As a nation we are reading a wide range of statements about the success of retail businesses on the Web. Some say things are very good, while others continue to question those claims. We probably all know that sales are occurring, and even that some enterprises, such as books, auction sites, or even day trading of stock, are doing very well. However, some of us are not entirely sure that the Web will make an eTailer out of every retailer.
According to U.K. market researcher Datamonitor Plc., Web sites containing adult material accounted for almost $1 billion, or 69 percent, of the $1.4 billion revenue generated worldwide from the purchase of Internet content last year.
Total revenue from online content is expected to almost quadruple to $5.4 billion by 2003 as subscription and pay-on- demand methods take hold. While adult content will account for more than half the total with $3.1 billion in revenue, online games will be the fastest growing segment, rising ten times to $680 million in 2003.
Currently about 2.3 million small businesses (fewer than 100 employees) are online, according to Cahners In-Stat Group, which surveys growth on the Web. Most standard retail business have relatively simple sites that consist of only a few pages, but that is likely to change as more ISOs, ISPs, and much larger organizations such as banks and technology companies begin to offer advanced Web building and support features.
Sites based in the U.S., which accounted for 84 percent of the market last year, will continue to dominate the market with a 78 percent share in 2003, Datamonitor said.
Content revenue does not include the sale of merchandise or advertising and this market has been far behind the adult content market. The adult folks have done a far better job of meeting consumer needs. From fast site access to eye-popping content (sorry) and online payment options, the adult sites have been at the cutting edge.
However, Microsoft, in its recent MSN Marketplace debut, believes that this will soon change. Commenting on why such an investment has been made, Microsoft rationalizes that traditional retail sales on the Web will be a $400 billion business by 2002. However recent surveys make it clear that sites will need to address some current problems to maximize this potential.
