Online Sales Will Account for Almost 40% of U.S. Consumer PC Shipments in 2004, According to IDC

FRAMINGHAM, MA – JUNE 28, 2000 – The number of PCs U.S. consumers purchase online will increase rapidly over the next five years. According to IDC, in 1999, just 8% of all PCs sold to U.S. consumers – or fewer than 1.4 million – were sold via the Internet. In 2004, close to 40% of all consumer PC sales in the United States, or almost 9.3 million PCs, will be made online.

 

"Given the current penetration of PCs in the home and the rapid rise in the percentage of homes accessing the Internet, a greater number of customers will utilize the Web as a commerce tool when shopping for a new PC," said Keith Waryas, research manager for IDC's Consumer eCommerce: Computing program. IDC estimates 50% of U.S. homes owned at least one PC in 1999, and almost 36% have Internet access.

According to IDC, targeted marketing efforts, convenience, growing comfort with ecommerce, and price will all help to drive consumer PC sales over the Internet. "The ability to search hundreds of merchants to find the best price of new PCs will be a major advantage for Internet sales and should encourage Internet users to buy their next PC online," Waryas said.

While the opportunity to sell PCs online to U.S. consumers is huge, vendors will need help from the channel to capitalize on this opportunity and will not be able to rely strictly on direct sales.

"Internet channel partners will be the primary route for consumer Internet purchases," Waryas said. "By focusing on retail these companies will be much better suited than manufacturers to handle one-off sales and shipping. In addition, etailers have the ability to easily and economically sell consumers complete computer systems, which can create a larger absolute profit than computer-only sales."

Online computer sellers who think they can compete on price alone against traditional brick-and-mortar retailers will be in for a rude awakening. Traditional retailers offer consumers nondollar value, which will keep them competitive for years to come. This value includes increased confidence in their purchase and easily accessible service.

"Ultimately, the amount of total retail that moves online will be determined by how much brick-and-mortar service can be brought to customers electronically," Waryas said. "As a result, during the next few years, etailers will transition their current two-dimensional process – price and specs – to a more interactive buying experience. Expect to see things like click-through surveys that access the customers' computing needs and then recommend a system."

According to IDC, the most successful computer sellers will be those that offer a combination of online and brick-and-mortar sales. "If thoroughly integrated, click and mortar will be a very successful combination in the consumer PC ecommerce sector," Waryas predicted.

IDC recently published PCs and eCommerce: Forecast and Analysis of Online U.S. Consumer PC Sales (IDC #B22421). This report analyzes the opportunity for selling computers to U.S. consumers via the Internet. The report looks at the ecommerce opportunity in the U.S. consumer market, forecasts total and consumer U.S. PCs shipments and value through 2004, examines U.S. PC consumer ownership by income, looks at applications consumers are using their PCs for, and compares U.S. consumer online and offline PC sales through 2004. Factors driving and inhibiting online PC sales are discussed. The report also looks at direct versus indirect online PC sales. To purchase the report, please contact Demetra Georgakopoulos at 1-800-343-4952, extension 4496 or at demetra@idc.com.

For more information on IDC's eBusiness programs, please visit idc.com/ebusiness/.

About IDC

IDC delivers dependable, high-impact insights and advice on the future of ebusiness, the Internet, and technology to help organizations make sound business decisions. IDC forecasts worldwide markets and trends and analyzes business strategies, technologies, and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC provides global research with local content through more than 500 analysts in 43 countries worldwide. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at http://www.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.

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