The story is no longer the growth of the Net. In the past the droves of users that were coming online, were in the double digit rates. There were periods in the early 2000's where the numbers of new users, out weighed the active users. The newbie's of the world were the majority. Net strategies were set-up to manage this growth, focused on user education and simplicity.
The new net is all about the growth of broadband. The most recent numbers, published by comScore Networks, have the percent of US Households with internet connections that have a broadband connection in their home at 42%. This is amazing growth, compared to the mid 20% range in 2002. Now reaching the internet consumer via a rich media ad, or streaming content is no longer the fringe. This is the masses. The signs show a potential 50% mark being reached by mid 2004.
Broadband adoption at home continues to accelerate within the online population. Though the overall online population is growing at around 8% year over year, the adoption of broadband is growing at 30% yoy and if recent trends continue, will grow by over 40% this year alone.
Online spending has grown by more than 100% versus 2001 ($53 B in 2001 vs. > well over $100 B in 2004). Travel now accounts for almost 50 percent of total spending, up from approximately 35 percent in 2001. 25% growth rate vs 03 Trans/Buyer is growing disportionally – they are transacting more often online – esp the case with broadband users – they buy more often
Increased broadband adoption and tenure (or experience) online both have dramatic effects on online spending. These two factors are also behind increased adoption of a wide range of other online activities, such as search, online banking and offline product research.
When asked what media sources do people prefer to use for each type of information, the responses were internet focused. These were of course travel, health financial research type info the Web is great for and consumers are connecting more and more to it. But letÂ?s look at more broad-based media consumption. Second in weather; beats magazines for entertainment and sports info; matches magazines for general news.
Additionally, In the past year, we have witnessed a substantial increase in the share of bandwidth consumed by non-P2P applications. This is no doubt a function of both the RIAA suits and the innovative streaming and download services introduced in the past year.
The story is broadband and tenure, and this is driving many of the key applications online today. Note, these are not just transactional apps, they are services and content. One of the fastest growing applications today is online dating/personals services. The growth in spending in this category from 2003 to 2004 is over 55%. More than $1.5 B was spent on online content in 2003. Personals accounted for 30 percent of it.
In the financial world, online banking is growing at ~30% annually, while bill pay is growing by ~40%. We’ve proven that customers who use online bill pay are twice as valuable (as measured by account balance) and half as likely to attrite as non-bill pay users.
The future marketer should be focused on reaching the more advanced and educated online consumer. This means, you can be complex in what you offer. Keep it Simple Stupid is still a good motto, but just not too stupid.
