Today's competitive business environment continually forces businesses to evaluate the means by which they conduct business and the ways in which they can quickly and effectively implement changes in response to competitive pressures and changes in the marketplace. Companies have long recognized that information technologies are effective and essential weapons for fighting these ongoing battles. With the introduction of Web-based technologies in recent months, businesses are dramatically rethinking the ways in which they use information technologies to address their problems.
A tremendous amount of hype and promise surrounds the business use of the Web. It is becoming clear that the Web is causing fundamental changes in the way many traditional business processes are conducted, although the Web is not a panacea or solution to all the problems of all businesses. The Web is a force to be reckoned with and a medium that most businesses need to consider using to some degree.
This chapter discusses many aspects of doing business on the Web and some of the advantages that may be realized. It takes a brief look at which market sectors have been successful in Web-based sales. This is followed by a look at the role databases may play in many Web business applications. Many different business activities can be conducted on the Web, and this chapter presents several possibilities, along with examples of what some businesses are doing today. The final section presents a number of points you should consider when doing business on the Web.
Doing business in today's increasingly competitive marketplace requires companies to continually review their business processes. Unabated competition means that businesses must find ways to continually improve products and services, cut costs, provide more value to their customers, and effectively grow their customer base. Several competitive factors and pressures come into play for businesses operating in such an environment:
You can use Web-based applications to address many of these factors. Intranet applications such as those discussed in Chapter 1, for example, can provide internal productivity improvements and facilitate information sharing. External Web applications can address the remaining factors--especially those with some degree of interaction with customers and potential customers.
Doing business on the Web is not restricted to the selling of products. As you will see throughout this chapter, doing business encompasses many activities and processes--from marketing surveys to direct sales to post-sales customer support. Bringing many of these business functions to the Internet can result in tremendous benefits to a company as well as to its customers and clients.
So why should your company consider doing business on the Web? The primary reason comes down to maintaining and improving the competitive posture of your business. Although Web technologies and business applications on the Web are still in relative infancy, maintaining a Website has become a service that is expected of businesses. In other words, not having a Website has become a determining factor for many customers.
The Web represents a marketplace embodying a number of unique elements that can help a business maintain or enhance its competitiveness and position its target markets:
Corporate image is an important element of any business's marketing strategy. Websites tailored to project a certain image to a certain clientele are becoming common. These sites may contain a wide spectrum of information related not only to the products and services they provide, but also to the unique qualities and capabilities that separate them from the competition. Some firms post additional information, such as social causes in which they are involved, or their corporate mission, goals, and philosophies. Still other firms choose to cite core capabilities and past performance. A small, high-technology firm may develop a Website that describes the variety of highly technical research and development contracts it has performed successfully, for example, complete with project abstracts that detail corporate capabilities.
Such use of the Web as a public-relations tool is important not only for maintaining a customer base but also for establishing new clientele and attracting top-quality talent to work for you.
The Web quickly has moved from simply being a tool for public relations and enhancement of corporate image to a whole new means of delivering products and services. No longer are Websites used simply to tout products and to direct (potential) customers to traditional sales channels. Many sites now offer the capability to order products online directly. Some products are available for immediate delivery online as well. Many software vendors, for example, now enable customers to purchase and download registered software. Other companies, such as market-research firms, can provide copies of marketing studies and services online to paying customers.
What do customers want? In addition to low prices, customers demand quality service. Web technologies allow businesses to provide improved "human-in-the-loop" and autonomous services much more effectively. No longer are laborious phone calls required to find technical product information or the answers to many common technical questions. Customers now can find much of this information directly on a vendor's Website--any time of day, any day of the year.
When a customer needs direct support, Web technologies such as e-mail, the Internet, and Intranet applications allow employees to handle and track far greater volumes of trouble and support calls than phone systems alone. Additionally, Web-based systems enable your company to record specific customer preferences and provide more individualized and personalized service.
Customers also want value-added services. Knowing what you have to offer is not enough; they want to know how it will benefit them or get suggestions on which products they can use to best solve their problems. To this end, many companies also provide customers with access to searchable knowledge bases, which include technical white papers, case studies, and suggestions on how particular products may be used.
What does expansive reach mean? Geography and time no longer are as relevant as they once were. The Web holds potential as a leveling technology and offers many advantages over traditional forms of advertising. Unlike many forms of print, radio, or television advertising, Web advertisements are not limited geographically. You have almost no boundaries on the audience you can reach. Even small companies, which historically had no way to attract business outside their immediate region, now can attract business outside their normal regions--even globally--in a cost-effective way. Whereas traditional forms of advertising are transient, require repetition, and are subject to being ignored by a large part of the target audience, Web advertisements are persistent, comprehensive in content, and have the advantage of many customers actively seeking out the advertisement.
Finally, because of standardization in the base capabilities of major Web browsers in use today, businesses easily can develop applications that customers can use on virtually any type of computer, running virtually any operating system. These applications can be developed without extensive customization or requiring customers to use expensive or proprietary systems.
The Web offers a number of services, such as search engines, with which users can locate providers of products and services of interest. Someone interested in specialty products, such as hand-crafted Scandinavian wood furniture, easily can perform a Net search to find out whether and where any vendors of such products exist. What does this mean to a business? Visitors to your Website are coming there for a purpose: They are interested in what you have to offer. These visitors represent highly qualified sales leads and business opportunities. If even a small percentage of these leads results in direct sales, the cost of generating those sales is virtually nonexistent when compared to more traditional (and expensive) methods of sales, such as sending catalogs and direct mailings.
The unique aspects of the Web marketplace translate to a number of advantages for businesses:
Several surveys of Web-based sales have come to the same conclusion: Mass market items are not the big sellers today. The current trend is toward purchases of upscale and specialty products and services. The order in which the various market sectors rank can be viewed in two ways. In terms of number of units sold, for example, market sectors can be ranked in roughly this order:
When viewed in terms of total dollar sales, however, the rankings change somewhat:
These products and services reflect the demographics of the primary users on the Web today. It is estimated that affluent, young, professional, well-educated North American men make up roughly two-thirds of worldwide users of the Web today. North American women account for roughly another 20 percent.
Additionally, the amount of goods sold through the Web is projected to increase dramatically during the next few years. During 1995, it is estimated that more than $400 million in worldwide sales transactions occurred on the Web. That figure is projected to grow to more than $45 billion by 1998.
Web-based business applications enable companies to provide value-added services to their customers. Databases serve an integral role in many applications being developed for customer use and to improve the services provided to them. Some of the uses of databases in Web business applications follow:
This section presents a few ways in which businesses are using the Web.
http://www.commerce.net http://www.yahoo.com/Business http://www.einet.net/galaxy/Business-and-Commerce.html http://www.oak-ridge.com/topibrp1.html http://www.directory.net
An increasing number of one-stop shopping Web sites are being developed. Many of these sites charge a fee to give retailers a link from the main Website pages to information specific to the offerings of each vendor. Other sites are more sophisticated and provide interfaces to product databases that allow comprehensive querying about products and the capability to seek out retailers with the lowest-cost items of interest. Figure 2.1 shows one example of an online mall.
An increasing number of sites offers businesses (for a fee) the capability to
advertise their products, services, giveaways, and special promotions. These electronic
billboards are placed where they will be seen by a large number of Web users. This
is especially true of the sites that provide Web search capabilities. Figure 2.2
shows advertising on the Open Text Index site. In this case, Internet banking services
(another popular Web business) are advertised.
FIGURE
2.1.An online shopping mall.
FIGURE
2.2. Advertising on electronic billboards.
Although some people might view such advertisements as an annoyance, these billboards do serve the purpose of defraying the cost of providing many services, such as Internet search capabilities, at no cost to the user.
Financial services firms were among the first to realize the potential of the Web. Some firms reported as many as 100,000 site visits in the opening months of operation. In many cases, these visits represented new, highly qualified customer prospects.
Nearly all large firms now have Websites that provide a full spectrum of information
and services, from funds information to up-to-the-minute stock quotes, to investing
strategies and applications that allow secure online securities trading. Figure 2.3
shows one example of such a site.
FIGURE
2.3.e.schwab--The Charles Schwab Online Discount Brokerage Services
site.
One particularly interesting aspect of the Schwab site is that it was able to leverage from previously developed custom applications and programming interfaces. These were integrated with Web applications to give the company an entirely new marketing channel while protecting its previous investments in custom software technology.
Many firms now provide varying forms of online customer services. Digital Equipment Corporation maintains an online bug-fix and software-patch knowledge base that its customers can tap, for example. This system was implemented at a low cost in a manner of weeks and offers customers a much-needed capability. Additionally, Microsoft Corporation maintains an extensive Website complete with late-breaking product information, free software downloads, white papers, search capabilities, and so on--all of which serve to improve customer satisfaction, build loyalty, and improve corporate image.
Federal Express provides an incredible example of how a very simple customer service
application not only improved customer service but also saved the company a bundle
of money. Figure 2.4 shows the online package-tracking service on the FedEx Airbill
Tracking Website, and Figure 2.5 shows the results of an inquiry about a package.
FIGURE
2.4. FedEx's package-tracking service.
FIGURE
2.5.The results of a package-tracking inquiry.
By implementing this service, FedEx improved response time to customer inquiries while decreasing the average cost per toll-free phone inquiry from about $7 to approximately 10 cents. Given the volume of packages FedEx handles yearly, this amounts to savings of hundreds of thousands of dollars with no reduction in service to their customers--a win-win situation.
Information is a valuable commodity. More and more companies are recognizing this
and providing information search-and-retrieval services. Unlike numerous Internet
search services, these comprehensive information services are not fully underwritten
by advertising and therefore require the user to pay a fee for the service. Figure
2.6 shows the Electric Library, which enables subscribers to comprehensively search
hundreds of publications.
FIGURE
2.6.Information brokering.
Such services give individuals and organizations near-instantaneous access to information of interest or importance.
Employment agencies abound on the Web today. Typically, these services are free
of charge to job seekers and charge a fee to companies that want to post openings.
Figure 2.7 shows one of the larger online recruitment services: the Online Career
Center.
FIGURE
2.7.The Online Career Center.
These services offer users comprehensive query capabilities so that they can search databases of regional, national, or international job listings that meet specific criteria such as location, salary, experience levels, educational background requirements, and job title. Many of these sites also give users information on salary surveys, resume writing and interviewing tips, and other information important to job seekers.
Specialty and niche market products represent some of the premier sales success stories on the Web. One company that has received much attention is Virtual Vineyards; its home page is shown in Figure 2.8.
This is a unique commercial application in several respects. First, it enables
shoppers to order a variety of products online. Second, it gives customers a number
of information sources and tips on wine selection, available products, and so on.
Third, this is one of the first commerce sites developed from the ground up as a
database-based application. Using new tools from Sybase (specifically, web.sql),
the developers generated user interfaces, forms, and server-side applications to
create page content displayed to shoppers and to handle and process customer orders
and accounts. And, fourth, this is an instance where transaction security is implemented.
Note the unbroken key symbol in the lower-left corner of the figure. This indicates
that information passing between the server and the browser is securely encrypted.
FIGURE
2.8.Virtual Vineyards: Your Personal Food & Wine Shop.
As stated earlier, surveys have indicated that real estate represents the largest market sector in terms of total dollar volume in sales on the Web. Real-estate listings seem to be a perfect match for the capabilities of the Web. Potential buyers can query property databases to obtain listings of properties in various cities, regions, and neighborhoods. They can limit their search to certain price ranges and requirements, such as number of bedrooms and types of amenities. They can even view a picture of the property--all without ever leaving home or dealing with an agent until they find something of interest. Imagine the amount of trouble this would save anyone faced with moving to another part of the country.
Figures 2.9 through 2.13 show screens from the search-and-listing service available
at the Electronic Realty Agency (ERA) Website.
FIGURE
2.9.Electronic Realty Agency's home page.
FIGURE
2.10.Limiting your search to certain states.
FIGURE
2.11.Limiting your search to certain cities, property types, and price
ranges.
FIGURE
2.12.A list of hypertext links for each property listing that meets
the user's criteria.
FIGURE
2.13.The description of a property selected from the list of hypertext
links.
I included this full range of figures from this site to illustrate a couple of points. First, this is another application in which databases and database applications figure prominently in the service rendered to users. The sequence of figures illustrates and embodies many of the fundamental Web database development techniques and methods you will learn in this book. Second, this is an example of a site and application that is well-designed and laid out and is easy and intuitive for the user to operate. Third, the application, although simple to use, employs complex applications that offer the user much utility and value.
A business can get connected to the Web and establish a Web presence in several ways.
With the rapidly decreasing cost of computer hardware and Web server software, many firms are choosing to host their own Website at their facilities. Doing so requires that your company purchase a leased line connection to the Internet through an Internet service provider (ISP).
You can purchase hosting services from one of a number of companies that provide Internet connection Website management services. Purchasing these services frees you of the responsibility of maintaining the Web server hardware and software, as well as of security concerns that go along with connecting your facility to the Internet. But turning over your site to be managed by others also can limit the types of applications you can develop to run on their CPU and software (for example, do they have the software development and database management software you need?). This, in turn, limits the capabilities and services you may be able to offer your customers and users.
Some important points for you to consider when doing business on the Web follow:
The primary goal of this chapter was to give you a broad view of conducting business on the Web. You were introduced to issues and uses of technology that might be valuable to your business or organization. Subsequent chapters will discuss in much greater detail the methods and techniques required to develop Web-based business applications.
This chapter began with an overview of the competitive environment businesses face today, including the ever-present need to improve products and services while reducing costs. This was followed by a discussion on why doing business on the Web is such a good idea. Many potential benefits for businesses were discussed, including image enhancement, improved services, increased sales leads, and keeping a competitive edge. Next, you briefly looked at which market sectors have been successful in Web-based sales. Real estate and upscale and specialty goods and services are the big winners in Internet sales.
Databases play a significant role in Web business applications by providing the foundation for information services, customer account information, demographics statistics, product inventory levels, and product specifications. Finally, later sections presented examples of what some businesses are currently doing on the Web today and some important points a business should consider when conducting business on the Web.
