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The Emerging Business
and the Internet:
Part Three


See also:
Electronic Commerce (eCommerce)

          "The Year of the Web."  Suddenly, the owner/manager of almost every small business is being badgered with the question of whether they need a "home page"  -- and, if so, why and how? "Everybody’s doing it!"  Unquestionably, the Web is revolutionizing marketing and nobody can afford to ignore what the impact is likely to be on their own business.

          Procter & Gamble announced in April that it is making a major marketing move on the Internet scheduling eight initial Web sites for consumer brands within three months. Tide  detergent, Pampers  diapers, and Cover-Girl  cosmetics are among the brands selected to have their own sites. P&G has registered more than 80 domains with InterNIC, the collaborative service with which network components are registered for Internet connectivity. This is far ahead of any competitors. As America’s largest advertiser, P&G has been respected for more than a century for "having written the book"  on the marketing of consumer products; while blindly copying this leader may not always make sense, any major marketing move by P&G always warrants careful consideration.

          However, while the Web is immersed in great frenzy and is bubbling with innovative marketing concepts, the decision whether, why and how to establish a Web presence must be approached with the same sound quantitative analysis we would employ for any other business decision. We do not establish a Web presence because "Everybody’s doing it!"  We establish a Web presence because we believe it is a way to strengthen market position and enhance earnings.

          Well before any decision is to be made, the owner/manager of the smaller business must  become familiar with the Internet. Even though it may be intended to hire a talented specialist to design and set-up a Web site, this does not obviate the need for the owner/manager of the smaller business being personally familiar with the Internet. It is important to see what other companies are doing and the wealth of innovative presentations being offered. Sites should be analyzed for content, structure and graphics; communicating via the Web is totally different than communicating via TV or the print media. The most effective Web sites are often designed by young artisans who are not locked into "old fashioned"  ways of communicating.

          The question can then be addressed what -- specifically -- do we expect to gain by a Web presence. Anyone with a grasp of business will quickly recognize that few businesses now on the Web are yet "making money"  on it. While many Web sites may require a surprisingly modest monetary investment, the commitment of management time, attention and distraction can be substantial. "What’s the payout?"

          The sole purpose of being online is to deliver information to our viewers. It is axiomatic that this information must "add value"  that is recognized by the viewer. The added value may be content, convenience and/or accessibility. The "added-value information"  offered by some companies is interactive product support. This is readily grasped for computer-related hardware and software, but P&G contemplates including the URLs (Web addresses) on consumer product packaging -- e.g., Duncan Hines  cake mixes -- offering the customer round-the-clock access for product-specific inquiries.

          Of course, the most common "added-value information"  offered is to enable prospective customers to make purchasing inquiries and even purchasing decisions -- viz.,  advertising. Internet advertising is a dynamic commerce that is evolving literally from week-to-week. Two initial options are available -- passive advertising and interactive advertising.

          Passive advertising is comparable to the traditional presentations in the print media, billboards or TV. It is designed primarily to enhance name recognition e.g., "Drink Coca-Cola®."  Some passive advertising is to be found on the Internet, primarily on the welcome pages of the consumer access services (e.g.,  America Online), the browsers (e.g.,  Netscape Navigator), and the search engines (e.g.,  AltaVista). These do not require any action by the viewer -- simply subliminal recognition.

          However, interactive advertising is writing the new rule book for advertising on the Web. Interactive advertising invites some action by the viewer that immediately "links"  the viewer to the advertiser’s site. A Link -- viz.,   hyperlink -- is the path between two douments (sites) allowing the viewer to point-and-click on specific words or icons on the screen and thereby move instantly to the requested location wherever it may be on the Internet; links  are the WEBbing of the World Wide Web (WWW).

          Interactive advertising can offer substantially more "value-added information"  to the viewer, and can facilitate an online response and even purchasing action by the viewer. Interactive advertising is the new communications dimension offered by the Web. Potentially, this is where enhanced earnings are to be found on the Web. In the bluntest terms, a Web presence makes sense -- perhaps especially for the smaller business -- once we construct a profitable revenue model for online interactive advertising.

          Online interactive communications and business development will be the continuing focus of subsequent columns.

Your comments and suggestions for these pages are most welcomed!

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Thomas A. Faulhaber, Editor

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