March 26, 2002, 12:00 AM

Consumers` Internet confidence slips but stays high, says Yahoo/Nielsen

Driven by less confidence in fulfillment of online orders, the Internet Confidence Index slipped four points in Q1 vs. Q4 of last year to 111.


Q4 fulfillment of online purchases may not have been as stellar as everyone believes, according to the latest Yahoo/ACNielsen Internet Confidence Index. The index, which Yahoo and Nielsen say measures confidence levels in Internet products and services, slipped four points in Q1 vs. Q4 of last year to 111.

“The Internet Confidence Index`s dip during this wave of the study was prompted in part by heavy Internet users who expressed less confidence with the fulfillment process for online orders, relating specifically to customer service and the delivery of goods during the holiday season,” the companies said in releasing the results. “Additionally, among all users, there was increased concern over the security of credit card information and level of trust with how personal information is being used. Nevertheless, consumers continue to acknowledge the convenience, availability of price comparisons and access to information offered by the Internet, especially among light Internet users.”

The index indicates, however, that more people intend to shop online during the second quarter of 2002. They are projected to spend $13.8 billion in the second quarter, slightly less than the index had projected for the first quarter.

The index now stands at 111, four points below where it stood in Q4. The baseline of 100 was established in June 2001. It stood at 105 in Q3 2001.

"We are seeing the progression and growth of what consumers expect from the Internet, especially during the holiday shopping period," said Jennifer Dulski, director of commerce marketing, Yahoo. "The more that people use the Internet to transact, the greater the possibility there is to have a negative experience at one point or another. This points to the need for businesses to address consumer concerns regarding delivery and customer service, as well as provide greater reassurance to shoppers about their Web site`s security in order to provide better experiences for their customers."

By region, the Northeast, which has traditionally led in Internet confidence, continued to lead with an index of 121, down four points from Q4. The Midwest index was 101, South, 108, West, 116. Men had greater confidence than women (118 vs. 104 among all users and 133 vs. 121 among Internet users).

The 25- to 34-year-old group had the highest confidence by age at 134. 35- to 44-year-olds had the next highest at 117, followed by 18- to 24-year-olds at 114 and 45 and above at 100.

The Internet Confidence Index is produced by ACNielsen for Yahoo Inc.


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