Planning & Managing an Internet Service

By Pauline M. Berry


INDEX

  1. Introduction to the Internet
  2. REAL BUSINESS OPPORTUNITIES
    2.1 Marketing on the Internet: Case Examples
      2.1.1 WWW Advertising
      2.1.2 Direct Marketing using mailing lists and email
    2.2 Improving Customer Services and Support: Case Examples
    2.3 New Business Opportunities: Case Examples
    2.4 The WWW as an intra-networking Tool: Case Examples
      2.4.1 Why should a business consider developing an Intranet?
      2.4.2 Why is Internet technology useful?
      2.4.3 What Kind of Information is on An Intranet?
      2.4.4 Some Intranet Case Studies
  3. Internet Access - build or buy?
  4. Site Construction
  5. WWW Tools
  6. Internet Issues and Implications
  7. Full Course Index

2. REAL BUSINESS OPPORTUNITIES

The fastest growing segment of the Internet is Business. But why is the Internet so attractive to businesses? Some of the answers are given by Ellisworth and Ellisworth as: Some of these business opportunities are conducted in a very visible way with corporations using a variety of internet services to create a corporate presence. Other users are less visible, using the Internet for large amounts of data traffic, these tend to be financial and medical institutions.

Once of the principal features of the Internet, email, is one of the most used in a business context. Communication is vital to today's business. Email provides a low-cost, fast, reliable service which doesn't see time zones as a problem. It allows a business to stay in touch with branches, customers and suppliers, to work in teams, collaborate with other organisations. Product and company sponsored mailinglists allow companies to enhance their customer support services. Public discussion lists and newsgroups often allows a company to keep up-to-date with technological, political and social change. Email and additional conferencing tools can be used to support virtual organisations and telecommuting. There are many advantages to email.

The more recent addition of the World Wide Web information service has further fuelled the business interest in the Internet. Internal Webs (intranets) can be used to make visible related information from different company divisions or business function. For example, marketing, accounting, sales and planning information can be integrated and current versions are available to the whole company. The WWW can also offer rich information sources from scientific data and product information to databases, books, manuals, training information, stock prices and corporate annual reports to name but a few. The WWW provides companies with the opportunity to increase their presence in an environment where online marketing, publicity and sales is possible. It can also help to level the playing field with giving a small company the ability to move from a provincial market to the global market. To create an image on the network which allows them to compete with large organisations.

Finally, there are new business opportunities on the Internet. The possibility of secure electronic financial transactions across the Internet has opened up the possibilities for financial institutions as well as business which conduct every facet of their activities online. Already there are numerous instances of virtual shops and shopping centres of information searching services and electronic publishers.

In this section we are going to take a closer look at some specific uses of the Internet in a business setting including: marketing; customer services and support; new internet-based business opportunities; and intraneting.


2.1 Marketing on the Internet: Case Examples

Experts predict that Internet advertising is about to take off in a big way. However, Internet advertising is not like print and TV advertising. For example, a World Wide Web Ad is not just a way to promote a product, but can also be a shop, help line and much more. Differences between online marketing and using other media include: A recent study by Forrester Research predicts that combined advertising on the WWW and online services will reach $2.6 billion by the year 2000.

In this section we will look at 2 aspects of Internet marketing: WWW advertising; and Direct Marketing using mailing lists and email.

2.1.1 WWW Advertising

Many companies recognise the benefit of having a corporate presence on the WWW and the possibilities for Marketing via the WWW. WebTrack said $7.3 million was spent on Web banners and links in January 1996. It also published tables showing the Top 10 WWW sites with most ad. revenues and the Top 10 advertisers. However, a WWW marketing strategy is quite complex and the amount spent on banner placement is only a fraction of the money advertisers are putting into the development of their own WWW pages.

Advertising on the WWW does not start and finish with the development of a nice flashy WWW home page. The WWW advertiser must address the following questions:

  1. How will I get people to visit my site?
  2. How will I get them to remember it?
  3. How will I get them to come back?

Web Marketing: Roll-up Roll-up

Companies use a variety of ideas to publicise their home page. Initially it is important to ensure your URL is visible on your print media, that your pages are designed to cross-link. By including the URL on all company employee .sig files and encouraging active participation in newsgroups and mailinglists. These .sig files are often picked up by Internet search tools.

It is also possible to buy advertising space on very popular sites. These spaces are called banners. The Web site which earns most from this business opportunity is Lycos and the company which spends most on banners is IBM. However, banners are a good way targetting market segments. Another popular banner sit is ESPNetSportZone which is targetted by sports and fast-food related businesses.

Other very popular sites do not use banner advertising but instead rely on word-of-mouth and the appearance of its URL on other media and in other areas of the Internet such as Newsgroups. A good example of this is Ragu's Mama' Cucina which is one of the most popular and charming commercial sites.

Web Marketing: Remember Me?

Good Web design is a key feature of getting someone to remember your company's name. As in traditional forms of advertising this can take the form of eye catching graphics and clever slogans, however, what must come across in each page and each banner is a corporate or product identity.

Let us look to the strengths of the internet. Robert Brueckner argues that it is wrong to use the TV as a comparison because there are differences in the 2 types of media.

   What TV is good at:	   What the Web is good at:
    
   * Moving pictures           	* Information                          
   * Sound                      * Communication                        
   * Passive Entertainment	* Active (self-directed) entertainment                          
   * Commercial Breaks          * Personal Choice                     

In contrast to TV advertising which is intrusive and designed grab your attention and convert you to a specific brand or product, the interactive model on which the Web is based presumes that marketing content is what the customer comes to see. "You're here so you must be interested in my products". Much of the appeal of the Internet is its interactivity and Web pages recognise the 3 levels of interactivity that currently operate on Web pages:

The levels of Interactivity:
  1. Get people to visit and read the page

    We have already dealt with the logistics of getting people to select your URL. But how do you get them to read anything? Consumer research offers important guidelines for Web page design. The golden rule is to communicate quickly, clearly and visually. People generally spend less than 15 seconds viewing each Web page so much of a page will be ignored. Thus the 2 important points to remember are to communicate visually, important points should break through the clutter of text with visual landmarks, and secondly get to the point quickly.

  2. Activity

    The customer can visit a page click on buttons, search for information, follow threads of interest. The pages to nurture a customer, get them to linger and thus create more interest in the product, company or service. Give the viewer something to do rather than just read.

  3. Interactivity

    At this level the customer begins to form a relatioship with the pages. The visitor may be able to leave feedback, send email, registration, order or take part in a survey, game, competition. Some of the best marketing pages offer this level of interaction: Time Magazine; HotWired; Ragu's Mama' Cucina.

Web Marketing: Your Hooked!

Once someone has visited your site, the challenge is to get them to come back. Some of the ideas that have been used so far include:
Curiosity
If it is a large site then there will be too much to see in one visit, so visitors might come back. The information should not be confusing but the visitor should always feel there is some nugget just around the next corner.
Item Turnover
Many sites provide some item that changes frequently or each time a someone visits a site. This may be a "what's new" feature a daily aphorism, coverage of current events in your industry. Newspapers (e.g. Times and Telegraph) have an inbuilt turnover factor and are frequently revisited. Other sites such as the BBC and Supernet us the "What's New" strategy.
Indispensable Tool or Resource
Many successful Web sites offer links to existing databases, collections of Internet resources, Web guides, searching tools or repositories of images or files. These collections or resources should be of high quality and well presented. These sites are sometimes called value-added Web sites and some god examples are Downtown Anywhere, Quadralay, Digital with it's award winning Altavista search engine. Others exist solely on the strength of their value-added services: e.g lycos, yahoo, bubl.
Unique Event or Resource
Finally, a page can provide contests or give-aways to keep people coming back. Some sites have given away money prizes, cars, houses, conference registration fees, free product samples etc. The Times has offered money prize contests, Other unique services might be first-person coverage of industry conferences or trade shows; an "ask the expert" feature or....

2.1.2 Direct Marketing using mailing lists and email.

The idea of bulk email has many possibilities and problems in the world of the Internet. In 1995 Marketry Inc., a direct-mail list-management company offered to rent out lists of over 250,000 e-mail addresses harvested from newsgroups and Web sites. It came under a large amount of pressure from Internet users, businesses and even it's own industry leaders. The idea was dropped by Marketry Inc.

Unsolicited e-mail advertising, or spamming, is fast becoming a real issue. Some within the advertising industry are concerned that just because email addresses are accessible doesn't mean they should be abused for marketing purposes. In fact, bulk email drops are unlike their land mail versions because the cost is borne, in part, by the "victims".

However, these concerns are not stopping an ever increasing rise in unsolicited email reaching our mailboxes. In the USA this problem is more relevant as it is early days in the UK. Some direct-marketing companies simply hoover up email addresses and the send out advertising mailshots, others justify their strategy by allowing "victims" the opportunity to remove their name from the list, see Cyber Promotion. However, at least one unwelcome message has to be received first.

One solution is to set up subscription lists. For example Tenagre Corp., runs a popular Web site called the WWW Tennis Server. Users can sign up for a companion mailing list and receive a monthly newsletter. Clifford Kurtzman Tenegra's president says of their subscription approach "..bulk email in itself can be a wonderful marketing tool....they've given you permission to put something right in front of them in their email box" Other solutions include a central opt-out system where consumers can be kept off the direct marketing lists. This solution is supported by the Direct Marketing Association.

For more information about bulk email:


2.2 Improving Customer Services and Support: Case Examples

Our second example of business uses of the WWW is in building customer connections. Customer Focus has become a watchword for companies intent on improvng their reputation for service and increasing market share, in fact a HARVARD BUSINESS REVIEW article notes

"the driving force behind world economic growth has changed from manufacturing volume to improving customer value. As a result, the key success factor for many firms is maximising customer value." [Carothers et al.]

Today the task of keeping the relationship between your company and your customers must involve more that occasional sales calls and promotional mail. It must also encompass knowing individual customer preferences, keeping in touch with overall market trends, supplying a stream of new information to potential customers and offering high quaility support services.

When we look at these requirements and the strengths of the Internet (information gathering, information provision and interactivity) the link with customer connections is obvious. This link was initially recognised by computer-oriented businesses who's customers often had internet access. As early as the mid-1980's Intel encouraged customers to email their bugs and problems for a fast response. Others were setting up mailing lists to promote discussion about their products or encouraging support staff to take part in Usenet Newsgroups concerning their products. For example Digital has used the Internet to distribute its press releases and product announcements to editors, consultants and analysts since the early 1980s. These are also posted to the biz.dec newsgroup on Usenet along with new services information, seminar announcements, promotions etc. Some sites are now offering online training to registered customers.

Figure :1 adapted from Cronin shows how the internet can be used to enhance customer connections at the three crutial points of interaction on the customer continuum.

Figure 1: The customer continuum

Good customer support must be integrated with the overall Internet strategy of an organisation. There are numerous example of customer support service on the internet, have a look at a few:

Digital

has long viewed the Internet as an important marketing, sales and support tool. For the casual customer it combines on-line product information with a virtual shop front. Customers have flexible access to product descriptions, detailed specifications, prices and even some on-line demos. New software can be downloaded for inspection and access to information about products' performances at other sites is available. Customers can order and track their orders via the internet. For users there are help desks, discussion groups, access to software patches and many other services.

Yankee Book Peddler

has a very different set of clients from Digital but found their customers expectations were becoming more important to the business and in 1992 set up a direct link to the Internet. As Amy Miller said,

"With an Internet Link in place, we are able to meet the immediate demand for enhanced information and explore other value-added service for the future"

Yankee provide a range of service from access to catalogs, online ordering services, search capabilities and through customer registration schemes can offer a personalized approach where dedicated customer service teams can be responsive to each library's (clients) needs and understands its unique service expectations.

Silcon Graphics

has an excellent reputation for customer support. A large number of technical staff follow discussion group and newsgroup discussions responding to individual queries and feeding back information from customers to development teams. Thus integrating the whole product lifecycle. E-mail help desks are set up for different customers to respond to different levels of technical competence.

2.3 New Business Opportunities: Case Examples

An early 20th century economist, Joseph Schumpeter theorised that

"major inventions lead to periods, or "outbursts", of intense technical innovation. These periods are followed by "creative destruction" of old industries as innovation diffuses through the marketplace transforming products and consumer expectations" (1942)

If the internet and global connectivity is the major invention then the innovation has already begun. New companies are being established all the time, in industries which didn't exist before the Internet or which transfor products, business practices and customer relationships.

In this section we will briefly mention a few of these opportunities. However, you should note that the possibilities are limited only by our immagination and people will continue to make fortunes with new ideas about how to make money on or using the Internet.

There are those for which the Internet or the WWW itself provides the business. Examples include:

There are those which wish to exploit the Internet as a resource through which their business operates. Some early examples include


2.4 The WWW as an intra-networking Tool: Case Examples

A study by Zona Research Ltd in 1995 suggested that

"using Internet technologies within an organisation and enterprise to improve internal communications and productivity is a bigger opportunity than supporting digital commerce applications"

The suggestion is that internet technology within an organisation may bring more benefits than between organisations. The resulting internal corporate Internet systems are now referred to as Intranets.

"An internal Internet, or Intranet, simply defined is the structured use of Internet technologies to conduct the business of an enterprise. It is an environment of network and computing tools based on those used in the global Internet that is isolated from or connected in a controlled way to the global network. This environment is completely owned by the enterprise and is generally not accessible from the Internet at large." NASA

2.4.1 Why should a business consider developing an Intranet?

This catergorisation of business benefits of Intra-enterprise use of Internet technology is adapted from Steven Telleen

To Reduce Information Overload
organisations are increasingly being buried under a sea of information. Technologies which were intended to help the problem seem to worsen it instead. Workers tend to file information, copies of information, email messages, printed copies of email messages, faxes, etc.. just -in-case. Organisations have moved to centralised information systems and databases in order to control the explosion of information. But the cost of inputting and maintaining these stires are too great. Web technology offers the possibility of distributed information authoring, publishing and management.

To Empower the Individual
The WWW technology also has the ability to shift control of the information flow from the creator to the user. An executive doesn't need to wait for montly updates on system performance or budget statements but can retrieve and view information when and where they need it. Information doesn't need to be sent just in case. This applies to a host of information that floods into out in-trays every day. From meeting minutes, to training schedules, reports and forms.

Another technology which empowers the individual is e-mail, a necessary component of Internet technology within an organisation. E-mail allows communication between individuals or within groups and often facilitates discussion.

Efficient Information Transfer
Documents and traditional training are often thought to be inefficient methods of distributing information. Traditional training provisiosn, like filing cabinets, are full of case-in-case information which is out of phase with requirements. Web technology allows training and other information to be maintained and supplied on-demand.

2.4.2 Why is Internet technology useful?

Scalability
An immediate concern for organisations today, in a global market place is the problem of increased environmental and organisational complexity. In theory an intranet may be able to tackle some of the issues surrounding this problem. In addition, since the technology sits on the ICP/IP stack then Intranets are highly scalable.

Open Standards
Intranet can be constructed using "open" standard-based applications thus avoiding the problem of being locked into proprietary technologies. There is no reliance on a particular infrastructure and the intranet can communicate across and between different platforms

Group Work/Virtual organisation Support
Intranets allow companies to integrate groupware or workflow-enabled applications.Links into a companies legacy databases can integrate company information.

2.4.3 What Kind of Information is on An Intranet?

In general terms the information supported on an Intranet can be distinguished from that on a companies Internet home page. Intranet information would be restricted to clients in the Intranet group and protected from the global Internet using some kind of firewall arrangement.

Information Sources

Pages on the internet can be "content" pages which can be read or supply information from a database. Broker pages help users find the relevant information. From Telleen>, there are 3 sources of content on enterprise Intranets.

Formal Information
official information about and from the company. Reviewed for accuracy, currency, confidentiality, liability and commitment.

Project/Group Information
intended for and perhaps limited to a specific group within a company. It might be accessible via password mechanism and may be used to coordinate activities, share ideas. Some of this information, once approved may move to the formal category. Other intranet tools which aid workflow includeemail, threaded email discussion groups and newsgroups. In addtion, companies such as Webflow and MKS are starting to provide Web tools that support groupware, reviewer's comments, and signing off functionality.

Informal information
begins to appear once users discover how easy it is to publish. This can be a powerful stimulus for collaborative effort.

2.4.4 Some Intranet Case Studies

From Netscape:

3M
3M's global network depends on timely economic analysis to prepare business plans and stay competitive. Using Netscape products, the company can quickly disseminate its corporate economists' quarterly reports to employees anywhere in the world, instantly and securely.

View demo       Company information

Cushman & Wakefield
The real estate services firm Cushman & Wakefield could use applications created with Netscape Server software to give its 700 brokers a competitive edge. No matter where they are in the field, with just a few computer keystrokes brokers could access a wide range of information that can help build relationships

View demo        Company information

National Semiconductor
National Semiconductor engineers can enhance their productivity by using an internal web site called Community of Practice. It can serve as a highly secure forum from which engineers can share confidential knowledge and ideas with their colleagues

View demo       Company information

Others:

Tyson Foods

Tyson Foods, Inc. and its various subsidiaries (collectively, the "Company" or "Tyson") produce, market and distribute a variety of food products.

Article


Back To:
FULL COURSE INDEX PAULINE BERRY | DIS | STRATHCLYDE UNIVERSITY


Last modified .