5/16/00retail planning associates1 the good news / the bad news retail planning associates rob rossi...

5/16/00 Retail Planning Associates 1

The Good News / The Bad News

Retail Planning Associates

Rob Rossi – Senior Technology Strategist


The Good News

The mass market is coming to the web and there are allkinds of devices that will need solid interface design.

The price tag for web development is demandingsuccessful deployments


The Bad News

There are no established standards for interface elements

The speed to market pressure and tight labor market squeeze resources for documentation and standardization

Speed of new technology developments and their adoptiondiscourage standardization opportunities.


Internet Market Facts


The Web: Between 101 & 66 Million U.S. Surfers

Online Population Definitions by Researcher

Population(millions)

Firm Age Accessedin Past

Study Date

101 The Strategis Group 18+ Ever Used October-99

100.1 Jupiter / NFO 2+ 30 Days Spring 9998 Harris Interactive 18+ 30 Days October-9990 IntelliQuest / Zona

Research16+ 90 Days Sepember 99

83 CommerceNet / Neilsen

16+ 30 Days June-99

82 International Data Corp.

All 30 Days September-99

74.8 Mediamark Research

18+ 30 Days Fall 99

69.3 Cyber Dialogue 18+ 30 Days October-9966.4 Media Metrix 2+ 30 Days September-99

Source: Companies Listed


U.S. Internet Universe


Current/Intended Internet Usage


Demographic Profile of U.S. Web Surfers

Source: MediaMark Research, Fall 1999

All U.S. Adults Web Users Index

Total 198.4 million 78.2 million 100Male 48% 51% 106Female 52% 49% 95

Age18-24 13% 17% 13125-34 20% 24% 11935-44 23% 28% 12245-54 17% 20% 11955-64 11% 8% 7165 and older 16% 3% 21Median 42.6 years 38.5 years

Household Income$150,000 or more 4% 7% 195$100,000 - $149,999 8% 15% 184$75,000 - $99,999 11% 18% 164$50,000 - $74,999 21% 26% 128$30,000 - $49,999 23% 20% 84$20,000 - $29,999 13% 7% 50Less than $20,000 20% 7% 34Median $44,038 $65,778


Feb 2000 Web Stats

Rank Overall Rank Web Site Reach Unique Visitors (000)1 1 yahoo.com 56.00% 37,5832 2 aol.com 53.20% 35,7153 3 geocities.com 41.50% 27,8744 4 msn.com 36.60% 24,6025 5 lycos.com 28.30% 19,0346 6 passport.com 26.70% 17,9147 7 angelfire.com 25.10% 16,8578 8 netscape.com 25.00% 16,7669 9 microsoft.com 23.50% 15,79610 10 tripod.com 23.20% 15,600

Source: PC DataOnline February 2000 Results Top 1500 Websites


Leading Languages Online

English 148,500,000Japanese 19,800,000Spanish 17,000,000Chinese 15,100,000French 10,900,000Korean 10,400,000Italian 9,700,000


source Boston Consulting Group

1999 E-Commerce • Online Retailers in U.S. and Canada

collected $38 billion during 1999.– $7.4 billion, Computer hardware & software– $7.3 billion, travel– $5.8 billion, financial brokerages– $5.4 billion, collectibles

• 145% increase over 1998 $14.9 billion• Orders have increased 200%• Number of shoppers increased 300%

– Source: Boston Consulting Group for Shop.org.


U.S. E-Commerce Shopping

• 39 million people shop online• Average 13 online purchases in 1999• Average $1,200 spent online• Currently spend 15% of “shopping money”

online, by 2002 this will be 36%• Online merchants say they are meeting or

exceeding their online retailing goals

source: Ernst & Young


2000 – The Net’s Biggest Year

• 11 million new households to shop on-line this year – 28 million total – more than ¼ of the US household population

• Average household spending will rise 17% - average household will spend $1,366– More individuals per household will shop online

– More households will buy from expensive categories

• Projected spending is $39 billion


The Party Will Eventually End

• 2000 – 11 million new shoppers• 2001 – 8 million new shoppers• 2002 – less than 6 million new shoppers• Easy acquisition game ends in 2002

– Until then online stores on the lookout for new buyers

– After that, experienced shoppers outnumber novices 6 to 1


The Mass Market Is Moving To the Web.

THE GOOD NEWS !


Interaction with DevicesNon PC DevicesInformational Touch pointsInternet Appliances

“IDC expects sales of information appliances (including WebTerminals, handheld computers and other devices) to grow from$2.4 billion in 1999 to $17.8 billion by 2004.” Inter@ctive Week 3/27

mailto:Inter@ctive


Video Telephone•Direct dial phone•DVD Player•LCD Monitor•Touch Pad Pointer

A marketing and sales tool which provides customers with 24 hour access to customer service, send and receive orders, applications, receipts, view information and product demos.

www.SalesPhone.com


Kodak Care Station


Kodak Care Station

Business to Consumer TelemedicineSolution using existing phone lines.

Unit Cost: $3,000 to $4,000


Iphone2-line (1 voice, 1 data)56k Built in ModemNavigation Keys7.4" Touch LCD Screen With:· Tilt Screen· Back light Display· 640x480 Resolution· 16 Color Grayscale SupportSlide-away Keyboard with Full Size KeysStylus PointerOne-touch Dial from Email, Web, and Address Book

www.infogear.com


IphoneInternet Browser HTML 3.2HTTP 1.1SSL with 128-bit EncryptionParental Content FilteringJPEG and GIFFrames, Cookies, FormsTables, Go Button, BookmarksHistory

Email POP3 Email, SMTPInbox and Multi-user Mailboxes (4)Sort by: Sender/Subject/DateLeave Mail on Server OptionAutomatic Email CheckCompose Email OfflineView JPEG and GIF AttachmentsForward Attachments

$399.00

www.infogear.com


IopenerThe i-opener browser supports:

•HTTP 1.1

•HTML 3.2 (frames, forms, tables)

•RealAudio 5.0

•Javascript 1.1

•SSL 128-bit encryption

•Cookies


Iopener


Ibrow

•10” DSTN LCD Backlight Display•Wireless keyboard w/trackball•2 USB connectors•56k v90 internal modem•Integrated stereo speakers•Microphone input•Amplified headphone output•Dual RJ-11 jack for Tel-in, Data-in•16Mb Flash memory•32Mb SDRAM•200Mhz. Media GXm Processor

Other than Native Plugins, Merinta software is not sensitive to hardware architecture and can easily run on any processor for which there is a Java VM.

The browser complies with most current W3C standards:HTML 4.0, XML, DOM, CSS,JavaScript, Java applets,HTTP 1.1, SSL 3.0, HTTPS,Internationalization – NLS/UNICODE, etc.

www.merinta.com


The LifeShirt system monitors 40 health indicators, which in turn are downloaded through a PDA module, uploaded to www.lifeshirt.com, and passed on to a doctor.

Life Shirt

www.lifeshirt.com

http://www.lifeshirt.com/


Ceiva

•4 X 6 inch passive matrix screen•640 X 480 resolution•1 MB of memory stores up to 10 JPEGs•33.6 modem pre-configured to dial service

Interface:Ceiva is set to check for newpictures daily randomly Between 1 – 5 am. Shuts off at midnight, on at 4:00 am. Your images are downloaded from theCeiva website. $249. + $7.99/month access


Imagicast


Imagicast

Fully integrated strategic one-to-one merchandising solution.

ImagicastOps•E-Commerce Solutions•Business Intelligence Services•Content Management Services

ImagicastNet•Back Office Services•Wireless, Wide-area connectivity Services•Merchandising Digital Appliance Services

ImagicastWorks•Planning Services•Content Development Services•Field Services

www.imagicast.com


NCR 7401

•Upgradeable Intel Pentium processor •Windows NT Workstation 4.0 or Windows 98 operating system •32MB, 64MB or 128MB RAM •2.1GB or 4.3GB hard disk drive •Integrated motion sensor •Rugged, self-contained design •Table-top, wall, pedestal and pole mount options •12.1" SVGA TFT active touch-screen supports 800x600 pixels, and 64K colors •Multimedia features deliver full-screen, full-motion video with fully synchronized audio playback and upgrade path to hardware-based MPEG-II decoding www.ncr.com


Navigation ?

9/10/99 - OnStar® announced that its services will be included in one millionGM cars and trucks within the next 18 months, dramatically increasing the subscriber base from the current level of 75,000.


The impact deployed the air bags, which sent a signal to an OnStar advisor describing the exact location of the accident. The advisor reassured the driver that help was on the way and notified emergencyservice personnel who arrived at the scene within four minutes.

An Onstar subscriber in Texas was involved in an accident that caused the vehicle to leave the roadwayand enter a lake.

Help !


Motorola Kiosk


Interactive TV

http://products.liberate.com/tv_navigator/demo/demo.swf


Web Development Cost

The cost of building an Internet storefront from scratch ranges from $2 million to $41 million in the first year for the three archetypes we modeled: transaction, share-grabber, and anticipatory-seller sites.



The Transaction SitePure plays like Gear.com launch with a basic level of functionality to get on the eCommerce map and prove their worth. Brick-and-mortar retailers like Sears, catalogers like Esprit, and manufacturers like K-Swiss build transaction sites to realize cost efficiencies, then test the waters for future investments in the Internet.

SELL GOODS Gestation $1,787,000.Annually $1,945,000


Web Development CostThe share-grabbing site This type of site seeks to build share by offering deep selection to a mass audience; success is measured in market share gains and look-to-buy ratio improvements.

Pure plays like Egghead provide competitive online offers but focus more on ringing the register than building a loyal following. Online sellers like Barnes and Noble.com and manufacturers like Ford adapt their businesses to the Internet to defend their franchises against pure-play competition rather than seize the opportunity to redefine customer relationships.

GRAB SALES FROM COMPETITORS Gestation $10,572,000.Annually $14,273,000



The anticipatory-selling siteIndustry leaders like Amazon.com, CDNOW, Expedia, and Dell bet their companies on the ability to use advanced guided selling and merchandising techniques like configurators and rich personalization to anticipate customers' needs for a broad range of products.

LOCK-IN CUSTOMER RELATIONSHIPS

Gestation $40,546,000.Annually $48,825,000


Usability Testing / Protecting your investment.

USWeb/CKS built a transactional site for over $1 million.The client pulled it down in less than a year because it was “overly complicated” and took “too long to load.”

Vectrix miss quoted a web development project and let the clientprovide project management. They bid $100,000 The site cost $600,000 to build.


The State of BroadbandBy 2002, 16 million U.S. households -- a quarter of all on-line homes -- will use broadband connections to the Internet. Service and content providers must begin now to reshape their communication, commerce, and entertainment offerings to weave them into the lives of broadband consumers.


The State of BroadbandBroadband Access Will Create:

New on-line routines. Broadband consumers will tap on-line event calendars and link to video previews of performers, then to venue maps and the virtual ticket window. Similarly, on-line weather, traffic, and news via the always-on PC will be part of families' morning rituals.

A new entertainment role for PCs. Broadband makes the PC-Internet combo more of an entertainment medium, but its content and user behaviors will still be very different from TV. Look for interactive applications that add an entertainment element on broadband-enabled PCs.

The prime candidates: games, gambling, and adult sites.



Web tone for new devices. Always-on connections will spread Web content and connectivity throughout the house like a new power utility. PCs will move from the spare bedroom into the kitchen to accommodate constant usage. IP appliances including TVs, phones, and handhelds will synchronize using Net-resident directories.

Practical video services. Road Runner is already testing video e-mail with a $150 camera package from Cubic Corp. that allows consumers to record video greetings, attach the file, and send it with an e-mail. It will be a short step for AT&T/TCI or others to create real-time video calls over the Internet



Useful virtual reality. Broadband will make 3-D walk-throughs of local attractions a feature of city guide sites. Road Runner in San Diego is working on capturing museum exhibits, parks, and its famous zoo using video and simulation tools from Interactive Pictures.

New regulatory imperatives. Broadband will spread primarily in higher-income cities and towns where providers have an easier time selling premium-priced services. This will raise the FCC's universal access question to a new level: When mandating Internet access for all citizens, how fast is fast enough?


The State of BroadbandConclusion: Broadband will reach a mass market. By the end of 2002, 16 million U.S. households -- a quarter of all on-line homes -- will have high-speed PC connections to the Internet.

Cable will lead the charge. More than 80% of broadband households will use cable-based service providers like @Home and Road Runner. ADSL connections will account for the other 20%, as AOL upgrades 10% of its members to premium broadband service by 2002.

Broadband content will kick in. Content and service providers will create new entertainment, commerce, and media services that will integrate on-line resources into the lives of broadband consumers.


In a World of Change What’s Gonna Stay Around?

XML, XSLJavaJavaScript MiddlewareOpen Architecture SolutionsPlug and Play Solutions

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