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E-Commerce by the Numbers: Research Sources and Solutions |
Traditional sources of quantitative industry data are not very useful when it comes to e-commerce and that can make finding answers to these types of questions difficult. Unlike other industries, e-commerce does not have its own SIC or NAICS code. Companies involved in the industry are classified under several categories, making it difficult to track overall industry activity. To bypass this problem, some researchers may try to aggregate data from individual companies involved in the industry. However, since many e-commerce companies are privately held, reliable data is difficult to find. Even among public companies, creative accounting techniques sometimes affect the validity of reported data.
However, the SIC/NAICS
coding problem does not mean that quantitative e-commerce data does not
exist. It just means that you need to dig a little deeper to find what
you seek and be a little more careful of what you find. This article will
try to show you where to start your search and to point out some caveats
to keep in mind along the way.
The E-Commerce Industry: An
Introduction
The e-commerce
industry — commonly referred to as the “Internet Economy” or the “New Economy”
— consists of companies deriving at least some portion of their revenues
from Internet-related products and services. According to the Center for
Research in Electronic Commerce (CREC) at the University of Texas1,
Internet Economy revenue exceeded $500 billion in 1999. By the end of 2000,
CREC expects revenue to reach $850 billion. CREC contends that the Internet
Economy directly supports about 2.75 million jobs, more than the number
supported by the insurance or communications or public utilities industries,
and more than twice the number supported by the airline or legal or real
estate industries. Overall, CREC maintains that the Internet Economy grows
at a rate 15 times that of the U.S. economy as a whole. As an information
professional, e-commerce is clearly an industry you should know about.
The first thing you will notice when you begin e-commerce research is that the industry — like most others — has its own lingo. [See “The E-Commerce Jargon” sidebar on page 60 for a translation of some of the most commonly used acronyms and terms.] You will also notice that for-profit firms constitute the primary source for the vast majority of quantitative data in the field. However, since no standard classification system exists for the e-commerce industry, these firms produce wildly differing economic measurements and projections. Each firm uses a different conceptual framework and a different analytical methodology for its research. The end result is a situation in which estimates among firms might vary by 75 percent or more.
Be careful to cite
your sources when presenting data to your end users. Treat quantitative
e-commerce figures as only guidelines, not as “facts.”
Finding Quantitative E-Commerce
Information
Market research
firms in the e-commerce industry do not ascribe to the “information wants
to be free” line of thinking. Typical reports cost anywhere from $1-3,000.
So if you are on a limited budget, how do you find the information you
need? There are four main approaches:
1. Look at market research firms’ press releases.
2. Search for mentions of a research study in the press — often an article will quote a study’s key findings. Look in article databases or on Internet Economy publication Web sites.
3. Visit Web sites with a quantitative e-commerce focus, such as statistics aggregators. These sites provide summaries of research firms’ findings for free (or at a very low cost). Some sites also add their own analysis as well.
4. Bypass market research firms and try to locate free or low-cost data from universities, nonprofit organizations, or government agencies.
Approach
#1: Press Releases
There are two
main ways to access research firm press releases: by searching the press
archives on company Web sites, or by searching the press release databases
available through commercial vendors such as Dialog, Factiva, LEXIS-NEXIS,
or Northern Light. Searching press archives on company Web sites may not
cost money, but it can cost a lot of time and also prove frustrating and
sometimes unsuccessful (especially when a company’s internal site search
engine is not very robust or does not exist at all and leaves you browsing
through titles chronologically). On the other hand, searching for press
releases through a database vendor such as LEXIS-NEXIS, while very efficient,
can also be expensive. Northern Light might offer a good compromise — the
search itself is free, and most full-text press releases are available
for a nominal charge.
If you decide to look at research firm Web sites, try the following URLs for significant findings from recent research:
Jupiter Communications
http://www.jupitercommunications.
com/company/pressreleaselist.jsp
Forrester Research
http://www.forrester.com/ER/Press/
ForrFind/0,1768,0,FF.html
Gartner Group
http://gartner3.gartnerweb.com/
public/static/aboutgg/pressrel/pr.html
International
Data Corporation (IDC)
http://www.idc.com/Press/release.stm
Giga Information
Group
http://www.gigaweb.com/Marketing/home.asp?intGContextID=15&strMode=newsroom1
META Group
http://www.metagroup.com/
ActivMedia Research
http://www.activmediaresearch.com/free_newsroom.html
Nielsen/NetRatings
http://63.140.238.20/press_releases.asp?country=north+america
WebSideStory
StatMarket
http://www.websidestory.com/content.cfm?Pg=3#Global%20Internet%20Statistics
Yankee Group
http://www.yankeegroup.com/webfolder/yg21a.nsf/webpress
Approach
#2: Research Mentioned in Articles
Try to find mentions
of primary research in news articles. There are two main ways to do this:
searching aggregated business news databases, or searching the Web-based
archives of print and online publications in which research mentions will
most likely appear. The first way may not work well, because most of the
important Internet Economy publications are not covered in major business
databases. For a more effective approach, go directly to the Web sites
of Internet Economy publications. Although slow, this approach will probably
find the information you need. The Web sites of Internet Economy publications
contain archives of previously published articles, usually accessible through
robust internal search engines. I recommend the following sites:
Industry Standard
http://www.thestandard.com/
Business 2.0
http://www.business20.com/content/research/numbers/
NUA Internet
Surveys
http://www.nua.ie/surveys/
CyberAtlas
http://cyberatlas.internet.com/
Internet World
http://www.internetworld.com/
E-Commerce Times
http://www.ecommercetimes.com/search/
E-Business World
from IDG.net
http://www.e-businessworld.com/
Red Herring
http://www.redherring.com/
InfoWorld
http://www.infoworld.com/researchtools/search_f.html
Interactive
Week
http://www.zdnet.com/intweek/
EcomWorld
http://www.ecomworld.com/
Digitrends and
Ebiz Daily
http://www.digitrends.net/
E-retail.net
http://www.e-retail.net/
E-business Strategy
from Advisor.com
http://www.advisor.com/whome.nsf/w/ZEBM
Iconocast e-zine
(Internet Marketing)
http://www.iconocast.com/archive.html
FreePint newsletter
(for Internet researchers)
http://www.freepint.co.uk/
E-commerce Guide
Trends
http://ecommerce.internet.com/opinions/
Approach
#3: Quantitative E-Commerce Research Aggregators
You can also visit
the Web sites of quantitative information aggregators. These sites pull
together research published by several different firms. Some sites also
publish summaries of their own internal analysis efforts.
EStats from
eMarketer
http://www.emarketer.com/estats/welcome.html
Click on eStatStore
for individual statistics reports, but be careful, many of the free statistics
available from the store are outdated.
Metrics archive
from The Industry Standard
http://www.thestandard.com/research/metrics/
Excellent resource.
Also, go to http://www.thestandard.com/research/metrics/display/0,2799,9801,00.html
for an article by Maryann Jones Thompson entitled “Tracking the Internet
Economy: 100 Numbers You Need to Know” (September 13, 1999).
CommerceNet
Research Center
http://www.commerce.net/research/stats/stats.html
Some useful statistics
here.
HotStats from
DeepCanyon
http://www.deepcanyon.com/b/numbers/current.htm
Has some unique
content not available through other sites.
Fact sheet about
Internet Economy from Cyveillance
http://www.cyveillance.com/resources/facts.asp
Aggregates others’
primary research, but though it lists its sources, it does not specify
source publication dates. Use with caution.
Ralph Wilson’s
E-CommerceResearch Room
http://www.wilsonweb.com/research/
Not a QER aggregator
per se, but it links to e-commerce articles, books, etc.
eCommerce Info
Center
http://www.ecominfocenter.com/
Similar to Ralph
Wilson’s E-Commerce Research Room, but more difficult to navigate.
Northern Light’s
E-Commerce Special Edition
http://special.northernlight.com/ecommerce/index.html
Lists some useful
e-commerce links.
@Brint.com
http://www.brint.com/Elecomm.htm
Offers a listing
of e-commerce links and resources.
AllNetResearch
http://www.allnetresearch.com/
A market research
reseller. If you want to order a primary market research report (and you
have a lot of money to spend), go to this site first.
Approach
#4 — Universities, Nonprofits, and Government Agencies
The last approach
we will cover involves tapping quantitative research available for free
through university research centers, nonprofit associations, or government
agencies.
One of the best sources of free quantitative e-commerce research is the Center for Research in Electronic Commerce at the University of Texas. Their most recent report, “Measuring the Internet Economy,” is an excellent resource for historical market data and trend projections in the e-commerce industry. To access the report, go to http://www.internetindicators.com/.
Try also the eLab at Vanderbilt University. There are several free research papers available for download here: http://www2000.ogsm.vanderbilt.edu/papers.html.
The Organization for Economic Cooperation and Development publishes its own Internet and Electronic Commerce indicators. See http://www.oecd.-org/dsti/sti/it/cm/.
The U.S. federal government publishes a few e-commerce reports. One recent report, the “Digital Economy 2000,” mentions several quantitative e-commerce studies conducted by market research firms. The report is available for download at http://www.ecommerce.gov/.
The federal government
also collects a limited amount of primary data. The Census Bureau publishes
estimates of U.S. retail e-commerce sales as part of their Monthly Retail
Trade Survey. Go to http://www.census.gov/mrts/www/current.html
for the most recent report.
The Future of Quantitative
E-Commerce Research
As the e-commerce
industry matures, the U.S. government will probably take a larger role
in data-collection efforts. This will lead to greater
standardization and a lessening reliance upon research conducted by for-profit
firms. As a result, research report prices could drop and report quality
improve. Until then, however, information professionals will need to locate
quantitative e-commerce information indirectly, and maintain a healthy
skepticism of the information once it’s found.
1. CREC, “Measuring
the Internet Economy,” June 2000, www.internetindicators.com.
| E-COMMERCE
JARGON: A PRIMER
ASP: Application Service Providers. Companies leasing access to software applications via the Internet (instead of selling or licensing software applications for installation on the user’s hard drive). ASPs generally follow a B2B business model, although in the future, consumer-oriented ASPs may prevail. B2B: Business-to-Business. Any Internet business that sells its products or services to other businesses. B2C: Business-to-Consumer. Any Internet business that sells its products or services to consumers for their own use. B2G: Business-to-Government. Any Internet business that sells products or services to government agencies. Back-End: The programs and applications that support the functionality of the front-end Web site. Bricks-and-Mortar: Businesses with physical locations (often refers to traditional firms without active e-commerce strategies). C2C: Consumer-to-Consumer. Any Internet business that provides a means for consumers to sell products or services to other consumers (such as e-Bay). Clicks-and-Mortar: Businesses with both physical locations and Internet sites (usually refers to e-tailers or to the e-tailing strategy of a formerly traditional firm). CRM: Customer Relationship Management. This refers to the whole customer experience with a company or a Web site, not just customer satisfaction after a sale. E2E: Exchange-to-Exchange. Any Internet company that facilitates the interaction or integration of two or more B2B marketplaces. E-Marketplace: An Internet marketplace in which businesses in the same industry (usually) come together to buy and sell products or services. ERP: Enterprise Resource Planning. This refers to business-wide process planning and integration. The Internet is often employed to make ERP more efficient. E-Tailers: Internet retailers who generally follow a B2C business model. Front-End: What people see when they go to the Web site — the interface and the site’s functionality (what it does). ISP: Internet Service Providers. Companies providing access to the Internet (such as AOL). Mission-Critical: Something necessary for the functioning of business operations. P2P: Peer-to-Peer. Any Internet company that enables individuals to exchange resources (such as computer files) amongst themselves without involving a centralized control system. Pure-Play: A company that only conducts business online (an e-tailer without a physical store presence would be called a “pure-play”). Scalable/Scalability: Usually refers to the ability of a software application to expand as a business grows or a Web site’s traffic volume increases. Traffic:
The volume of hits a Web site receives (the number of times people visit
a Web site).
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| The Big Picture
It sometimes helps to consider the structure of how the Internet Economy works before one tries to deal with quantitative e-commerce information. The CREC group at the University of Texas developed a conceptual framework particularly well-suited for this purpose. Their framework breaks down the Internet Economy into four layers: infrastructure, applications infrastructure, intermediary, and commerce (see Table 1). Table 1: Internet Economy Conceptual Frame
Source: Based on "Measuring the Internet Economy," Center for Research in Electronic Commerce, University of Texas, June 6, 2000, www.internetindicators.com. |
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