Consumer and Enterprises in Network Age

ABSTRACT

Internet is growing rapidly among Japanese consumers. Many consumers access Internet fromhome, and shopping on the Internet becomes more and more popular. However, there are littlestudies about the impact of Internet on consumer behavior. In this article, we discuss therelationship between Internet and consumers. We also suggest that existing corporations haveto change their business models and there will be huge business chances to capture therequirements of new consumers in the network age.

There is a critical difference between Internet and traditional media such as broadcasting andnews papers. Using Internet, a consumer can get more information about products than everand place an order from everywhere at anytime. However, the amount and quality ofinformation which a consumer can collect using internet is much more dependent on his or herattitude and literacy than using old media. Therefore, benefits of Internet is very differentamong consumers, and consumers may be polarized by their Internet access and literacy.

Analyzing the result of survey on Japanese female consumers, we identified that Internet userscan almost be characterized by demographic factors: they are young, single, highly-educated,and have professional jobs. However, the demographic profile of Internet users who placeorders on Internet ("net buyers") are not so different from that of those who do not ("non netbuyers"). The most significant difference between "net buyers" and "non net buyers" is thefrequency and depth of Internet usage. This fact means that it is necessary to improveconsumers' Internet access and literacy for further extension of consumer electronic commerce.

In order to cope with the change of consumers, corporations must achieve a fundamental changeof their business model. It is a shift from "selling what were already made" to "making whatcan be sold". In addition to the change in existing businesses, new business will emerge tointermediate vast information on the Internet for consumers. This kind of business is called"electronic intermediaries" or "infomediaries", and many start-up companies aim to enter thisindustry in the U.S. These new services will play very important role in Japan, too. However,since the attitude to new services may be different between Japanese consumers and Americanconsumers, Japanese market need its own business models and industry policy to promote thisnew industry.