JCMC 3 (1) June 1997
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Evaluating the World Wide Web:
A Global Study of Commercial Sites

James Ho
Information and Decision Sciences
University of Illinois at Chicago

Table of Contents

Abstract

While commercial applications of the Internet proliferate, particularly in the form of business sites on the World Wide Web, on-line business is still relatively insignificant. One reason is that truly compelling applications have yet to be devised to penetrate the mass market. To help identify approaches that may eventually be successful, one must address the question of what value is being created on the Web. As a first step, this paper proposes a framework to evaluate Web sites from a customer's perspective of value-added. A global study covering 1,800 sites, with representative samples from diverse industries and localities worldwide, is conducted to give a profile of commercial use of the World Wide Web in 1996.

Introduction

By mid-1996, there were over 250,000 World Wide Web (WWW or Web in short) sites on the Internet, up from 15,000 in 1994 [e-land, 1997a]. Business enterprises--from multinational conglomerates to solo entrepreneurs--are staking their presence on the Internet, all poised to become pioneers in what promises to be the frontier of electronic commerce [Kalakota and Whinston, 1996]. Yet, in spite of estimates ranging from 14.1 million WWW users 16 years of age or older in the US alone [Hoffman, Kalsbeek, and Novak, 1996] to 37.4 million in the US and Canada [CommerceNet, 1997], on-line business is still relatively insignificant. Net merchants were estimated to sell some $750 million worth of goods by the end of 1996, compared to $1.7 trillion for the retail industry and $57 billion for the home shopping industry [e-land, 1997b]. Apart from the obvious difficulties with bandwidth and security [Alpar, 1996], technical issues that can no doubt be resolved eventually, there is the more probing question of what value is being created by information technology in general [Ho, 1994], and on the Web in particular. Certainly, one cannot expect real progress if it is simply the digital replacement of conventional channels such as newspaper ads, TV commercials, phones, and fax [Ho, 1996a].

Since Web-based business models are still in the nascent stage, there are no obvious criteria to evaluate the effectiveness of commercial Web sites. Indeed, the earliest attempts are in the purely subjective form of individual preferences, which are themselves recorded as pages of "Cool Links," "Top Lists," and ""Hot Sites" (e.g. [USA Today, 1996, June 11].) More organized efforts have since appeared as Web reviews [The Web Magazine, 1997] or popularity polls [IntelliQuest Technology Panel, 1997]. Academic studies are still scarce, with the few examples covering either generic functions of commercial sites [Hoffman, Novak, and Chatterjee, 1995], or applications in specific industries (e.g. hotels [Murphy, Forrest, Wotring, and Brymer, 1996], and art galleries [Smith and McLaughlin, 1996]).

This paper proposes a general framework to evaluate Web sites from a customer's perspective of value added. A global study of commercial sites, conducted in May through September, provides a snapshot of the development of this new medium for business in 1996. First, representative samples in North America (US and Canada) from 40 industries, totaling 1000 sites, are evaluated. The results are presented and discussed by industry. Next, 8 other localities worldwide are considered: Australia, France, Germany, Hong Kong, Italy, Singapore, Taiwan, and United Kingdom. A sample of 100 sites from 20 industries is studied for each locality. Comparative results are presented in three groupings. Interpretation of the aggregate sample is then given, concluding with implications and suggestions of future directions of this approach to evaluation.

A Framework for Evaluation

The business purposes of a commercial Web site are classified into three categories:

I.   Promotion of product and services
II.  Provision of data and information
III. Processing of business transactions

Four types of value creation are identified:

1.   Timely
2.   Custom
3.   Logistic
4.   Sensational

This framework is illustrated as the three by four matrix below.

Value\Purpose Promotion Provision Processing
Timely ? ? ?
Custom ? ? ?
Logistic ? ? ?
Sensational ? ? ?

Typical examples of Web site features or functions that fit each of the purpose-value combination are listed as follows:
Timely Value in Promotion:
items on sale; special offers; product announcements
Custom Value in Promotion:
product/service database search; customized product/service report
Logistic Value in Promotion:
rates and fare quotes; facilities locator
Sensational Value in Promotion:
contests, sweepstakes, giveaways; outstanding Web design
Timely Value in Provision:
stock quotes; employment opportunities; press releases
Custom Value in Provision:
general database search; customized news report
Logistic Value in Provision:
financial reports; research data; comparative, benchmark, and survey results
Sensational Value in Provision:
freeware; games; puzzles; downloadable multimedia
Timely Value in Processing:
on-line auctions; interactive brokering
Custom Value in Processing
custom orders; interactive consulting
Logistic Value in Processing
on-line customer service; delivery or job status tracking
Sensational Value in Processing
"surprise" discounts and bonuses; instant winners

The list is by no means exhaustive and definitive. While covering all the major functions in current practice, it will most certainly expand as innovative features are realized to take full advantage of the Web. To appreciate the usefulness of this classification scheme, let us examine briefly how it is derived. Starting with a set of conceptual guidelines, numerous cases were considered that led to an iterative process of refinement.

Consider first the distinction among the purposes. Promotion is specific to the products and services that a business offers to customers. Provision pertains to the supply of information to gain good will, exposure, credibility, or to expedite communication. For an oil company, information on its gasolines and fleet fueling services is promotional; whereas data on explorations and reserves, financial reports for investors, and its environmental polices are provisional. Similarly, new product announcements are promotional; job postings are provisional. Processing refers to those business transactions that are beyond the generation of sales leads by promotion. Requesting a catalog is promotional; on-line ordering is processing.

The kinds of value created by any given feature of a Web site may not be obvious. Our model with the four categories: timely, custom, logistic, and sensational, is distilled from extensive empirical observations. Timely value applies to time-sensitive information, and not to the speed of its delivery. Quarterly earnings as a news item is timely, but not as part of an archived financial report, even when the latter can be downloaded at the click of a mouse. While timely value can be serendipitous, both custom and logistic values arise from specific intent on the part of the visitor to a Web site.

Custom value is predicated on predisposed preferences of the visitor. Searching a database of real estate listings based on preferred price range, location, size and style of home, creates custom value. The indicated preferences are assumed to be meaningful beyond the context of one particular query. In contrast, logistic value is predicated on preprogrammed propositions on the Web site. Quoting the rate for shipping a 2 lb. package to a certain address creates logistic value. The weight and distance parameters are only incidental to the actual query. In other words, the proceedings of a custom value-adding feature generate a profile of the visitor while the proceedings of a logistic value-adding feature generate a profile of the business of the Web site.

Sensational value in general is totally subjective. The fact that any Web page can show up on the screen at all can be a thrill to the first time surfer, as can any variety of fancy graphics. To keep the evaluation manageable, we judge against the current level of expectation for a frequent visitor to the Web.

It should be remarked that for the present purpose, we are taking a customer's perspective, and credit value-adding features accordingly. Value created for the business, for example, in terms of demographic data for market analysis, is not taken into account explicitly. Asking a visitor to sign a guest book is of value to the business, but not to the visitor. However, if signing the guest book enters one in the drawing for a free gift, then we count it as having sensational value.

For a single page showcase of current examples, visit the Web site "Dr. Ho's Way of the Web" [Ho, 1996b].

Industries in the Study of 1000 North American Sites

25 Web sites were selected from each of the following 40 industries:

Accounting, Advertising, Aerospace, Airline, Apparel, Automobile, Banks, Beverage, Brokerage, Chemicals, Computers, Construction(Materials), Construction(Services), Cosmetics, Data Services, Electronics, Food, Furniture, Healthcare, Hotel/Resorts, Insurance, Internet Services, Jewelry, Newspaper/Magazines, Mining/Exploration, Movie/TV, Music, Office Supplies, Oil and Gas, Paper Products, Pharmaceuticals, Publishing, Real Estate, Software, Sports, Telecommunication, Textile, Travel, Trucking/Shipping, Wine/Spirits.

The list of industries originated from one commonly used in the business literature. Modifications were made according to an initial survey of activities on the world wide Web. Categories were subdivided, regrouped, or renamed to reflect more accurately the current constituencies of commercial Web sites. For the selection of sites within an industry, queries were made using popular search engines such as Yahoo and AltaVista. From such a collection of listings, a stratified random sample of 25 sites based in the US and Canada was then generated. Essentially, care was taken to ensure that well-known businesses, which tend to have larger and more complex Web sites, were not disproportionately represented.

Results and Observations by Industry

Each site was explored in sufficient detail so that all its value-adding features were identified and classified using the above framework. The percentage of sites having features in each purpose-value category was recorded. In the following, we tabulate the results for each industry and give a brief account of both common and special features of its sites. Since we are dealing with a sample, and the details of Web sites can be changed rapidly, we choose not to refer to any specific sites or companies by name.

Accounting:


Value\Purpose Promotion Provision Processing
Timely 0 68 0
Custom 12 12 4
Logistic 100 60 24
Sensational 20 12 0

Every site advertises its services. Some have products such as books. Sensational promotion is in the form of free trials, demo software, and video clips. Timely provision is mainly employment opportunities and seminar schedules. Logistic provision includes tax tips and tax rule updates. Accounting jokes and quiz are examples of sensational provision. A few sites provide database searches. One offers on-line tax service.

Advertising:


Value\Purpose Promotion Provision Processing
Timely 8 8 0
Custom 0 4 0
Logistic 100 8 4
Sensational 12 28 0

Our sample includes traditional advertising agencies, and a new wave of on-line marketers, in particular a number of coupon distributors. While the agencies promote their services, usually with samples of their work, the coupon sites offer discount coupons for products of their clients. The visitor prints the coupons of choice to be redeemed in stores. Compared to conventional print media, this use of Web sites should be cost effective for the client companies. To the customers, the sensational value remains the same.

Aerospace:


Value\Purpose Promotion Provision Processing
Timely 12 48 0
Custom 0 0 0
Logistic 100 60 4
Sensational 4 28 0

The companies range from large aircraft manufacturers to small space system contractors. While every site provides information about products and services, one can hardly expect customers to order rocket boosters through a Web page. This accounts for the sparsity of the processing column. However, the potential of business to business transaction is there, with two large sites providing procurement terms, EDI standards, and maintenance manuals for its partners. As sensational provision, several sites offer multi-media material on space exploration. Many of the smaller sites are hosted by a few internet hosts for the industry.

Airlines:


Value\Purpose Promotion Provision Processing
Timely 24 40 4
Custom 32 4 0
Logistic 100 40 28
Sensational 20 8 4

The sample includes major carriers, regional and discount fare airlines, executive and tour charters, and helicopter services. Special fares, database searches for flight schedule and fare quotes, contests for trips and bonus miles appear in the promotion column. News, travel tips, job openings, financial data for the larger companies, and games are provisional. Processing covers on-line reservations and enrollment in special programs. Since passenger space on scheduled flights is essentially a perishable commodity, the prospect of dynamic pricing and real-time auctioning is quite plausible. Indeed, a very limited version, in the form of a silent auction of specific flight packages, is being offered by one site in our sample. There is also one example of "surprise" bonuses to frequent customers.

Apparel/Fashion:


Value\Purpose Promotion Provision Processing
Timely 32 24 0
Custom 16 12 0
Logistic 96 32 32
Sensational 36 8 0

A large variety of specialty products, including designer brands, bridal fashion, custom-tailored shirts, children's clothing, formal wear, shoes, and pantyhose, are represented. This is one industry enjoying great success in mail orders and TV home shopping. Its relatively low level in on-line processing may come as a surprise. However, this may be explained by the fact that there is still no significant overlap between the traditional TV audience and the new wave of Web-savvy consumers.

Automobile:


Value\Purpose Promotion Provision Processing
Timely 60 48 4
Custom 16 0 4
Logistic 100 68 24
Sensational 24 24 0

Included are manufacturers, dealer networks, and parts suppliers. The quantity and quality of both promotional and provisional information are high. These Web sites are portents of "cutting out the middleman." Yet, virtual test-drives are still far from the real thing. On-line search and interactive bidding for used cars, as well as custom order of new ones are promising innovative uses of the Web. With sports sponsorship and a lifestyle orientation, these pages are foundations to build a cult following.

Banking:


Value\Purpose Promotion Provision Processing
Timely 24 20 0
Custom 8 8 4
Logistic 100 72 16
Sensational 8 8 0

Home banking never quite caught on since it was introduced over two decades ago. If it will have a second chance, the Web may be it. There is ample evidence of efforts by banking institutions large and small to begin distributing services on-line. This is one industry where not all the players are taking the same approach, as it involves a total vision of customer service in the information age, and not just putting up Web pages. The opportunity to create value in provision and processing is substantial here.

Beverage:


Value\Purpose Promotion Provision Processing
Timely 12 16 0
Custom 0 0 0
Logistic 96 44 32
Sensational 52 32 0

This covers soft drinks, beer, and bottled water. While some sites offer jazzy graphics, the common theme is basically low-tech advertising and marketing gimmicks. Sensational value by way of contests, sweepstakes, free samples, discount coupons, introductory and trial offers, games (e.g., an on-line slot machine), and cartoon archive is the norm. For the larger companies, on-line processing may refer only to the ordering of souvenir or gift items, and registration for membership which is required for full access to the Web site.

Brokerage:


Value\Purpose Promotion Provision Processing
Timely 12 20 12
Custom 0 4 0
Logistic 92 28 20
Sensational 20 0 4

The sample ranges from sites with one-page ads to those supporting full-fledged on-line trading of stocks and securities. In any case, the relatively scanty provisional value created at the Web sites is clear indication that it will take substantially more work to truly empower the investor in cyberspace. Processing can mean very diverse activities, from subscribing to investment guides, sending resumes on-line, opening an account, downloading software package for brokers, to actual trading. Sensational value is in the form of free trials, discounts, and software demos.

Chemicals:


Value\Purpose Promotion Provision Processing
Timely 56 20 0
Custom 20 0 0
Logistic 100 56 4
Sensational 0 8 0

Ranging from multinationals to small suppliers, the Web sites in our sample project a definite "we are here too" profile. Apart from one distributor who accepts on-line ordering, there is no other entry in the processing column. Provision falls mainly into career opportunities, issues on environmental responsibility, and financial data for investors. Still, it is not totally cut and dried. There are two cases of jokes and humor for sensational appeal. This is another industry where business to business transactions over the Web have great potential.

Computers:


Value\Purpose Promotion Provision Processing
Timely 96 88 0
Custom 72 20 0
Logistic 100 88 52
Sensational 44 12 0

Manufacturers of microprocessors, computer systems, and hardware peripherals make up this list. Knowing that the Web is their backyard, one would expect these sites to lead the way. Indeed, the density of features and complexity of the content are high. Searchable databases, user chat groups, and choice of languages do boost custom value. Yet, after all is said and done, the marketing pitches seem to be universal, whether the products are computers, cars, or colas. The commonality lies in the purpose of the medium, not the nature of the industry.

Construction(Materials):


Value\Purpose Promotion Provision Processing
Timely 20 16 0
Custom 0 4 0
Logistic 100 52 8
Sensational 16 0 0

While low in processing features (only two sites offer on-line shopping), this industry produces remarkably sensible and useful Web sites. Provisional contents include construction ideas and tips, tutorial on materials, industry trends and resources, and community services. Sites for retail chains provide store locators by state or zip code. On-line catalogs are concise and illustrated with nice graphics, including color samples in some cases. Sensational appeal ranges from an "identify this object" game to a sweepstakes for a round-the-world trip for two.

Construction(Services):


Value\Purpose Promotion Provision Processing
Timely 12 8 0
Custom 4 4 0
Logistic 96 48 12
Sensational 20 0 0

Our sample includes architects, builders, contractors, inspectors, plumbing and roofing services. These are relatively small Web sites exhibiting portfolios of designs and projects. Pictorial essays documenting entire projects, complete with comments from the clients, are particularly effective. The two instances of custom value involve searchable databases, one of products, and the other for home repair and maintenance. Limited on-line processing includes free estimates available to a specific locale.

Cosmetics:


Value\Purpose Promotion Provision Processing
Timely 28 20 0
Custom 0 0 0
Logistic 96 42 8
Sensational 28 8 4

This high gloss industry is not quite high tech as yet. We found mainly transplanted advertising copy promoting products or business and career opportunities. Toll-free numbers predominate. One site requires order forms to be printed and then sent by mail. Another features special sale prices on a page that has not been updated for nine months. Provision includes skin care consulting, color analysis, and poetry. One beauty of sensational processing: the first on-line order each day is free.

Data Services:


Value\Purpose Promotion Provision Processing
Timely 4 44 0
Custom 4 0 0
Logistic 100 48 12
Sensational 0 0 0

Data processing, direct marketing, mass mailing, turnkey systems, EDI specialists, healthcare information management, seismic data, educational data, market research, credit card processing, and vehicle registration databases span a wide spectrum of products and services in this category. Most sites are small and concise. Many post job openings, and provide technical information. On-line submission of resume and service tracking are the few instances of processing.

Electronics:


on the wall: do
Value\Purpose Promotion Provision Processing
Timely 60 16 0
Custom 16 0 0
Logistic100 12 8
Sensational 24 12 0

Consumer electronics, audio-video equipment, and home automation are covered. The sites sampled are almost exclusively manufacturers and national chain stores, which may explain the emphasis on product promotion with little or no transaction processing. Except for an occasional product database search, other promotional features (news on technology, products and features, special offers, store locators, contests, sweepstakes and giveaways) are conventional. The message here seems to be: browse our site but rush to the store.

Food:


Value\Purpose Promotion Provision Processing
Timely 40 36 4
Custom 8 4 0
Logistic 92 88 32
Sensational 36 16 0

The companies range from food manufacturing conglomerates, premium ice cream, chocolate, fast food, deli and caterer, to gourmet specialties. Although the majority are household names, most Web sites are surprisingly small (and uncluttered). In fact, two of the sites are mere listings in a hosting service. Yet perhaps because of the name recognition, they were both accorded an entire "category" status by a major search engine. The promotional approach is in most cases a transplant from the conventional advertising media of TV, newspaper, and magazines. Provisional value is primarily in the form of recipes for consumers, and financial data for investors. Processing includes on-line shopping and application for a franchise operation. One innovative instance of timely processing is a gift reminder service.

Furniture:


Value\Purpose Promotion Provision Processing
Timely 8 4 0
Custom 4 0 0
Logistic 100 40 28
Sensational 20 4 4

The sample covers manufacturers, distributors, as well as retailers. Its profile is one of heavy emphasis on promotion of stable product lines. Despite the on-line catalogs, many of the sites encourage the visitor to order the printed catalog by e-mail. Provisional information includes what to look for when buying furniture, and decorating tips. An example of sensational processing is free personalized inscriptions for on-line orders.

Healthcare:


Value\Purpose Promotion Provision Processing
Timely 28 56 0
Custom 48 4 4
Logistic 100 80 8
Sensational 20 8 0

We found hospitals, HMOs, dental practice, suppliers, as well as a site on telemedicine in our sample. Half the sites have searchable databases, calendar of events, programs and seminars to promote their services. Provisional information is mainly generic in nature, including survey results, research findings, tutorials, and even financial reports for investors. What is noticeably absent is timely, custom, and logistic provision regarding quality of care and patient education. The Web could be an excellent conduit for this purpose.

Hotel/Resorts:


Value\Purpose Promotion Provision Processing
Timely 28 24 0
Custom 0 0 0
Logistic 96 24 32
Sensational 16 0 0

Luxury hotels, motel chains, destination resorts, and casinos are represented. With the advertising budgets of some of the well-known companies, it is somewhat surprising to find these pages to be little more than modest travel brochures. Apart from travel tips and destination guides, provisional value is rather scanty. Even sensational value falls short of expectation, with only a few contests, and free drawings. On-line reservation and availability checking are emerging and may hold the key to future development.

Insurance:


Value\Purpose Promotion Provision Processing
Timely 0 24 0
Custom 4 4 0
Logistic 100 40 0
Sensational 8 16 0

Based on our sample, the insurance industry appears to be void of on-line processing on its Web sites. While on-line rate quotes are available on a few sites, such features are classified under logistic-promotion. Provisional value is mainly from financial data with two exceptions. One site provides information for prospective independent agents. Another offers health tips as well as a comprehensive database of doctors and hospitals searchable by zip code and health plan. Otherwise, it seems that this industry still conducts business as usual.

Internet Services:


Value\Purpose Promotion Provision Processing
Timely 48 36 0
Custom 40 0 0
Logistic 100 16 60
Sensational 8 16 0

These are providers of on-line services (content), network access (on-ramps), and Web sites (design and maintenance). Major players as well as upstarts are represented. Site news and job postings make up the timely components. Services and fees are advertised without much ado. There is little provisional information apart from occasional survey results and tutorials on business and the Internet. All site providers have search functions to promote their clients. On-line sign-up and downloading of connection software constitute the bulk of actual processing.

Jewelry:


Value\Purpose Promotion Provision Processing
Timely 24 4 0
Custom 4 0 0
Logistic 92 44 20
Sensational 36 4 0

Current Web sites in this category are mostly non-chain retailers offering original and custom designs in silver, gold, precious stones, metal, and diamonds. Watch makers and distributors are also represented. The majority are simple ad pages listing toll-free numbers for ordering. Promotional value include monthly features, limited time offers, graduation gifts, and listing of products with pictures. Provisional information is in the form of of explanation of gem grading systems, and how to avoid mistakes in jewelry purchases.

Mining/Exploration:


Value\Purpose Promotion Provision Processing
Timely 56 12 4
Custom 0 0 0
Logistic 64 72 8
Sensational 0 0 0

This category is populated predominantly by companies owning mining rights and operating explorations, although manufacturers of equipment, hardware and software also appeared in the sample. Many are listed with a commercial host site for the industry. Even for those with end products, the target audience here is clearly the investor. Financial reports are the norm. Timely value is from press releases. A few listed employment opportunities. One unusual feature is an on-line auction of gold nuggets and lodes. The absence of custom or sensational features is notable.

Movie/TV:


Value\Purpose Promotion Provision Processing
Timely 96 76 0
Custom 60 4 4
Logistic 100 88 16
Sensational 88 72 0

This category includes major movie studios, network television, cable channels, and video rental. These are very effective Web sites, promoting what is new by all the tricks of the entertainment trade. Previews, games, contests, sweepstakes, and trivia quizzes abound. Some theme channels provide topical libraries. One may speculate that WWW will divert the attention of movie and TV audiences. The industry seems confident that it can exploit the competition to its own advantage.

Music:


Value\Purpose Promotion Provision Processing
Timely 84 32 0
Custom 32 0 8
Logistic 100 60 32
Sensational 68 12 0

Our sample includes recording studios, distributors of CDs and tapes, musical instrument makers, musicians (classical and rock), and a music festival. Unlike movies and TV , which are promoted as media, music is promoted more nearly as merchandise in the form of CDs and tapes. Hence the higher incidence of logistic processing in the form of on-line shopping. Contests (including one song-writing competition), and sound clips make up the bulk of sensational attractions.

Newspaper/Magazines:


Value\Purpose Promotion Provision Processing
Timely 36 88 4
Custom 36 20 8
Logistic 76 88 56
Sensational 36 24 0

It is not surprising that the traditional print media became natural migrants to cyberspace. The new bandwidth and interactivity provide fertile middle ground between print and air waves. Note that the products and services in this industry are primarily in advertising. If the Web proves to be more effective and popular in broadcasting provisional content, tremendous growth can be expected. Within our evaluation framework, custom value will be the major indicator in tracking progress in this regard.

Office Supplies:


Value\Purpose Promotion Provision Processing
Timely 20 8 0
Custom 16 4 0
Logistic 100 28 20
Sensational 12 4 0

Manufacturers and suppliers of office furniture, time clocks, copiers, fax machines and bar code systems make up the sample. Typically, the smaller companies list their products and toll-free numbers; the larger ones provide searchable catalogs. Special offers and job listings are timely. Provisional content is low. Processing is limited to on-line customer service by one large manufacturer, and on-line ordering by two large suppliers. A few contests, and one downloadable time calculator add a touch of sensational value.

Oil and Gas:


Value\Purpose Promotion Provision Processing
Timely 24 44 0
Custom 0 8 0
Logistic 60 72 16
Sensational 8 8 0

For anyone pondering the commercial value of a Web site, the sample from this industry can serve as intriguing case studies. The major companies have sleek, professionally designed pages promoting their product and services, providing financial data, exhibiting cultural and sport sponsorship, Yet, one wonders if they actually expect to sell more gasoline or stocks this way. Much of the processing involves on-line ordering of "collectible" items, hardly a mainstay of the business. By contrast, the promotion of fleet card fueling systems, and home heating oil delivery plans by the less elaborate sites may actually be more effective.

Paper:


Value\Purpose Promotion Provision Processing
Timely 28 8 0
Custom 0 0 0
Logistic 100 44 20
Sensational 16 4 0

Manufacturers of paper and related products, paper-making machinery, suppliers and distributors are represented. The sites demonstrate the richness of specialty and niche markets in this sector: from handmade paper to tree-free products. As provisional value, the large companies showcase their environmental consciousness with information on forest management, ecological codes, and customer training programs. One site takes the sensational approach to such provision in the form of a game that put the visitor in charge of the company.

Pharmaceutical:


Value\Purpose Promotion Provision Processing
Timely 24 48 0
Custom 24 4 0
Logistic 100 48 16
Sensational 8 8 0

The sites range from multinational manufacturers, specialized laboratories, suppliers and distributors, to pharmacies. New product announcements, research news, and job opportunities give timely value. Logistic provision is almost exclusively financial reports for investors. The larger sites have searchable features. Apart from on-line ordering for a few suppliers, there is little processing on the Web sites. Discounts, games, video clips are the occasional touches of sensational attraction.

Publishing:


Value\Purpose Promotion Provision Processing
Timely 40 40 0
Custom 8 12 0
Logistic 96 40 44
Sensational 32 20 0

Our sample covers many of the established publishers as well as some smaller and specialty presses. Timely value is from new releases, exhibition events and schedules, special features, award updates, and employment opportunities. Custom value is from searchable catalogs, a directory of bookstores in the US, and a database of lawyers in Canada. Contests, giveaways, demo software, a love quiz, a virtual field trip, a trivia treasure hunt, and free admission to a multi-media convention are the sensational attractions. On-line ordering is offered by several sites.

Real Estate:


Value\Purpose Promotion Provision Processing
Timely 28 20 0
Custom 20 4 16
Logistic 92 56 28
Sensational 4 0 0

The list includes national franchises, regional and local companies. As timely value, some provide news on recent transactions, and public service announcements. Database searches of listings are available on larger sites. Matching buyer preferences to referrals can expedite processing. As nascent features, the potential for custom value is tremendous, although it is obvious that the databases in most cases are incomplete. This may affect credibility with serious users. Smaller sites post bio-sketches of agents, giving an personal feeling to building customer relations.

Software:


Value\Purpose Promotion Provision Processing
Timely 92 80 0
Custom 64 4 0
Logistic 100 44 44
Sensational 72 8 0

The sample covers developers and distributors. By nature of the industry, timely promotion of new products and upgrades is high priority. Timely provision is mostly job opportunities, making it easy to know who is hiring. The majority have searchable sites or product libraries. Logistic provision is in the form of financial reports or information on business partners. On-line ordering and downloading of upgrades is leading the way to on-line delivery of purchases. Most have free demos, or free trials. A few run contests, or give away freeware such as screen savers.

Sports:


Value\Purpose Promotion Provision Processing
Timely 32 32 0
Custom 12 8 0
Logistic 96 84 20
Sensational 32 16 0

We sampled from lists of major league team sports, athletic clubs, player associations, training camps, and sport clinics. Sporting goods manufacturers and suppliers are not included. In this industry the line between promotion and provision is rather fine. Creating value to attract more participants or fans is certainly promotion, but is one actually selling the sport? In any case, once there is a following, even pictures of star athletes may be considered as sensational values on these sites.

Telecommunication:


Value\Purpose Promotion Provision Processing
Timely 24 64 0
Custom 28 24 4
Logistic 92 56 32
Sensational 36 12 0

Telecom giants, networking product suppliers, phone center outsourcers, answering services, and system installers are represented. As major players in the high growth arena of converging information technologies, these companies, especially the large ones, are busy showcasing their ware. Ironically, as each site becomes more elaborate, it is harder for the customers to differentiate and make well-informed choices.

Textiles:


Value\Purpose Promotion Provision Processing
Timely 20 8 0
Custom 0 4 0
Logistic 100 36 12
Sensational 4 0 0

Fabric manufacturers, designers, developers, specialty suppliers (felt, trail blankets, tents, nets, car mats), surplus exchange clearinghouses, and custom services are found in the sample. Most are small sites with no-frills ads for their products. The majority may be intended for business to business contacts, although there is little evidence of efforts in this regard. One site with a counter registered 545 visits in five months. The clearinghouse, which charges a membership fee, draws more traffic (over 23,000 visits in five months).

Travel:


Value\Purpose Promotion Provision Processing
Timely 72 16 12
Custom 36 12 0
Logistic 100 76 40
Sensational 36 8 0

This covers the package tour and cruise businesses, as well as travel agencies. In general, there is more content and information than found in the related category of hotels and resorts. Especially for luxury cruises, a projected oversupply of capacity is expected to heat up competition. Attracting customers over the Web has obvious potential. Its success will depend on innovative features in timely and custom processing, including interactive consultation and on-line selection and confirmation of custom options.

Trucking/Shipping:


Value\Purpose Promotion Provision Processing
Timely 48 36 0
Custom 0 0 0
Logistic 96 40 32
Sensational 0 8 0

Express couriers, transportation and freight services, specialty delivery (produce, flowers), and overseas container lines are represented. Overall, there is a tone of "Do you want us to talk, or do you want us to get going?" The package tracking feature pioneered by this industry is the prime example of logistic processing value. It shows the potential of letting customers tap into business data through the Web.

Wine/Spirits:


Value\Purpose Promotion Provision Processing
Timely 20 24 4
Custom 4 8 0
Logistic 88 48 36
Sensational 16 12 4

The sample includes vineyards and wineries, distributors and merchants, a wine society, and a "shopping agent." The producers tend to be more informative, providing tasting notes, information about wine-making traditions and techniques, and complementary foods to serve with wine. The merchants focus more on logistic promotion, essentially using on-line catalogs. The shopping agent is innovative. It publishes best prices actually offered by retailers on selected wines. However, only paying members have passwords to reveal the identity of the retailers.

Aggregate Results for the Study of 1000 North American Sites

The percentage of commercial Web sites in the entire sample of 1000 with features in each purpose-value combination is presented in the following table.

Value\Purpose Promotion Provision Processing
Timely 35 33 1
Custom 16 5 2
Logistic 95 53 24
Sensational 24 12 1

Industries in the Comparative Studies

For the global study, which includes eight additional localities worldwide, commercial Web sites were selected from each of the following 20 industries:

Advertising(ADVT), Aviation(AVIA), Apparel/Fashion(APPA), Banking(BANK),
Computers(COMP), Construction(CONS), Healthcare(HEAL), Hotel/Resorts(HOTL),
Insurance(INSU), Internet Services(INET), Jewelry(JLRY), Manufacturing(MANF),
Movie/TV/Radio(MOTV), Newspaper/Magazines(NEWZ), Publishing(PUBL),
Real Estate(REAL), Software(SOFT), Sports(SPRT), Travel(TRVL), Wine/Beverage(WINE)

As the pace of development of Web sites in the places under study varies, the industries were chosen to ensure adequate coverage. For the selection of sites within an industry, queries were made using popular search engines such as Yahoo and AltaVista. Extensive listings of individual sites as well as directories were collected. For Australia (AU), France (FR), Germany (DE), Hong Kong (HK), Italy (IT), Singapore (SG), Taiwan (TW), and United Kingdom (UK), a sample of 5 sites was selected from each industry. This gave a total of 100 sites for each of these places. For USA (US), where the population of sites is much larger, a sample of 25 sites was used for 18 of the 20 industries. The USA sample for Manufacturing had 100 sites, being the aggregate of 25 sites each from automobile, chemicals, furniture, and paper. The USA sample for construction had 50 sites, being the aggregate of 25 sites each from construction services, and construction materials. This gave a total of 600 sites for USA, and a grand total of 1400 sites for the comparative study.

All Australian, UK, and US sites were in English. Among the French sites, 25 had English versions, 3 were in English only, and 3 offered other options beside English and French. For Germany, 15 had English versions, 4 in English only, and 3 in multiple languages. For Italy, 30 had English versions, 17 in English only, and 7 in multiple languages. For Hong Kong, most sites were in English, some were bilingual (English and Chinese), and a few exclusively Chinese. Most sites in Singapore were primarily in English, many with Chinese headings and keywords, and a few multilingual (English, Chinese, and Malay.) For Taiwan, most sites were in Chinese, with only a few providing English versions. Except for the English-only sites, all Web pages were studied in their native language.

A Ranking of the Industries

Each site was explored in sufficient detail so that all its value-adding features were identified and classified using the above framework. The percentage of sites having features in each purpose-value category was recorded. The data for USA was obtained in May 1996, as part of the study of 1000 North American sites. All evaluations were conducted in June 1996 for Australia, France, and Hong Kong; June and July 1996 for UK and Italy; and August and September 1996 for Germany.

In order to shed some light on the relative development of commercial Web sites by industry and by locality, we use a crude measure of the "breadth" in their value-adding features. Denoted as the ß (beta) index, this measure is simply the number of purpose-value categories covered by a Web site. Since there are 12 categories (3 purposes by 4 values), the maximum ß is 12. Note that multiple features in the same category are not accounted for. There is also no attempt to evaluate the effectiveness of a feature, or to weigh the relative significance of the different categories. For this reason, the ß index is only a structural indicator of the breadth, rather than depth, of coverage. Nonetheless, until more complex evaluation models can be constructed, this measure does provide an interesting perspective for a comparative study. The sample averages by industry and by locality are summarized in Figures 1 - 3 in three groupings for i) World Group [US, AU, FR, HK], ii) Asia-Pacific Group [AU, TW, SG, HK], and iii) Euro Group [DE, FR, IT, UK], respectively.

For the 20 industries, the averages for the ß index are US=3.32, AU=2.51, FR=2.40, UK=2.40, DE=2.37, TW=2.22, SG=2.22, HK=1.92, and IT=1.81. Let us use these to indicate the relative development of commercial Web sites in these localities in mid-1996. Since the sample size of 5 per industry outside of the US was small, we can only make some generic observations. First it should be remarked that the latest Web technology is available and is being applied in all localities, though the average level of sophistication varies significantly. In the US, Web page layout has by and large evolved beyond rudimentary HTML standards to precise color and font controls, tables and frames. By contrast, the use of blinking items is still rather prevalent outside of the US, especially in France. The use of audio and video clips as well as interactive animation is emerging at comparable rates at all localities. This is likely due to the universal availability of software (often as free downloads) from various major developers.

Referring to the grouping in Figure 1, certain industries can be identified as being "on cue" across the localities. This means their relative standings follow the interlocality trend. Examples are Computers, Software, Newspaper/Magazines, Sports, Apparel/Fashion, and Jewelry. Advances in Web application in these industries can be expected to follow the US lead in the foreseeable future.

Industries that exhibit a level pattern across the localities are considered to be "on par". Examples are Hotels, Advertising, and Insurance. Typically, their ß indices are low. Either because of the nature of the business or entrenched mindsets, truly innovative exploitation of the Web has yet to come for these industries. As they are technologically behind the curve, there is ample room for advances. Good ideas may arise from any locality, most likely one where competition is keenest.

Beside the two clear-cut patterns, there are many variations that reveal a cultural factor. For instance, Movie/TV/Radio/Video, Manufacturing, and Real Estate are almost "on cue," except that they are unexpectedly low in Australia. So too is Publishing except for the lag in the US. Banking and Internet Services are "on par" with France lagging. For aviation, with only a small number of US airlines as innovative leaders, the rest of the industry, especially outside of the US is "on par." The situation is similar with Healthcare. Construction is "on par" with Hong Kong trailing. Both Australia and France lag in Travel.

The case of Wine/Beverage illustrates a typical difficulty with sampling. While the top US sites here were actually way ahead of Australia's, enough others were no more than 1-page ads to drag down the average. Australia, with fewer but generally well-developed sites, came out with a significantly higher average. With this in mind, we next consider the aggregate sample over 20 industries for each locality, which should provide a more accurate picture of commercial Web sites in general.

Aggregate Results for the Comparative Study

The percentages of commercial Web sites in the aggregate sample over 20 industries with features in each purpose-value combination are presented in Figures 4 - 6 in three groupings for the World Group [US, AU, FR, HK], Asia-Pacific Group [AU, TW, SG, HK], and Euro Group [DE, FR, IT, UK], respectively.

As a snapshot of how businesses are making use of WWW technology on the Internet as of mid-1996, the results are revealing. Although the US is ahead in most categories, the patterns across all localities are quite consistent. To the customers, the values of the sites are primarily promotional. And the marketing approach taken is by and large conventional: product news, catalogs and portfolios, previews and samples, special offers and discounts, contests and sweepstakes. There is one crucial difference though. Instead of an "in-your-face" deluge of TV commercials and junk mail advertising, the consumers have better control over what they are exposed to. This "Don't call us, we'll call you" mindset can change the rules of the game in marketing substantially.

As to provisional content, not only is the level significantly lower than for promotion, but the bulk of it is in the form of financial data, quarterly earnings, and annual reports from larger, publicly traded companies. Such pages offer little to potential customers of the services and products, and the usefulness to prospective investors may be at best perfunctory. Yet, as a repository and channel of dissemination of such literature, the Web can at least reduce the use of paper.

Use of the Web to process business transactions is largely undeveloped. On-line ordering, with or without secured payment, is in most cases only a slight extension of electronic mail. The few innovative examples include delivery tracking in the trucking/shipping industry, various components of home banking, and on-line auctions by airlines. Business to business transaction is unexplored territory, except for rudimentary provision of EDI protocols and procurement terms. From our observation, the processing column is where competitive advantages will arise.

Across localities, it will be of interest to track the relative standings over time. Which industries that are currently "on cue" will stay that way, and which ones will tend to become "on par"? When will those that are "on par" take a quantum leap in innovation? Can local cultural and market conditions help predict when and where such advances will occur?

Our results represent only a first step in the meaningful evaluation of business uses of WWW. First, we focus on value to the customer on the assumption that higher value makes a Web site more attractive. We do not assign ratings for comparative values. Features are simply classified by their primary function into one of the twelve purpose-value categories. Obviously, for compatible sites, say, from the same industry, it is possible to compare how well they do in the same category. Rating scales, e.g., from none, low, medium, to high can be devised to evaluate the features. Also, we do not add up contributions from multiple features. A site may have many entries contributing to one category. More quantitative evaluations will certainly take this into consideration.

Along this line, our framework can be used to develop more elaborate models of evaluation [Bloch, Pigneur, and Segev, 1996]. Starting from comparative ratings of features, models of effectiveness of a Web site in terms of the traffic it generates can be formulated as functions of the purpose-value categories. Subsequently, models of how site traffic relates to other business performance measures can be attempted. For the moment, we do have a picture of how things look in this rapidly changing environment.

Acknowledgments

An earlier version of a portion of this paper was published in the Proceedings of the 5th International Conference on Telecommunication Systems, American Telecommunication Systems Management Association, pp. 304-317(1997).

The research assistants for this project were Tatjana Sinkovic, Michael Chen, Amy Nelson, Sylvia Michalski, and Norbert Spinner. A team of eight graduate students in a Spring '96 course in information management participated in a preliminary phase of the work and contributed to the refinement of the evaluation procedure.

References

About the Author

James K. Ho is Professor of Information and Decision Sciences at the University of Illinois at Chicago, where he also serves as Director of Applied Research and Consulting Services in the College of Business Administration. He did his undergraduate work at Columbia University and obtained his Ph.D from Stanford University. Based on his recent book, Prosperity in the Information Age: Creating Value with Technology -- from Mailrooms to Boardrooms (1994), he conducts executive seminars worldwide on "Competing in the Information Age: Maximizing the Payoff from Technology," and "Internet Strategies: Beyond Web Sites and Home Pages."
Address: Prof. James K. Ho, m/c 294, 601 South Morgan, Chicago, IL 60607, USA.