Originally created 04/12/98

Web users finally sold on Internet shopping



If you've bought something online lately, you've got plenty of company.

New studies indicate that online retailing is finally showing the kind of growth curve that electronic-commerce advocates have long forecast.

Odyssey, a market research firm, said online purchasing doubled in 1997. The company reported that 30 percent of online households -- roughly 7 million in all -- made some kind of electronic purchase during the last six months of the year.

The reasons for online shopping growth are varied and fascinating.

For one, there are simply more Web surfers out there to buy things these days. Nearly half of all U.S. households now have a personal computer and half of those are online.

It should come as no surprise that these techno-savvy households also have disproportionately high income and education levels -- two predictors of a willingness to try Internet commerce.

Moreover, those who have Internet connections are using them more than ever. Web users now spend more time on the Net than they do watching television, according to a separate study.

But Mark K. Wright, chairman and chief executive of at Plan, a Stamford, Conn.-based market research firm, thinks he has detected an even more surprising reason that Internet commerce is up sharply: men.

Men aren't typically regarded as shoppers. In the real world, women exercise most of the purchasing power. But the Internet could change all that, said Wright.

"Most retailers know that guys are intentional shoppers. They know what they want, they go to the store and buy it," he said.

"But what you see here on the Internet is for the first time, you've got a retailing space where a guy will go and browse, they'll go and shop. If you shop, you'll always end up purchasing more."

Wright cites the example of a music store. Many middle-aged men wouldn't be caught dead in the record store at the mall at 9 p.m. on a Friday. They're tired after a week of work and the teen-age crowd there makes them uncomfortable.

But those same men have no problem browsing a Web site like CD Now at 9 p.m. on Friday from home, he said. And because Web browsing is so easy, these male shoppers might well pick up one or two CDs in addition to the one they went to buy in the first place.

"For the first time you have a medium that has gotten guys to browse," Wright said. "That's a trend that I don't think is commonly known, but it's very true and I think the data is there to support it."

The evolution of Internet retailing from a specialty form of commerce to a broad audience is continuing as well, according to at Plan's research.

The earliest buyers on the Net were the technologically adept. They understood the online environment and had few problems with the idea of sending their credit card number through cyberspace to buy a software program or a piece of computer hardware. Trouble was, not too many people fit this description.

A second wave of Internet shoppers decided they would start small in testing the waters of electronic commerce. So they concentrated much of their purchasing on relatively inexpensive items -- such as CDs and books -- just to see how things would work out.

Perhaps heartened by that experience, an increasing number of shoppers are back for some big-ticket buying.

"Now what you're seeing beginning to emerge are some pretty serious, non-tech oriented purchases, like stocks and mutual funds," Wright said. "It would indicate that the fears of putting your credit card number on the Internet are beginning to dissipate."

Indeed, at Plan's research shows sharp increases in a variety of buying categories. Airline ticket reservations placed online shot up 300 percent last year; online stock and mutual fund purchases increased 291 percent; car rentals were up 105 percent.

Meanwhile, "second wave" Net purchases continued along their own growth curves. Computer hardware sales online increased 111 percent; online book sales jumped 94 percent.

"The numbers demonstrate that the retail model on the Web is coming of age," Wright said. "Our numbers indicate that the trend will continue in 1998 as the Web audience continues to transform from its technological roots to mainstream consumers."