Best Practices: E-Commerce

E-Commerce Overview

Experts predict that by 2003, 500 million people will use the Internet on a regular basis. By 2004, Internet sales will reach 1.5 trillion dollars. According to TEC speakers Terry Schulenburg, Ken Sethney and Ed Taylor, riding this economic wave requires a keen understanding of how the World Wide Web is reshaping the way we do business.

What's driving the Internet's explosive growth? A remarkable ability to increase sales and reduce costs while simultaneously enabling businesses to deliver their products and services in ever-expanding ways. Even more remarkable is the Internet's ability to change the face of entire industries.

The Internet has already changed the way many people buy cars, shop for mortgages, interact with their banks, book travel arrangements and more. On the business-to-business side, the revolution has just begun. Industry giants like Wal-Mart and Home Depot are spearheading an online onslaught that will permanently alter the way companies and their vendors do business together.

In the future, companies will succeed according to their ability to use digital technology to streamline business processes and add value to their customers in ways never imagined before the arrival of the Internet.

Creating a Successful Web Presence

The Internet is not about technology. It's about using technology to solve problems that people can't solve for themselves. Companies that succeed in establishing a dominant online presence:

• Create a focused Internet plan with very clear timetables, roles and responsibilities, and expected outcomes.
  
  
• Clearly define the expectations for their Web sites.
  
  
• Clearly define their target markets.
  
  
• Have a strong "pull component," the compelling benefit that brings people to their Web sites.
  
  
• Understand how the Internet differs from every other communication medium.
  
  
• Outsource as much of the technology as possible.
  
  
• Measure results.

Creating an Internet Action Plan

Companies that succeed on the Internet use two types of plans to accomplish their e-commerce goals: a one-page business plan for the CEO and a more detailed implementation plan for the project manager. The business plan should cover five key areas:

• The business problem(s) you intend to solve for your target market
  
  
• Specific goals and objectives for the Web site
  
  
• Time frames
  
  
• Budget
  
  
• Measurement criteria

The implementation plan includes seven essential steps:

1. Identify the goals and objectives of the site.
   
   
2. Assign roles and responsibilities.
   
   
3. Conduct site analysis and design.
   
   
4. Create the content.
   
   
5. Market and promote the site.
   
   
6. Establish a timeline.
   
   
7. Measure results.

Designing an Effective Web Site

According to our TEC speakers, all great Web sites incorporate 10 fundamental design principles:

1. Convenience
   
   
2. Transparency
   
   
3. Fulfillment
   
   
4. Security
   
   
5. Personalization
   
   
6. Proactivity
   
   
7. Timeliness
   
   
8. Choice
   
   
9. Interaction
   
   
10. Focus on content.

To provide meaningful content to your Web site audience:

• Establish your corporate power point, the compelling value you offer that sets you apart from the competition.
  
  
• Use the three "Cs" of online copywriting. Create Clear, Concise and Compelling copy that:
  
  
• Tells a story about your product or service
  
  
• Focuses on the benefits of using your product or service
  
  
• Asks for and entices customers to take action now
  
  
• Tells customers what's in it for them if they act right away
  
  
• Use attention-grabbing headlines and subheads.
  
  
• Allow for plenty of white space.
  
  
• Romance the reader.

Marketing Your Web Site

An effective Web site marketing campaign involves three key elements -- the proper use of search engines plus online and offline marketing and promotional tools. To optimize your Web pages for search engines:

• Identify search words that relate to your company/product/service.
  
  
• Establish strategic page titles.
  
  
• Use hidden search words.
  
  
• Use search word density.
  
  
• Plan for misspellings.
  
  
• Consider multiple entry pages.
  
  
• Monitor your search engine ranking.

Online marketing tools include:

• E-mail, especially when used in conjunction with list servers
  
  
• Banner advertising. When using banner advertising:
  
  
• Use the magic words "click here."
  
  
• Use motion, such as a blinking sign that says "free."
  
  
• Use bright colors.
  
  
• Test your banner ads in three locations: search engines, niche sites (sites your target market visits) and high-traffic, general interest sites.
  
  
• Contact-sensitive advertising
  
  
• Online micro-markets, such as e-zines and news groups
  
  
• Reciprocal links

Offline marketing tools include:

• Printed brochures detailing the benefits of your Web site
  
  
• Postcards
  
  
• Offering a free report or white paper on the site
  
  
• Listing your Web address on invoices, business cards, letterhead, fax cover sheets, etc.
  
  
• Messages about your site on your telephone on-hold recording
  
  
• Radio, billboards and trade magazine print ads
  
  
• PR
  
  
• Coffee cups, refrigerator magnets and other trade-show give-aways
  
  
• Media reviews of your Web site

Implementation Tips

To assist your online implementation process, our e-commerce experts recommend the following:

• Take advantage of the online loyalty factor.
  
  
• Don't overlook the "About Us" and "Contact Us" pages.
  
  
• Give online customers as much access to your internal systems as possible.
  
  
• Use your site to educate customers.
  
  
• Use e-mail as a customer retention tool.
  
  
• Help your employees deal with the technological changes.
  
  
• Consider application service providers.
  
  
• Communicate eye to eye.
  
  
• Get personal.
  
  
• Build an online community.
  
  
• Deliver real value for a person's time online.
  
  
• Reverse-engineer your site.
  
  
• Beware of the "Disney distraction."
  
  
• Use buttons and text links to simplify site navigation.
  
  
• Plan for offline data capture.
  
  
• Consider offline follow-up.

Working with Outside Vendors

Outsourcing the technology (not the strategy) side of e-commerce offers considerable advantages, including faster time to market, better use of internal manpower and resources, ability to keep up with changing technology and avoiding costly mistakes.

When outsourcing:

• Don't hire a vendor/consultant you wouldn't hire as an employee.
  
  
• Check references carefully.
  
  
• Know the vendor's capabilities.
  
  
• Demand transfer of knowledge.
  
  
• Understand the two types of bids -- "time and materials" and "fixed" bids -- including the advantages and disadvantages of each.

Security Issues: Building a Safe Web Site

Online security has to do with protecting sensitive information from online theft. Online privacy has to do with not giving or selling personal information to third parties. Successful Web sites pay close attention to both. To guard against the theft of sensitive information and give your customers a sense of security:

• Store sensitive information on a separate server.
  
  
• Have a security/privacy statement.
  
  
• Include an "About Us" section to build trust with your site visitors.
  
  
• Offer payment alternatives to people who don't want to use their credit cards online.
  
  
• Outsource the processing of transactions and storage of sensitive information.
  
  
• Use passwords to protect your site.

Measuring Results

Companies with successful Web sites measure two levels of performance -- the performance of the site itself and its ability to achieve e-commerce goals and objectives.

Key site performance measures include things like:

• Unique site visits
  
  
• Individual page hits
  
  
• Advertising use
  
  
• Profiles by city, state, region, country, organization or Web address
  
  
• Activity level by time of day and day of week
  
  
• Bandwidth
  
  
• Banner ad hits
  
  
• How people find out about your site

To measure your e-commerce ROI, ask one simple question: "Is our Web site making or saving us money?" If so, it's working.

The Top 10 E-Commerce Mistakes

Beware of these common -- and potentially fatal -- e-commerce mistakes.

1. Lack of clear goals and objectives
   
   
2. Giving control of your Web project to an IT manager or Web designer
   
   
3. Failure to promote your site
   
   
4. Lack of scalability
   
   
5. Failure to make it easy to do business with you
   
   
6. Failure to understand the medium
   
   
7. Poor site navigation
   
   
8. Boring content
   
   
9. Overuse of LUGs (Large Unnecessary Graphics)
   
   
10. Failure to measure results.

Contributing Experts:

Terry Schulenburg

Terry Schulenburg is director of Internet development for WinkComm, a technology services firm specializing in Internet business application development. An experienced programmer and frequent speaker at technology conferences, he is known for communicating highly technical ideas and issues to non-technical managers. He has worked on more than 100 Web sites over the past five years, and has a clear understanding of where the market has been and where it is going. His TEC program focuses on how to create and measure your online value proposition.

Ken Sethney

Ken Sethney is president of The Sethney Group, a consulting firm that works with CEOs and senior managers to plan and implement successful e-business strategies. As an Internet strategy coach, he guides the design and development of Web sites and marketing communications programs to meet his clients' e-business objectives. An experienced marketing communications professional, Sethney advocates a fully integrated approach to online marketing, sales and customer service, one that uses the Internet to create new business opportunities and improve relationships with customers, employees and channel partners.

Ed Taylor

Ed Taylor is recognized nationally and internationally as a leading authority on Internet marketing. He is president and founder of Internet Marketing Group, an Oregon-based consulting firm that helps companies identify and clarify Internet business strategies, build Web sites, "architect" the development of Web sites, audit Web sites and improve their productivity. He also counsels clients on how to implement e-mail marketing programs, monitor and enhance search engine rankings, provide newsgroup marketing, establish reciprocal links, establish and monitor "affiliate programs" and create, place and monitor banner advertising. A frequent speaker at national conferences, including the prestigious Inc. magazine conference, Taylor also publishes a newsletter on Internet marketing. He has addressed more than 100 TEC groups on the subject of "Using the Web for Marketing and Competitive Advantage."

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