What Are Folks Doing on the Net?

It turns out that people are doing just about everything. Students are doing schoolwork, and business folks are looking for business news. Insurance agents are looking for insurance news as well as general business news and information about the schedule for their son's soccer league. Investors are checking their portfolio. Grandparents are getting email from their grandchildren. The Net has become such a pervasive part of people's lives that we've missed the turning point.

What are the things that people do online, now that online usage patterns are starting to gel? It seems to me that they're doing four significant kinds of activities.

People are using the Net to get the news. They may not be using it for their major daily dose of news. For the majority of folks in the U. S., that major daily dose of news comes from television, but they are using it as a primary news source nonetheless.

There is a bit of a chicken and egg problem here. People like to use the Web for the kinds of things the Web does well. It's accessible all of the time, and so it's great for the times when folks want to check out the detail on a news story that they caught the basics of on television. The Web also allows for lots of information to be linked together. That makes it excellent for getting background on a story you've seen on television or read in the newspaper, or for getting a handle on complex issues like the recent Enron debacle.

Businesspeople like the Web for news that's special to them. The Net allows you to get news in very narrowly focused areas. If you check out the resource page that I've put together for this site, youâll find several specific links to insurance news and information sources.

What's significant here is that, especially for upscale households and individuals, the Web has been a major way to connect to news stories and to gather additional depth and information.

Gathering information is the second major use of the Web these days. Folks go online to gather information about issues, but they also go online to gather information about lots of other things. Children go online to gather information for a homework assignment. Businesspeople research issues and potential vendors. And people research major purchases.

Let me say that again. People use the net to research major purchases. Insurance is a major purchase.

One of the key findings that we have about how people use the Net for commerce-related activities is that the Web is becoming a primary source for information related to large or complex purchases, such as automobiles, homes, major appliances, and financial service instruments.

People are using the Net and the Web to maintain and develop relationships. Many of those are personal. My grandson, Teddy, had his sixth birthday on the 12th of February. On that day, my daughter took some pictures of Teddy and his presents and e-mailed them to me, to my ex-wife, to Teddy's aunts and uncles, and to his great-grandfather. Speaking of that great-grandfather, my dad uses e-mail to stay in touch with friends scattered around the world that he can't visit as often as he used to.

People are also using the Net to maintain commercial relationships. Mostly this has been done by having businesses maintain the contact in some regular manner. E-mail newsletters, especially those that folks have signed up for, are the primary way that this gets done.

Businesses of all kinds have found that the Net is an excellent way to solve the problem of staying in touch with folks between the times when they're ready to buy or have a problem. This contact is an excellent tool for building and maintaining relationships, especially for industries like insurance with high latency factors -- the time between contacts.

People are doing business on the Net. Businesses are buying things and so are individuals. We're learning, though, that folks use the Net to buy things in a particular way.

There are some things that they buy outright. Generally these include items, which are perceived to be commodities, such as books, CDs, software, or anything else where the product is perceived to be the same saying regardless of who you buy it from.

People also do a lot of re-purchasing on the Web. They renew subscriptions, and yes, insurance policies. They buy replacement parts and things that they've bought before. A guitarist may not buy a guitar on the Web (more on that in a moment), but he or she will likely buy guitar strings and picks and stomp boxes. A man may not buy a sweater over the Web, but he is likely to make repeat purchases of the shirt that he likes from Landsâ End. A person may not buy an insurance policy online, but may use the net to research options, make changes and keep up with premiums.

There's also a pattern to how people begin buying on the Net. They tend to begin with a small purchase of less than twenty dollars. Then they move up from there, as well as on to other vendors.

For you in the insurance business, the most significant thing to be aware of is that people do an awful lot of research on the Net for purchases that they perceive as large, complex, or involving risk or embarrassment.

Close to two-thirds of the homes or automobiles bought in the United States last year were bought after, or involving, research on the Web. What are they researching?

What people use the Web for is to gather the information they need to be comfortable, either making a purchase, or asking questions, or negotiating. That guitar player is going to walk into a guitar store to try out the instrument; but before going in, he or she will find out all of the details about the product and the competition.

That's the overall state of what consumers are doing on the Net. What we need to look at next is how that applies to insurance.

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