Question #1

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3. Question #1 • What percentage of U.S. households have a computer at home? • 55% HED 460

4. Question #2 • What percentage of U.S. households have a Internet access at home? • 51% HED 460

5. Question #3 • After the USA, what country has the highest percentage of adults going online? • Netherlands – 46% followed by Australia at 45% and Hong Kong at 42% HED 460

6. Question #4 • After the USA, what country has the highest percentage of adults purchasing online? • Japan, with 20%, then UK and Canada with 18% and Germany with 17% HED 460

7. Question #5 • What is the profile of online shoppers? (gender, age, income) • 57% males w/online access shop • 25-34 (66%), then 35-44 (49%) • > income, higher percentage shop HED 460

8. Question #6 • What are the 3 attributes of favorite web sites? • Good product selection • Competitive prices • Ease of use HED 460

9. Question #7 • What is the greatest barrier to online purchasing? • Fear factor - Credit card safety (69%), then privacy (61%) HED 460

10. Other barriers • Other fears • Returns • Customer service questions answered • Feel factor • Feel, see, try out/on • Prefer shopping at stores HED 460

11. Try-out/”experience” • Zanybrainy.com – selected toys • 3D interaction to zoom in and out, “use” products (sharperimage.com) • 3D shoe boutique (neimanmarcus) HED 460

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14. Zanybrainy link HED 460

15. Other barriers • Fulfillment factor • Not willing to pay shipping/handling • Don’t want to wait for products • Frustration factor • Difficult to shop online • Completing transaction takes too long HED 460

16. Question #8 • What is the greatest barrier to online purchasing for clothing? • Inability to try on clothes for fit before purchase (81%) • Unable to feel material quality (45%) • Concern about ease of return (44%) HED 460

17. The Fit Issue • Hat size, “Melon Meter” (lids.com) • Shop by body type (lucy.com) • Eight virtual boutiques • Virtual models (landsend.com and jcpenney.com) • Fit guides and comparisons (pants@gap.com and eddiebauer.com) HED 460

18. Question #9 • What is the cause of e-shoppers abandoning their shopping carts? • Excessive shipping costs (1/2) • 66% abandonment rate • Present shipping costs up front HED 460

19. Question #10 • What is the most frequently purchased online category? • Media (books, CDs/cassettes, videos, software) • Amazon.com HED 460

20. Question #11 • What categories experienced the highest growth levels? • Toys • Infant/children/teen clothes • Home office supplies • Cosmetics/fragrances HED 460

21. Question #12 • How much are consumers spending on Internet purchases? • $230 in 1997 • $1200 in 1999 • Users estimate 36% of total retail spending will be on the Internet HED 460

22. Question #13 • What is the main advantage of being a pure-play e-tailer? • Focused and nimble • What is the main advantage of being a multichannel e-tailer? • Brand name HED 460

23. What has Amazon done right? • Amazon simplifies shopping • Equity built with consumers is saving Amazon with investors • Selection, competitive prices • Ease of navigating site/convenience • Delivery speed and options HED 460