The Number One Reason For a Web Presence
Someone once asked in the Marketing Challenge private site,
"What's the number one reason a business should have a web
presence?" This is a fascinating question because, very often,
many businesses (particularly with those I've consulted in my
practice) have no clue as to why they are online. Yes, it is a
new medium that's affordable, more effective and wrought with
opportunity -- especially for smaller businesses.
But many businesses currently operating offline jump into the
web for a variety of reasons that are often unclear to the
business owner. Of course, the hype can be very enticing. But
it can also make things hazy for the entrepreneur. I believe
that the main reason for a web presence, in most cases but
particularly for bricks-and-mortar businesses, is the awesome
potential for reducing costs and/or increasing revenues.
However, depending on the type of business, the path or paths
that lead to such outcomes are not as specific as one might
think. The number one reason for any given business to go
online can vary tremendously from industry to industry,
business to business and goal to goal. But if I were to
summarize it all by isolating several categories, I would say
that a website can offer one of four different benefits:
1) A distribution channel
2) A marketing channel
3) A sales channel
4) A communications (support) channel
Or a combination of any of the above.
So here's a quick look at some examples based on those four
key benefits and, maybe, this could enlighten you on potential
breakthroughs currently hidden in your business:
Doing business online expands the marketplace to national and
international markets, and offers the ability to reach new,
untapped markets that would have been potentially unreachable
otherwise. On the Internet, boundaries (at least in terms of
communication) are nonexistent or less restrictive.
For one, a website can provide a supplementary sales channel
that can reach, promote to and serve markets that would have
been difficult or even impossible to reach in the real world.
For another, the Internet provides a unique benefit not
available elsewhere: Through "viral marketing," the web can
help propagate the knowledge of a website, company or product
faster and more extensively than ever before.
An online business decreases administrative costs normally
associated with managing paper-based information. It also
lowers telecommunications costs since the Internet is more
economical than other conventional forms of communication.
For example, for a totally bricks-and-mortar business the
Internet mainly provides a new, inexpensive form of
advertising. It helps to reduce the costs associated with
conducting business such as providing information -- like a
brochure or catalog -- quickly and efficiently, without the
need for publishing a physical one or for its postage.
It also reduces the time that normally lapses between the
launch of a product, building its consumer awareness, selling
the product and delivering it to the market. In other words,
it reduces cycle times (like the adoption and sales cycles)
and time-to-market, and shortens the distribution channel by
delivering directly to the end-user or removing excess layers.
For instance, a new product can be manufactured, launched and
deployed -- as well as promoted, sold and delivered to the
marketplace -- faster than any other traditional forms of
media. As a result, increased market share can also be
achievable in a vastly shorter period of time.
With the Internet, the need for human attention or involvement
traditionally required in a bricks-and-mortar business, from
labor to middle management, is considerably lessened. And the
web increases and improves productivity, output, delivery of
services at a reduced cost, effectiveness and quality.
Many parts of the traditional sales process can be completely
automated with the help of a website, thus saving time, money
and person-hours usually required. Also, being electronic
especially in the sales order and fulfillment processes, the
Internet eliminates much of the potential for human errors one
often encounters when such are processed by personnel.
A web business also allows reduced inventories and overhead by
facilitating a "pull" type of supply chain management (e.g.,
"just-in-time" inventory) and allows for the customization of
products and services, which in turn provides a significant
competitive advantage often not available in the real world.
Above all, the greatest benefit of the web is the ability to
offer customized and/or personalized services. As my respected
colleague Dr. Kevin Nunley of http://www.drnunley.com/ once
noted, "If current trends offer any indication, the demand for
personalized services [...] will continue to grow [and as
such] the future of the Internet lies in personalized services
supplied by small businesses and individuals."
Also, with the help of the web products can be stocked and
orders can be fulfilled more efficiently, thereby reducing the
time between the outlay of capital and the receipt of products
and services. Take, for example, Dell computers' enormously
effective just-in-time inventory control process, where parts
are ordered for its customized computer sales on a daily basis
-- there's no need to maintain a huge, costly inventory.
An added advantage to doing business online is that the web
enhances communications within organizations, between partners
and with a business' various publics (e.g., media, market
segments, government, agencies, trade associations, etc).
To illustrate, media and news releases can be distributed
quicker on the Internet. Additionally, complete follow-up or
supplementary information, among others, can be posted on
one's website for retrieval by the press. On top of the rapid
dissemination of information, the correction of errors, as
well as the modification and update of data, can be done
quicker and more effectively through the help of the web.
Being a branding and positioning consultant, I've personally
noticed that the Internet greatly facilitates the adoption and
branding processes -- such as with the ability to project a
strong corporate identity and to build brand equity, both over
a shorter period of time. Moreover, it removes potentially
critical, physical comparisons (i.e., on the Internet, the
element of size no longer exists). Everyone is the same.
Take for instance a large company like
Dell computers and a smaller rival like Stupid PC. You can look just as big and be just
as effective as the "big guns." Similarly, the web offers the
capacity to project a favorable, positive corporate image --
and do so easily and cost-effectively -- where in the physical
dimension a mere fancy catalog will not cut it for most.
This one is my favorite. The web is an extraordinary market
research tool. It facilitates intelligence gathering, tracking
and measuring of marketing efforts (often referred as "data
mining"). As well, it offers new promotional avenues, and
opens new customer service and product support channels.
For example, in a physical store it's virtually impossible and
often extremely difficult to track buyer behavior. You can't,
for instance, follow your customers around your store with a
video camera and track their every move in order to see which
isles they visited, at which products they looked, how long
they looked at them, how many isles they visited, what their
interests are by their shopping trajectories, who referred
them to your store, where they are going and so on.
Agreeably, you can obtain this type of information through
market research, focus groups, surveys and so on -- which
takes money, time and the willingness of customers. But with a
website, all this and more can be mined from your server logs
or tracking software -- especially in a matter of seconds.
Of course, there are many drawbacks too. The lack of privacy,
security, tangibility, human response and so on can become and
are, in many cases, impediments to online sales. But there are
ways to overcome these. We have brought you quite a few in
previous issues and especially in the Marketing Challenge
private site. Nevertheless, weighing the differences between
the benefits and the drawbacks of doing business on the web is
an exercise most businesses should do at some point. It might
prove itself to be quite revealing ... And profitable.
About the Author
Michel Fortin is an author, speaker and Internet marketing consultant dedicated to turning businesses into powerful magnets. Visit
http://SuccessDoctor.com. He is also the editor of the "Internet Marketing Chronicles" ezine delivered weekly to 100,000 subscribers - subscribe free at http://SuccessDoctor.com/IMC/
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