eMaven eStrategy partners 1

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Internet UseInternet UseGreat Triumphs and Blunders of F1000Great Triumphs and Blunders of F1000

Linda RossettiFounder, eMaven, Inc.lindar@emaven.com617-306-0216

eMaven eStrategy partners 2

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Triumphs and BlundersTriumphs and BlundersWho is winning? Extend Existing BusinessWho is winning? Extend Existing Business

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Triumphs and BlundersTriumphs and BlundersWho is winning? New Business ModelsWho is winning? New Business Models

Federated

Fingerhut

Macys, Bloomingdale’s, Lazarus, Bon Marche,

Burdines,Rich’s Goldsmiths, Sterns, Fingerhut

Ordertrust

Wedding Channel.com

$1.7 Billion1999 investment

$200M annually1999, 2000

$33M

N/A

Backend Operations

Frontend Revenue Generation

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Triumphs and BlundersTriumphs and BlundersWho is winning? New Business ModelsWho is winning? New Business Models

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Triumphs and BlundersTriumphs and BlundersWho is winning? Performance DriversWho is winning? Performance Drivers

Delphi Automotive Systems• $29 Bn Auto-parts manufacturer• $360 MM purchases through online

auctions in 1999• Saved $58 MM or 16% of normal

cost of goods purchased• Only 3% of total annual purchasing

volume being transacted online• Potential savings of $2.4 Bn if total

annual purchasing volume shifted online

• Purchasing process time reduced from 2-16 weeks to 2-5 weeks

Source: Reuters 3/6/00; eMaven analysis

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Triumphs and BlundersTriumphs and BlundersWho is winning? Extend Existing BusinessWho is winning? Extend Existing Business

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Triumphs and BlundersTriumphs and BlunderseCommerce ProjectionseCommerce Projections

$184$144$101$64$39$20$8

$2,696

$43 $109

$406

$716

$1,167

$1,823

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

1998 1999 2000 2001 2002 2003 2004

Bill

ion

s

B2B RevenueB2C Revenue

Source: Forrester Research 10/99; Forrester Research 2/00

B2B CAGR = 99% B2C CAGR = 69%

eMaven eStrategy partners 8

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Triumphs and BlundersTriumphs and BlundersB2C ProjectionsB2C Projections

$0

$5

$10

$15

$20

$25

$30

$35

2000 2004

Bil

lio

ns

AutomobilesHousehold GoodsEvent TicketsGifts & FlowersHousewareFood & Bev.Health & BeautyMiscellaneousRecreationApparelMediaElectronicsLeisure Travel

US Online Retail Revenue by Category

Source: Forrester Research 1/00

Total = $39 Bn 1% of Total Retail Revenue

Total = $184 Bn 7% of Total Retail Revenue

eMaven eStrategy partners 9

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Triumphs and BlundersTriumphs and BlundersB2B ProjectionsB2B Projections

$0

$100

$200

$300

$400

$500

$600

2000 2004

Bil

lio

ns

Heavy IndustriesAerospaceShippingIndustrial EquipmentPharmaceuticalsConstructionFood & AgricultureConsumer GoodsPaper & OfficeUtilitiesPetrochemicalsMotor VehiclesComputing & Electronics

Source: Forrester Research 2/00

U.S. B2B Growth by Industry

Total = $406 Bn 3% of Total Business Trade

Total = $2.7 Tn 17% of Total Business Trade

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Triumphs and BlundersTriumphs and BlundersChannel Shift - Who stands to win?Channel Shift - Who stands to win?

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100

$110

1999 2000 2001 2002

Billions

Incremental Sales

Total Online Sales

Source: Jupiter Communications 6/99

1.2

20

2.4

39

4

64

6.6

101

eMaven eStrategy partners 11

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Triumphs and BlundersTriumphs and BlundersUse: Business vs. HomeUse: Business vs. Home

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Households Businesses

Not Online

Online

Source: Goldman Sachs 11/99

Total: 100.2 MM

Total: 6.23 MM

2000 U.S. Internet Penetration: Business vs. Residential

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Triumphs and BlundersTriumphs and BlundersBusiness’ Internet Activity Business’ Internet Activity

Source: Morgan Stanley, 8/11/99

28%

52%

97%

20%

55%

92%

2%12%

38%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Access Web Site eCommerce

Small (1-99)

Medium (100-999)Large (1,000+)

Internet Activities by Company Size: 1999

By ‘04Business with web

siteswill include

70%of small, 95% of

medium and 98% of large.

eMaven eStrategy partners 13

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$350

$1,000

$2,000

$0

$400

$800

$1,200

$1,600

$2,000

Low Average High

79%

11%

10% LaborRelated

Hardware

Software

Reported Cost of eCommerce Site Development(in thousands)

Spending During Site Establishment

(n = 20 midsize to large corporations that were launching first phase e-commerceSource: Gartner Group May 1999

Triumphs and BlundersTriumphs and BlundersBusiness’ Investment Business’ Investment

eMaven eStrategy partners 14

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Triumphs and BlundersTriumphs and BlundersBusiness’ Internet ActivityBusiness’ Internet Activity

$182,000

$252,500

$307,100

$0

$80,000

$160,000

$240,000

$320,000

Maintain Develop Site DevelopeCommerce Site

Source: Association of National Advertisers 1999

1999 Averages Among Fortune 1000 Companies

eMaven eStrategy partners 15

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Triumphs and BlundersTriumphs and BlundersHow is value generated?How is value generated?

Information Dialogue Transaction

Internet – collection of functionality that together communicates a value proposition to a user

customer

eMaven eStrategy partners 16

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Triumphs and BlundersTriumphs and BlundersInformationInformation

Post vs. Enable

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Triumphs and BlundersTriumphs and BlundersInformationInformation

eMaven eStrategy partners 18

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Source: Iconocast 7/29/99, Customers.comhttp://www.aa.com

Triumphs and BlundersTriumphs and BlundersDialogueDialogue

•1.7M opted-in to weekly NetSAAver email•Estimates of click thru 5% to view online offer at site (estimated at 20% of site traffic)

eMaven eStrategy partners 19

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Triumphs and BlundersTriumphs and BlundersDialogueDialogue

Opt-in E-mail List Servs

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Triumphs and BlundersTriumphs and BlundersDialogueDialogue

Source: Informationweek 1/31/00; Busimess Wire 6/15/99

Autobytel• 600,000 cars sales projected in 2000• 6.5 MM registered users• 89% of registered users have not purchased

• “Garage” your vehicle – Autobytel provides e-mail service reminders, recall info & a lease watch to track mileage

eMaven eStrategy partners 21

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Triumphs and BlundersTriumphs and BlundersTransaction Transaction

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Entry Strategies Entry Strategies Information-Dialogue-Transaction Information-Dialogue-Transaction

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Entry Strategies Entry Strategies Information-Dialogue-TransactionInformation-Dialogue-Transaction

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Entry Strategies Entry Strategies Information-Dialogue-TransactionInformation-Dialogue-Transaction

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Entry Strategies Entry Strategies Information-Dialogue-TransactionInformation-Dialogue-Transaction

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Entry Strategies Entry Strategies Information-Dialogue-TransactionInformation-Dialogue-Transaction

Source:

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Triumphs and BlundersTriumphs and BlundersHow is value generated?How is value generated?

Information Dialogue Transaction

“It is not a revolution in technology, machinery, techniques, or software. It is a revolution in CONCEPTS” Peter F.

Drucker ASAP 8/24/98

eMaven eStrategy partners 28

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Internet UseInternet UseGreat Triumphs and Blunders of F1000Great Triumphs and Blunders of F1000

Linda RossettiFounder, eMaven, Inc.lindar@emaven.com617-306-0216