Published in
Svoboda's Home and Small Business Review
The Computer Contrarian
January, 2000

E-Business 101

Wm. R. Stocking

"If I hear another DotCom... I'll scream!"

Yes, this has been the year of the DotCom. Buying, selling and the whole sales process will never be the same again. The Internet has become the newest battleground in the fight for the inside of your wallet. Why is the Internet so different from traditional selling environments? Let's start with a historical perspective.

Electronic Attempts of the Past

Attempts to take retail sales into the electronic realm has been going on since the arrival of the first crystal set. Radio reined supreme for several decades before television took electronic huckstering to new heights. Remember the "Magic Fisherman" and the "Kitchen Magician"? Later, The Home Shopping Network and it's clones added the elements of a non-browse enabled catalog and buyer-seller interaction to the pitch-and-sell process.

Looking at it another way, this TV shop at home phenomenon added some other parts to the process: it combined the advertising and sales elements into a shortened and unified parcel of time. Product presentation and orders for product occur simultaneously or immediately following the product pitch. It was a new way of doing business and a harbinger to what is happening now.

Print Advertising

That old standby, print advertising, continues to be used as it still has some advantages over newer electronic media. Hard copy stays around more than a few seconds allowing the gathering of information at a leisurely pace when and where ever it's convenient for the buyer. This style of buying better suits some people. It's a more sensual method; you can savor the product and flip the pages. (The extreme example of this is the "scratch and sniff" perfume ad.)

Print advertising is particularly suited to complicate merchandise requiring study to make informed decisions. It is also most suitable for products that are fairly stable in configuration and price. This "persistent" aspect of print has some negative qualities: it takes longer to deliver and "goes stale" quickly. Print as a medium is a one way street: except for making paper airplanes out of it, there is no interaction.

"Ok, now just how different is buying on the Internet than buying from TV," you say. Buying and selling on the Internet combines most of the positive elements of print, radio and TV and adds a yet another element. Let's see how this works:

• Like television, buying from a website is primarily visual though audio is becoming a bigger part of the experience.
• Interaction Similar to television in the interaction between the seller and the buyer: You see it, you order it.
• User controlled presentation: Like print advertising, the buyer can navigate an online catalog at their own pace and in random order. This is a great advantage over television or radio presentations of product.
• Unlike printed catalogs, an online catalog can be instantly updated – no more stale information or pricing, but like printed matter, the online catalog has "persistence," the buyer can come back to it over and over until they're ready to make a decision.
• Tangible copy: As one browses an online catalog, they can always print out pages of major interest.
• Personalization: This is THE major advantage of online selling and shopping. The Internet is turning the interactive elements of the sales process in a totally new direction; a direction hinted at by mail order catalogs when they began to do targeted marketing. Traditional catalog sellers have look at their buyers' profiles then seek to mail additional prospects on the basis of matching demographic information on existing buyers to information in lists of new prospects

Internet marketing goes much further. The "target" of the interactive website is YOU! Thus we have gone through paradigms of "mass media" to "target marketing" and now we've advanced to a personalized shopping experience. Every time you visit a major website your every move through the site is followed and recorded. Of course, if you buy something that is noted as well. The immediate buying process can trigger the presentation of additional items to go along with your purchase.

Personalization

The next time you enter one of these personalization enabled sites, what you see and what is offered will, in part, be based on your previous interaction with the site. Pretty clever, huh! This is not unlike a live buying trip to a favorite clothing boutique where the sales person has a record of what you have bought in the past, your sizes, etc.

The best example of this personalization process is illustrated by Amazon.com where it is refined on an almost weekly basis. They might not be making any money at this point, but they are far ahead of everyone else in understanding and using it to build mind share and market share. Eventually, it will probably pay off big for Amazon and others like them.

The big question: Should you be marketing online? We'll discuss this and other aspect of using the Internet to better your business in future articles – The answer isn't that simple.

Thirteenth Hour Y2K Fixes

If you didn't do anything with regards to Y2K preparations, you're probably paying the price right now. As you read this we will be finding out how the world is holding up during the turn of the century clock. Speculation over: It's life as we've always known it with a lot of minor inconveniences. At least that is as bad as I hope things turn out as I write this. There has always been the possibility of hoarding, panic and major disruptions, but somehow I don't think we'll suffer from any of those things – just a lot of minor and a few major annoyances.

To read other articles and get some good consulting advice from dozens of management consultants visit our website: http://www.firstbiz.com.