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A growing percentage of Internet users in Hong Kong are visiting shopping Web sites, but people are still cool to the idea of buying online, according to a study released yesterday.

A poll by Nielsen/NetRatings shows that almost 800,000 people in the SAR visited a site that offered e-commerce last month, an increase of 46 per cent from the same period the previous year. But at the same time, only 4 per cent of Internet users said they had made an online purchase during the past 12 months, unchanged from last year.

Hugh Bloch, managing director of Nielsen/NetRatings Asia, said the latest statistics should be seen as a good news, bad news scenario.

On the plus side, he said the increase in Web traffic showed Hong Kong consumers viewed the Internet as a good place for comparison-shopping.

Overall, merchants would also have seen a modest increase in business as the number of people going online grew to 1.9 million last month.

On the down side, Mr Bloch said the 4 per cent purchase rate showed consumers were still not comfortable with e-commerce.

'It's a huge problem. It is quite clear that they are not addressing the concerns people have about buying online,' he said.

Mr Bloch said Hong Kong residents were worried about security and customer service issues such as return policies.

Geography also plays a role, and when stores are close by, people tend to be less interested in waiting for an Internet order to be delivered.

'You've got the old issue in Hong Kong where people are comparing prices by visiting Web sites, and then they go down the road and buy something from a store,' he said.

But regions with similar physical circumstances to Hong Kong have been more successful in selling the idea of e-commerce.

Nielsen/NetRatings also found that the number of Singaporeans who bought goods online increased from 4 per cent to 9 per cent during the past year.

Mr Bloch said Singapore had been more effective in promoting e-commerce because the Government was more active and merchants were co-operating to promote the concept of Internet shopping.

Elsewhere in Asia-Pacific, 12 per cent of South Koreans using the Internet had made an online purchase, along with 14 per cent of Australians and New Zealanders.

Taiwan's online purchasing rate, at 5 per cent, was similar to Hong Kong's.

Meanwhile, the survey showed that film tickets and books topped the list of the most popular items to browse for online in Hong Kong.

The most popular shopping site in Hong Kong last month was amazon.com, which attracted 121,800 visitors.

Cinema.com.hk was next with 107,100 visitors, followed by hk

.shopping.yahoo.com with 101,400.

Of the top-10 most visited sites, nine were pure dotcoms, which goes against the conventional wisdom among industry observers which suggests retailers that have an offline and online presence will be the most successful.

'It seems there was a holiday flurry to online shopping sites in December, and surprisingly, just one of the top-10 spots [sony

.com.hk in fifth spot] was held by a bricks and mortar retailer,' Mr Bloch said.

'A couple of entertainment sites experienced the greatest increase over the previous month, as consumers logged on to city

line.com.hk and cinema.com.hk for information and to purchase tickets for movies and events in Hong Kong.'

Some Hong Kong shopping sites are not performing as well, according to the survey.

Online auction site red-dots.com, which recently closed some of its service centres, saw a 3 per cent decline in visitors during the past year, to fewer than 80,000.

Icare.com.hk, an online shopping mall and services site owned by Hong Kong & China Gas and Henderson Investment, saw its traffic drop by 11 per cent, while phone directory yp.com.hk declined by 35 per cent.

Graphic: aud22gwz



Security concerns and service worries keep potential customers away from buying online