Going Mainstream

Anyone who still thinks the Internet is populated solely with videogame-addled teenagers and computer programmers in sore need of a date hasn't been reading nearly enough. Heck, anyone who thinks males still dominate online needs a little more social interaction.

The Internet is rapidly heading toward mainstream-media status, and marketers are scrambling to take advantage of that fact. Although the demographics of cybersurfers are changing rapidly, PROMO thought it high time to freeze frame the marketplace and offer a profile of today's — but not necessarily tomorrow's — Internet user.

According to the Computer Industry Almanac, approximately 136 million Americans have Internet access. By 2005, 80 million U.S. households — about 74 percent of the nation's total — will be on the Net.

“There is no longer a typical Internet user,” says Ekaterina Walsh, a senior analyst with Cambridge, MA-based Forrester Research. “It has reached the point where it's a mass consumer technology.”

For the record, however, the “typical” Internet user is now a woman between the ages of 35 and 54, according to Jupiter Media Metrix, New York City. That's an about-face from a year ago, when men in that age group held sway. Kids 18 and under make up about 19 percent of total users, with 12- to 17-year-olds comprising 12 percent, up from 10 percent a year ago.

In terms of ethnic groups, 69 percent of Asian-American households are connected, compared with 47 percent of Hispanic households, 43 percent of white households, and 33 percent of African-American households.

On average, Internet users across all demographic groups spend about 12 hours per month on the Web, up 21 percent from 9.3 hours in 2000. And they aren't sitting still: the average user views about 675 Web pages each month, up from 580.

According to Jupiter Media Metrix, about 55 percent of Web surfers have an annual income lower than $60,000 a year, up slightly from 54.5 percent last year. Surfers in the $60,000 to $100,000 income group slipped from just over 28 percent to 26 percent this year. Exactly 19 percent earn more than $100,000 annually, up from 17 percent last year.

This Is Not a Toy

A Jupiter Media Metrix survey conducted last summer found that most people use the Internet for “utility-oriented activities” such as research and communication.

About 93 percent said they used the Internet for e-mail at least twice a month, 79 percent said they utilize search engines, and 78 percent said they research products and services for purchases both online and off.

Online buying is increasing, of course. About 36 million consumers made online purchases over the 2000 holidays, ringing up $10.8 billion in sales, per Jupiter. By 2005, the Internet will account for 11 percent of total retail sales, or $269 billion, and influence an additional $378 billion in offline sales, per Forrester.

And where there's shopping, there's bargain hunting. A survey of 1,000 Internet-savvy consumers conducted for PROMO by Greenwich, CT-based NFO Research (December 2000 PROMO) found that 48 percent said they spend time “promotion surfing” for special offers; 46 percent log on for the express purpose of entering a promotion. And more than 50 percent of respondents regularly visit promotion-related Web sites.

Thus, it's not surprising that online coupon, sweepstakes, and loyalty operations are among the most heavily trafficked Web sites. Jupiter's ranking of the Top 50 most-visited sites for January 2001 included three: Irvington, NY-based iWon.com (27th), with just over 8.5 million visitors; Chicago-based CoolSavings.com (36th), which had 7.8 million visitors; and San Francisco-based MyPoints.com (47th), which drew 6.7 million visitors.

Chicago-based CoolSavings.com markets itself as a site that develops customer loyalty through purchase incentives such as coupons, targeted e-mails, and free samples. In return, the company asks its members to supply such information as e-mail addresses, shopping habits, and interests so they can receive targeted offers. In addition to the offers sent directly to them, members can browse more than 800,000 incentive offers on the site.

CoolSavings.-com currently has about 13.5 million registered members, and is growing by about 600,000 members monthly. About 65 percent of the site's users are women with children (average age is 34) and are typically homeowners.

“They also have a very high propensity to shop online,” says president and chief operating officer Matt Moog, adding that members spend more than twice as much time online as the average Internet user. “We put a lot of incentives in front of them that are tailored to their interests, which leads to a higher conversion.”

Iwon.com is a site that fuses the functionality of a search engine with sweepstakes giveaways. After registering, users are rewarded for browsing the site with entries into daily, weekly, monthly, and annual sweepstakes dangling prizes from $10,000 daily to a $10 million annual giveaway.

The site's typical user is 35 to 40 years old with a household income of around $75,000. The gender split is roughly 50-50, says group vp-marketing Jon Brod (who declined to provide membership figures).

“Business models that work on the Internet are similar to those that work offline,” Brod says. “Consumers like added value such as sales, coupons, and frequent-flier miles.”

The company is in the middle of a 13-week tie-in to New York City-based CBS's reality series, Survivor, in which viewers visit the site after each week's show to answer trivia questions based on the broadcast. Correct answers earn 10 entries into a sweeps for $1,000. When Survivor ends in May, the 13 weekly winners will be flown to New York City for a trivia showdown on the CBS Early Show. Winner gets $50,000. Web graphics, e-mails to registered iWon.com users, and TV spots support.

San Francisco-based MyPoints.com is a rewards-based site with 16 million members who provide the company with information on shopping habits and favored products. MyPoints.com sends targeted e-mails featuring advertising messages and incentives. Members earn points for reading the e-mails and taking advantage of the offers. Points can also be earned by shopping, filling out surveys, hopping to advertisers' sites, and referring friends.

The site's typical user is female, and more than 70 percent of members are over 24, says vp-corporate relations Geoff Ossias. Half are married homeowners; typical income is $50,000 and above. “They know how to use the Internet and are willing to entrust a third party with personal information,” he says. “When we first started out, it was a bunch of business owners who were interested in frequent-flier miles.”

Now, some of the more popular redemption items are retail gift certificates, restaurant coupons, and long-distance phone cards. “As the Internet population has grown in size, [the user] has become the person next door,” Ossias says.

There goes the neighborhood.