 Back to College for a Day
By Michael McGrath
I was a guest speaker last week at a business symposium sponsored by the Charlton College of Business, University of Massachusetts, having been asked to make a presentation on Internet Marketing and Search Engine Optimization. Businesses from southeastern Massachusetts were the attendees, and speakers included professors from the College of Business who were presenting results from regional studies they had supervised. The studies all had some connection to E-Commerce, and included corporate blogging and online commerce saturation into the small business community as subjects. I was fascinated by what I learned, much of which had to do with how much, still, I have to learn, and I want to share a little of that with you in this month's missive.
We work in the virtual world, and we read voraciously everything we can get our hands on when it comes to our industry and our craft. I thought we had a good handle on the market place, its trends, and the percentage of businesses already on the Internet fully engaged in e-commerce. I learned, however, that is not the case. A little research over the weekend gave me some numbers that helped put things into some perspective, and something worth noting.
The most recent numbers from the US Census Bureau suggests there are 1.04 million businesses in the US with from 4-9 employees, and 2.77 million businesses with between 1-4 employees, These would constitute what we would all consider small businesses. The best figures I've been able to find on the percentage of these that have web sites is just about half. Some of the study results presented at this recent U-Mass symposium suggest southeastern New England businesses are a little more web-present than the national percentages - - more businesses have web sites. What the study results told me that was new, though, was the percentage of those businesses with web sites who were actually engaged in e-commerce.
Only a small percentage of businesses in this area of the country use the Internet for e-commerce, with most websites (92% in 2000, 93% in 2007) providing only company and product information. The study also showed that the percent of total sales generated from company web sites who were engaged in online commerce had grown from 6% in 2000 to 13% in 2007. I am astounded by these numbers, and perhaps you are, too. More web sites online for area businesses, but a higher percentage not engaging in online sales; yet those who have engaged in online sales have seen a nice growth in the percentage of their total sales coming from the Internet.
I'm wondering if this is representative of the entire country, or whether this is a regional phenomenon, and if it's regional, why. Even though there are fewer web development firms in the region than there were 3-5 years ago, companies wanting to bring their business sales to the Internet still have resources to choose from in the industry. Perhaps it's the cost associated with doing so - - custom programming for an online shopping cart, along with the web site to surround it, and the Internet marketing necessary to promote it, can collectively run up to the $9,000 - $15,000 range. There have been more than ample studies showing the buying habits of the average Internet user (207million out of 300 million in this country) - - nearly 90% use the Internet to do all or virtually all of their pre-purchase research online, no matter the product. That number itself would be enough for me to want my business online. Our own observations are that once a person has had a successful online transaction, well - - you won't get the toothpaste back in the tube after that.
All in all, though, these numbers tell me the Internet will continue growing for some time to come. There are still a great many businesses who will need a web presence just to keep up with the competition. As the number of web sites increases, so, too, with those with some e-commerce component for the sale of more and more “widgets.” Good news for a company like KISS, but the extent of the business still to come was surprising. I wonder how many websites will join the Internet in the next five years - - would you care to guess?
No one should be shy about joining in, though. The Internet makes the world very small, but it does so without diminishing in any way the size of the market. A small business needs such a small share of that market in order to be successful, and there is still plenty of room for everyone. I guess that was one of the lessons I learned from going back to college for a day last week. |
