``The Problem With E-Commerce Is Not the Lack of Online Buyers,'' Said BizRate.com.

Business Editors

LOS ANGELES--(BUSINESS WIRE)--June 27, 2000

BizRate.com's Latest Q1 Consumer Online Report(TM) Shows Surge

in E-Tailing and the Company Forecasts Success for Q2

Investors may have cooled toward business-to-consumer e-commerce stocks, but consumer demand for online shopping is healthier than ever--according to BizRate.com's (www.bizrate.com) first quarter 2000 Consumer Online(TM) Report(a).

The findings reveal that online retailing sales in 2000 increased by 12 percent over the prior quarter, and actual orders increased by six percent. Despite the fact that some online retailers are floundering, BizRate.com is forecasting second quarter sales to grow a further 25 percent over first quarter sales--to $10.2 billion.

The growth represents a significant leap, as it marks an increase in both sales and orders over the peak holiday-driven fourth quarter. Sales are up from $7.25 billion in the fourth quarter to $8.15 billion in the first quarter. Similarly, orders jumped from 70 million in the fourth quarter to 75 million in the first quarter.

Chuck Davis, president and chief executive officer of BizRate.com said, "Business-to-consumer e-tailing shows no sign of slowing down. There are plenty of online buyers out there, and shopping on the Web is currently thriving. The problem confronting e-tailers rests in meeting investors'--not consumers'--demands by getting costs under control and showing a clear path to profitability. E-tailers who are able to target buyers cost-effectively should be able to satisfy both audiences. Increasingly, such retailers are turning to pay-for-performance marketing relationships."

BizRate.com, the Web's largest open shopping marketplace, has been benefiting from this pay-for-performance trend, experiencing phenomenal merchant growth with over 500 merchants signing up with BizRate.com each month. "E-tailers see the value in a model which helps them acquire customers without having to invest in upfront `pay-and-pray' marketing costs," concluded Davis.

BizRate.com links more than four million online shoppers a month to more than a thousand online sellers. Unlike other online shopping marketplaces, BizRate.com is the only "shopping democracy" allowing unrestricted access for both shoppers and "best-of-breed" sellers so that consumers have the widest and best range of online stores to choose from. Meanwhile, e-tailers get free access to shoppers.

The BizRate.com Consumer Online(TM) Report also revealed that:

-- The Entertainment (+35%), Computer Goods (+30%) and Gifts &

Flowers (+14%) category sales grew faster than sales for the

Industry (+12%). Not surprisingly, sales in the popular

holiday categories such as Food & Wine (-60%) and Toys &

Hobbies (-72%) showed dramatic decreases from Q4 1999 to Q1

2000.

-- The Industry's average purchase amount per order also

increased six percent from $103 in Q4 1999 to $109 in Q1.

-- First-time merchant buyers continue to dominate online sales

for the industry. They accounted for 63 percent of online

sales and orders in Q1.

-- Average household income showed a slight decrease in Q1

(down 4% from $81,200 in Q4 1999 to $78,000 in Q1).

-- Share of new online orders by female buyers (54%) continued to

exceed those of new online orders by male buyers.

-- Merchandising tactics like product search tools, express

ordering and featured sale items continue to be most important

to converting browsers to buyers by emphasizing convenience

and lower price to online buyers.

About BizRate.com

Founded in 1996, BizRate.com (http://www.bizrate.com) is an open and comprehensive marketplace, governed by customer ratings, linking millions of online buyers to leading online merchants each month. As a trusted market-maker, BizRate.com combines valuable customer-generated information with a powerful set of shopping tools to help online shoppers confidently and easily decide where to buy online. BizRate.com's proprietary customer ratings form the backbone of the marketplace and are derived from its position as the only company trusted by more than 4,600 online stores to collect direct customer feedback and transactional information at the point of every purchase. These ratings, widely recognized as the standard for customer satisfaction on the Web, are the only statistically rigorous way of differentiating retailers on "quality of service" metrics, allowing consumers to take the focus away from pure price comparisons. BizRate.com's ratings also appear on Consumer Reports Online and in Consumer Reports magazine, as well as on Microsoft Network, AltaVista, GO Network, Go2Net, Snap, Citibank, iChoose, Brodia and CNET.

(a)Note: BizRate.com's quarterly Consumer Online(TM) Report provides the most reliable snapshot of e-commerce trends because BizRate.com is the only company that sits on the "e-point-of-sale," measuring the experiences of millions of online buyers.