E-Commerce and Small Business - A Recipe for Success Doing business on the Internet is a great opportunity and it seems

like everyone is doing it. Unfortunately, putting a website on the net is similar to launching a rowboat into the ocean. It is a vast and unforgiving frontier that devours many businesses banking of the e-commerce boom. This sounds intimidating but it should not be that way. If the people responsible for a business follow six simple guidelines, they will greatly enhance the chances that their business will succeed and possibly flourish in the ecommerce world. 1. Every business considering a website for e-commerce purposes must develop an underlying strategy. This is critical! After all, just posting a website probably will not draw substantial traffic. The target audience needs to be educated about the existence of the site. Developing a strategy will force you to consider your approach towards the Internet and help set realistic goals. Without quantifiable goals it will be impossible to gauge whether your investment in e-commerce is successful or not. 2. Simplicity is King. Many businesses attempt to enter the Internet and e-commerce with a huge splash. The result is over-engineered sites that are complex and cumbersome. If the website navigation is complicated or the pages load slowly, the potential customer is likely to become frustrated and abandon your site for happier surfing elsewhere. Therefore, maintain a customer focus and make the site simple. In addition, give the potential customer alternative choices in doing business with you. Some people like to do research on the web but would rather call or visit when they are ready to buy. Give them the telephone number and the address on every page. In addition, careful consideration must be given to design. Pay particular attention to how the site is laid out. Are items on the page aligned or not? Do not mix alignments. If you center one piece of information, center everything and vice versa. Also, make sure to use text colors that have good contrast with background colors (Black text on a white background has the best contrast). Finally, do not put large picture files or so many picture files into your page that it takes forever to load. If it takes more than thirty seconds, it is too long.

3. Evaluate your products or services for compatibility with an e-commerce environment. For example, many people are not comfortable with buying clothes over the Internet. They want to try clothes on before they buy them to make sure they fit or that they look good in a particular style. On the other hand, books or computer equipment sell well in an electronic environment because people know what to expect from the product. If you are not sure if your product or service is a good fit with the Internet, survey your target market to see if you can learn what they think about ecommerce and your product.

Net UsersWorldwideTakingCommerceOnline
By Michael Pastore In between dot-bomb jokes and pink-slip parties, it's easy to forget that Internet use is still growing at a pretty good clip worldwide, and more users means more e-commerce transactions. Nearly 1 billion people, about 15 percent of the world's population, will be using the Internet by 2005, International Data Corp. (IDC) found, and their use will fuel more than $5 trillion in Internet commerce. That represents a staggering 70 percent compound annual growth rate when compared to Internet spending of $354 billion in 2000. "With the dot-com stock crash and U.S. economic doldrums so much in the news, it's easy to lose sight of the explosive growth in Internet usage and commerce taking place below the surface," said John Gantz, IDC's chief research officer. "More than 100 million new users come onto the Web every year, and corporate volume purchasing over the Web is just getting cranked up. Add to that the proliferation of mobile phones and other Internet access devices that will allow people to access the Internet anytime, anywhere, and you have a scenario for explosive growth." With the much-publicized periods of hypergrowth over, and with the mature markets topping out, Internet use in the coming years will be widespread, as opposed to dominated by a single region. In 2000, the United States accounted for 34 percent of Internet users, with Europe at 29 percent, Asia-Pacific (excluding Japan) at 16 percent, Japan at 10

percent, and rest of world at 11 percent. But growth in the number of Internet users in Asia-Pacific and the rest of the world -- especially in Latin American countries -- will quickly outpace growth in more developed countries such as the United States, Canada and major European nations. By 2005, the balance of Internet users will completely shift, with Asia-Pacific rivaling Europe for the most Internet users while the United States slips to third place. Similar shifts will occur among e-commerce. The United States currently accounts for just under half (46 percent) of total e-commerce. By 2005, however, its share will dip to 36 percent, according to IDC. "The U.S. share in 2005 is actually more in line with its position in the offline economy, representing the shift in ecommerce from an emerging market to a more mainstream industry," said Carol Glasheen, vice president of IDC's Global Market Models and Demand-Side Research program. Growth in e-commerce in all regions will be healthy, but Asia-Pacific and Western Europe will grow the fastest between 2000 and 2005. According to the First Quarter 2001 Global Internet Trends report from Nielsen//NetRatings, one in six European adults used the Internet to seek pricing or product information for products and services. One in 11 adults actually made an online purchase in the same period. Denmark, Sweden and Switzerland led the region in terms of Web-based browsing and purchasing, while Belgium/Luxembourg, Italy and Spain had relatively few people browsing or purchasing via the Internet. Half of the Europeans who have browsed for information in the past six months have purchased, with browsing to purchase rates highest in Britain, Norway and Sweden. Italians and Spanish, on the other hand, are more reluctant than other Europeans to buy after having sought product information online. According to Nielsen//NetRatings, only Sweden comes close to the United States, where 74 percent of all Web surfers shop online each month and 30 percent buy online. In the Asia-Pacific region, adults in Australia and New Zealand are most likely to use the Internet to seek information about products and services, with one in four

adults turning to the Net. Purchasing online is also common in Australia and New Zealand, as well as South Korea. Only a very small proportion of people in Hong Kong, Taiwan and Singapore have bought goods and services online. "If a South Korean browses the Internet for information on goods or services, he or she is much more likely to buy than is the case in other countries," said Richard Goosey, chief of measurement science and analytics for ACNielsen eRatings.com. "Three in five South Koreans who browse convert that investigation into a purchase. By contrast, only one-third of adults from Hong Kong or Taiwan who browse for information then go on to buy." Worldwide Online Browsing and Purchasing Behavior
Past six months, adults 16+

Nation Australia Austria Belgium/Luxembourg Denmark Finland France Germany Hong Kong Ireland Italy Netherlands New Zealand Norway Singapore South Korea Spain

Browsing for Products 24% 25% 12% 39% 28% 12% 22% 13% 17% 10% 28% 29% 24% 19% 18% 8%

Purchasing Products 10% 12% 5% 16% 11% 6% 11% 4% 8% 3% 11% 12% 14% 7% 11% 3%

Sweden Switzerland Taiwan UK United States Percentage of Population Using the Internet Canada Australia Singapore USA New Zealand UK Germany Hong Kong Taiwan France Philipines Malaysia China South Africa Thailand Indonesia 38% 25% 25% 25% 24% 15% 14% 14% 12% 11% 8% 7% 4% 2% 2% 1%

46% 32% 13% 19% 74%

26% 17% 4% 11% 30%

E-Commerce,MobileAccessDrawingInterestfromNet Users
By Michael Pastore As the official ISP of some 25 million subscribers, it's in America Online's best interest to see what Internet users do on the Net, think of the Net, and perhaps most importantly, have in store for the Net. For the third year, AOL had Roper Starch conduct its Cyberstudy of Internet users.

This year's study found that online e-commerce activities have exploded into the mass market, as millions of consumers discover services like shopping, banking, news, stocks, and health information. The study also shows a strong and growing demand for access to the online medium through cell phones, TVs, voice portals, and other non-PC devices. According to the study, online commerce has become an everyday activity for millions of users. This year, more than half of the survey's respondents (56 percent) say that they currently shop online, nearly double the percent of those who did in 1998 (31 percent). Similarly, as the holiday season approaches, the percent of users who say they intend to shop online during that period has doubled from 14 percent in 1998 to 28 percent today. "Two years ago, most online users were only dipping their toes in the electronic commerce pool, but this year, they're diving right in," said Marshall Cohen, America Online Senior Vice President of Brand Development. "With a majority of users saying they now shop online and 80 percent saying they research products online before buying something, Internet Use, 1998 vs. 2000 Use Shop online Intend to shop online in future 1998 2000 31% 56% 14% 28%

Plan to increase 41% 49% online purchases Banking Trading stocks we're seeing a true coming-of-age for electronic commerce." In addition to shopping more frequently, consumers are also spending more when they shop online, with the percent of respondents who say they spent more than $500 online in the previous 3 months jumping by more 16% 25% 11% 16%

Source: AOL/Roper Starch Cyberstudy

than one-third over the past year (from 19 percent in 1999 to 26 percent now). The percent of users who say they plan to increase the number of online purchases they make in the next few years has jumped to 49 percent from 41 percent in 1998, and when the timeframe is expanded, 40 percent of users think they will do "almost all" of their shopping online within 10 years. In addition to shopping, there has been extremely rapid growth in a wide range of other online activities -- from banking (up from 16 percent to 25 percent since 1998) to trading stocks (up from 11 percent to 16 percent since 1998) and booking travel reservations or tickets (up from 32 percent to 49 percent since 1998). Online research is now a standard part of the buying process with 80 percent of online users saying they research products online before they make a purchase. The majority of users also get news (76 percent), health information (70 percent), and local entertainment info (50 percent). As users grow accustomed to integrating the online medium in their everyday lives, they are also increasingly demanding access to it from any place, at any time. More than half of users (54 percent) say they would be interested in using a small Internet device to go online from any room in the house, and just under half (46 percent) say they would be interested in having their email read to them by calling a special phone number. Nearly half of users (43 percent) already log on to their home accounts even when they are away from home, up from 36 percent in 1999. If they own a laptop, more than a third (37 percent) users checks his or her e-mail account when traveling for business, and 32 percent do so when traveling on vacation. Looking ahead to a much more fully wired world, 60 percent of respondents believe that within 10 years, every room in their house will be wired for Internet access. And showing the potential for wireless devices, 63 percent already also own at least one cell phone. "As people get used to online services and convenience, they increasingly want to be able to do their favorite online

activities regardless of what room of the house or what part of the world they happen to be in," Cohen said. "That increased consumer reliance on popular online services can be seen in strong and growing demand for Internetaccessible cell phones, PDAs, two-way pagers, small kitchen devices, and TV set top boxes." More than half of online users (53 percent) have a computer and TV in the same room of their house, and 60 percent say they currently watch TV and go online at the same time. Additionally, 51 percent say they would be interested in checking their e-mail through their television, and two-thirds of online users (67 percent) would be interested if they could check out a Web site they'd seen on TV without getting up from the TV to find it. E-mail addresses have become such a pervasive part of an individual's identity that 75 percent of Internet users expect more people to know their e-mail than their phone number in the future. A full half of online users (50 percent) now say that they prefer to use e-mail instead of the telephone (34 percent) to communicate with business associates. As people spend more time online, the study found they're also spending less time doing more traditional media activities. More than a third of users (34 percent) say that they are watching less TV since they started going online, up from 26 percent a year ago. Finally, online users are unambiguous about their views on privacy, with virtually all of the respondents (94 percent) saying it is "very important" that their privacy and security are protected while online. America Online commissioned Roper Starch Worldwide to produce a random survey of 1,004 adults (ages 18+) who subscribe to an Internet or online service at home. Interviews were conducted via telephone in August 2000. The results have a +/- 4 percent margin of error.