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E-Business Secrets
Brian Livingston
Successful e-tailers spend $14 acquiring a new customer

A new study shows there's quite a difference between the cost of acquiring new customers for the most profitable online retailers compared to the rest.

The top-performing Web-only retailers (the top 50 percent) in the survey spent an average of $14 in marketing costs to acquire each new customer in the year 2000. That's about the same level of spending as catalog-only retailers, but it's sharply below the average of $55 for all Web-based retailers. That figure, in turn, is an improvement over the figure of $82 per new customer spent by Web-only retailers in 1999.

The customer acquisition costs for all online retailers, including those that have physical stores, declined to $29 in 2000 from $38 in 1999.

The study was conducted by The Boston Consulting Group for Shop.org, a division of the National Retail Federation that serves e-tailers. A 32-page executive summary of the report is available to nonmembers of Shop.org for $995.

Despite the dot-com slowdown, the study found that online retailers were able to improve their financial situation somewhat. At the end of 2000, 27 percent of Web-based retailers were profitable at an operating level, Shop.org says. That compares with 72 percent of catalog sellers and 43 percent of store-based retailers.

Overall, online retailers reduced operating losses to 13 percent, or $5.6 billion, of their 2000 revenue, compared to 19 percent in 1999. The study found that business-to-consumer online sales grew 66 percent in 2000, reaching almost $45 billion.

One of the brightest spots in the study was online travel sales. The largest online category, with $13.8 billion in 2000, travel is expected to grow 50 percent this year. Books and computer hardware are slowing, with 25 percent and 15 percent growth expected.

Online Retail Market Study by Shop.org:

http://www.shop.org@54.vg/?3aa1

LIVINGSTON'S E-BUSINESS BOOK REVIEW

Lynda and William Weinman's first edition of "Creative HTML Design" became something of a classic back in 1998. It's now available in a revised edition with the latest dope on WYSIWYG editors and graphics techniques. Lynda Weinman's site (www.lynda.com/hex.html) is famous for its tireless promotion of the "Browser-Safe Palette" (the 216 colors that look the same on both Macs and PCs using 8-bit color drivers), and her new book builds enormously on that kind of useful information.

The Weinmans (they're brother and sister) say Web sites should be designed in the following general order:

1. Concept

2. Planning

3. Collecting assets (artwork, text, etc.)

4. Producing graphics and layouts

5. Writing code, HTML editing, scripting, etc.

6. Publishing to a server

To the authors' credit, they point out that you can't learn HTML in that order. (How can you develop a concept if you don't understand what assets are available to you?) So their book isn't written in that order.

Instead, the book walks the reader through the basics of HTML, graphics, style sheets, search engine listings, and more. The authors are a little biased toward HTML hand coding, but that's easily ignored. This new volume is arguably the best book you can give someone who wants to learn how to build a Web site from scratch.

CREATIVE HTML DESIGN.2: A HANDS-ON WEB DESIGN TUTORIAL

By Lynda and William Weinman (New Riders Publishing)

http://www.amazon.com@54.vg/?0735709726

LIVINGSTON'S TOP 10 NEWS PICKS O' THE WEEK

1. MusicMatch is first with $5-a-month radio service

http://www.siliconvalley.com@1c.to/?3f1

2. Amazon m-commerce grossed only $1 million last year

http://www.msnbc.com@836.as?/7d9

3. Senate may not renew Internet tax moratorium

http://seattlep-i.nwsource.com@e.la/?bc1

4. Search engines create only 7 percent of your traffic

http://searchenginewatch.com@31.dk/?fa9

5. Digital devices monitor employees, now even in bars

http://www.wired.com@a6r.ms/?1391

6. Pentagon can't stop international hacker attacks

http://www.washingtonpost.com@54.vg/?1779

7. Socially conscious site satirizes high-tech imagery

http://www.about-face.org@a2.tc/?1b61

8. "The Wall Street Journal" succeeds with wireless; can you?

http://www.publish.com@th.gs/?1f49

9. What rules apply to business-to-business marketing?

http://www.clickz.com@836.as/?2331

10. Site builds traffic with "Am I normal?" questions

http://www.aminormal.com@1c.to/?2719

E-BUSINESS SECRETS: Our mission is to bring you such useful and thought-provoking information about the Web that you actually look forward to reading your e-mail.

ABOUT THE AUTHOR: E-Business Secrets is written by InfoWorld contributing editor Brian Livingston. Research Directors: Ben Livingston (no relation) and Eryn Paull. Brian has published 10 books, including:

Windows Me Secrets: http://www.amazon.com@54.vg/?34939

Windows 2000 Secrets: http://www.amazon.com@54.vg/?34130

Win a book free if you're the first to send a tip Brian prints. mailto:tips@SecretsPro.com


Brian Livingston , an InfoWorld contributing editor, has published 10 books, including Windows Me Secrets and Windows 2000 Secrets. Win a book free if you're the first to send a tip Brian prints. Send in your tips today, at tips@secretspro.com.



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