Winning in the Post-Dot-Com WorldThe bubble has burst. The bloom is off the rose. The fat lady sang. It is the dawn of Internet 2.0. It is Act Two of the new economy. It is a post-dot-com world. Pick your cliché. Something is clearly different.
At the moment, nobody believes the Internet is the universal answer, the silver bullet or the sign for the messiah. The dot-com gold rush is over. But shed no tears for the venture capitalists. Instead, get beyond the hype and the continuing spin, and begin to understand the role that the Internet can effectively play as an integrated part of existing technology, marketing processes and systems.
A number of clear lessons have emerged from the dot-com frenzy. Now you need to internalize and apply them as site publishers and marketers seek to wring the return on investment out of substantial investments.
Consider the following lessons:
• User experience ruthlessly drives perception, acceptance, adoption, commerce and usage. If it is not easy to use or requires too many steps, customers bail out. Traffic is a gift that must be cherished, nurtured and converted. What people do and see on your site is the most important part. Failure to get the user interface right condemns you to being a one-time Charlie.
• E-commerce is a multidimensional, multichannel game. Building sustainable retail businesses is about coordinating messages, merchandising and technology at many points along the awareness-consideration-purchase spectrum. Winners will leverage the best capabilities of each channel (advertisements, Web, phone, mail and store) into a coherent, sequential strategy for contacts and messaging.
• Simple, intuitive navigation and shopping require sophisticated back-end technology to bring it to life and sophisticated metrics and analytics are needed to optimize activity, nimbly adjust to your customers and maximize conversion. The measurement investment is equally as important as the technology. Without it, you are flying blind without a map or radar.
• Measured business objectives must drive technology deployment. If the new toys do not drive traffic, close sales or eliminate costs, they are simply expensive bells and whistles. If you can cook it up, it does not necessarily follow that anyone wants it or can use it profitably. Beware of software salesmen.
• Very few visions are visionary. Most are wet dreams. Change is hard to sell. Most consumers and businesses are anxious about technology. Few see panaceas on the Web. The burden of translating the vision into conventional thinking lies with visionaries and marketers. If in doubt, assume your target audience cannot or will not do the math for you. Assume they will not get it unless it is simple, plain to follow and written at an eighth-grade level.
In the context of these lessons, you can clearly identify things the Internet can and should do within the marketing process. And you can hypothesize about areas where the Web shows promise but needs opportunities for testing and learning. Consider the following proven Internet applications:
Multichannel brand integration. The Web facilitates 24/7/365 availability for a brand as well as a platform to align brand values and brand voices on a global, immediate and dynamic basis. Many firms have integrated the look, feel, tone and manner of their brands across advertising, point of sale, the Web, mail, phone, stores and sales force. Many have presented consistent merchandise, product catalogs and return or credit policies across platforms and geographies to serve customers better and optimize investments. The Web offers the next best chance for brands to speak with one voice across markets and across the globe.
Data aggregation. The Web is a competitive tool for aggregating data from multiple sources and for extracting data from legacy systems to optimize business decision-making. Secured extranets and intranets are supercharging competition in financial services, insurance, healthcare, retail and business-to-business markets. The Web expedites a firm's ability to organize, filter and display data economically in ways that yield real-time competitive advantages.
Supply-chain management. The Web is quickly overtaking electronic data interchange because it is an open system that requires minimal investment and empowers small and medium-sized businesses to compete for national and global contracts. Thousands of firms have copied the Dell model of linking with vendors and suppliers over the Net with varying degrees of success. While the jury is still out on those highly publicized online exchanges, it is a good bet that one per sector will emerge as successful and valuable to its members.
Companies using the Web have reduced costs, expedited just-in-time delivery and optimized tracking and replenishment. They also have begun to experiment with new, faster and more intimate ways to integrate with suppliers, vendors and customers to shave precious hours and dollars from production, shipping and marketing processes.
Integrated marketing and communications. The Web facilitates message management, targeting, tracking and measurement. Integrating channels allows you to leverage investments in sight, sound, imagery, photography and copy. Synchronizing messages and allocating budgets to target distinct segments using specific media are improving returns on investment and are reducing the cost of contact, sale, acquisition and usage stimulation. Interweaving media expenditures on the basis of measurement norms and ROI calculations can achieve economies of scale and take the first step toward norms for using discrete media combinations and synchronizations to direct and segment customer traffic for maximum efficiency.
Selling. The Web is a proven transactional tool with the ability to store transactional histories and to serve up appropriate repeat, replenishment, upsell or cross-sell offers. Even in its infancy, e-commerce has changed the way businesses and consumers research, price and buy products.
The next challenge is to understand the dynamics between online and offline commerce and leverage strategy and technology to maximize returns and conversion. The best players are experimenting with mix-and-match combinations of media and messages to identify the number and the channel of customer contacts necessary to yield cost-efficient conversions.
Given these demonstrable benefits from the Internet, look for greater experimentation in the next year. Many also suspect that there are several more applications with "legs" enough to influence business thinking and practices.
Among the new or emerging Web applications are:
• Internet as a storage/staging platform. Look for firms to build massive databases online that can be accessed to deploy or service wireless devices, private networks, intranets or voice channels. The Web is increasingly secure and reliable for storing and accessing huge amounts of data efficiently for global use.
• Internet as a go-anywhere tool. As the Web becomes untethered, it changes from being a desk resource to a personalized mobile tool. It is no longer an appointment or a destination. It is something you use all the time to make your life easier and more convenient.
• Intranets as internal expediting. Most intranets are just emerging from being brochureware. As more sophisticated technology is deployed, intranets will present personalized "dashboards" to employees to facilitate thinking, interacting and transacting with customers on a continual global basis. Content management, multipoint publishing, multilevel security and instant messaging will increase control, cost savings and competitive agility.
• Legacy system and enterprise resource planning work-arounds. Posting huge amounts of data to the Web is cheaper than redesigning legacy systems or undertaking large-scale ERP implementations. Look for a big class of companies to sidestep millions in investments in favor of Web-based platforms and work-arounds.
Things are not bleak. There is no reason to talk ourselves into a recession. The first big bubble of dumb money and hype has burst.
It is time for the realists and practitioners to take over and to bring the promise of the Internet to life outside the hothouse of incubators and venture capital-driven greed.
There are plenty of ways to do it. We have the technology, the learning and the people. Let's stop whining and let's get going.