Consumer report bucks Web trend

Consumer-oriented Web sites are proliferating so fast they'll be the hottest segment of the e-commerce market in the next few years, according a new report from ActivMedia.

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Consumer-oriented Web sites that generate revenue are proliferating so fast that they'll be the hottest segment of the e-commerce market in the next few years, according a new report from market research house ActivMedia.

That finding differs sharply with conclusions of other Net researchers, including Forrester Research and IDC, which generally pinpoint business-to-business transactions as the immediate opportunity on the Web.

"They are all pretty much discounting retail sales, but we are seeing a rather healthy growth in number of sites that sell consumer products globally," said Harry Wolhandler, ActivMedia director of research. "Even in the United States, 30 percent of commerce sites are selling consumer products and services."

The report, "Real Numbers behind Net Profits," points to expanding local consumer markets and more online shopping as driving the consumer trend.

Web-generated business topped $1 billion in March, ActivMedia said, counting transactions completed offline as well as online, and may hit $24 billion for the full year. Sales and fees account for 85 percent of revenues, with ad banners generating the remainder.

Only about 14 percent sales on the Web are actually consummated online, Wolhandler said

Commercial sites in the consumer and business-to-business segments each accounted for 25 percent of sites in the latest survey, while 21 percent were computer-related sites, slipping from No. 1 billing last year. While growing in number, computer sites are losing market share because relatively few entrants haven't jumped online yet.

In other findings, the report stated the following:

  • Industrial and manufacturing sites account for one in seven Web sites and are booming because closer coordination between trading partners cuts costs.

  • Publishing sites, searching for ways to boost revenue, dropped from 13 to 8 percent of commercial sites since last year.

  • Travel sites mostly to promote destinations, not for ticketing or transportation, hold steady at six percent of commercial Web sites.

  • Real estate sites are booming, jumping from two to six percent of sites, but most merely offer listings.

  • Finance sites held stead at four percent.

    The study excluded Japanese language sites, ISPs, and builders of Web sites. It was based on 3,500 email responses from a random sample of the estimated 250,000 commercial Web sites.