Population
Between July 1995 and July 1998, some 42 Internet population studies were published. But with more than half of Netizens now living outside the U.S., the accuracy of Net population estimates is at an all-time low. IDC bravely estimates that there were some 196 million Internet users worldwide by the
end of 1999. Their forecast for 2003: 502 million.
 

Sites
There are more than 10,000 publications in the U.S. today, including B2B and consumer. But the Internet makes that look like child's play. In April 1997, the Web passed the 1 million site mark, according to UK-based Netcraft. This month, that tally reached 11 million.

Netcraft collects as many host names as it can find, and systematically polls each with an HTTP request for server name. But most domains are not active. In fact, Alexa, which claims to crawl the entire Web every two months, counted just 3.4 million top-level pages in Sept. 1999. More importantly, their research shows that despite a gargantuan number of sites, 80% of traffic ends up at only 0.5% of all URLs, or about 15,000.

Domains

The reason why fewer domains are active is due to cyber- squatting, the speculative practice of stockpiling domain names. The domain business is now very profitable. In 1997, idNames.com sold "business.com" for $150,000, which prompted company Vice President Pinky Brand to note, "The buying and selling of Internet domain names is quickly becoming the new 'intellectual property lottery' for hundreds of quick- thinking entrepreneurs." It sure has, Pinky. That same domain recently sold for $7.5 million. Here are some of the more notable domain-name sales:
 
 

Rank	Domain	Sales Price (million US $)
1	Business.com
2	Altavista.com
3	Loans.com
4	Autos.com
5	Express.com
6	Fly.com
7	Bingo.com
8	WallStreet.com
9	ForSaleByOwner.com
10	Drugs.com

Source: Feb. 2000 ICONOCAST/GreatDomains.com

"Generically" branded domain names have both pros and cons. Amazon.com and Yahoo! are far more memorable, but obtaining clever names is difficult due to having to clear both domain name *and* trademark hurdles. That's why many eMarketers opt for hard-to-differentiate, generic domain names.
 

"Spare-a-dime" Shift

No early ICONOCAST was complete without a pointed analysis of the vagaries of dotcom land. In Jan. '97, The Wall Street Journal frightened everyone with a Don Clark story subtitled "Reality Hits the Internet." Some of the Net's early crash- and-burn victims included American Cybercast (The Spot),
iFusion Com, NETdelivery, Electric Minds, Jim Manzi's Nets, CMP's NetGuide, Imagine Media's The Net, Mecklermedia's Web Week, IDG's Web Magazine, Adbot, PowerAgent, Carnelian and Narrowline.

While the Internet economy's natural buoyancy keeps failures to a minimum, The New York Times made history repeat itself on Jan. 14 with a story entitled, "Investors Start to Take a Harder Look at Dot-Coms' Performance."

Here are a few other observations that show the big picture:

1. Estimated size of Internet economy* in 1999: $507 billion
2. Estimated size of Internet economy* in 2003: $1.2 trillion
* Includes computer hardware/software; online retailers
and brokers; portals and other Web-related businesses.

3. Projected health-care expenditures in 2002: $1.5 trillion

4. GDP boost ascribed to the Internet economy in 1999: 59%
5. Percent of employees who "constantly" surf the Web: 37%

6. Number of 1999 eMarketing IPOs and follow-on offerings: 47
7. Average number of stock quotes AOL members get each day: 10

8. First offline company acquired by an online company:
Butterfield & Butterfield by eBay (Apr. 1999)

9. Hottest eMarketing trends:
a. Offline branding
b. "Everything free"
c. E-mail customer retention
d. Viral marketing
e. Customer management
f. 360-degree marketing
g. Personalization
h. Desktop branding
i. Downloadable advertising
j. B2B
 

Pageviews

In three years of covering online advertising, we've seen it all. But as the pace of marketing accelerates, one tends to remember less. So, here are some key data points that may help refresh your memory:

Super Bowl
1. Internet advertisers in Super Bowl 1998:  2
2. Internet advertisers in Super Bowl 2000: 17 (out of 38)

3. Cost of Super Bowl 1998 30-second spot: $1.7 million
4. Cost of Super Bowl 2000 30-second spot: $2.2 million

5. Clickthrough rate for Intel's Super Bowl 1998 spot: 1.7%
6. Cost-per-visitor for Intel's Super Bowl 1998 spot: $3.25

7. Most recalled Super Bowl 2000 Internet spot: E*Trade, 69%

8. Percent of Super Bowl advertisers who boosted traffic compared to pre-Bowl levels: 53%

9. Average cost-per-visitor for Super Bowl 2000 advertiser: $38

10. Percent of Internet users who mention having visited sites because of a mention in offline media: 44%
 

Ad Expenditures

1. Average CPM rate in Dec. 1997: $37.21
2. Average CPM rate in Dec. 1998: $35.13
3. Average CPM rate in Dec. 1999: $33.75

4. Internet ad expenditures in Q3 1997: $227 million
5. Internet ad expenditures in Q3 1998: $491 million
6. Internet ad expenditures in Q3 1997: $1.2 billion

7. Offline spending by U.S. dotcoms Jan-Sep 1999: $1.8 billion
8. Projected offline spending by dotcoms CY 1999: $3-4 billion
9. "Run rate" of offline spending by dotcoms: $7.4 billion

10. U.S. online ad spending forecast 2000: $5.3 billion (+89%)
11. Total U.S. ad spending forecast 2000: $233 billion (+8%)
12. U.S. Internet ad spending forecast 2004: $22 billion
13. Worldwide Internet ad spending forecast 2004: $33 billion

14. Percent of revenues Gucci spends on advertising: 8%
15. Percent of revenues dotcoms spend on advertising: 25%+*
(*Amazon.com spent 25% of sales on marketing in 1999.
 Computers.com spent $3.2 million of its $6 million
 first-round funding on Super Bowl advertising.)
 

Ad Performance

1. Average Internet clickthrough rate Mar-Sep 1996: 2.12%
2. Average Internet clickthrough rate in Jan. 2000: 0.47%
3. Best 1999 dotcom TV spot according to MSNBC poll: Monster.com's "When I grow up"
4. Amount dotcoms have to spend in 2000 to gain a noticeable share of mind on network TV: $25 million

Consumers

1. Biggest Internet frustration: Finding things online, 60%

2. Average time spent online in Jan. 1997:  3.2 hours
3. Average time spent online in Jan. 2000: 13.2 hours
4. Pages viewed by U.S. Internet users in Oct. 1999: 32 billion
5. Minutes spent online by U.S. users in Jan. 2000: 58 billion

6. Number of pageviews per session in Jan. 2000: 34
7. Number of unique sites visited in Jan. 2000: 10
8. Duration of pageview in Jan. 2000: 54 sec.
9. Average number of ad messages consumers see each day: 1,000

E-commerce

1. Amazon.com's 1995 sales: $500,000
2. Amazon.com's 1996 sales: $15.7 million
3. Amazon.com's 1997 sales: $148 million
4. Amazon.com's 1998 sales: $610 million
5. Amazon.com's 1999 sales: $1.6 billion
6. Amazon.com's valuation in 1997: $300 million
7. Amazon.com's valuation in 2000: $22 billion
8. Amazon.com's customer acquisition cost: $19
9. CDnow's customer acquisition cost: $65
10. Amazon.com's Aug. 1999 "net" sales conversion rate: 8.3%
11. Industry average "net" sales conversion rate: 1%
12. Total Amazon.com customers in 1999: 17 million

13. Average amount each Amazon customer spent in 1999: $116
14. Average purchase value at top 10 e-commerce sites: $48
15. Average savings of a basket of goods purchased online compared to offline: 13%

16. Percent of top 50 e-merchants that responded to inquiry: 60%
17. Percent of top 50 e-merchants that cross-sell: 53%
18. Pecent of top 50 e-merchants recognizing repeat buyers: 25%
19. Percent of top 50 e-merchants that personalize e-mail: 4%

20. Online consumer spending during 1996 holidays: $500 million
21. Online consumer spending during 1997 holidays: $1.1 billion
22. Online consumer spending during 1998 holidays: $3.0 billion
23. Online consumer spending during 1999 holidays: $7.0 billion

24. Business spending on auction merchandise 2002: $52 billion
25. Consumer spending on auction merchandise 2003: $6.2 billion
26. Online, health-related consumer spending 2004: $10 billion

27. Online buyers who cite other sites as prompting visit:   51%
28. Online buyers who cite word of mouth as prompting visit: 30%
29. Online buyers who cite offline media as prompting visit: 19%

30. Percent of shoppers that begin their cyber shopping trip at a portal: 26%

31. Most effective Web site promotion technique: Search engine positioning (mentioned by 66%)

32. Average number of people to whom shoppers recount their online shopping experiences: 12
 

E-mail

1. Number of e-mail messages 21 million AOL members sent each day in Jan. 2000: 110 million (average: 5 per member)
2. Types of promotional e-mail messages consumers like most: Coupons and gift certificates (mentioned by 67%)
3. Total CPM for direct-mail promotion using rented lists: $850
4. Total CPM for e-mail promotion using rented lists: $200
5. Average clickthrough rate for e-mail promotions: 5-15%
6. Average "gross" conversion rate: 0.0025% (for a mailing of 10,000, 1,000 click through, and 25 purchase)
7. Number of e-mail messages U.S. marketers will send in 2004: 200 billion

Source: ICONOCAST

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