Has web useage leveled off

Year over Year double digit growth appears to be gone

[lgn]

Frankly, I do little promotion. Other than designing a good web site, and using basic common
sense, so we rank well in search engines. Also we obtain a lot of customers via customer referal.

By providing excellent service and low prices, customers have spread the word around about our website.

Between 1998 and 2001, this resulted in growth rates of 30-40% in traffic. In the past year or so, I have noticed that our growth in web traffic has slowed down, such that I will only see 5 -10% growth in 2003. Has the Internet matured. Has everybody that is going to use the Internet for shopping, done so? Will I now need to get off my behind, and start doing some serious web site promotion.

I was always under the impression that this industry would not peak until 2005.

Or has the consolidation of search engine useage, to Google and Yahoo, have a negative impact.

Anybody else seen this trend, that has been in the business for five years or so.

[fathom]

Indeed North America is closing on saturation, but as a whole is now only about 33% of the Internet community.

The double digit growth is now South Pacific, Asia and to a lesser extent Europe, but unless you have identified and attempt to capture these potential markets your growth will slow as well.

[jsinger]

Web use in N. America may be leveling, but the use of the web for shopping has a long way to grow. Our online sales are double last year's and our site is about 4 years old.

Web shopping will continue to grow because web merchants charge less than stores and catalogs. Plus there are often substantial sales tax benefits that can more than offset shipping costs.

We don't sell outside the U.S.

The better question is whether web PROFITS will continue to grow much. Product pricing is very competitive. Markups, in our field, are off maybe 5% this year. Like everyone we're spending more on web advertising (PPC stuff, affiliates etc).

But the lower prices (and margins) are just peeling off more customers from stores and, especially, M.O. catalogs.

[TallTroll]

I think that you will see lower growth in connection rates in the US and Europe (as many of those who want to be connected now are), but what you should still see is growth in the %age of those who are willing to make online purchases, and the value and frequency of those purchases.

The pie will continue to grow, but it will do it by grabbing market share here, diverting consumers from traditional sales channels, and increasing revenue per user, rather than by growth in raw user numbers.

However the Asian market will massive, when it matures. Those of us who trade in only limited geographical areas may want to keep one eye on that...