1. E-commerce Trends Change is a SURE thing! Pamela J. Brown, Ph.D. Associate Professor & Extension Entrepreneurship Specialist Tucumcari Workshop Basic Track

2. E-commerce Sales of goods and services where an order is placed by the buyer or price and terms of sale are negotiated over an Internet, extranet, EDI, email, or other online system. Source: U.S. Dept of Commerce News, Feb. 24, 2005.

3. E-COMMERCE Customer driven Many choices Many channels Seamless interactions Relationships drive the business Source: http://www.forbes.comhttp://www.forbes.com eBusiness for a Customer-Driven World

4. Facts U.S. - 35.6 million –37% over 2000 –81% of teens –63% of adults 18-29 -80% 30-39 -74% 50-64 -60% 65+ -26% –60% women –66% men –Ethnicity Whites -68% Hispanics -60% Blacks -42% Source:www.pewinternet.com http://www.forrester.com Globe – 445 Million World home use 51% –U.S. –German –United Kingdom –France –Australia –Spain –Sweden –Switzerland –Hong Kong Source: www.clickz.com

5. U.S. Economic Impact E-commerce sales 2004: –$69.2 Billion – 23.5% increase from 2003 – 2.2% of all retail sales are online (2005) 1.9% of total retail (2004) sales (1.6% - 2003 ) – Retail sales up 7.8%

6. Challenges to e-commerce businesses Bad news: Browsers and shoppers not completing purchase Repeat visitors not purchasing Good news: Online businesses have a higher conversion rate than brick and mortars online

7. Changing Demographics

8. SEGMENTING E-CONSUMERS Young females – buy less Males 18-35 – shoppers/buyers Older adults – information seekers Minorities – increasing as access increases

10. Why aren’t “they” are buying? 28% of online consumers do not buy online 59% search aggregate sites, not merchant sites Value the in-store experience Delivery costs Credit security Delay in purchase satisfaction No credit Seeing is believing Too complicated Source: http://www.forrester.comhttp://www.forrester.com Why Some Consumers Don’t Buy Online,March 30, 2005

11. E-Loyalty: Is it real? Multiple retailers Price Good service Emotional connection/loyalty Relevance to customers Keep customer as central focus of e- commerce Source: http://www.forrester.comhttp://www.forrester.com Getting the Most Out of Retail Loyalty Programs, March 8, 2005

12. What do e-customers want? TRUST –Recognizable sender –Easily read content –Quick response to inquiries –Real answers to real questions –Sequence of steps –Privacy info Source: Forrester, Best and Worst of Email Customer Service, 2005 http://www.forrester.com

13. 2004-2010 Online sales $300 Billion Most categories grow 10-20% annually 77% of households will have access –40% will shop online –2 million / yr will shop online –2007-2009 – 50% US households with broadband

14. Impact on Business Conducting business Costs Profit Time Customer relations Employees Vendors Policy E-business is saving AND selling! Source: Access Minnesota, 2005