The demographics of the U.S. online population are dramatically changing, and online merchants who don`t adjust their business models to accommodate the changes are risking their profitability. According to IDC`s Internet Commerce Market Model (ICMM), by 2004, 103 million new users will join the ranks of the U.S. online population a population that will then total 210 million and more closely resemble the overall U.S. populace.
"People from all walks of life and socioeconomic status will be online users, and online households will be much more like the average household than they are today," said Barry Parr, director of Consumer eCommerce research at IDC. "The increase in the number of online users will mean that marketers who have in the past avoided online campaigns will need to embrace the Internet or lose out to the competition."
The growing number of U.S. online users and the change in demographics is both good and bad news for those who sell products and services online.
"For new entrants into consumer ecommerce, the changes and the growth in the online population mean there is still plenty of opportunity," Parr said. "Existing online merchants who designed their business models to capture early adopters, however, will have to adjust their strategies. They`ll need to expand their offerings to attract older and lower-income households while making ure they don`t overlook the growing number of high-income online households."
IDC believes portals, especially, should work extra hard to get a large share of new users. "Many users will stick with the first portal they find and feel comfortable with," Parr said.
According to IDC, adults 55 and older represent the fastest-growing group of U.S. online users. In fact, their numbers will more than triple from 11.1 million in 1999 to 34.1 million in 2004, and they will account for 20% of all new users.
The U.S. population that falls into the 18-34 age group are the most active online users. By 2004, almost 91% of this group will be online. "Many in this group already take the Internet for granted," Parr said. "In five years, they`ll expect it to be as reliable as electricity, the telephone, and running water."
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International Data Corporation (IDC)
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