30 percent of online visits come from search engines

30% of online visits come from search engines

September 7, 2004

More than 30.3 percent of U.S. visits to music retail websites in July 2004 resulted directly from search-engines.

According to a new report from Hitwise, the world's leading online competitive intelligence service, this high rate of search-driven music shopping compares with 19.2 percent for the overall retail category. July 2004 visits to music retailers from search engines and directories have grown by 49.0 percent versus the same period a year ago.

"Search engines have long played a vital role in helping consumers navigate the Internet, however they now are playing a monumental role in connecting music fans with music retailers," said Bill Tancer, vice president of research, Hitwise.

"For music shoppers, search engines and directories offer an effective and comprehensive means for locating music products and seeking the best deals. For the music retailers, a major new customer-acquisition platform has arrived.

And with the increasing popularity of the Internet for music distribution and listening, retailers have no choice but to engage it."

Highlights of the August 2004 Hitwise Online Music Report (All findings based on July 2004 monthly data unless noted otherwise):

-- Among the top 100 search terms, 50 percent of search queries that resulted in visits to the Hitwise Music retail category were brand related (i.e. "bmgmusic"); 21 percent were navigational (included a URL, i.e., "www.columbiahouse.com"); and 29 percent were generic in nature (associated keywords, i.e., "music downloads").

-- Over 53 percent of search queries resulting in visits to music retailer sites consisted of three or more words, compared to 48 percent for overall online retailers (for the 4 weeks ending June 19, 2004). According to Tancer this demonstrates that online music shoppers tend to more specific in their search goals.

-- Within the music-retail genre, download sites increased 20.6 percent in market share of U.S. visits during the period of January 2004 to July 2004, while traditional music retailers lost market share at a rate of 9.1 percent. Nonetheless, as of July 2004, traditional music retailers captured 3.9 times the amount of US visits than music download sites.

-- The predominant demographic of visitors to online music retail sites is between 25-44 years of age and earning a household income of $30,000 to $60,000. While females represent 49 percent of all visitors to the retail-music category, women are heavily represented on several major music catalogue sites: www.bmgmusic.com (60 percent) and www.columbiahouse.com (58 percent).

-- Sony promoted its new music download service Sony Connect (www.connect.com) through a joint promotion with McDonald's. As a result, Connect's market share of U.S. visits skyrocketed 1,426 percent (week ending May 29 compared to week ending June 19), jumping from number 68 to eight in the 'Shopping & Classifieds - Music' site ranking.

This increase pushed Connect ahead of leading competitors - such as iTunes, Napster and Walmart Download - for the following three weeks. Sony Connect received 9.5 percent of its traffic from search engines for the week ending August 28, 2004, well below the average (21.3 percent) of the entire music retail category for the same week. -0- *T Hitwise Data Number of words per search query resulting in visits to the Music retail category for the 4 weeks ending June 19, 2004.

Source: TMC Net.com

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