Newspaper sites popular Web destinations
In major markets across the country, online newspapers are some of the most recognized and visited Web sites among local-oriented Internet destinations, according to marketing research firm NFO AD:IMPACT, Greenwich, Conn.
According to the data, which aggregated survey results from more than 10,000 online consumers across 17 major local markets between January and June 2000, two-thirds (66 percent) of all online consumers, on average, were aware of onfine newspaper Web sites. In contrast, an average of about one-third (34 percent) of online consumers were aware of local competitive city guide sites. Further, nearly half (48 percent) of online consumers had visited the local newspaper site, on average, and more than 22 percent had visited in the past 30 days. In comparison, across these same markets, only an average of 16 percent of online consumers had ever visited the local city guide sites measured and less than 5 percent visited in the past month.
From a projected total population perspective for those 17 major markets, NFO AD:IMPACT estimates that nearly five million online users (4.97M) had visited the newspaper sites in the previous 30 days, almost twice as many as the combined traffic of the local city guides assessed in those same markets.
In addition to driving strong traffic numbers, online newspapers also drive a higher volume of more "valuable traffic" as it relates to potential online advertisers and their efforts to attract shoppers. As a result of visiting the newspaper Web sites examined in this research, nearly 1.4 milfion online consumers report contacting a business in the previous 30 days and more than half of those 750,000 made purchases (either online or offline). Again, both of those numbers exceed the combined figures for the local city guides assessed in this study.
The 17 major markets and online newspapers examined in this investigation include: Atlanta and the Atlanta Journal-Constitution’s ajc.com; Boston and New York Times Digital’s boston.com, Chicago and Tribune Interactive’s Chicagotribune.com, Denver and the Denver Post Online, Detroit and KnightRidder.com s Detroit Free Press, Ft. Lauderdale and Tribune Interactive’s Sun-Sentinel.com, Los Angeles and Latimes.com, Miami and Knightridder.com’s The Miami Herald Internet Edition; Minneapolis and StarTribune.com, New Orleans and Advance Internet’s NOLA Live, Orlando and Tribune Interactive’s Orlando Sentinel Online, Phoenix and the Arizona Republic’s AZCentral.com, Portland and Advance Internet’s Oregon Live, Charlotte and The Charlotte Observer’s Charlotte.com, Salt Lake City and the Salt Lake Tribune’s Utah Online, Seattle and the SeattleTimes.com and Washington, D.C. and WashingtonPost.com.
Local competition compared across each of the 17 markets included America Online’s Digital City service, Lycos Cityguide and Ticketmaster CitySearch. In addition, NFO Worldwide also assessed the performance of online newspapers against Yahoo’s local city guide equivalent, Yahoo!Local, in seven major markets (Atlanta, Boston, Chicago, Los Angeles, Miami, Minneapolis, and Washington D.C.). Online newspapers again emerged on top. Across those seven markets, online newspapers had an average awareness of 74 percent among online users compared to 34 percent for Yahoo!Local; 56 percent of online users visited the newspaper sites, on average, compared to 16 percent for Yahoo!Local; and 28 percent indicated visiting newspapers’ sites in the past month relative to Yahoo!Local’s 4 percent.
NFO//Consumer.choice is a thirdparty, independent initiative; none of the companies and Web sites surveyed has commissioned this research.
More online gift buying expected this season
One third of 4,500 online consumers report that they will spend more for holiday gifts online and offline this year compared to last, according to a survey by Greenfield Online, Wilton, Conn. These consumers indicate that they will spend an average of $660 for holiday gifts, with Mom the most likely recipient of something bought online. (The pre-holiday study last year reported an average dollar amount for anticipated spending that was nearly the same.) Amazon.com continues to be the leading Web site destination for online gift buying, but this year 84 percent also say they will head to retailer Web sites.
Best price and guaranteed delivery are the most important services expected from Web sites as the holiday shopping frenzy unfolds, followed closely by customer service. After last year, when many e-commerce sites lured shoppers with offers of free shipping, consumers indicate they will be alert to the impact of these charges this season. Some 61 percent of those who have purchased on the Web say they have abandoned a purchase online because of shipping charges. People who refuse to purchase online cited shipping charges as a key reason in this pre-holiday survey.
The study reflects the very kind of shoppers e-commerce sites want to attract in terms of savvy and income. The respondents are mainly experienced Internet users who have been on the Internet long enough to be comfortable with making purchases online. Their average household income is $58,000. The increasing number of experienced Internet users has been a factor cited by various consultants who have forecasted online sales of $19 billion for this holiday season compared to $10 billion in 1999.
The five top items respondents intend to buy online are: CD/tapes, 47 percent; books, 46 percent; toys/games, 35 percent; clothing, 28 percent; gift certificates, 26 percent.
The study was conducted online August 7-14 with a sample of 4,500 U.S. respondents. All survey findings report aggregate information about groups, not individuals. Greenfield Online weights data collected from its panel to Forrester Research, Inc.’s Year 2000 Benchmark survey of 80,000 U.S. offline and online individuals.
Study rates online retailers
The @plan Institute for Online Commerce has released its first @plan e-Performance Report covering the automotive, general merchandising and travel categories of online retailing. The report, scheduled for release each quarter, uses shopper satisfaction data from nearly 15,000 active online shoppers. Sites earned performance stars ranging between one and five. Performance stars were calculated using an aggegate measure of four specific attributes and a pre-determined scoring system. Reported sites that did not reach the four-star threshold can be found at www.webplan.net on the Institute for Online Commerce link.
A five-star designation, the highest level of performance, indicates that shoppers evaluated the site as excellent in at least 50 percent of the shopping evaluations. Similarly, four-star designations mean that the site was evaluated as excellent in at least 40 percent of shopping evaluations. Three-star designations mean that the site was evaluated as excellent in at least 30 percent of shopping evaluations. Two-star designations mean that the site was evaluated as excellent in at least 20 percent of shopping evaluations. A one-star designation means that the site was evaluated as excellent in at least 10 percent of shopping evaluations.
In the automotive, general merchandising or travel categories, Amazon.com was the only reported site to achieve a five-star designation. Sites that achieved a four-star designation in the clothes/apparel category are Cabela’s, the Disney Store, L.L. Bean, Land’s End, Nordstrom, and Victoria’s Secret. Sites that achieved the four-star designation in the airline tickets/reservations category are Expedia.com and Southwest.com. @plan selected four specific attributes used to arrive at an overall composite measure of shopper satisfaction:
- the likelihood you would recommend the site to a friend;
- ease of finding what you wanted on the site;
- the site’s ability to provide help;
- quality of customer service.
@plan’s survey of nearly 15,000 online shoppers in the automotive, general merchandising and travel categories was conducted from May 1 through July 24. The study was a representative survey based on a scientific random probability sample. At the 95 percent confidence level, the sampling error varies between 1 percent and 5 percent, depending on the number of respondents who evaluated each reported site. All scores within the statistical margin of error were rounded up to the next star.
Businesses regret switching energy suppliers
American businesses that switched their energy suppliers for lower electricity prices are measurably less satisfied than companies that stuck with their current provider, says a new national survey.
Indeed, U.S. companies staying with their current provider are not only more satisfied with their present utility, but also give their supplier higher marks on all major dimensions of performance, from cost savings and customer service to billing and usage information. In contrast, businesses that changed suppliers for price reductions express the lowest level of satisfaction with all performance levels beyond costs.
And although they acknowledge lower costs, these same businesses are still disappointed in the magnitude of the savings, according to the survey. These results are part of the Midyear National Business Customer Assessment conducted by RKS Research & Consulting, North Salem, N.Y. Between the end of May and mid-June, RKS Conducted telephone inter 402 key accounts. Results are now being reported to sponsoring utilities and energy marketing firms.
Key accounts - larger firms with multiple sites and monthly electric bills in excess of $2 million - are shopping for savings and switching electricity suppliers much more than businesses in general, the survey notes. But only a third of these switchers give their new supplier high marks, and three quarters of these larger firms will give their incumbent supplier an opportunity to meet or beat competitive bids.
The same survey finds increasing interest among U.S. businesses in "premium" power - clean, uninterrupted energy to mn sensitive equipment - as well as additional services in such areas as equipment upgades, real-time monitoring, and on-site generation. While business customers express high degrees of satisfaction with power delivery, they remain concerned about outages. For example, key accounts place the average cost of a one-hour outage at nearly $300,000. And the survey finds a direct link between power reliability satisfaction and shopping for a new supplier.
According to the findings, one in five American businesses can now choose their electric supplier. Within that 20 percent base, seven in 10 companies have elected to stick with their present provider; only one in 10 chose a new supplier.
Among the larger key accounts, one in four have a choice of suppliers, and the research demonstrates that shopping and switching are on the increase. Indeed, just over half- 56 percent - of these companies have retained their present energy supplier, compared with 71 percent of U.S. businesses. Among the key accounts with choice, one out of five picked a new supplier unaffiliated with the local utihty.
While the businesses that switched realized lower electric costs, the actual savings fell far short of their expectations, according to the study. Meanwhile, the firms that stayed put were pleasantly surprised by the comparison of their costs to regulated tariffs. The bottom line: on a l(poor)-to- 7(excellent) satisfaction scale, nonswitchers are signficantly more positive about their supplier, by a margin of 1.2 points (5.74 for those that stayed vs. 4.56 for switchers).
In an important sign of loyalty, three out of four key accounts say they will give their current electric supplier an opportunity to meet or beat competitive bids.
"Switching suppliers doesn’t always deliver improvements," says Carmine Grastataro, RKS senior vice president in charge of this survey. "For instance, only a third - 33 percent - of key accounts are satisfied with their new supplier, compared to the 58 percent satisfaction level among companies that stayed with the incumbent provider. While the switchers acknowledge lower prices, they also report extra work and billing issues with their new supplier."
Despite widespread concerns about power delivery, business customers give utilities high marks for reliability - 6.1 on a 1(poor)-to-7 (excellent) scale. At the same time, half of the U.S. businesses surveyed say they would switch suppliers over excessive outages or fluctuations as a means of registering their dissatisfaction with power delivery problems. And key accounts that switched suppliers are less satisfied with power delivery than those that stayed with their incumbent provider.
"Businesses are evaluating on-site generation to alleviate power delivery concerns and address potential capacity shortages," says Grastataro. "The energy crisis in California, coupled with disappointment over competitive electric prices, have helped businesses focus on value-added information and energy services. For these businesses, competition is not just about price. It’s about finding the total solutions package that derivers the ultimate in value."
Many use online loyalty programs
A research report from Jupiter Communications, Inc., New York, has found that more than 75 percent of online consumers participate in some type of loyalty program, but few said that it is a critical motivator to increase online purchases. Commerce players must not rely on incentive programs to serve as the sole mechanism to drive loyalty; instead, they must fill functionality gaps or face losing customers to either more costly channels or to competitors that offer more value.
While specialized programs provide incentives to drive loyalty, commerce players must first address critical issues that affect a broad audience. According to a Jupiter/NFO Consumer Survey of 1,200 U.S. online consumers, only 22 percent of respondents indicated that loyalty programs serve as an incentive to purchase online. Online consumers place a higher value on easy returns (40 percent), customer service (37 percent), and product selection (37 percent).
Even commerce sectors such as travel, an early innovator in developing aggressive customer loyalty initiatives, have yet to extend their retention and loyalty efforts to the Web effectively. Loyalty initiatives must go beyond points; instead, they must offer online consumers compelling service and functionality to coax loyal customers online and develop online relationships with new customers.
"Loyalty is not only about loyalty programs, but also about rather unique and differentiated products or levels of service," says Melissa Shore, a senior analyst for Jupiter Communications. "Consumers return to sites where they receive tangible value for being loyal, whether the value is priority service, personalized offers, or e-mail updates. Commerce players must create an online experience for users in which their customers see transacting on the Internet as a benefit."
Shore recommends that commerce players pursue the following actions:
- Improve customer service response rates. Commerce players must continue to .make investments in customer service and improve response rates to customers’ inquiries. A Jupiter/NFO Consumer Survey found that 72 percent of online buyers said that customer service is a critical factor in their online shopping satisfaction; however, only 41 percent indicated that they were actually satisfied with their customer service experience.
- Streamline product research and purchasing navigation. Commerce players, especially those selling complex products, must address a highly diverse set of questions posed by a broad customer base. Confusing navigation with limited service options will dissuade customers from current and future transactions.
- Enhance product information. Consumers are seeking comprehensive product information in a customer friendly environment; providing this information remains a critical issue for commerce players. Content must fill the gap created by the inability of consumers to physically touch or see a product prior to purchase. Richer information leads to smarter purchasing decisions; satisfied purchasing experiences deepen the relationship between companies and their customers.
- Improve product selection and availability. Commerce players that sell physical products must invest in internal systems such as inventory management, while improving external-facing functionality such as product availability and shipping status simultaneously. Stock-outs present an opportunity for competitors to steal even the most loyal customers.
- Ease the return process. An overwhelming 85 percent of online buyers said that the ability to return merchandise easily is important to them, but more than half remain dissatisfied with the process, the survey found. Commerce players must expand servicing channels by either leveraging traditional retail outlets or partnering with companies that own physical channels.
- Analyze program viability. Of online consumers that participate in loyalty programs, 65 percent belong to just three or fewer programs. Commerce players must analyze the likelihood of consumers actively participating in their loyalty program, given consumers’ low threshold for participating in a number of programs.
- Leverage information about users. Commerce players must develop an understanding of actual and potential levels of loyalty among their customers. By analyzing demographic and behavioral data, commerce players can identify high potential users and target incentives to induce profitable behavior.