InformationWeek

June 28, 1999

New Model For E-Commerce

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After asking questions about features such as image stabilization, zoom ratio, and audio quality, your customer hones in on price and, more important, availability. The E-store representative offers a toll-free number to close the sale, suggesting that a nearby affiliate store would be the fastest way to get the camera and sending an E-mail link to a map showing how to get there from the customer's office or home. Before ending the transaction, the E-store offers a technical support and maintenance service package on the Web and bookmarks to discounts on blank tapes and accessories. If the customer chooses a package delivery service, another link points to a tracking page for customer service. By this tight communication loop, more fully informed customers get used to you as not just a vendor but as a partner.

Not all types of organizations can take advantage of the high-tone, high-touch market. First, there are the dominant players. They have a deep investment in the existing low-touch, low-margin world. It will be hard for them to brand themselves in the high-demand world, though they could likely start cobbling together the technology and staff to conduct themselves in the new way--or simply use slick advertising campaigns that give the impression they're doing it. Their legacy business model, finances, and digital infrastructure all work against them.

These companies are closely related to the pro forma category, those businesses that have a Web storefront because they have to or because the IT department really wanted to build one--but what they have isn't designed to be even vaguely critical to their company strategy. Smaller regional retail powerhouses often fall into this category. This group may benefit from strategic use of innovative shrink-wrapped tools to simulate or presage the new feature set.

Late adopters might be in the best position to take advantage of this new sales model. Companies that have yet to deploy or are early in their design cycle can take advantage of both historical experience and emerging technology to create competition-shattering customer-centric innovations. Whether they haven't committed yet because they didn't want to or because they wanted to but didn't have the resources, late adopters stand to benefit the most.

What companies looking to jump in now need to think through depends on the resources they have available and whether what they want to sell better fits the old, commodity model or the new, differentiated model. While companies with a sophisticated development group can use available and emerging tools to execute the new model right now, it may be simplest for companies shopping for a quick solution to throw something online fast with minimum effort as a bridge to the future. If that is your strategy, aim for a quick (and not necessarily high) return. And remember that you don't have to buy into the new model to succeed with certain commodities.

To make any kind of play, you'll need tools that get you there quickly--and provide a route to the high-touch world in the near future. Most E-commerce tools settle naturally into three areas: inexpensive wizard-based packages (priced at hundreds of dollars), third-party value-added reseller or business partner add-ons that get existing sites ready for commerce (thousands of dollars), and mass customization products that wrap enterprise resource planning, sales-force automation, workflow, and legacy enterprise data mining applications into an E-business platform (tens of thousands of dollars).

Hosting services run parallel to these segments. They offer speed of deployment at the low end, leverage the outsourcing of development resources and quality of service in the middle tier, and resell high-end services to midsize companies based on adoption of the new E-business framework toolkits.

Speed Vs. Flexibility
Rapid E-commerce development is a series of trade-offs, most commonly speed at the cost of flexibility. At the low end, Impulse Software Inc.'s Impulse 4.1 lets you import product information from small-business packages such as Microsoft Access, M.Y.O.B, Peachtree Accounting, and QuickBooks. You can use but not customize Impulse site templates, or click the Just Add Commerce To My Site button to enable an existing site for E-commerce. There are no tools for transaction-processing support or WYSIWYG preview, but anyone can follow the manual's instructions to set up a site.

LaGarde Inc.'s Storefront 2000 ($195) hitches a ride on the Office 2000 bandwagon, using FrontPage 2000's new Component Object Model (COM) add-in and enhanced programmability to integrate E-commerce tools with Microsoft's low-end Web authoring tool. The Visual Basic for Applications plug-in uses FrontPage's Web and Document object models to interact with FrontPage Webs and Web files, deploys product bots to commerce-enable pages, and uses Open Database Connectivity to map featured product content to Access and SQL Server back-end data sources. Storefront's application files use Active Server Pages to interact with NT's Internet Information Server (IIS).

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