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E-commerce tipped to embrace 30% of NZ business within
three years

New Zealand corporate and government IT directors expect
revenues from e-commerce to approach 30% of total business
revenues within three years and e-commerce transaction
volumes to reach 35%. But despite that they rate their
organisations behind the eight-ball in comparison with
international competitors.

That result from Fairfax’s Strategic Research in its latest
MIS MarketTrends 2000 survey of New Zealand’s IT leaders.

Despite dot.com crashes and an apparent failure in the
business to consumer or e-tailing space, corporate
organisations continue to back e-commerce projects as a
core competitive differentiator and the key to increased
market share and efficiency.

While revenue and transaction volume expectations over the
next three years are high, the take-off in local e-commerce
won’t happen immediately or evenly.

“Respondents predict only marginal increases in e-commerce
revenues and transcations over the next year,” says
Strategic’s New Zealand analyst Rob O’Neill. “Early
indications from the research show a large number of e-
commerce-related projects under way, especially in the
development of secure intranets as an enabler of business-
to-business transactions.”

New Zealand IT managers are even more bullish on e-
colmmerce than their Australian counterparts. In Australia
it is expected that in two years 21% of transactions and
31% of revenues will be derived from e-commerce systems.

Notable in both results is the difference between
expectations in transaction numbers and revenue – a clear
indicator that e-commerce systems are geared for the
delivery of more commoditised products and services rather
than highly value-added differentiated products and
services.

Indeed,as has been claimed, e-commerce capabilities can in
many instances act as a driver of commoditisation through
its ability to admit new competitors to markets dominated
by incumbents.

Y2K appears to have posed a significant barrier to e-
commerce development. New Zealand IT managers, as with
their Australian counterparts, clearly rate their e-
commerce efforts to date as behind global best practice.

“In total 65% of organisations in the survey rated
themselves behind the e-commerce eight-ball, while only
7.9% rated themselves ahead,” O’Neill says.

In total 111 organisations, across a broad range of
industries, responded to the MIS MarketTrends 2000 report
in New Zealand.

Contact:
Rob O’Neill
Research Analyst
Strategic Research
+09 379 3880

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