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The 2000 National Technology Readiness Survey: Implications for E- Commerce and Internet-Based Services Ninth Annual Frontiers in Services Conference September.

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Presentation on theme: "The 2000 National Technology Readiness Survey: Implications for E- Commerce and Internet-Based Services Ninth Annual Frontiers in Services Conference September."— Presentation transcript:

1 The 2000 National Technology Readiness Survey: Implications for E- Commerce and Internet-Based Services Ninth Annual Frontiers in Services Conference September 23, 2000 A. Parasuraman, University of Miami & Charles Colby, Rockbridge Associates, Inc.

2 Presentation Outline v Overview of TR and the NTRS v Comparison of the 1999 and 2000 NTRS – Properties of the TR Index – TR-based typology of customers v E-Commerce-related findings from the 2000 NTRS – Selected e-commerce behaviors – Variations across TR-based segments v Research and Managerial Implications

3 What is Technology Readiness [TR]? TR refers to peoples propensity to embrace and use new technologies for accomplishing goals in home life and at work

4 NTRS Background & Purpose v Developed jointly with Rockbridge Associates, Inc. v Intended as an aid for effectively implementing technology among customers and employees v Provides an in-depth view of customer beliefs about technology v Profiles customers by their level of Technology Readiness

5 Methodology for 1999 and 2000 NTRS v v Each survey included a sample of 1000 U.S. adults v v Respondents chosen through random digit dialing v v Data collected via computer-assisted telephone interviewing v v Survey included questions about technology beliefs, demographics, psychographics, and technology-related behaviors and preferences

6 Drivers of Technology Readiness DiscomfortInsecurity Inhibitors Contributors Innovativeness Optimism Technology Readiness

7 Definitions of the TRI Dimensions v v Optimism: Positive view of technology; belief that it offers increased control, flexibility and efficiency v v Innovativeness: Tendency to be a technology pioneer and thought leader v v Discomfort: Perceived lack of control over technology and a feeling of being overwhelmed by it v v Insecurity: Distrust of technology and skepticism about its working properly

8 OPT. TRI INS.DIS.INN Mean TR Scores TR Scores by Dimension and Overall TRI

9 Low TR (Lower Third) Technology Readiness Index Distribution [Mean = 100] Medium TR (Middle Third) High TR (Upper Third)

10 v v Optimism [10 items]…… v v Innovativeness [7 items] v v Discomfort [10 items]… v v Insecurity [9 items]…… The TRIs Reliability [Coefficient Alphas]

11 Shared Variance among TR Dimensions % Opt-Inn Opt-Dis Opt-InsInn-DisInn-InsDis-Ins

12 Characteristics of Technology Segments OptimismInnovative-Dis- Insecur-nesscomfort ity Explorers HighHighLowLow Pioneers HighHighHighHigh Skeptics LowLowLowLow Paranoids HighLowHighHigh Laggards LowLowHighHigh

13 Typology of Technology Customers: Mean TR Scores for Segments (Population Mean = 100)

14 % Typology of Technology Customers: Percent of Population in Each Segment

15 Typology of Technology Customers: Mean Age in Each Segment Overall Mean: 43.5

16 % Typology of Technology Customers: Percent of Males in Each Segment 50%

17 Typology of Technology Customers: Mean Household Income (in 000s of US$) Overall Mean: 48 US$ 000s

18 Research Implications Need to examine: v Temporal stability of TR scores over the long term -- e.g., Are some dimensions more stable than others? v Possible variations in TR across countries and cultures, reasons for such variations, and their implications for multinational companies. Individual-specific drivers (e.g., psychographics) and consequences (e.g., satisfaction) of TR in past year, only 16% checked their bank Individual-specific drivers (e.g., psychographics) and consequences (e.g., satisfaction) of TR in past year, only 16% checked their bank

19 E-commerce in 2000 Findings from the 2000 NTRS

20 Concern over the Safety of E- Commerce Persists Do not consider it safe giving out Do not consider it safe giving out a credit card number over a computer Do not feel confident doing business with a place that can only be reached online Do not consider it safe to do any kind of financial business online % 73% 67% 70% 58% 59%

21 Despite Concerns, E-Commerce Continues to Grow, Especially for Items Costing $10 or More %

22 Explorers are Leading the Pack (almost half make big ticket purchases), Followed by Pioneers and Skeptics %

23 What are People Buying Online? Males v Books/magazines (49%) v Computer Equipment (44%) v Music (42%) Females v Books/Magazines (48%) v Clothing (37%) v Music (29%) Businesses v Computer Software, Computer Hardware, Books, Office Supplies, Airline Travel

24 Motivations for Buying Online v 70% of purchases are for personal use, 12% business, 17% gifts v Reasons for buying online include: convenience, availability (items not found in a nearby store), better prices v Major reason for NOT buying online is a concern about safety/security v Purchases tend to be planned

25 The Most Important Features of E- Commerce Sites are those that Protect and Reassure the Consumer

26 The More Popular E-Commerce Sites Stand Out by Offering Availability, Selection and Ease of Use; Needs Differ by TR-Level * Note: Small sample size (n=22) for Low TR group %

27 Other Observations about E- Commerce v Most Preferred Method of Customer Service is Telephone Support v Credit Cards are the Preferred and Most Widely Used Payment Method for Merchandise v Services seem to lag behind products; e.g., account online & only 5% have signed up for telecom service online

28 Who is Buying Online? v 50% are female v Fastest growth among females and medium- TR consumers v Slightly younger (55% are under 40, versus 45% of U.S.) v Much more educated (41% have 4 yr. college degree versus 24% of U.S.) v Higher income (median income $52K versus $40K for all U.S.) v Similar marital, family and ethnic background

29 Implications Implications

30 Managerial Implications v Insecurity and Discomfort are major inhibitors of e-commerce; consumer beliefs so far remain unchanged v E-commerce providers can address these concerns through: secure sites, privacy policies, warranties, clear information, telephone support v Less techno-ready consumers seek out sites for their availability of unique goods; they are less price conscious than more techno- ready consumers v It is critical for providers to test their sites for ease of navigation and use

31 v Watch out for Techno-Ready Marketing: How and Why Your Customers Acquire Technology, A. Parasuraman and Charles Colby, Free Press, NY, May 2001 v Visit and select Technology Readiness For More Information...


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