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ONLINE BUSINESS

Ethnic Web Sites Search for Niche Markets
 

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The Web has become increasingly saturatedwith new multi-ethnic sites ranging from basicinformation hubs to community-building arenas toe-commerce sites. It has been a natural evolution ofthe Web to target minorities. First there were searchengines and portals, now there are verticalportals.

The growth of such sites has been spurred by recentpredictions of an explosion in Internet access forminority groups. Forrester Research projects the number of African-American households online to grow by 74%this year, while it expects the number of Hispanic householdsto increase by 20% and white households by 28%. About 64% of Asian-American households are already online, the largest percentage of any group.

"This is the year people of color are going to arrive on the Net," says Larry Irving, CEO of UrbanMagic.com, an African-American portal scheduled to launch in April.

Before joining UrbanMagic.com, Irving was principal adviser to the White House on Internet issues and spearheaded "Falling through the Net," a series of Commerce Department reports that documented the widening disparity between the Net haves and have-nots. "You can't sell any more computers to white males," Irving told ICONOCAST. "The growth is in minority communities."

A number of recent studies suggest that the "digital divide" has as much, or more, to do with income as it does race. A study released in September 1999 by the Joint Center for Political and Economic Studies, a nonprofit Washington think tank, found that among those reporting household incomes of more than $90,000, Net usage was slightly higher for African-Americans than among the general population.

Education is also a key factor. The Joint Center study found that for the highest education levels, the distance between African-Americans and the general population is meaningful, but slight. For those with less than a high school education, however, the disparity is more than 2-to-1.

A strong market potential exists for vertical portals emphasizing content tailored to niche audiences. Ethnic site developers such as Benjamin Sun, CEO and president of Community Connect in New York, do see a risk with specialization: The tighter the focus of a site, themore the community component is lost, making it harder to connect with the audience.

"Specialization is important," Sun told ICONOCAST, "but thereare lifestyle interests that you have to key in on to personalize your offering."

Once our sights turn global, identifying ethnic Net usage and online spending becomes even more complex. According to a survey of StarMedia's Latin American users, almost 30% have purchased products online. This relatively high figure is due to the fact that current Internet usage is concentrated among very upscale households, which tend to buy a lot of goods abroad.

In 1998, about three-quarters of all money spent online by Latin American users went outside the region, primarily to U.S.-based companies. The IDC Atlas Web Survey found that U.S. users, by contrast, spend 90% of their dollars within the United States. The Boston Consulting Group, on the other hand, predicts that the tide willchange: Latin American online vendors this year will capture half of all e-commerce purchases made in the region.

Last updated: Mar 7, 2000




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