Today, you can’t pick up a newspaper or magazine, watch the news or listen to the radio without hearing about the Internet.
In truth, the Internet is the most talked about business issue of our time. Like it or loathe it, the simple fact is you cannot escape it.
Some people would have you believe that the Internet is about to take over our lives, revolutionising everything that we do. Others believe it is a mere flash in the pan, a useful but short-lived tool. But who is right?
The fact of the matter is that the Internet is already having huge impact on our lives.
In the UK, a staggering 10.6m adults or 25% of the population used the Internet at the start of last year and this was predicted to increase to around 12.7m adults or 30% of the population by the end of the year, an impressive rate of change by anyone’s standards.
And this pace is set to continue, with growth being driven by consumers’ increasing use new media, the availability of low-cost PCs and lower call costs in a deregulated market.
About 50% of users do so every day though the majority will be doing so from their place of work. Encouragingly 57% use it to book or research travel.
It is true the majority of travel searches relate to the purchasing of travel components, i.e. flights, hotels, car hire etc, rather than package holidays.
This is a function of what’s currently available on-line and is certain to evolve to include package holidays as more package-driven Web sites are created and content-driven sites become a key focus. Importantly, 56% would like to book a holiday on-line which confirms that consumer demand is alive and well.
Conversely, Internet users are very fickle. Just because they visit your site once doesn’t mean they plan to return. You’ve got to work very hard and very consistently to create any kind of loyalty. The fact that around 35% of net time is spent on just 50 sites underlines this very point.
Furthermore, customer expectations are very high. They want better information, faster service and value for money prices.
Here, speed relates not only to how fast your site can be downloaded and how up-to-date your material is, but most especially how quickly you respond to e-mail requests and enquiries.
Managing customer expectations is the order of the day. Tell them honestly what your turnaround time is or they’ll probably expect a response within the hour and then lose confidence in your organisation if they don’t receive one.
But enough of today and what of tomorrow? It is estimated that the UK is roughly two to three years behind the US, where free calls to the Internet have helped to promote its usage both at home and in the workplace.
What’s clear is that events and market developments in the US are being seen later in the UK in a kind of ripple effect. Despite some alarmists predicting the end of the .com boom, the signs of continued growth and clear and strong as the charts below confirm.
Last time, I mentioned that there are still plenty of opportunities for small and medium-sized companies to take advantage of the new e-volution and it seems that many of you agree.
Being small, nimble and flexible, they can take decisions quickly and act fast.
Their personal relationship with the customer and in-depth knowledge of his or her buying behaviour is the envy of the multiples.
This powerful relationship tool is becoming even more important in retaining market share against a growing period of consolidation within on-line travel.
After a recent period of .com acquisition, the three on-line travel leaders, Expedia, Travelocity and Preview Travel, currently account for 40% of global on-line travel bookings.
While this may sound as though the market is too crowded for another entrant, this is not the case.
With a clear strategy, a differentiated positioning and some real, tangible consumer benefits, the Internet is still a very attractive business development opportunity whatever your business size.
ninternet users in Europe
1999 48m
2000 64m
2001 76m
2002 91m
2003 100m
2004 110m
n internet adoption in europe
UK 25%
Scandinavia 17%
Germany 19%
France 12%
Italy 10%
Spain 6%
Netherlands 4%
Others 7%
n Global on-line travel spend
1996 $276m;
1997 $827m;
2002 $9bn;
2003 $29bn
Data sources: Veo, TIA, Forrester Research, PhoCusWright, Jupiter Communications, MORI, NOP, London Business School, Hotel Marketing.