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How Do I Know If the Internet Is Right for My Business?
by Jon Leland

It seems like we're all so busy these days that taking our business online can seem like just one more "to-do."

On top of seemingly constant time pressure, there's the need to make a reasonable return on any kind of marketing or customer service investment. How do we know that our investment in a new technology learning curve, the commitment of valuable resources and the other kinds of time drains are worth it?

Making this evaluation can be especially challenging, given that we're in the early stages of the Internet's development as a communication medium, and lots of web experiments have proven to be unsuccessful when evaluated against a straight return.

That's why, this month on The Web Edge, I'm taking on the question, "How do I know if the Internet is right for my business?" Apparently it's a concern that a lot of people share. After all, creating a website can be a risky business. It's a new form of communication on a new frontier, and therefore, it's easy to make mistakes. In fact, that's part of the reason that the "cutting edge" is sometimes known as the "bleeding edge" and why this column is called The Web Edge.

THE NEW COMMUNICATIONS ENVIRONMENT
But, don't get me wrong. I'm not trying to talk you out of anything. Au contra ire! In some ways, because I'm such a believer in the power of the Web. I think the question should be, "What's the best way for my company to get on the Web?" (I'll address that question more concretely in next month's Web Edge column.) Bottom line, I think that almost every business can benefit from an effective website, however that doesn't mean that you should over-spend which is where I think a lot of the negative feedback comes from.

As a recent headline in the San Francisco Chronicle shouted, "The Internet boom is just beginning." Reporting on the Summer Internet World 97 in Chicago, the article quoted Alan Taffel, a VP at mega-ISP Uunet Technologies Inc. as saying "Our network has to grow by a factor of 10 every year. What industry has even come close to that rate?" Another report says that the number of web pages posted on the Web doubles every 53 days. Everybody has their favorite statistics, but the phenomenal growth of the Internet is indisputable, and it is continuing to literally reshape the computer and the communication industries. As far as I can tell, it will continue to do so for at least the next three to five years.

Amongst the large technology companies, everyone from Microsoft to Novell is reshaping their entire business strategy to try to take advantage of the Internet's growth and impact on communications. And what have been their biggest mistakes? They didn't move quickly enough when the dimensions of the ways that the Internet is changing business began to become apparent.

So what should you do?

THE NEED TO NETWORK
The specific answer to "what you should do" obviously depends on the size, nature and resources of your business. I'll get more specific about that in a moment, but first I want to tell you that I believe that it won't be long (if we're not there already) before not having a website will be something like not having a fax machine was just a few years ago.

Another way to think about it is to remember that as far as communications are concerned you need to put the customer first. A few months ago when Kinko's asked me to write "5 Ways To Do Better Business In A Digital Age," my first point was " Open all channels of communication." The critical factor here is that you need to be able to respond to your customers through whichever medium they prefer. I've now got many clients who prefer e-mail communications. Can you imagine how short-sighted it would be of me not to accommodate them? Fundamentally, in the same way that it's obvious that you need a fax machine now a days, pretty soon you'll need your company connected online (both outgoing and incoming communications, both e-mail and a website) just to keep all of your customer "channels" open.

WHAT WORKS BEST?
Now, let's get down to seven specific recommendations regarding what kinds of businesses are most likely to create short term success stories on the Web. To get your creative juices flowing, I've written seven simple questions designed to nudge you in the right direction if that's appropriate. Although I think every business can benefit from being an online leader and from carving out a niche in cyberspace, if you've got an enthusiastic "yes" to any one of the questions below, then you're likely to benefit even more handsomely from being a web entrepreneur.

1. Can you use the web to demonstrate your business's ability to deliver real value?
Most of you probably know by now that simply putting a sales brochure online is not enough to impress a web audience. Whether it's an interactive exercise or a solid article that illustrates your expertise. The best way to attract potential clients or customers to your site is to offer something of value for free. For example, I'm just completing a site for Sterling Consulting Group who are international experts on customer service. In addition to posting the newsletter that they create for the International Association for Quality Service, they have also developed a free interactive quality service audit that offers real insights to any company who visits their site. Participants answer ten simple questions online and then receive free consulting in the form of a response that's determined by their answers. It's fun, and more importantly, doing the audit gives online viewers a tangible illustration of Sterling Consulting Group's expertise.

What could you offer online that would demonstrate the value of the services or products that your company provides?

2. Do you understand how to develop one-to-one marketing programs?
Businesses are built on relationships, and the whole business environment is changing rapidly from a mass marketing model to a marketplace where one-to-one marketing strategies will create real strategic advantages. The essence is that inter activity enables a whole new kind of relationship building, and the web is a great environment for these new brands of outreach. The people who wrote the books on this subject are Don Pepper and Martha Rogers. You can find out more about their books and about "One-to-One Marketing," at their website at: www.marketing1to1.com.

3. Can you use the Internet or the Web to offer better service or support than your competition?
Airlines and courier services as well as high tech companies have already discovered that enhancing their services by extending them into the online universe can please customers while also saving money. For example, UPS has saved lots of money in service phone personnel payroll expenses by answering questions about pricing and helping customers track shipments through their website. At the same time, software companies are designing a whole new generation of tech support e-mail services that automatically search for key words and then generate on-target responses.

What might your company be able to do to support your customers by making useful "inside" information more accessible to your customers?

4. Are you already selling products that could be offered online with little incremental cost?
Amazon.Com is everybody's favorite example of success in online commerce. With 20-20 hindsight, it's clear that Amazon took an initiative in a niche where online commerce really makes sense. What's also clear is that more and more products are going to be sold through the Web.

International Data estimates that by the year 2000, 46 million American consumers will be buying online, spending an average of $350 each (which means online retail would become a $16 billion market). That's an astronomical increase from the estimate by Forrester Research for 1996 of $520 million, but no matter what you think of International Data's projection, it underscores the significance of online commerce in the years ahead.

If you're already selling products directly to consumers (or especially if your selling products business-to-business), shouldn't you be taking the initiative to create an online marketplace for your goods?

5. Are your customers asking for or would they like more online interaction?
Little explanation is needed here. If you're listening to your customers and there is any indication whatsoever that they would like to be interacting with you online, then please consider that to be an "alert" signal that represents the tip of the iceberg. Act now.

6. Is your company already using multimedia or video in your sales and marketing process?
All media is becoming digital. If you're already using multimedia or video in your marketing or communication programs, you're already ahead on the learning curve. The Web is a great way to leverage that advantage so that you will look even better than your competition. However, if you've got "digital assets" that you can bring to your website, don't just make them an electronic brochure. Figure out how to make them part of a relationship-building exercise, contest or some other kind of creative program.

7. Can your company benefit from being part of a virtual community and form networked team building?|
I'll write more about this in the December Web Edge column, but many companies today are recognizing the value of virtual teams who use the network to stay connected. E-mail is the base line, but file transfers, group ware and advances in video conferencing will continue to enhance the power of these professional relationships. Furthermore, I believe that web entrepreneurs with the vision to build virtual communities around their product or service focus will reap large returns if they have the resources to continue to develop these enterprises over the next three to five years. If you're interested in learning more about this opportunity, I'm sure the book Net Gain written by two McKinsey and Co. Consultants, John Hagel and Arthur Armstrong will prove to be a worthy read.

TAKING THE PLUNGE
As I said at the beginning of this column, I think that almost every business can benefit from an effective website, but that doesn't mean that you should over-spend. Beyond all of the valuable ingredients described above, and perhaps more important than climbing the technology learning curve, is the skills and talent that are necessary to effectively balance your resources. I think a lot of companies suffer from an overdose of entrepreneurial enthusiasm without the counter-balance of careful planning.

So my recommendation is to determine first which of the web's many strategic advantages will benefit your company most. The result will be the creation of realistic goals. Then, if you set your objectives precisely and design an efficient plan to achieve those goals, your reward will be a successful website.

Next month, I'll talk about strategies for website implementation. In the meantime, my general recommendation regarding whether the Internet is right for your company, is that the answer is probably "yes." However, given the challenges I've discussed, you should proceed with care, but proceed. Otherwise, you will risk being pre-empted by your competition.

Until next month, stay tuned.

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Jon welcomes feedback and suggestions via e-mail at jon@combridges.com

 
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