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SECCIÒN :: GLOBAL TRENDS
FUENTE:

Analysis produced by Fernando A. Machuca B., Academic Director, Programme on Internet Continuous Education- Management for Success.

AUTOR:

Fernando A. Machuca B.

FECHA: November 5, 2007.
Machuca
The Unstoppable Global Explosion of E-Business

Business global statistics (according to 2005-2007 report figures of eMarketer, PricewaterhouseCoopers and Economist Intelligence Unit) confirm that e-Business is an irreversible phenomenon, determining in a great extent, the success or failure of any business.

 
Internet advertising, which is in a continuous growth, has reached extraordinary figures.
 

Internet sales, which are in a continuous growth, have reached gigantic figures.

 

Two e-businesses (Google and Yahoo) have been operating for a long time obtaining billions on Internet advertising sales through their search engines.

 

Internet market, unstoppable in its growth, exceeded 1.000 million people in 2006.

 

Few years after being founded (two to three years) several e-business have reached financial valuations of billions of dollars.

 
 

Even though Internet penetration in Latin America was slow at the beginning, now growth has improved and the region is in the way of becoming an excellent Internet market.

 

As it usually happens with great business phenomena, the way implementation is made determines the result.

 

Regretfully, e-Business in many companies is poorly applied with the consequent disappointing results.

 

The first step to success is still a good training on the subject matter.

 
 
 
 
 
 

Business global statistics (according to 2005-2007 report figures of eMarketer, PricewaterhouseCoopers and Economist Intelligence Unit) confirm that e-Business is an irreversible phenomenon, determining in a great extent, the success or failure of any business. In those countries that dynamize world economy, with an important number of people using Internet (according to 2006 data, 181.9 million in the United States; 148.3 in the five biggest European countries: France, Germany, Italy, Spain and Great Britain; 133.5 million in China; 87.2 in Japan; 34.4 in South Korea and 25.5 in India), a great number of organizations have already converted to e-business, that is, they have become companies that integrated Internet into their operations. The reason is quite clear. A good Internet integration in a business may imply dramatic cost reductions and an enormous increase in incomes. e-Business seen in a very simple way, is integrating Internet into business different processes.

Interrelated basic facts shown by statistics (according to eMarketer, PricewaterhouseCoopers and Economist Intelligence Unit) in the business world are as follows:

  • Internet advertising, which is in a continuous growth, has reached extraordinary figures.
    • On line advertising (by Internet) amount to the figure of 21.000 million dollars in 2007 in the United States (last repot in September 2007.)
    • For year 2007, projections are that local advertising by Internet in the United States will amount to 2.900 million dollars (August 2007 Study forecasts). This corresponds only to 13.4% of the total Internet advertising market on the United States.
    • Western Europe will spend around 7.500 million dollars in Internet advertising in the same year (October 2007 Report with an increase of 25% compared to the 6.000 million of year 2006.)
    • Expenses on on-line advertising and marketing in the Untied States in sector B2B (Business to Business) is expected to amount to 2.400 million dollars this year, while consumption in traditional media (television, journals, radio) decreases.
    • The accounting emphasis and the return on investment, both in the United States and in Europe, are carrying more marketers to use marketing through information search engines.
  • Internet sales, which are in a continuous growth, have reached gigantic figures.
    • European B2C sales (Business to Consumer) of goods and services totalized 133.000 million dollars as of July 2007. With an annual projected growth of 25% during the next four years, the market will grow threefold, reaching 407.000 million dollars in 2011.
    • American buyers by Internet spent around 24.000 million dollars only during the 2006 Christmas Season (November and December). This represented an approximate growth of 22,1% with respect to 2005.
    • Two thirds of the Americans that use Internet buy on-line.
    • One of each 10 dollars spent on the different retail channels in the United States corresponds to Internet.
  • Two e-businesses (Google and Yahoo) have been operating for a long time obtaining billions on Internet advertising sales through their search engines.
    • Approximately 90% of the advertising in the United States through search engines goes to Google and Yahoo, according to February 2007 Report. The Pay Per Clic mechanism (where only those people who clic on an advertisement to know more and potentially buy, really pay), has consolidated a powerful advertising method with very good return on the investment indexes.
  • Internet market, unstoppable in its growth, exceeded 1.000 million people in 2006.
    • In 2006, the first 15 countries ordered by number of Internet users are:

Position

Country

Users (millions)

% penetration

1

United States

181.9

63.6

2

China

133.5

10.2

3

Japan

87.2

68.4

4

Germany

39.4

47.8

5

Great Britain

35.1

57.9

6

South Korea

34.4

70.5

7

France

28.7

47.1

8

Italy

28.6

49.2

9

India

25.5

2.3

10

Brazil

21.2

11.3

11

Canada

21.0

63.4

12

Mexico

20.0

18.6

13

Spain

16.5

40.8

14

Australia

13.1

64.5

15

Argentina

7.9

19.8

    • The rest of the world has 368.0 million people and a 13.2% of penetration in the population. The total number of users in the world is 1.080,0 million and a penetration of 16.6%
    • Three fourth of the American people uses Internet.
    • Two thirds of American homes have a broad band connection.
    • According to a December 2006 report, the use of Internet in Western Europe continues to grow steadily, the number of users on line per day reaching 45% and spending, in average, 11 hours 20 minutes in the Web per week, compared to 10 hours and 15 minutes in 2005.
    • Broad band penetration in Western Europe is also growing, reaching 27%.
  • Few years after being founded (two to three years) several e-business have reached financial valuations of billions of dollars.
    • Microsoft recently acquired 1.6% of Facebook for 240 million dollars. Facebook, created in 2004, uses a virtual community business model where people can “socialize” (that is, can share as in real world) with their friends. Facebook’s virtual community is formed by some 42 million people.
    • Google bought Youtube for 1.650 million dollars. Youtube, created in 2005, is an Internet portal that allows sharing videos. Users may upload their videos to the portal, watch them and share them. According to 2006 studies, 100 million videos are seen on a daily basis in the portal and 65.000 new videos are added every 24 hours.
  • Even though Internet penetration in Latin America was slow at the beginning, now growth has improved and the region is in the way of becoming an excellent Internet market.
    • In 2006, Latin America reached 60.5 million Internet users, of which 7.3 million have broad band.
    • 4,341 million dollars in Internet access and on-line advertising were spent.
    • Internet users tend to be younger than the average population, in general.
    • The countries with greater momentum are Brazil, Mexico, Argentina and Chile.

As it usually happens with great business phenomena, the way implementation is made determines the result. Regretfully, e-Business in many companies is poorly applied with the consequent disappointing results. The first step to success is still a good training on the subject matter.

Translated from Spanish to English by: Victoria www.libratraducciones.cl

 

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