"Startling Increase" in Internet Shopping Reported in New CommerceNet/Nielsen Media Research Survey; Active Web Shoppers More Than Double in the Past 18 Months -- One-Third of All Web Users Have Made Purchases Based on Internet Information.

PALO ALTO, Calif.--(BUSINESS WIRE)--March 12, 1997--A "startling increase" in Web users actively shopping on the Internet -- 39 percent of all Web users have searched for product information online prior to making a purchase, compared to 19 percent in Fall '95 -- is among the dramatic key findings of a new, comprehensive demographic survey released today by CommerceNet and Nielsen Media Research.

The Spring '97 release of the CommerceNet/Nielsen Media Demographic and Electronic Commerce Study also reveals continued vigorous growth in the number of people in the U.S. and Canada using the Internet and Worldwide Web -- more than doubling in the past 18 months -- accompanied by a significant narrowing of the gap between the number of male and female users.

At the same time, the rigorously scientific, population- projectable survey -- designed to gauge public acceptance of the Internet, the Web and online services in North America -- shows a lack of trust in the security of electronic payments as the leading inhibitor preventing people from actually purchasing goods and services online. But in spite of the roadblocks, the survey indicates that the Internet has clearly moved beyond the question of who will use it, to questions about who will buy and sell products and services.

"Our survey pinpoints a number of challenges and opportunities for businesses as they propel the Internet from a simple communications medium to a viable platform for consumer shopping and purchasing," said Randall Whiting, president and CEO of CommerceNet. "While the numbers confirm that the Internet has become an established shopping vehicle, clearly changes in technology, product offerings and perceptions are needed before most people will want to buy online."

The CommerceNet/Nielsen Media survey was based on telephone interviews with people 16 years or older from randomly-selected households in the U.S. and Canada during the months of December 1996 and January 1997. Special sampling techniques and a weighting methodology were employed to ensure that this pool of more than 6600 respondents would be population projectable to more than 220 million people in the U.S. and Canada and reliable as a benchmark for planning purposes.

"The electronic commerce statistics found in the current CommerceNet/Nielsen Media study make it the first to offer hard numbers that begin to measure the viability of the Internet as a medium for buying and selling," said David Harkness, senior vice president for planning and development at Nielsen Media Research. "We believe these findings will have a far reaching impact on the electronic commerce industry."

The Electronic Commerce Overview released today looks at extracts from the Spring '97 CommerceNet/Nielsen Media Demographic and Electronic Commerce Study, and offers readers a snapshot of the state of electronic commerce today that they can use to understand the Internet's shopping potential. The full report of the survey is a comprehensive research and analysis tool comprising over 300 pages of tables providing many detailed results, including cross-tabulations of each survey question against approximately 25 user characteristics. A complete list of the questions covered in the survey can be found on the Nielsen Media Research Web site: http://www.nielsenmedia.com .

More Key Findings

The population of Internet users has more than doubled since the first CommerceNet/Nielsen Media Internet Demographics Survey was released in Fall 1995. According to the latest results, 23 percent of all persons over 16 years of age in the U.S. and Canada have used the Internet during the past month and still have access today. The study in Fall '95 showed that only 10 percent had used the Internet during the three months prior to the survey. Increased use of the Worldwide Web is also dramatic, more than doubling from eight percent using the Web during the three months prior to the survey in Fall 1995 to 17 percent using the Web during the month prior to this most recent report.

The report also found that women are increasingly using the Internet, now accounting for 42 percent of users in the past three months as compared to 34 percent in the original survey.

As in earlier surveys, this study indicates that Internet users tend to be professional or managers to a greater extent than the total population. However, Internet use is becoming more mainstream. In the Fall 1995 survey, 50 percent of the Internet users were professional or managers. While this number dropped to 39 percent for the most recent survey, it is still well above the average -- 25 percent -- in the U.S. and Canada.

Shopping is one of the most popular activities on the Internet, and the number of people who shop and buy products on the Internet is growing. A large majority of Web users -- 73 percent -- spend some portion of their time online searching for information about a specific product or service. More than half of these users -- 53 percent -- have searched specifically when making a purchase decision. This is a significant increase over the findings in the Fall 1995 survey, when 55 percent of all Web users used the Web for shopping and only 35 percent prior to an actual purchase.

According to the survey, Web shoppers still outnumber online purchasers. Of all Web users, 15 percent -- or approximately 5.6 million people -- have used it to purchase a product or service online.

"The combination of increased general usage and growth of shopping as an activity, paints an extremely promising future for electronic commerce," said Stacey Bressler, vice president of marketing for CommerceNet. "This confirms the value proposition for companies planning to use the Internet as a marketing tool."

The Spring '97 survey also indicates a clear narrowing of the gender gap on the Internet. According to the survey, of all Internet users in the target group using the Internet in the past three months, 58 percent are male, down from 66 percent in the Fall 1995 report. But when it comes to shopping and buying behaviors, larger differences exist. Males are more likely to search for product information online than females and are more likely to make purchases. Not surprisingly, computer hardware and software is the leading category for attracting both shoppers and buyers on the Internet.

Study Availability

The complete Spring 1997 CommerceNet/Nielsen Media Internet Demographics and Electronic Commerce Survey results, featuring two volumes of survey analysis and full details about the scientific methodology used, are available in a printed report or in CD-ROM for $5,000 (U.S.). The combined printed/CD-ROM version of the report is $5,500. The Electronic Commerce Overview is available for $195. Custom information packages, including pre-packaged studies for selected vertical markets, will be priced on request. To obtain copies of the results, contact Kevin Noonan at Nielsen Media Research Company by phone at 212/708-7500, extension 6936, or by e-mail at [e-mail]. The results can also be ordered from Loel McPhee at CommerceNet, 415/858-1930, ext. 219. Reports can be ordered electronically on CommerceNet's Web site, http://www.commerce.net, or by e-mail at [e-mail] .

About Nielsen Media Research

Nielsen Media Research, a Cognizant company, has headquarters in New York City and offices in major markets across the U.S. and Canada. It is the producer of the Nielsen TV ratings and the leading provider of broadcast and cable television information services, both nationally and locally. Through its Interactive Services division, Nielsen Media Research develops audience measurement and custom research on new media, including the Internet, the Web and Online Services, and has become a leading provider of research services to the Internet, advertising and electronic commerce communities.

About CommerceNet

CommerceNet is the premier industry association for promoting and building electronic commerce solutions on the Internet. Launched in April 1994 in Silicon Valley, Calif., its membership has grown to more than 200 companies and organizations worldwide. They include the leading banks, telecommunications companies, VANs, ISPs, online services, software and service companies, as well as end-users, who together are transforming the Internet into a global electronic marketplace. CommerceNet can be contacted at Tel: [phone]; Fax: [phone]; URL: http://www.commerce.net .

CONTACT: CommerceNet

Stacey Bressler, 415/858-1930

[e-mail]

or

For CommerceNet:

Patrick Corman, 415/326-9648

[e-mail]

or

For Nielsen Media Research

Jack Loftus, 212/708-7724

[e-mail]