Saturday, January 20, 2001

A Look at the Australian Internet Economy

Australia gained 1.89 million Internet users between 1999 and 2000, to number 7.4 million people today. eCommerce spending grew to reach US$2.9 billion in 2000, and more growth is yet to come. IDC expects the market to be worth well over US$37 billion by 2004.

These findings have recently been published in IDC's latest report on the Australian Internet Economy, "Lessons Learned in 2000" (IDC # AU40003H). IDC's senior analysts Brooke Galloway and Lisa Shishido examined the current state of the Internet market in Australia and highlighted the top ten lessons the industry has learned in the past 12 months, including:

The Internet is not a fad
Financial reality met the dot-com world
The Internet is just another channel, not a separate business
EDI is not dead
A customer's experience doesn't end at the Web site
Internet services and content are not free
An Internet strategy is not an IT strategy, it's a business strategy
eMarketplaces need buyers AND suppliers
Consumers care about their privacy and security
eCommerce failed to capture the attention of the SME market
" Bricks-and-mortar businesses with an Internet arm have learned that integration between their traditional and online business is key to success" said Ms. Galloway. "More and more customers expect to be serviced through whichever channel is most convenient and comfortable for them at any given time. That is why enterprises should not think of themselves as running two separate businesses - a traditional business and an online business - but one business which delivers through different channels".

According to the market researcher, to reap the full benefits of an Internet strategy, business processes and organisational structures must change. Without the support of senior management and business units, an eBusiness strategy will fail to deliver a competitive advantage to the organisation.

"The deployment of an eBusiness solution has far-reaching implications for an organisation as a whole. As-such, eBusiness strategies are increasingly moving from being an IT-led project to a business driven strategy" added Ms. Shishido. "In recent years, the Internet has often been held responsible for moving IT into the boardroom. However, many organisations have begun to realise that when their eBusiness strategy is managed through the IT department in isolation it will fail, and as such, the Internet Executive role is increasingly being filled by non-IT candidates", said Ms. Shishido.

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