest growing medium ever. If you look at how
quickly various communications media took to penetrate 25
percent of U.S. households, you'll see the Internet has
achieved that milestone in just five years. The next closest
technology is cell phones, which took 13 years.
The median age on the Net is 37, versus the national average
of 42. The Internet population is younger, but Michael
points out that is not unusual considering that the Internet
started on college campuses. The Net is also now 45 percent
female, closely mirroring the gender percentage in the U.S.
population (52 percent).
An favorable skew in the numbers is evident when you look at
the education level on the Net. About 55 percent of the
Internet population is college educated. Only 20 percent of
Americans overall have a college education. And as you would
expect from an educated audience, they also have money.
About 51 percent of the online population has a head of
household income exceeding $50,000. Only 27 percent of the
U.S. population overall fits into that bracket.
What all this tells you, said Michael, is that the
demographic profile on the Net is up scale compared to the
national average. And even though there are only 41.5
million Americans on the Internet, they are a highly
desirable 41.5 million Americans.
Fastest Growing Segments
------------------------
Three user segments are growing the fastest. First,
financial/investment information is fueling the growth of
the 55+ crowd. Second, more women are coming online to find
travel and health information. And finally, 14 percent of
all children under 18 are online (about 9.4 million). It is
projected 45 million children under 18 will be online by
2002.
Outside the U.S. women are also a fast growing segment,
particularly in South America and Japan.
Another segment Michael predicts will grow is that of
ethnicity. Right now 85 percent of the online population is
White. African-Americans, Hispanics and Asians are each at
about 3 percent. These three have a large potential for
growth.
Are People Buying?
------------------
According to Nielson Media Research, one in four people have
bought online. The items they are buying the most in
descending order are: computer hardware/software, books,
music, travel services, and financial services.
"If you feel that the purchases are
namby-pamby-less-than-$20-stuff, put that out of your
mind," Michael said. According to Nielson Media Research,
about a third of the purchases online are less than $100.
The other third is between $100 - $499. And the final third
is $500 or higher.
As you might expect, existing customers are more valuable
that new customers. According to a study by Binary Compass
Enterprises, a new shopper spends $127 on average, while a
repeat customer spends $251 on average. Michael said this
shows the viability of building a marketing program
specifically aimed at boosting sales with existing customers.
He cited examples such as Preview Travel, an online travel
booking service. Preview Travel sends you a "welcome home"
email after you get back containing a survey to assess how
your travel went. He even took it a step further by
suggesting a clever scenario he envisions a few years from
now.
"Two years from now you are going to get (the Preview Travel
welcome home email) in HTML. It will be full of banners and
ads. It will say, hey, welcome home Michael Tchong. I bet
your house is messy after traveling for seven days. Call
this toll free number, or go to this Web site, and here is a
maid service to clean up your place. And here is a place to
buy groceries that can be delivered to your home."
"There is going to be huge opportunities in this
service-oriented market to boost sales," he added.
Business-to-Business Commerce
-----------------------------
Last year about $7 billion was done in business-to-business
e-commerce. By 2002, Forrester predicts it will hit $327
billion. If that seems excessive, Michael says consider
this. In 1978 you hardly ever saw a catalog in your business
or home mail box. Today it is a $372 billion business, with
the bulk of it being business-to-business commerce. In five
to eight years, he believes we can easily see that same
trend played out on the Internet.
About 60 percent of all Internet users access business
information. Roughly 66 percent of executives use the
Internet at the office. The total number of business users
is about 36 million world-wide.
Probably the most interesting trend in the business user
statistics is that 20 percent of such users are currently
getting their news from online sources. Michael did some
math and figured out that all Internet business users spend
about 226,800,000 hours online every week.
"Now you can see why people like The (Wall Street) Journal
and any other business publication in this country should be
shaking in their boots," he said.
This ends the seventh report from Web Advertising 98. Stay tuned for
more detailed session synopses.
======================================================================
======================================================================
This conference coverage is generously underwritten by:
narrative.com
makers of Enliven
the best way to *Capture Your Audience*
Why? Because only Enliven ads deliver a no-plugin experience of
sight, sound, and emotion to attract users, transaction capabilities
to keep their interest, and near real-time reporting for campaigns
that stay on track.
Try Enliven for FREE! Download from http://www.enliven.com
Visit http://www.narrative.com/whosusing.htm for the latest on
who's using Enliven.
Visit http://www.narrative.com/demos/rptoview.htm to find out why.
======================================================================
======================================================================
SUBSCRIBE INSTRUCTIONS
To subscribe to the Online Advertising Discussion List,
Fill out the form at: http://www.o-a.com/
UNSUBSCRIBE INSTRUCTIONS
You may leave the Online Advertising Discussion List at
any time by sending an email message with the word UNSUBSCRIBE
(just the word) in the body or content of your message to:
online-ads-digest-request_at_o-a.com
if you get the digest version, and
online-ads-request_at_o-a.com
if you get the non-digest version.
Online Advertising Discussion List
http://www.o-a.com/
a publication of The Tenagra Corporation
http://www.tenagra.com/
