Service Providers of the Information Society – Dissemination of E-Commerce Slightly Decreasing

In the second quarter of 2005, approximately 33 per cent of IT-related service providers state that they use the internet as a sales channel to reach end customers. Compared to the previous quarter, this corresponds to a slight decline in the so-called business to consumer electronic commerce (B2C e-commerce).

In the second quarter of 2004, about 40 per cent of the companies provided end customers with the possibility to order services online. Business to business e-commerce (B2B e-commerce), i.e. electronic trade with business partners, is much more common among companies of this economic sector. Approximately 52 per cent of the companies confirmed in the second quarter, that they used the Internet to place orders with business partners (2004: 54 per cent). The average proportion of revenues generated through e-commerce amounted to almost 5 per cent in 2004.

This is the result of a business survey among German IT-related service providers conducted by the Centre for European Economic Research (ZEW), Mannheim, in cooperation with Creditreform, Neuss, in June and Juli 2005. About 1,000 firms participated in this survey. The sector of the IT-related service providers comprises the Information and Communication Technology (ICT) service providers (firms in the branches of computer service and leasing, ICT-specialised trade as well as telecommunication services) and knowledge intensive service providers (firms in the branches of tax consultancy and accounting, management consultancy, architecture, technical consultancy and planning, research and development as well as advertising).

The dissemination of e-commerce varies significantly between the different branches of the economic sector. B2C e-commerce is most common among business consultancies. Almost 75 per cent of the companies in this branch use the Internet as a sales channel. A similar proportion of 70 per cent employ B2C e-commerce in the field of research and development. Computer service and leasing companies (about 43 per cent) and ICT-specialized trading firms (about 39 per cent) also make an above-average use of B2C e-commerce. Advertising agencies hardly employ e-commerce to sell their services (15 per cent), but occupy a leading position in using e-commerce for the procurement of input goods and services. Approximately 73 per cent of them use B2B e-commerce for this purpose. Business consultancies (63 per cent), computer service and leasing companies (61 per cent) as well as ICT-specialized trading firms (58 per cent) also employ B2B e-commerce very often.

When asked about the key motives for using e-commerce in the second quarter of 2005, most IT-related service providers put the accelleration of business procedures first, followed by the need to keep pace with the competition. In the previous year, lower costs for business processes and an increased service quality were seen as the most crucial arguments, but these motives have now slipped to the third and fourth rank. By now, the extension of business hours is considered more important than the extension of the geographical sales market. The fact that using e-commerce might shape a company's image still ranks seventh.

Contact

Jörg Ohnemus, Phone +49(0)621/1235-354, E-mail ohnemus@zew.de