B2B E-Sales Will Exceed B2C by Tenfold Next Year

FLORENCE, ITALY (04/03/2000) - By 2004, the business-to-business e-commerce market will be worth US$7.3 trillion, representing 6.9 percent of the global economy, Peter Sondergaard, group vice president of GartnerGroup Inc., said today in his keynote speech here at the Spring Symposium.

The message for online vendors from the GartnerGroup executive was clear: shift over to a business-to-business-oriented organization or die.

"By 2001, business-to-business e-commerce sales will exceed business-to-consumer e-commerce sales by more than tenfold," Sondergaard said.

The challenge for IT companies who wish to survive in the future will be to decide where their strengths are, according to Sondergaard. Today, most companies have an organization consisting of three key business processes: customer-centric processes, manufacturing processes and knowledge-management processes. A successful future organization will only have one of these, outsourcing the others. So the challenge is not to find outsourcing partners or key customers, but to decide which processes to focus on, Sondergaard said.

Sondergaard went on to kill some myths. "Dot-com" companies will not dominate in the future, as some may think, he said. In fact, 95 percent of strictly online companies will fail in the next 24 months, leaving room for more successful clicks-and-mortar, or hybrid, companies. That is, a company cannot survive on the Web only; the more traditional high-street office and shop are vital to success.

European companies will not spend as much on IT-investments as U.S. companies, according to Sondergaard, who went on to challenge his audience: "This will not necessarily be a competitive disadvantage to the European companies, since the Europeans manage their budgets better than the Americans," he said.

Furthermore, the future technology trends will be in XML (Extensible Markup Language), wireless Web, Bluetooth, speech recognition and language-enabling applications, Sondergaard said.

The GartnerGroup Spring Symposium continues through Wednesday in Florence.

GartnerGroup, based in Stamford, Connecticut, can be reached at +1-203-316-1111 or on the Web at http://www.gartner.com/.

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