BUSINESS AT NET SPEED Click for June 22, 1998 issue


Nearly everyone's doing it -- doing business on the Internet, that is. For the most part, though, companies aren't actually buying and selling products electronically. Much more often, executives told a Business Week/Harris poll, they're distributing product information, advertising, or supporting customer service. Just 45% of execs said their companies actually sell to customers on the Net -- and most of those who don't said have no plans to start. Why not? Too often, they said, electronic commerce conflicts with another sales channel, or the Internet simply doesn't fit their products and services. Another big concern: online security. On the other hand, a large majority of those who do buy or sell online say they reach a broader base of customers, communicate with suppliers more easily, and save on transaction costs.

Nearly Everyone's Surfin'

Does your company use the Internet, the World Wide Web, or some other online method to: YES NO DON'T KNOW Provide potential customers 87% 13% 0% with product information Advertise or do brand marketing 72% 27% 1% Provide customer service 61% 36% 3% Sell products or services 45% 54% 1% directly to customers Bring buyers and sellers together 43% 52% 5% Buy products or services 41% 47% 11%

Those Who Don't, Won't

If your company doesn't now sell online, do you have any plans to sell products or services online, or not? Have plans 27% Do not have plans 64% Don't know 9%

How Long to the Net?

If so, within how many years does your company plan to sell products or services online? 0 years 16% 1 year 30% 2 years 36% 3 years 7% 5 years 5% Don't know 6%

Road Blocks

If your company doesn't now sell online, which one of these, if any, is your company's single biggest obstacle? Conflict with existing sales channel 28% Internet not applicable 27% Lack of adequate customer base online 17% Lack of security 10% Customer perceptions of security risk 7% The cost of running a Web site 2% Something else 3% Don't know 6%

The Upside

Are the following a major benefit that your company gains from buying or selling online, a minor benefit, or no benefit at all? MAJOR MINOR NO DON'T BENEFIT BENEFIT BENEFIT KNOW Reaching customers directly 42% 46% 9% 3% Reaching a broader base 36% 48% 15% 1% of customers More easily communicating and 28% 51% 17% 4% transacting with suppliers Savings on transaction costs 17% 51% 28% 4% Cutting out middlemen 13% 45% 38% 4% Savings on marketing 9% 46% 40% 5%

Pricing Stability

When doing business online, does your company change prices more often, less often, or about as often compared to your traditional non-online transactions? More often 5% Less often 3% About as often 68% Don't know 24%

No Online Premium

When doing business online, are your company's average prices higher, lower, or about the same compared to your traditional non-online transactions? Higher 4% Lower 10% About the same 65% Don't know 21%

Jobs Impact

As a result of your company's use of the Internet, the World Wide Web, or some other online method, have you increased employment, reduced employment, or kept employment about the same? Raised employment 18% Reduced employment 3% Kept employment about the same 75% Don't know 4%

Employment to Come?

In the next year, do you anticipate increasing employment, reducing employment, or keeping employment about the same as a result of your company's use of the Internet, the World Wide Web, or some other online method? Will increase employment 22% Will reduce employment 6% Will keep employment about the same 66% Don't know 6%

Security Angst

Are concerns about security slowing down your company's plans to move more business online, or not? Yes 34% No 61% Don't know 5% Survey of 308 senior executives at large public corporations. Interviews were conducted May 27 to June 5, 1998, for Business Week by Louis Harris & Associates Inc.
Edited by Keith H. Hammonds - For corrections and clarifications click here


The 'Click Here' Economy
COVER IMAGE: Doing Business in the Internet Age

GRAPHIC: Online Sales Are Soaring

TABLE: How the Internet Changes (Almost) Everything

TABLE: Understanding Net-Speak

GRAPHIC: How a Mythical Merchant Uses Three Avenues of the Net for E-Commerce (.pdf)

Supply Chain
GRAPHIC: How Mythical Sportz Gets Products to Market

CHART: Explosion in Enterprise Software: These Tools Are Being Honed for E-Commerce

Customer Service
TABLE: At Your (Cyber) Service

TABLE: Six Signs That You Have Been Hacked

BW/Harris Poll
FedEx: An Internet Stock?
Online Merchants
Cyber Prices
Next: Smart Cards
Net Tax Commentary
Knowledge Management


Updated June 11, 1998 by bwwebmaster
Copyright 1998, Bloomberg L.P.
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