MOST COMPANIES recognize the Internet is here to stay, and that they’ve got to figure out this new thing called e-commerce. While many firms get it, the vast majority simply don’t. They fail to observe the three golden rules of online business.
Trust Why is trust so important? Because the Internet is flat-one can’t see the depth and strength of the company behind the Web page. There is no Fifth Avenue or Wall Street address, no big, fancy building or quality decorating that might give a clue about the financial strength, integrity and longevity of the firm. Anyone can put up a Web page that looks great and gives the impression of a solid, well-financed, highly reputable outfit. Moreover, the cost of creating such a page is incredibly small. The result is a lot of fraud, and a lot of fear.
Rather than arguing about the extent of Web fraud, or whether the general public’s fear of doing business online is decreasing, businesses need to accept the truths that fraud and fear exist. Even if-or, more optimistically, when-the amount of fraud and fear decrease significantly, because the Web is a flat medium there always will be a very healthy degree of skepticism affecting how online buyers shop. More specifically, it will dictate who they give information to (e.g., their credit card number), and who they buy from.
Thus, in terms of building an Internet brand, businesses must emphasize the creation or exploitation (depending on your business’ standing in the non-Internet world) of trust.
If yours is a well-entrenched Fortune 500 company, wave the flag. Coordinate non-Web brand building with online efforts. Exploit the current state of fear and position the firm as a “real” company, with real offices or stores your customers can go to, and real people to talk to. If yours is a new Web-based company, think about the fear factor and develop ways to overcome it. One obvious and very effective technique is to use testimonials or product and service reviews from well-respected magazines and consumer surveying companies.
The specific technique used to exploit or build trust isn’t important. What is important is the recognition that fear exists, and building a successful e-commerce brand requires the trust of the company’s current and future customers.
Consistency The importance of consistency, like trust, derives from the very nature of the Internet. Every Web page is unique. Moreover, there aren’t any norms for navi gating through a complex site or utilizing a site’s offerings. For example, how does a customer buy something? Every site is laid out differently, requires the input of lots of data, and presents charges and costs in a different way. The result is that every customer must endure a learning curve to use a site. While the grade of incline and length of the curve vary, the existence of some curve is universal.
The concept is best explained by way of analogy. Most Americans have the option of buying their groceries from two or more stores virtually identical in terms of price, convenience of location, and quantity and quality of selection. Why, then, do most grocery buyers generally shop at just one of the two or more “identical” stores? Because they know the store they frequent. They have learned where particular items are located, the logic of the store’s groupings and layout, who has the answers to their questions and where those people can be found. In other words, they’ve undergone a learning curve. They tend to select the store that requires no new learning, and are reluctant to change stores without a compelling reason to endure that learning curve again.
These “supermarket truths” apply to the Internet in the same way. Once you design and put up your Web site, enhance it-don’t change it. Make transitions and face-lifts gradually. Assure logical continuity. Remember that the learning curve is exacerbated by the trust issue: One of the elements that must be learned is trust. A site that is always different doesn’t engender trust.
Basic Business Practices The final golden rule is so basic it’s often forgotten. It is, very simply, to remember that technology is a tool, not a substitute for fundamental business practices.
One of the pre-eminent problems today with the Internet and e-commerce is that frequently the managers who oversee Web sites are techies. They don’t understand the fundamentals of corporate brand building, profits, customer retention and the like.
Moreover, these so-called managers are often unmanaged. Why? Because the people supervising the techies may not fully comprehend the technology, and are in fear and awe of it. Further, it is not uncommon for traditional managers to believe they could better communicate with an alien than with a techie. Making matters worse is that, in terms of revenue and profits for most corporations, the Internet is still usually comparable to a gnat on the back of an elephant. Good managers prioritize, and the small-dollar items fall to the bottom of the heap.
While this situation is rapidly changing, it’s still all too often the case. Since most Web sites are run by engineers rather than skilled businesspeople, it’s no wonder that companies see few (if any) profits from their Web investments. Similarly, it is easy to understand why technological glitz and “cool” dominate many Web sites instead of, say, the arts of effective marketing and merchandising.
Points to Remember Yet, if one talks to those individuals who run profitable Web sites (and they do exist, contrary to common belief), two themes are repeated over and over.
First: Know the customer. Build an e-commerce site based on customers’ desires, tastes and needs. Second: Profits and revenue are derived from great retailing, solid merchandising and superior customer satisfaction-not technology.
While these two points might seem obvious, they are all too often lost in the whiz-bang world of e-commerce. No matter how great the show, if the products are lousy, poorly marketed or badly priced, sales and profits won’t happen. Similarly, if the products and prices are great but the interface is too complicated or cumbersome for site visitors to deal with, those surfers will click away and no sales will be generated. Also, if the product, merchandising, prices and interface are all terrific but the goods don’t arrive in a timely fashion, or there are billing errors and problems, the customer will likely not return. Indeed, an e-commerce site is like a restaurant: one bad meal and the customer is lost forever.
E-commerce is a fundamentally new form of business communication built on truths that are still being learned. Even so, experience to date has revealed some guidelines to go by.
When the Internet is understood to be not a new twist on existing media but rather a unique and essentially different medium, and the three golden rules of trust, consistency and basic business practices over technological flash are applied, an effective cyber-brand is created-and profits follow.
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