Planning & Managing an Internet Service
By Pauline M. Berry
- Introduction to the Internet
- 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
- Internet Access - build or buy?
- Site Construction
- WWW Tools
- Internet Issues and Implications
- Full Course Index
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:
- communication (internal and external)
- corporate logistics
- levelling the playing field
- globalization
- gaining and maintaining a competitive advantage
- cost containment
- collaboration and development
- information retrieval and utilisation
- marketing, PR and sales
- transmission of data
- creating a corporate presence
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.
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:
- Market aggregation: The internet and especially the WWW is not generally understood as a mass market (despite the numbers) it usually involves one-to-one promotion.
- The Internet supports both horizontal and vertical markets
- Environment scanning on the Internet usually has a narrower scope
- Market Segmentation and Demographic research are new to the Internet and surveys are still somewhat unreliable
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.
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:
- How will I get people to visit my site?
- How will I get them to remember it?
- How will I get them to come back?
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.
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:
- 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.
- 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.
- 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.
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....
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:
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.
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
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
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.
- 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.
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.
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.
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 .