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About Face: The Changing Face of the Internet

Changing Internet Demographics and Their Implications for Your Business and Your Web Site

When the Internet first emerged as a legitimate channel for conducting commerce, businesses and consumers alike desperately tried to find ways to make the most of this technology to help them achieve their business and recreational goals. Throughout the 1990's, the world of the wide web was expanding rapidly and seemed to offer countless opportunities. New business models seemed to emerge as quickly as Dotcoms securing venture funding.

With the new millennium came a new calm and the return to traditional measures of success. So, while growth on the Internet remains at a break-neck pace - nearly 1,000,000 people leap onto the web every month - the demands and expectations of e-businesses are now more firmly grounded than ever before.

The emphasis on well-established methods may, however, be all for naught for it comes at a time when the Internet is going through a radical transformation whose impact has greater implications than perhaps the introduction of the Web itself. The Internet's face is changing - that is, the people using the Internet, where they live and why they're on the web.

In this article, we highlight some of the most drastic Internet-related demographic changes and explore how they will likely change what and how you conduct your e-business.

1. The 'new face' of the Internet isn't where you'd think.

- North Americans on the Internet are outnumbered by Internet users in Asia. PC Data Online estimates that approximately 53-65 million North Americans (United States, Canada, Mexico) logged onto the Internet. At the same time, Asian Internet users (Japan, China, South Korea, Taiwan, India, Hong Kong, Malaysia, Singapore plus Australia) range between 66 and 78 million. Furthermore, Internet usage in these same Asian countries is expected to grow at considerably higher rates than those in North America for the next several years.

- North Americans are not getting on the Internet as quickly as Europeans. By 2003, the number of Europeans online will grow to nearly 105 million.

Implications for your business

If you currently limit yourself to conducting business with North Americans and you decide to tap into the large and fast-growing non-North American Internet population, you will be developing products, customer service, marketing and operations for audiences that have very different values from your current client base.

As a result, your overall business and operational strategies will need to be based on new research. Suggestions for conducting strategic research include:

1. visiting popular web sites in key geographic centres and those that cater to audiences similar to those you are scouting;

2. reviewing reports generated by publications such as The Economist that explore political, social, economic and cultural trends and attitudes; and,

3. engaging local research firms to conduct in-depth consumer and labour market research. Once this strong foundation is established, the next challenge will be to determine what proportion of your budgets and energies should be allocated towards these emerging markets.

Explore the possibilities and risks of establishing local servers and language-specific web pages. The former establishes you as a serious player in a foreign area and the latter will soon be the industry standard. Keep in mind that certain web-user principles (e.g. colours, layout, navigation, etc.) that you have refined may not apply. For a list of questions and lessons to help you focus your web efforts, see our articles, "To Web or Not to Web" and "Is E-Commerce Profitable Commerce?"

The Asian and European Internet Markets: Both these markets are expected to grow largely due to the growth in mobile technologies. That means if your business model doesn't take into account that customers and potential partners may be away from their computers when they visit your site, you might need to re-examine your entire web site and offerings.

2. The 'new face' of the Internet isn't ageless.

- The number of Americans (United States) over the age of 55 will increase from almost 60 million this year to almost 66 million by 2005 and 75 million by 2010. By the end of this year, the number of seniors online will approach 9 million and that number will almost double to 17.5 million by 2003.

Implications for your business

Almost since its inception, the shape of the Internet has been dominated by the visionaries and techno geeks. Seniors aren't typically counted in these groups and so, up until now, have not been addressed as a significant interest group on the Internet. Some emphasis has been placed on seniors who are likely never to join the Internet community - technophobes, those with lack of access, lack of interest or physical inability.

But, seniors are now spending more time than any other age group on the Internet. This means that businesses need to explore partnerships with senior-focused services (e.g. health, personal privacy, financial security, etc.). For a summary of the predominant values, attitudes and concerns felt and expressed by seniors about life at work and beyond, review the insightful source entitled, 'Generations at Work' by Ron Zemke & Claire Raines and our review of this book, Generations Really Works.

Because their notions of service are rooted in the 1950s, 60s and 70s, web features that will likely appeal to seniors include:

1. policies and procedures that truly protect their very private and personal information;

2. browsing-friendly sites;

3. large print and graphics; and,

4. attentive, personal and immediate customer service.

3. The 'new face' of the Internet isn't wealthy.

- The fastest growing segment of Internet users in North America is the lower income groups.

Implications for your business

When computer manufacturers consistently issue profit warnings, the message is clear: people aren't racing out to buy new computers. One of the byproducts of this saturation of the mainstream computer market has been that lower income groups are becoming a valuable growth target market. Much of this group currently does not have, nor will they immediately gain access to, the Internet. This leaves businesses to find ways to help this group get onto the Internet in order to capitalize on the opportunity this market provides. As this group comes onto the Internet, their attention spans, buying habits and expectations will be unique.

You may wish to consider the number of plug-ins and size of files for this group, as they will likely not be fitted for the Web's latest technologies. Another consideration should be that layout and language reflect potentially lower education levels.

4. The 'new face' of the Internet focuses on purchases.

One of the fastest growing segments of American Internet users that currently spends, and is expected to spend, more online is teenagers. Current year spending is estimated to be $710 million and $1.8 billion by 2003.

Implications for your business

The Internet generation has arrived and now they're getting allowances! As we discussed in our marketing article, "Is marketing on the Web for kids worthwhile for business?", businesses can no longer disregard the teen market; on the Internet they are a force to reckon with. Not only are they among the most savvy, they are the most critical, the most impatient, the most demanding and the ones soon to have most of the money.

If you are serious about developing web sites to attract and retain this group as paying customers, sources of research or new ideas, you've got your work cut out for you. Fast, dynamic, colourful, and new graphics, layouts and incentives need to be carefully balanced with product or service details that are almost immediately informative and still establish a strong brand. Not for the faint of heart.

As these demographic changes suggest, the 'new face' of the Internet is complex and multi-faceted. More wrinkles will develop in the months to come. The challenge for you as a thriving business is to embrace this new Internet and not do an 'about face'.

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