Internet Market Research

Internet Usage
Number of US citizens online as of 1996: 36 million¹¹
Number of US citizens online as of Jan 2000: 99 million¹¹
Number of households online in 1998: 33 million¹⁵
Number of households online in 2000: 44.4 million¹⁵
Estimated number of households online in 2003: 59.8 million¹⁵

Number of "active" US web users in Dec 1998: 55 million¹¹

Number of dialup accounts in US in 1999: 41 million⁵
Number of DSL & cable accounts in US in 1999: 2.6 million⁵

General E-Commerce
83% of shopping is done at home, 16% is done at work
Top reason for buying online: Convenience (71%)
Average online purchase: $142
Average online purchase in most expensive category (travel): $466¹⁶
Number of US citizens shopping online in Dec 1998: 34 million
Average cost for an ecommerce site to acquire a customer: $108 ¹
Customer turnover: ?Most sites lose 60% of customers every six weeks? ¹

Total E-Commerce in 1997: $3 Billion⁵
Total E-Commerce in 1998: $8 Billion⁵
Total E-Commerce in 1999: $120 Billion⁵
Business-to-Business: $100 Billion⁵ (estimated to surpass $1 Trillion in 2003)¹³
Business-to-Consumer: $20 Billion⁵ (up from $700 Million in 1996, estimated at $184 Billion in 2004, total US retail industry is $2.6 Trillion)

By 2003, business transactions worth $1.4 trillion will take place over the web; yet only 2.7% of e-businesses will succeed in converting online lookers into actual buyers.5

E-Commerce Market Segments
Estimated size of US health and beauty market: $509 Million¹²
Size of US grocery market: $513 Million¹²
Women make or influence 80% of household sales, and comprise 51% of the population⁴

1999 product categories

• General business services: $22 Billion⁵
• Financial services: $7.3 Billion (total market of $103 Billion)⁷
• Estimated online brokerage account values in Jan 2000: $374 Billion⁷
• Estimated in 2003 that 9.7 million households will manage $3 trillion in online brokerage accounts (19% of retail investment assets)⁷
• Travel services: $5.95 Billion (corporate travel was $5 Billion)⁵
• Computer hardware and software: $5.8 Billion5 (all video games make a $6.2Billion market)¹
• Administrative business support (subset of General Business Services): $3.9 Billion⁵
• Books: $1.7 Billion⁵
• Business telecommunications (subset of General Business Services): $1.5 Billion⁵
• Gifts and flowers: $730 Million⁵
• Internet-based games (subset of Computer hardware and software): $555 Million (estimated $2 Billion in 2000)¹
  Music: $540 Million⁵
  Apparel and footwear: $460 Million⁵
  Food and Beverage (1998): $235 Million (estimated $16.7 Billion by 2004)⁵

Source for Above Chart: Media Metrix

Advertising on the Web
Total revenues generated from advertising in 1994 in US: $1 Million¹
Total revenues generated from advertising in 1998 in US: $2 Billion¹
- Amount spent on other (non-Internet) forms of advertising Internet business in 1998: $1.6 Billion¹
Estimated revenues from advertising in 2003 in US: $11.5 Billion (5% of total US advertising market)¹
Cost for 45?x40? billboard in Times Square for one year by indulge.com: $102,000 (estimated annual exposure to over 700 million people)¹
Cost for 30 second superbowl ad, January 2000: $2 million
All dot.com advertising in 1999: $1.4 Billion¹⁷
- Money was spent on network TV, magazines, cable TV, national newspapers, billboards (in descending order)
Total direct marketing, annual market: $1.5 Trillion¹

Supporting Industries
Growth of US Internet services market: $1.3 Billion in 1997 to $8 Billion in 2000¹
Estimated size of US Internet services market in 2003: $57 Billion¹

Cost of Services
Average 5-page brochure website: $2,700 ($1,000-$10,000 range)²
Average e-commerce enabled website: $5,000-$25,0002 ($80/month to maintain credit card processing capability)
Average database-driven website: $20,000 - $125,000²
Average cost of web programmer (HTML): $30-$70/hr (depending on reputation, ability, and location)
Average cost of graphic artist: $30-$120/hr (depending on reputation and portfolio)
Average cost of applications developer (CGI, Java, ASP): $40-$250/hr (depending on application, portfolio, and location)
Average cost of database developer: $125-$275/hr (depending on database application, reputation, skill, and location)

Domain Names
Number of domains in Feb 2000: ¹⁸
.com ? 8,006,089
.net ? 1,216,750
.org ? 779,956
.edu ? 5,673
.gov ? 730

Top 5 international domains in Feb 2000: ¹⁸
.de (Germany) ? 893,159
.uk (United Kingdom) ? 758,478
.ar (Argentina) 146,399
.kr (South Korea) ? 132,286
.nl (Netherlands) ? 121,242

Total domains registered ? 13,226,005 ¹⁸
Number of domain names that have been involved in legal disputes: over 9,000 ¹⁹

Venture Capital and Financing

Chance of a high-tech business becoming successful and going public: 6 in a million 20
Percentage of funded startups that go public: less than 10%20
Average percentage of funded business plans: 0.6%20
Most commonly left-out-but-important phrase in business plans: ?sustainable competitive advantage?20

Environmental Issues (Computer Hardware)
Pounds of lead in a typical 17? monitor: 5 ²³
Percentage of PC?s recycled (and not thrown in the garbage) in 1998: 2.3% ²⁴
Number of computers thrown out in 1999: over 12 million²⁴
Number of computers considered ?obsolete? between 1997 and 2007: 500 million ²⁴

Connection Speeds
56K modem ? up to 56kbps (kilobits per second)
ISDN ? up to 128 kbps
DSL, cable modem ? up to 1.5Mbps (megabits per second)
T-1 ? up to 1.544 Mbps
Microwave wireless ? up to 6 Mbps
T-3 ? 43 Mbps

Security
Number of people concerned with telemarketers and their data-gathering and usage: 94%¹
Number of people concerned about online marketing practices: 22%¹

Location Location Location
Average space for a worker: 125 sq feet for a call center, 200-250 sq feet for computer users¹
High-tech space, monthly cost/sq foot: 22
Loop 360, Austin, TX - $27.50
Cambridge (Boston), MA - $35-$40
Silicon Alley (New York), NY - $27-$33
South of Market (San Francisco), CA - $41-$51
Kirkland (Seattle), WA - $35-$40
Silicon Valley - $45
Dulles Toll Road (Washington, DC) - $21-$33

Show Me the Money
Median Salaries for Internet Companies 25
CEO/CIO/CTO - $87,501
Technical VP - $109,501
Business Dev/Marketing VP - $92,501
Technical Director - $82,501
Web Designer/Creative Director - $42,501
Programmer - $61,251 to $64,501 (depending on application)
Systems Administrator - $50,501
Content Developer - $52,501
Sales - $47,501

Other Interesting Data
Number of Years to Reach 50 Million Users: 15

• Radio - 38
• TV - 13
• PC - 16
• Internet - 4

Growth of Internet Economy (1995-1998): 175%¹⁴
Growth of US Gross Domestic Product (1995-1998): 3%¹⁴

Number of Internet stocks on NASDAQ, 22 Nov 99: 295 of 5,259 total (5.6 %) ⁸
Number of Internet stocks in Dow Jones Industrial Average, 22 Nov 99: 0 ⁸
Number of Internet stocks in S&P 500: 2 ⁸
Number of Internet stocks in NASDAQ 100: 6 ⁸

Expected cost of marketing for Internet startups: 75% of sales ²¹

Use of the phrase ?information superhighway? vs ?ecommerce? in major newspapers in 1995: 4,562 to 915 in 1999: 842 to 20,641 ²⁶
Political Contributions by the computer industry ? 1992 - $4.8M, 1996 - $8.8M, 1998 - $9.2M¹

Sources
1. Business 2.0
2. The Albuquerque Tribune
3. PC Magazine
4. WomanTrend
5. Forrester Research
6. eMarketer
7. Morgan Stanley Dean Witter
8. CYBERManagement
9. National Venture Capital Association/Venture Economics
10. PC Magazine
11. Jupiter Communications Research
12. Lucy.com Research
13. AMR Research of Boston
14. University of Texas at Austin Center for Research in Electronic Commerce
15. US Department of Commerce
16. The Yankee Group
17. Competitive Media Reporting
18. NetNames
19. Network Solutions
20. ?High Tech Startup? by Josh Nesheim
21. Mercer Management Consulting
22. CB Richard Ellis
23. Silicon Valley Toxics Coalition
24. National Safety Council's Environmental Health Center
25. Association of Internet Professionals
26. Norman Solomon/FAIR