BY DAVID STEIN, The Internet Doctor
AUTOMATIC ONLINE SYSTEMS
Everyday we hear how the Internet is the commerce tool of the future here today. It seems you can't pick up a magazine without seeing an article about how another company is doing something new on the web.
Yet up to now, many companies have watched as the list of much publicized ventures have failed to turn a profit. This has created an air of pessimism that the web is not for everyone. But the web's powerful force that overturns the constraints of location, scale, and time zones has given opportunity to unknown start-ups. With early returns in, e-commerce has fundamentally reshaped business.
With the phenomenal growth of the
Internet in both the business to business and consumer sectors along with the
wide scale acceptance of e-commerce you can't help but ask when do I join in
and should I even be concerned about e-commerce?
Current projections are e-commerce will soon hit one trillion dollars in sales
with 70% comprised of business to business transactions. Consumer on-line purchasing
is expected to exceed $8 billion this year and $327 billion by the year 2002.
With numbers like these it is no wonder that so many companies are joining in
the festivities. Even if projections are severely overestimated these are big
numbers. So whatever the number is, it's a big one and should be considered
part of your business strategy.
Don't underestimate who uses the Internet and how it is changing the way consumers are making purchases. If your customer base and your product lines are like most you will be well received by the on-line community and you should be expanding your marketing reach with an on-line presence. In general consumers find the shop at home/office convenience, 24 hours a day, without traffic for virtually everything by moving from site to site a positive experience. Although cluttered, this collection of choices also allows them to gather information on purchases they plan to make using conventional sales channels. Moreover, you can service customers economically all over the world, catering to tastes no brick and mortar store could serve.
Ah yes, but do I have the capital for an e-presence on the web, you ask? Obviously if you already own a profitable business, it is easier. You already know to be prepared for some rough times. Like your traditional business you know there is an initial phase where you don't make money, you just accumulate expenses. You also have the benefit of a business infrastructure to handle customers, order fulfillment, inventory control etc.
Remember just because it is new, when setting up or expanding your on-line presence you should focus on the traditional marketing aspects of your business model. The technical aspects should be de-emphasized and just as you would your traditional business model focus in on marketing and premier customer service.
E-commerce applications offer high returns on investment and create value for clients. The most obvious are the traditional on-line catalogs. Rich, interactive retail sites like amazon.com and musicboulevard.com. Although still in its infancy, it is one of the fastest growing sectors of the U.S. economy. These pioneers also recognize there are more opportunities for customer interaction than just grabbing their credit card number. It provides you the ability to tailor your product offerings to your customers tastes and needs. You have the opportunity to cross sell by recommending individualized services.
E-commerce is low overhead capitalism, ignored until now by many companies. If forecasts are correct it will fundamentally change business. The day will come when companies that don't implement web base transactions will have a hard time finding business partners.
Internet commerce will continue to grow as technology continues to push its way into bigger markets and expands into more homes. Next month we will take a look at how others are using the Web to enhance the shopping experience and their relationship with the consumer. By applying technology to improve processes, order a shirt at lunch and wear it at dinner. Don't laugh, it is currently being tested in Europe and Japan.
David Stein is President of Automatic On-Line System (www.aols.com), a full service web design and maintenance company. You can reach David at 718-361-3091 or e-mail at internetdoctor@autoonline.net.