Put your business in peril - ignore Web 2.0

The need for Internet-based businesses to adapt to the mass phenomenon of Web 2.0 is "urgent", a top consultant warned yesterday.

In a message to firms, regardless of their size, Booz Allen Hamilton said they jeopardise retaining and attracting customers if they ignore the main idea behind successful websites like YouTube and MySpace.

Reflecting on its poll into the 'Web 2.0 readiness' of consumers, the consultant found more than four out of ten people now use sites that allow them to interact with others in a massive global community.

Contrary to popular belief that the next-generation of the Internet is just for geeks, both men and women were found to be visiting sites that offer a platform to exchange and process information, generate user content, and use entertainment media through new channels.

Although newer sites still have primarily young user communities (50% of MySpace users are under the age of 25), a significant proportion fall into the older 35-49 age category.

Generally the more established the site, the more balanced the age group using it – a quarter of retail giant Amazon's users are over the age of 50, and "over time, sites such as MySpace and YouTube are expected to see a similar adoption trend," the consultant predicted.

In contrast to perceived consumer attitudes to the Internet, users are also willingly disclosing so-called 'private information.'

In fact, more than six out of ten MySpace users in the UK have uploaded materials intended only for themselves or their friends, but only 39% have taken steps to restrict access for the general public. Overall, 70% of users have taken MySpace up on its offer of uploading personal content.

Elsewhere the study, based on the attitudes of "several thousand" consumers, reinforced previous research that Web 2.0 formats - such as blogs - are now highly trusted as sources of information.

Evidencing the claim, Booz Allen Hamilton found nearly half of MySpace users are "happy" to act on the purchasing recommendation of an unknown peer.

Citing Friends Reunited as a pioneer of next-gen Internet sites, the consultant concluded: "Web 2.0 has already reached a critical mass – companies must now adapt to the new paradigm.

"Unless businesses recognise and respond to such trends, the shift in consumer behaviour is likely to have an adverse effect on both customer acquisition and retention.

"Competitors can be expected to take advantage of online channels to win customers, while utilising social communities to drive buying decisions and to form positive product opinions."

Businesses were recommended to use Web 2.0 to boost their overall efficiency. One example is to use existing online forums to shift the decision-making to the online community.

 

31st January 2007

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