The atmosphere of doom and gloom portrayed in stories about the Internet is actually good news for traditional marketers who are selling online. That’s the reality check Mary Modahl, vice president of research at Cambridge, MA-based Forrester Research, delivered in her keynote yesterday, at The DMA net.marketing conference here.
In spite of dot-coms crashing after being devalued by Wall Street and recklessly spending e-merchants meeting their demise, “online consumer retailing powered on,” Modahl said. “Activity on the consumer side for 2000 has actually accelerated beyond what Forrester thought it would be.” Consumers are expected to spend $44 billion online this year, up from Forrester’s original prediction of $38 billion.
The reason for this is that mainstream adult consumers are increasingly comfortable online, and young consumers approach the Internet as though it is their local shopping mall.
A consumer about to turn 20, who was born as IBM introduced the first PC, and who was a junior in high school in 1997 as America Online entered the popular consciousness, views the Internet as an integral part of their lives. Young consumers go online for the first time because they want to buy something, while adults have to be online for 18 months before becoming comfortable enough to buy something. “Adults adopt the Web, young consumers internalize it,” Modahl said.
Although only 18% of mainstream adult Americans buy online, that number is increasing. The mainstream is held back by two factors: if they can’t afford to shop online or if they are not comfortable with the technology. Not surprisingly, familiarity and affordability drive them to become buyers.
Modahl said, a company that’s done a “tremendous job” at getting people to go online is K-Mart’s BlueLight.com, which offers free Internet access. The very name resonates affordability, Modahl said, reminding the audience of shopping at the brick-and-mortar retailer and hearing: “Attention, K-Mart shoppers, there’s a Bluelight special in Aisle 5.” Plus, BlueLight.com lets customers buy products online and return them at an offline store.
The familiarity issue was addressed because some 95% of Americans live within 10 miles of a K-Mart store. Then, other household names were added to as partners. Yahoo! came on as the Internet service provider, and Martha Stewart, with her own product line.
The BlueLight plan resulted in 4.5 million users in nine months-one of the biggest marketing success stories ever, Modahl said.
The various ads for dot-com retailers, broadcasting endlessly, all sound the same, she indicated. “But what consumers hear is this Internet thing is kind of cool,” she said. “When they do go online, they’ll got to a brand they know. If you’re a traditional retailer with an established brand, what’s happened with dot-coms crashing, opens the door for you online.”
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