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Marketing in the internet – as seen from Italy

No. 56 – March 21, 2001



loghino.gif (1071 byte) 1. Editorial: The deflated bubble

It’s quite boring to go back to a subject that was discussed several times in this newsletter (and in other articles on this site). The hype and the “bubble”. But it’s hard to ignore it when it’s still making front-page headlines almost every day. The press is blaming the analysts, the analysts are blaming the press, everyone is trying to “pass the buck” and the whole mess is quite ridiculous. It was pretty obvious year ago – to anyone looking at the realities – that the bubble was filled with hot air (or some smelly and not-so-wholesome gas). And that there is no such thing as perennial, unlimited growth – in the stock market or anywhere else.

The bubble hasn’t exploded completely; more downturns will be necessary before investments can stand on any sort of firm ground. This isn’t a matter of bears and bulls. It has been (and partly still is) simply a case of poor choice by investors, managers, analysts, business advisors, and all sorts of self-appointed “experts”.

It isn’t even a problem of “profit multipliers”. A pretty crude measurement in any case, but especially with new technologies. The irony is that conceptually it’s quite reasonable to assume that the potential of a new venture can not be measured by short-term income or profits. Investing in a company that is losing money is not, per se, a mistake – if that company has real potential. The problem is that “potential” was defined by very poor criteria. Now, while many poorly planned ventures have failed (and others will fail in the future) the dismal disappointment may deprive good companies of the support they need.

The real question is: where do we go from here? The answer isn’t easy, but the basic concept is quite simple. Most good ventures in the internet need consistency over time more than they need large up-front investments. Forget haste. Look for established or fledgling ventures with a genuine ability to build sound relations with their customers – and hold them and grow them over time. Rewards may not be instant, but if investments were more gradual and less hasty there would be fewer failures.

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loghino.gif (1071 byte) 2. The internet and advertising

Online advertising income has been disappointing in most countries; and current expectations of growth are far behind the hype projections that were so popular a while ago. That isn’t much of a problem, except for the (many) internet ventures that based their business plans on enormously unrealistic expectations of ad revenue.

On the other hand – many “dot coms” spent (and wasted) a great deal of money in traditional media. Not only in the United States, but in several other places (including my country). That’s another bubble and that, too, has exploded. Mainstream media had a boom year 2000 when the “new economy” advertisers spent so much money that space and time were sold out – at increasing prices. In the last quarter of 2000 there were clear symptoms that the game was over. Now the figures are published and we know that ad revenue growth this year will be slower (one of the results is that prices are becoming more negotiable). Mostly because many of last year’s new advertisers wont’ be there.

What was the problem? In many cases the advertising newcomers were more interested in impressing shareholders and investors that in selling anything to customers. Or – if they thought that they could boost sales just by spending a lot of money on (often nonsensical) advertising – they were bitterly disappointed. Once again, the origin of the failures was haste. The solution lies in some very old, tried and true, principles. Such as look before you leap, learn to walk before you run. And if you really want to advertise... try to say something that is meaningful to potential customers, even if it won’t entertain your board of directors or your friends at cocktail parties.


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loghino.gif (1071 byte) 3. New data

Data on the size and growth of the internet, worldwide and in Europe, are no longer included in this newsletter. They are in a separate section on this site. (It's in Italian, but charts and graphs are understandable regardless of language). Hosever, here is a short summary of a few basic developments – also for the sake of comparison in the future, when the data reports will be upfìdated but this page will remain unchanged.

The new report on international hostcount (updated to the end of year 2000) was published in March 14, 2001. These are the figures for the 17 countrties with over 500,000 internet hosts.

  Number of host
december 2000
% change
in a year
% of
Per 1000
United States 72,456,761 + 43.5 66.1 264.6
Japan 4,640,863 + 76.0 4.2 36.6
Canada 2,364,014 + 41.6 2.2 76.0
United Kingdom 2,291,369 + 20.5 2.1 39.0
Germany 2,163,326 + 27.1 2.0 26.3
Italy 1,630,526 + 147.7 1.5 28.5
Netherlands 1,623,567 + 97.8 1.5 102.8
Australia 1,615,939 + 48.2 1.5 85.5
France 1,375,081 + 76.3 1.3 23.3
Taiwan 1,095,718 + 83.5 1.0 50.0
Brazil 875,596 + 96.2 0.8 5.4
Finland 771,725 + 22.2 0.7 148.4
Sweden 764,011 + 28.5 0.7 85.8
Spain 663,553 + 59.7 0.6 13.6
Mexico 559,165 + 38.1 0.5 5.6
Norway 525,030 + 30.6 0.5 105.4
Austria 504,144 + 83.8 0.5 61.8
Total 109,574,429 + 51.4 .nbsp; 5.0

The situation of the "ten nations" that we had seen in the last issue has changed.

10 nations

The red section of bars shows the increase in two years.

An analysis of the two large ethnic communities is available in Italian and Spanish.

Here is an updated map of density in Europe

Internet hosts per 1000 inhabitants


For two more charts of the sitation at this time see the Italian version of this issue.
For a more detailed updated analysis see the worldwide and European data reports (they are in Italian – but data, charts and graphs are fairly clear regardless of language).



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