Information still killer app on the Internet

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The Internet continues to be an information rather than an entertainment medium, and one of the key online activities is searching for product information on company home pages.

Those are some of the findings of the fifth annual Interactive Media Study, conducted for Advertising Age by the Telenation polling service of researcher Market Facts, Arlington Heights, Ill..

The study was based on telephone interviews with 2,000 adults in the U.S., 584 of whom have used online services or the Web in the past six months.


The No. 1 online activity, the same as last year, was gathering news or information (87.8%). Also high on the list were sending e-mail (83.2%), conducting research (80.5%) and random surfing (75.3%).

However, like last year, shopping ranked last, with only 17.8% of online users reporting shopping as an online activity.

"People are still interested in interactive services that relate to gathering information, education and conducting research," said Tom Mularz, VP-general manager of Market Facts Telenation.

"But as we've seen over the past two years, people appear to be reluctant to engage heavily in transactional activities over the Internet," said Mr. Mularz.

However, while not many users are shopping online, a huge percentage are actively looking for product information on Web sites.

"If they're looking for product information, they're shopping, in my book," said Lynn Bolger, senior VP-Web media director, at Ammirati Puris Lintas, New York.

This year, 71.9% of online users said they had visited a company's home page, up from 52.9% a year ago.

"That's absolutely significant," said Ms. Bolger."This is potentially reflecting a wider level of experience with the medium."


When asked what they do on company home pages, 90.5% of online users who had visited them said they look for product information; 87.8% look for company information; 34.5% shop for products; 31.7% receive discounts, coupons, etc.; and 18.9% enter contests.

"With 90% looking for product information, companies had better wake up," said Kevin O'Connor, CEO at advertising network DoubleClick, New York.

"Some very influential people are spending more and more time researching products online," he said.

In terms of demographics, those using the Internet for research and gathering information appear to be an influential group indeed.

According to the survey, 57% of online users have household incomes of $50,000 or greater. And of users in the $50,000 bracket, 38.1% said they shop on company home pages.

For those not shopping online, the No. 1 reason cited was security concerns (65.7%). Other factors were not being able to touch the merchandise before purchasing (59.7%) and not being familiar with the online merchant (42.8%).

Other reasons were finding online shopping too time consuming and having more fun shopping in the real world.


In other survey results, it appears advertisers' efforts to drive traffic to the Web via traditional media campaigns are working.

When asked if they ever visited a site because they saw it mentioned in a magazine or newspaper ad, 62.2% of online users said yes, compared with 50.5% last year.

Other media successfully driving people to Web sites include TV spots (53.3% this year compared with 37.9% last year); product packaging (38.3% in 1997, up from 26% in 1996); and radio (22.1% this year compared with 19.3% in 1996).


However, direct mail fell as a Web site driver (25% this year against 26.3% in 1996), as did outdoor campaigns (12.7% compared with 13.6% last year).

"The fact that more advertisers are slapping a URL onto traditional messages is reflected in those numbers," said Ms. Bolger.

Users are also interacting more frequently with online advertising. The portion of online users who said they look at banner ads very often rose slightly to 4.7% this year compared with 4.5% last year; 11.5% said they look at banners often, up from 6.2% last year; and 45.1% look sometimes, about the same as last year's 45%.

But perhaps more significantly, the number of users who never look at banner ads has dropped. Last year, 44.2% said they never look at them, while this year, 38.7% said they never look.


How often they're clicking is mixed. Consistent with the industry average, exactly 2% of online users click very often on ads, although this number is down just slightly from 2.1% last year; 4.7% of users click often, down from 5.1% last year. Exactly half of online users click sometimes, up from 42.2% last year; and 43% never click, which is down from 50.3% last year.

Overall, people are spending more time online. Of the online users, 17.7% said they spend 10 or more hours online per week, compared with 13.7% last year.

Users spending between six and 10 hours per week online has jumped to 15.3% this year, up from 13.2% in 1996. And 33.9% spend an hour or less online per week.

With the time spent online increasing, and with information being the primary goal, the message to content providers and advertisers seems to be this: Just give us the facts.

Copyright October 1997, Crain Communications Inc.

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