2011年3月30日星期三

Business Growing On The Net

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by Peter DeWolf

Business is everywhere on the Internet. Small companies and large are
making their presence felt. According to a recent survey done by Jupiter
Communications, a research firm in New York, 132 million dollars US was
the total business transacted directly on the Internet during 1995. This does
not include business that may have been attracted by a Web presence, and
completed off-line by conventional means.

In 1996, projections call for this amount of direct Internet commerce to triple,
and by the year 2000, less than 4 years from now, the amount will top 4
billion dollars US annually. Not only are computer-related businesses going
on-line to advertise and sell their wares, but such mail-order giants as L.L.
Bean and Eddie Bauer Corporation. You can view their products, and order
on-line. Even Pizza Hut can be found, and yes, you can order the stuffed crust
too. It is only a matter of time before your screen lights up with "would you
like fries with that too?".

Many towns and cities are on the Internet, with maps, guides aimed at tourists
and investors, and even real estate listings. It has become possible to get
information on your destination, book hotel reservations, and a flight; then
notify your relatives of your arrival time, all on-line. Oh yes, don't forget to
make reservations at a nice restaurant, a complete listing of good eating
establishments are available for many cities. The local newspaper on-line will
provide you with a lot of great ideas also.
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The smaller business person will say, this is all wonderful, but how does it
relate to me? I am not a huge corporation with a big market area or share. A
perfect example is a local business in my area, who makes custom wood
furniture. Before he hooked up to the Internet, his possible market was
restricted to the Ottawa Valley, and by word of mouth. With a Web Page, he
now attracts inquiries and business from all over the world. His cost is less
than 50 dollars a month for this opportunity to have a world-wide presence. If
you are interested in visiting a well set-up Page that attracts attention and is
well organised try "http://www.igs.net/woodworks".

The important thing for any business is to clearly define what they wish to
accomplish on the Internet, and take the time and effort to present the right
image. As in any business, first impressions mean a lot, and how your product
or service appear will determine your success. A well organized presentation,
done professionally, will attract the clientele you want. Unless you feel
comfortable working with Hypertext Mark-up Language, it might be
advisable to use a consultant. Talk to your Internet Service Provider, he may
have some suggestions, or talk to other businesses you see on the Net, and
ask. It is common for a Web Page to have an author's name on it, so if you
see a presentation that catches your eye, see if the consultant who produced it
is listed, or contact the company and ask. Remember, with the Internet, it
doesn't matter if the consultant is nearby, because distance has no meaning on
the Web.
Until next time, see you in cyberspace. Drop me a line at "whisper@igs.net".
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Business on the Net

by Peter DeWolf

Imagine millions of potential customers exposed to your unique products and services.
Would that increase the chances of your business expanding and thriving in these tough
economic times? Add to that not having to pay a large rent bill every month, or cover the
financial burdens of a large inventory, and have I got your attention? Large and small
companies alike are discovering the Internet, and the potential it represents. A recent
survey found that upwards of 74% of medium and large businesses in North America are
planning to make use of the Internet for intercommunications and a information resource.
Fully 23% are interested in selling their services or goods directly on the Web.
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Most Internet users are in the profile that business today wishes to attract, the 25 to 50
year old, with a 30,000 dollar a year or more income, and a few dollars of disposable
income. This group represents the majority of Internet users, and traditionally businesses
have paid big dollars to get their message to this audience. A Home Page, properly
planned and executed, can bring in big rewards by extending the reach of your current
marketing techniques to encompass whole new areas.

Many businesses are already advertising on some of the more popular Internet sites, by
placing their logos at the top of the page. This usually contains a link that a potential
customer can click on to reach the advertiser's Home Page, to get more information, and
in some cases, even place an order. Some sites even have multiple pages that allow the
business to show off its product or services in some detail.

Current technology for home pages includes the protocol HTML, or hyper text machine
language. It can be difficult to work with, but programs are available to allow you to "roll
your own". If you don't have the time or the inclination to learn for yourself, then you
guessed it, there are businesses set up to do the work for you in a professional manner.

The future is even more exciting. Already, in a few selected sites, is a new protocol called
Hot Java, which will allow for audio and moving video clips to enhance your presentation.
Imagine a TV ad aimed at your potential customer, when he is actually watching, and not
busy at the refrigerator. Best of all, they have chosen to watch, as they have a genuine
interest in your product.
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A good non-profit Home Page I have seen recently is for the Optimist Club in the Ottawa
Valley. They are available by asking your search engine for Arnprior, and then click on
Optimist Club. There are multiple links to individual clubs, and related organisations, and
after connecting to the Arnprior Club, I can even get a listing of my favourite Redman
games. That information is available to anyone on the Web, anywhere in the world.

At last count there were 10 million users on the Internet, and that is expected to increase
to well over 100 million in the next five years, and to 200 million by 2005. That is a lot of
potential customers. My server's home page which lists a number of links to area
businesses has had almost 55,000 visitors since mid-summer. Yes, you can even count the
number of times your page has been accessed.

When I am finished this column, I will be checking into the Net, sending this article to be
typeset, downloading my mail, then renewing a subscription to a magazine, all without
stamps, or a visit to the post office, or writing a cheque; you get the idea. That leaves me
time to enjoy a quiet cup of coffee at my favourite restaurant, before heading into work.

One question I have been asked by several people is what is the gender gap on the Net?
All the research I have seen indicates that in actual users, 25% are women. That gap is
likely to close, as women are now far less intimidated by technology, and are actually
more willing to try new ways of doing things, than many men. With many women now
starting home based businesses, the Internet provides them with great potential for
expansion, so the feeling is that women may soon exceed men in their utilisation of this
technology.

I look forward to the day, not far off, when I can enjoy my coffee at home, and do my
days work without having to leave my house. For many people, Huxley's prediction of a
brave new society without work in the traditional sense, is not far off. Information and the
ability to distribute and accumulate it, is fast becoming the true coin of the realm.

I invite your comments and suggestions, as they allow this column to be relevant to your
interests. Until next time, see you in cyberspace.


Peter DeWolf is a freelance journalist, and former broadcaster who makes Glasgow
Station Ontario his home. He may be reached concerning this column through this
newspaper, or by e-mail at "whisper@igs.net".
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Actually I do hope one day, I could like author’s wish wish,I can stay at home, and money pure in , is it just a hope, or may be one day will be true… “I look forward to the day, not far off, when I can enjoy my coffee at home, and do my days work without having to leave my house.”

2011年3月24日星期四

Sorting Through Your Options

If you're looking at E-commerce for your business, make sure you take a close look at the type of applications you want to support. Do you need a buy-side application? A sell-side application? A marketplace? Each application type has different requirements and considerations. Also keep your long-term objectives in mind. For example, if you want only buy-side today but plan to implement sell-side or marketplace Web commerce in the future, don't limit yourself to a product that handles only buy-side.
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Second, make sure you determine what resources you have available for application development and deployment. Do you want to get an application up and running quickly, and do you have limited technical expertise? Look at packaged applications such as those from Ariba, Netscape, Open Market, and Trade'ex. Do you need more flexibility, and do you have the time and people to do custom development? Look at a toolkit such as those from Connect, IBM, and Microsoft.

No matter what the application type, one of the biggest keys to success in your application is usability. If you don't get buy-in from the people that use your application (the buyers and sellers), no amount of technology will make them use the application. Another key consideration is reliability. Not all the products available leverage the scalability and availability of environments such as Web application servers or middleware. If your system is down when customers want to use it, they may never come back.
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The fact that the E-commerce technology market is not very mature doesn't make things any easier. If you're delving into E-commerce--no matter which application type or development approach you use--realize that it's a complex undertaking

Buyers And Sellers

Marketplace solutions are a relative newcomer to E-commerce, and very few online marketplaces exist today. Marketplace applications create a virtual community that brings together multiple suppliers and buyers. In this case, the marketplace provider supplies the application infrastructures that let multiple parties transact business. This application type is more prevalent in the business-to-consumer market (for example, eBay's online auctions), but is now starting to appear in the business-to-business sector.

Such communities create secondary markets that make sense for specific vertical industries, such as steel, chemicals, or plastics. For example, a steel vendor can use a marketplace provider such as MetalSite to sell steel to a community of interested buyers. Such sites allow for many-to-many relationships, and the marketplace provider will probably collect a fee on every transaction.
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In addition, marketplaces can be used for auctions, creating a market for excess inventory that might otherwise go to waste.

Another example is a large franchise such as a fast-food chain. This company can set up a marketplace in which all franchises act as buyers, and all suppliers of napkins, beef, and other products act as sellers. The parent company can create a marketplace application to facilitate buying and selling while maintaining control over the marketplace itself.

One of the key factors to keep in mind while evaluating marketplace applications is the protection of buyer-seller relationships. For example, many customers may have negotiated private contracts with particular sellers--and the contract price must be protected from other buyers and sellers, something that can be a challenge in a marketplace environment. In addition, a marketplace application may need to support secure contract negotiations among buyers and sellers
One of the key factors to keep in mind while evaluating marketplace applications is the protection of buyer-seller relationships. For example, many customers may have negotiated private contracts with particular sellers--and the contract price must be protected from other buyers and sellers, something that can be a challenge in a marketplace environment. In addition, a marketplace application may need to support secure contract negotiations among buyers and sellers.
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The only two vendors we saw whose products support marketplace applications are Trade'ex (Procurement for the Marketplace) and Connect Inc. (MarketStream). Trade'ex provides a packaged application for marketplace uses, making it easy for service providers or portals to get into the game. Connect Inc.'s primary revenue source is in services, and the company will use its technology to build marketplace applications for consolidators and aggregators. In the future, expect portal service providers such as Yahoo and America Online/ Netscape to play in the marketplace arena.

E-commerce applications have four distinct layers: low-level system services (load balancing, scalability, failover, database connection pooling, etc.), specific business logic (catalog functionality, inventory-handling capabilities, or shipment request and tracking functionality), administration (which can also include modules for target marketing or personalization), and payment processing.

No matter what type of application you're trying to implement, your application must include these layers. Clearly, you have choices when it comes to application development and deployment. There are five basic approaches you can take:
• Build a homegrown solution. You can always build your application from scratch. You'll have lots of freedom and flexibility--but you'll need a team of skilled developers to do lots of low-level coding, and you'll have to maintain the application code yourself. While this approach used to be a company's only option, today there are simpler ways to create E-commerce apps.
• Use Web application development tools plus in-house customization. Most development environments for Web applications provide low-level system services and graphical development environments. Using these tools, organizations can simplify development and leverage the low-level services that are already provided in the application server environment. Incorporating the commerce portion of the application will require custom development.
Some vendors that provide these middle-tier servers include Allaire, Bluestone Software, EveryWare Development, Haht Software, Netscape, NetDynamics (recently purchased by Sun Microsystems), SilverStream; and the BEA WebXpress division of BEA Systems (formerly WebLogic). -------- www.e-shops-list.com ----- Convenience you can never imagine ---- online store list -----

• Use Web application development tools plus specialized E-commerce toolkits. Many vendors provide E-commerce toolkits that can be used in conjunction with Web application development environments and servers. The result is a further simplification of the development process, eliminating the need to build the commerce transaction portion of the application from scratch. Examples of E-commerce toolkits include Microsoft's Site Server Commerce Edition and IBM's Net.Commerce.
• Use packaged applications. Packaged E-commerce applications are designed to provide most of an application right out of the box, which hopefully means rapid deployment. With these applications, getting a system up and running is more of a configuration and setup issue than a custom-development initiative. On the downside, such applications may lack the flexibility to perform specialized or highly complex processing, and they can be far more expensive than E-commerce toolkits. In addition, many packaged applications use their own low-level services instead of leveraging industry-standard middleware or application servers, which may sacrifice reliability and scalability.
• Outsource everything to a third party or hosting service. Of course, you can always contract with an integrator or service provider to build and maintain your application, and even host it externally. This approach is especially attractive to smaller companies that lack internal development resources and expertise.
Outsourcing relieves you of the headaches associated with development and maintenance, but you may be giving away some flexibility and control. Keep in mind that not many service providers offer sophisticated outsourcing and hosting services for business-to-business applications, although it is a prime area for market growth. In addition, you may have to pay a fee for every transaction your service provider handles.
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Solutions For Buying

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Another key business-to-business commerce application is buy-side or corporate procurement. Such uses let companies build applications that internal personnel can use for procurement. Buy-side applications provide a central point of control for procurement, helping organizations to manage spending and acquisition more efficiently, negotiate more competitive prices with vendors, and save time and money.

For example, a large insurance company could build an intranet site that would let executive assistants purchase office supplies for their areas. The application could provide a generic list of products and services from which users can select what they need, or it could provide an aggregation of catalogs from multiple vendors. The application could then place the order with the lowest-priced vendor or determine if the necessary goods have already been purchased and can be delivered from another location.

Most products focus on buying indirect goods--products and services that won't critically hamper your business if you don't receive them on time, such as office supplies. Procurement of direct goods--such as raw materials for discrete manufacturing operations--is often handled by enterprise resource planning systems and dedicated procurement personnel.

A big consideration for buy-side applications is whether they are usable. Buyers are often infrequent users who are internal to your company, so look for products that let you build rich, functional interfaces using technologies such as Java on the client side. In addition, the system should be able to capture all purchasing activities, which will prevent employees from going outside the system for purchasing. You may even want to integrate your expense-reporting system into your buy-side application, providing total central control on all spending.

Of the vendors supplying tools for buy-side commerce, Ariba Technologies Inc. focuses only on buy-side applications and provides a rich feature set for these kinds of applications. Ariba, Netscape, and Trade'ex focus heavily on occasional users by providing easy-to-use interfaces. Microsoft provides a sample buy-side application, but making it fit your needs may require extensive custom development. Connect Inc.'s core competency comes from the company's integration services and its ability to roll customer-focused features into the underlying technology.

2011年3月23日星期三

Solutions For Selling

The primary purpose of sell-side applications is revenue generation. Sell-side applications follow the classic E-commerce model: enabling an organization to sell products or services to multiple buyers, usually outside the organization. For example, companies such as Cisco Systems and Dell Computer let business customers place orders over the Web.

Sell-side applications require several important capabilities. For example, if you're an auto-parts manufacturer that sells parts to a large automaker, you'll want your E-commerce application to integrate with your inventory system and your production scheduling systems. If you're an online publisher selling content over the Web, you'll need special features to ensure successful delivery of the product
Other considerations include a flexible client interface and high usability. Since sell-side applications typically reach customers outside the company, you need to give them the option of selecting HTML interfaces that run well in any browser or over slower connection speeds. The application should require no training and should provide customer self-help if possible. You might also want products that let you incorporate personalization, target marketing, branding, cross-selling, up-selling, and substitute selling within your commerce application.
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Software products for sell-side applications include IBM Net.Commerce; Open Market Transact and LiveCommerce; Microsoft Site Server Commerce Edition; and Netscape SellerXpert. These vendors target seller organizations as well as hosting services that use the software to provide commerce capabilities to their business customers.

The offerings from Microsoft and IBM are toolkits, which means that you'll need experienced developers to create your applications. Microsoft's product makes sense if you have Microsoft-savvy developers. IBM's strength is that it has features that make it easier for business users participate in development, although using some of the applications' functionality requires C-level programming.

Open Market and Netscape's offerings are packaged applications that let less-technical individuals get the application up and running. Netscape's SellerXpert features good EDI capabilities, making it a good choice for organizations that have already implemented EDI solutions. Open Market's architecture is conducive not only for business use, but also for use by Internet service providers and commerce service providers that supply hosting or outsourcing services.
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Using E-Commerce For Business

At a high level, there are two major types of E-commerce applications: business-to-consumer and business-to-business. Initial interest in E-commerce was in the business-to-consumer sector. There are numerous examples of high-profile business-to-consumer Web-commerce applications, including Amazon.com, CDnow, and 1-800 Flowers, and countless other mail-order businesses.

But most experts agree that the real impact of Web-based commerce will be in the business-to-business sector. For this study, we focused on products that provide solutions for business-to-business commerce over the World Wide Web.

Business-to-business E-commerce is nothing new. EDI has been around for years--but it's expensive and is beyond the scope of all but the largest companies. With the Web, E-commerce is now viable for companies of any size, not just corporate powerhouses with deep pockets and vast resources. The Web opens new opportunities for companies to engage in commerce with their suppliers, customers, and business partners.

However, there are different classes of E-commerce applications within the business-to-business sector. The primary classes are: sell-side, which focuses on selling goods or services to customers; buy-side, which focuses on helping companies make procurements; and marketplace, in which an aggregator brings together multiple buyers and sellers, providing a community for commerce among the participants.
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Each application type has different requirements. Consequently, many vendors of E-commerce software and hardware offer products specifically aimed at these application types. Vendors that want to attack multiple application types face the challenge of providing multiple products (which can be a maintenance headache) or incorporating comprehensive functionality into a single product (which can become unwieldy).

Tools For Growth In E-Commerce

y Jeetu Patel, Mark Schenecker, and Gautam Desai of Doculabs, and Jason Levitt of InformationWeek Labs
lectronic commerce is gaining momentum like a runaway truck heading down a mountain pass. The most eye-popping prediction we've seen lately comes from Forrester Research Inc., which projects as much as $3.2 trillion in worldwide sales over the Internet by 2003.
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Whether or not you agree with such estimates, there's no doubt that Web-based E-commerce has arrived. The World Wide Web provides a whole new sales channel for companies that have traditionally relied on their sales personnel for direct and indirect sales. Other companies are springing up for which the Web is the only sales channel. Some companies are even assigning sales quotas to their CIOs, making technology groups responsible for using IS to generate revenue. Web-based E-commerce gives companies global reach, and it's far less expensive than alternatives such as electronic data interchange. Web-based commerce can also streamline processing, facilitate branding, and lead to greater customer satisfaction.

As more companies jump on the Web-comcommerce bandwagon, E-commerce products and systems are justifiably being viewed not as technology infrastructure, but as a central part of a company's sales and marketing operations. But are today's E-commerce products ready for use as cornerstone technologies on which companies can bet their most critical commerce applications?
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With this question in mind, Doculabs and InformationWeek Labs compared a number of technologies for Web-based commerce--specifically for business-to-business commerce applications. We found that, despite all the hype, the E-commerce technology market is still relatively immature. There are some good products available, but keep in mind that their deployment can require a lot of application development, integration, deployment, and maintenance. They are extremely complex undertakings.

In this article, the first of two parts, we take a look at how today's products are addressing the needs of complex business-to-business E-commerce applications. (For this evaluation, we looked at products in the toolkit and packaged application categories. Next week, we'll take a closer look at each of the individual products' capabilities, strengths, limitations, and ideal deployment.)

A wide range of products is available to handle different classes of applications. The challenge for businesses is to understand the philosophies, approaches, and target applications of a given product, and to match those factors with their own application needs and environment. In the end, you may find a product that offers a perfect fit for your application--and plenty of others that may fall short of your needs.
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Plan Ahead For Security

Although security is often fundamental to success, it often remains an afterthought. Companies looking to increase their business opportunities via the Web typically look first at applications and then consider infrastructure issues. "We see many cases where ERP or sales-force automation implementations fail when infrastructure and security come into the picture after the fact," Kelly says.
Security products that used to be viewed as risk-management tools are now being considered an "enabling mechanism" that is necessary for new business ventures.
The Boston Globe, for example, takes security more seriously now that its advertisers can place advertisements online and pay for them with a credit card. "It has expanded our view of security," says Dave Pearson, director of IT infrastructure. "I view it more as enabling than risk management, though it has to do both."
Another key element of an enlightened approach to security is a companywide campaign to promote user awareness. But that campaign "can't just be an annual brochure," says Jim Patterson, VP of security and telecommunications at OppenheimerFunds Inc., a mutual fund company in New York. For example, Oppenheimer occasionally has a life-sized cardboard figure named "Mr. Security" around its Denver campus. The character is dressed as a baseball umpire and holds a stack of index cards with information security tips for Oppenheimer's 1,800 employees.
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Another change is the people directly involved in making security-related decisions. While security remains an IT function, some of that responsibility is gravitating toward the business side as the Internet burrows into various parts of the company, such as the purchasing and marketing departments.
"We are doing more transfer of ownership of applications and security from IT to business owners," McKesson's Villani says. For example, Villani handles security policy; but the the company's VP of customer operations is responsible for applying it to the extranet.

On average, survey respondents rate information security a 7.4 on a 1-to-10 scale, with 10 being the highest priority. Respondents say the most important security techniques are blocking unauthorized access, establishing network security, securing top management commitment, and gaining end-user awareness. On average, most companies rate themselves a 6.9 on a 1-to-10 scale, with 10 being extremely successful, an evaluation that suggests most respondents see room for improvement.
The survey strongly suggests, however, that even if companies do well establishing these best practices, they must seek ways to do even more with their existing resources. Managing risk is now a top priority.
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Early And Often

In the world of information security, proactive measures are generally considered the most cost-effective, too. McKesson makes an extranet available to a few corporate managers at Rite Aid Corp., the pharmacy chain based in Camp Hill, Pa. These managers will be able to go behind the first of McKesson's two firewalls to view orders and track information about inventories and past purchases by Rite Aid. McKesson's internal systems are guarded behind the second firewall. Before launching the extranet, McKesson began using Internet technologies to sell medications to the Department of Defense in Asia, an arrangement that compelled the distributor to implement a double firewall scheme.
"At the very first stage, security was considered," says McKesson CIO Carmine Villani. "We think about security more as a core value or function rather than a bolt-on." In the past few years, Villani says, McKesson has spent more than $500,000 on various security measures, including secure identification cards with constantly changing digital codes for all employees, and double firewalls to separate the secure servers where the company keeps customer information and its own internal systems.
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Acceptable Risks(II)

I think they are estimating low." In fact, 49% of those surveyed concede they don't know if they were pickpocketed in the past year. Only 28% say they're certain they haven't suffered any monetary loss. If companies improve their detection capabilities via emerging intrusion- detection tools and enhanced measurement criteria, Murphy says, they will become more aware of the losses they're incurring already. And while E-commerce is galloping ahead, he expects the incidence and amounts of financial damages to surge upward, too.
Yet there are effective strategies to consider. Some IT managers are going to considerable lengths to measure the success of their security policies. McKesson Corp., a pharmaceutical distributor, has beefed up its policy and installed double firewalls to provide a secure area where a drugstore chain can have access to information about its accounts. Intralinks, a financial services firm, asks banks on its extranet to adjust their security procedures so that each adopts the highest common denominator. And at VHA Inc., a group of health-care providers and suppliers, IT executives are rethinking their approach to security after building an extranet.
Other companies are doing more encryption and rolling out awareness campaigns to educate employees about information security. Above all, they're making security a priority at the earliest possible stages of new projects.
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Acceptable Risks(I)

organizations rushing to build information systems for all forms of digital commerce are realizing there's no fail-safe way to secure the free flow of data or money. It's like trying to protect the telephone system from prank callers, or trying to block spammers from clogging your messaging system.
Except it's often far worse. Organizations engaged in Web commerce, electronic supply chains, and enterprise resource planning experience three times the incidents of information loss and theft of trade secrets than everybody else. Revenue loss, though not prevalent, is seven times more likely to strike Web commerce sites compared with noncommerce sites.
These are two of the key findings of the 1998 InformationWeek/PricewaterhouseCoopers Global Information Security Survey fielded this summer in 50 countries and completed by 1,600 IT and security professionals.
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A keen awareness of an organization's increased exposure to internal and external dangers isn't enough to plug the gaps. The digital commerce sites experiencing the most attacks, including banks and financial services companies, are the same disciplined IT shops that also create information security policies, spend lots of money on security products such as firewalls and encryption, and institute policy training for IT staff and end users.
All of which points to an obvious business trade-off, especially for IT managers who want to open their enterprise to outside partners. "An extranet is a risk," says Enno Becker, director of technology infrastructure at the Forum Corp., a training and consulting company in Boston whose extranet is linked to three corporate customers. "You're creating a tunnel into another environment that you don't control. But the business benefits are too great to be ignored."
Defining what's an acceptable risk varies greatly from industry to industry. In retail, a 3% loss from online credit-card fraud might be tolerable, but in the chemical industry the same fraud loss might be considered a disaster. Such expectations not only drive security policies and spending, but they also influence experience.
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• Overall, 59% of sites selling products or services on the Web report at least one or more security breaches in the past year, compared with 52% of sites that may have a Web site but aren't using it for monetary transactions.
• Sites with supply-chain networks or ERP applications are struck about 10% more often than sites without such applications, possibly because they have competitive intelligence available to plunder.
• Information loss has occurred at 22% of firms conducting Web sales, but only 13% of companies not selling products on the Web say they have had the same experience.
• Significantly, 12% of E-commerce sites reported theft of data or trade secrets, three times the number of companies not selling products via the Web
Among those survey respondents able to identify losses due to security breaches in the past 12 months, 84% say they lost between $1,000 and $100,000 in U.S. dollars. The other 16% say they racked up more than $100,000 in losses.
"There are significant financial losses that people don't even know about," says Bruce Murphy, managing director at PricewaterhouseCoopers, which advises companies on information security issues.

2011年3月21日星期一

The Nuts and Bolts of Business-to-Business E-Commerce

By Brian Walsh With commercial interests fueling the rapid growth of the Internet, sooner or later your organization will have to jump on the electronic commerce bandwagon. Nine companies tell us how they succeeded in making the transition.
Electronic commerce has been at the epicenter of a mesh of trading partner relationships for more than 20 years. With e-commerce, electronic component manufacturers provide samples to their distributors. Photojournalists submit images to a stock house. Fast-food outlets combine their purchasing power. Health-care companies check eligibility and receive settlement. And the guy who sells stepladders to the giant home center uses e-comme rce because that's the only way the home center will buy anything.
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The question is not when we will arrive in a computer-mediated market but, rather, when will your organization enter that market and what competition will it find when it gets there? Deftly combining a long history with the latest technology, e-commerce is the most popular application of the moment. Presales, encryption, customer support--they're all part of the mystique of electronic commerce. But the real lure is undoubtedly the money.
We're all in it for the money. Commercial interests are the largest segment of the Internet and will continue to fuel its growth. Think of all those documents with little dollar signs on them that companies deal with on a daily basis. Now imagine them all as bits flowing automatically in and out of their respective databases--no paper, no phone calls, no faxes. That was the promise of EDI (electronic data interchange) (see "Everything Old Is New Again," page 82).
Now it's called electronic commerce. R on Koskinen, marketing director for AT&T's SecureBuy service, explains: "Business-to-business e-commerce takes many different forms. So, as such, you can consider EDI business-to-business e-commerce. You can consider some types of message-enabled applications to be facilitated for business-to-business e-commerce. You can also look at Web-based catalogs that provide features of functions that are necessary for businesses to sell to other businesses as business-to-business e-commerce."
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No matter how you slice it, your systems will have to exchange legal documents related to the transparent transfer of goods and services. The Internet provides ubiquitous, high-speed access to information. It offers a platform-independent means to exchange information with trading partners. Where EDI was primarily the exchange of documents between application subsystems, such as order entry or accounts payable, Internet-based e-commerce casts a wider net: Documents are exchan ged in real time; your customers or partners may be as likely to use their browsers to access your system as to use a local system; and transaction flow follows a matrix of user-to-application and application-to-application paths. EDI is faceless; no common user interface or mechanism addresses what the Web does so well: promotions links, editorial content, integration with internal systems and intensive personalization access. Customers can help themselves--and get fast responses to inquiries and access to complete information.

Easier Research

Research is one of the mainstays of marketing, and business users who want or need to access multiple sites for research or other data-gathering functions will find their work made easier by XML-based E-commerce tools. One such product is the Web Automation Toolkit from webMethods Inc. The toolkit wraps XML technology around HTML. Using the toolkit, webMethods created Agent Discovery, an automated procurement and purchasing application that can search multiple Web sites simultaneously and bring back photographs or other information such as data for Excel spreadsheets.
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The photo services group of Discovery Communications Inc., an advertising agency in Bethesda, Md., uses Agent Discovery to query Web sites and retrieve photographs for use in ads. The company has preprogrammed Agent Discovery to query the top 10 stock photography vendors it uses. If the vendors' sites are suitably equipped, they can bill Discovery over the Web as their photos are retrieved.

"We used to have to search individual Web sites and identify the results and bring back the photographs individually," says Pam Huling, senior manager of photo services at Discovery. Now the company's offices around the world use Agent Discovery to find photos they previously wouldn't have been able to access.
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E-commerce technology is being used to overcome the traditional boundaries of time and space, even to create new types of businesses. As E-commerce technology evolves through new products and standards, companies will find ways to reach out further to their customers and suppliers.

A Whole New Business

David Perry, president and CEO of Chemdex Corp., a Palo Alto, Calif., reseller of life-science products such as hormones, enzymes, and antibodies, used E-commerce packages to set up a whole new kind of business. Chemdex, established last September with $2 million in funding, offers 250,000 products online from 2,000 manu- facturers to 300,000 scientists across the country.

In the beginning, Chemdex faced three challenges, Perry says: Get suppliers on board, get customers interested, and get the two to interact. Early success was important since Chemdex wanted to do a second round of financing as quickly as possible.
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Speed to market was the key for Chemdex. "Internet businesses are about market share and first-move advantage," Perry says. Anybody with a computer and access to the Web can do business on the Web, he explains, so "If you can get out there first and do it very very well, you can build traffic before they do."

Chemdex tested various software packages to see which would let it get to market fastest. Also, because the company deals in sophisticated technical products, any software it purchased would need customization. "It's not like selling boots online," Perry says.

Chemdex chose Connect Inc.'s PurchaseStream, a Web-based distributed requisitioning system that automates routine transactions and lets customers serve themselves.
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"PurchaseStream had a lot of the functionality we needed-a database, a transaction engine, and a front end-all built together," Perry says. "It let us get up and running in a real hurry." It took six weeks from the time Chemdex bought PurchaseStream to have a prototype to show to prospective customers. "There's a tremendous difference between talking about a plan and having a system that's running even though it's not perfect," Perry says.

Connect has since leveraged much of the customization it did for Chemdex to create its latest product, MarketStream, a multiseller-multibuyer marketplace application for companies selling on the Internet. Features include the ability to search multiple suppliers' product lists and provide users with customized product lists and pricing. The product also provides administrators with reporting tools.

Managing sales over the Web is a popular E-commerce application. But doing it in a way that customers are comfortable with isn't always easy.

John Landwehr, director of product marketing at smart-card manufacturer Gemplus Corp. in Redwood City, Calif., found that his personal experience ordering flowers over the Web colored his view of the technology. Landwehr had waited six hours to find out what happened to his order because the front-end and back-end systems were synchronized only four times a day.
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Landwehr swore he wouldn't put his company's customers through a similar experience when Gemplus set up its Web-based store. "I wanted more than just a simple Web front end," he says. "I wanted to combine an internal call center with a Web interface so the front and back ends were always synchronized, whether orders were placed over the Web or the telephone."

After a long search, Landwehr selected Orders of Magnitude, an order-management package from Dover Pacific Computing Inc. Orders of Magnitude lets companies control and integrate every aspect of taking, processing, fulfilling, and shipping orders. The software also works with existing back-end systems. Landwehr rolled out the Web site in March during a product launch.

Gemplus customers get product support and updates on order status in real time. Orders of Magnitude also sends orders electronically from Gemplus' Web site to its fulfillment company, which ships orders and sends back confirmation information using the shipment-tracking number.
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"We couldn't have gotten the storefront up and running as quickly with another product, and I don't believe we could find another product that would let us do exactly what we're doing," Landwehr says. Orders of Magnitude also can create customized reports on all incoming orders. "It's nice to be able to track leads as they come in," Landwehr says. Eventually, he'd like to develop a system for repeat customers that will let sales reps have information about the customers on their screens before they even pick up the phone.

E-Commerce Impact

Companies are finding new ways for Web technology to expand their businesses

By Richard Adhikari

Trump Casino Services plans to teach visitors to its Web site how to play casino games. But it's not doing this for fun. The games are part of a lead-generation application to help the Atlantic City, N.J., casino increase its customer base.
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Lead generation is just one of many ways companies are exploiting the expanding repertoire of E-commerce technology. Companies are using E-commerce tools to globalize operations, offer personalized customer service, manage sales and support, even create new business. Meanwhile, the technology continues to evolve rapidly. New applications using the emerging Extensible Markup Language (XML) standard are providing users with added capabilities such as information retrieval on a scale not possible before.

Trump Casino plans to use its Web application to take hotel reservations, sell tickets, and market merchandise. By year's end, Trump will have in place a Java-based analysis tool from InterWorld Corp., called InterWorld Business Analyzer. It will be customized to collect information as visitors play on the Web site. Trump will find out how long they remain online, the amount of time they spend playing games, which games they prefer, their ability level, and other details. "We're very heavily database-oriented, and this will create a sophisticated marketing machine," executive VP Robert Pickus says.
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American Airlines' AAdvantage frequent flier program is the world's largest, with 32 million members, multiple tiers of membership, and many ways of earning frequent flier points, says John Samuel, director of American's interactive marketing group in Fort Worth, Texas. Personalizing customer service on the company's frequent flier Web site has improved the level of service to customers by offering information based on a user's profile. "We'll give you information about offers, travel-related news, information about American Airlines schedules, new flights, and so on," Samuel says. If, for example, there's construction at an airport, members living in nearby cities will be told about it and asked to allow extra time for travel.

American is using BroadVision One-to-One from BroadVision Inc. BroadVision One-To-One supports large user and content databases, high transaction volumes, intelligent agent matching, and easy integration with existing business systems. BroadVision leverages American's Sabre computer reservations system and databases to dynamically create personalized content for users.
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Samuel plans to extend the personalized service. "We're moving from the technical challenge of being able to do it to the operational and business challenges," he says.

E-commerce technology can help erase the traditional boundaries of time and space. When General Nutrition Cos., a Pittsburgh maker of nutrition supplements and health products, expanded globally, distance and time-zone differences slowed the order and fulfillment process. The company's 200 overseas franchisees, for example, waited several hours just to get questions answered.

CIO Tom Smith decided to use E-commerce technology to let the company's 2,500 franchisees find out whether products were available, reserve them, or look at alternatives, all in real time. He also wanted to let franchisees customize product listings, so they wouldn't get lists with products they couldn't sell or in a format different from their own. The solution also had to tie into the existing IBM DB2 database on General Nutrition's mainframe.

After evaluating several proposals, Smith selected the Signal SegWay Suite from Signal Internet Technologies Inc. The product suite links the enterprise with its distribution channel through the Internet. It can be tailored to users' business rules and can be integrated into legacy mainframe and client-server applications so disparate systems can use and exchange data in real time. The vendor created a link to GNC's DB2 database and agreed to run the application for a year, until Smith's staff learned to maintain it.
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The resulting Worldwide Product Ordering System has paid off for GNC: "Real-time response gave us higher ship rates, a more satisfied customer base, and slightly larger orders," Smith says. "And franchisees in Asia, where there's a 12-hour time differential, can deal with us according to their working hours."

2011年3月20日星期日

MYTH NO. 8: It leads to product commodization. (Myths And Realities of Web commerce Part eight)

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Some disciples of this dogma point to Priceline.com, the site where consumers set the price they want to pay, then let airlines and other suppliers compete to meet that price. Certainly, it's an innovative model that wouldn't be possible without the Web. Online auction sites such as OnSale and eBay have also been successful and have their place for some types of products. But price isn't the No. 1 selling point for most companies online.

Amazon.com and Dell have the most online customers in their industries, and they don't always offer the lowest prices. That's because customers also want brands and service they trust. And they're figuring out that searching the Web to save a few bucks can be no less aggravating than driving all over town for a bargain. Online shopping agents, or "bots," such as Excite Product Finder and MySimon, have their fans, but they can still be frustrating and ineffectual
"In E-commerce, the quality of the participant is more important than ever," says Office Depot VP Gaffney. "Price information alone is very imperfect information. It tells you nothing about reliability, product availability, merchant behavior, or returns and exchanges policies. You might be able to lure online customers with the lowest price, but it doesn't mean you keep them."
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Even in commodity industries, price is only one factor in E-commerce strategies. "Gas and electricity are commodities that we sell online, but there are differentiating things we can do in the E-commerce space," says PG&E's Keast. "We're developing billing information and the ability for a buyer to customize their bill online. Our role is to differentiate the commodity by providing other things around it that add value."

E-commerce is anything but a myth. It's a major trend that's reshaping businesses and the IT that runs them. But there's a common theme that runs through each of the myth dissections above: E-commerce, in almost all cases, doesn't change some fundamental rules of business.

Doing business on the Web successfully takes capital, innovative leadership and execution, marketing savvy, perseverance, and the intelligent application of IT. As the Internet continues to speed the pace of change in the coming years, many aspects of business will be altered and transformed--but those guiding principles will always remain.
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MYTH NO. 7: It means the end of mass marketing. (Myths And Realities of Web commerce Part seven)

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Once again, the theory is simple enough: The Web is the first communications channel that enables cost-effective one-to-one marketing on a huge scale. Marketing to a "segment of one" has long been the goal of database marketing, data mining, and telemarketing, but Web technology enables marketing of unprecedented exactitude and low cost.

But how do companies get people to come to their Web sites in the first place? Customization and personalization are fine for customer retention but not so good for customer acquisition. "In the global world of the Internet, what counts is brand," says Compaq's Meyer. That's why Yahoo posted billboards at San Diego's Qualcomm Stadium during the World Series, and why Web shopping site Buy.com kicked off a $25 million mass marketing campaign with ads on Monday Night Football last month.

Can consumers click on a stadium billboard or TV ad to purchase something, which is what the "mass marketing is dead" pundits claim all ads should let buyers do? Of course not. Buy.com founder and CEO Scott Blum knows that it will take conventional marketing channels such as Monday Night Football, as well as low-priced merchandise online, to achieve his company's goal to leapfrog Amazon.com. "We want to be a household name," says Blum, and that won't happen with only targeted Web banner ads. Witness the proliferation of mass-media ads for Web sites during the current holiday shopping season.
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Mass marketing is also a necessity for the captains of online industry. Dell isn't the largest online PC seller only because of execution; it also heavily markets its direct-selling approach--on prime-time TV and elsewhere. "In theory, an Internet-only computer company should have surpassed Dell by now," says US Web's Laube. "But there is no 'PCs.com,' at least not one that's been very successful. In E-commerce, branding and mass marketing are more important than ever."

Ultimately, that's just common sense--at least for those who understand there's more to E-commerce than click-throughs. "You can't just build it, because they will not come," says Cliff Conneighton, CEO of Icoms Inc., which has developed commerce sites for Houghton-Mifflin, Hasbro, Fujitsu, and other companies. "Tiger Electronics doesn't expect people to find Furby.com, so they run TV ads. The Net is like TV with 10 million channels. You can't just hope that someone surfs by."

MYTH NO. 6: It leads to disintermediation. (Myths And Realities of Web commerce Part six)

The theory was simple: The Web provides an instant global sales channel to all producers of goods and services, so why use conventional distributors, resellers, and other middlemen when you can sell directly? Well, it simply hasn't happened, for three main reasons: the actions of producers, the actions of distributors, and the rise of dozens of new intermediaries on the Web, giving rise to the second-generation buzzword "reintermediation."
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The only trend partially validating this myth is the fact that some producers that always bypassed reseller channels, notably Dell, have done very well selling on the Web. (Dell sells $10 million worth of PCs per day on its Web site--triple what it sold online last year.) But most successful E-commerce players are using the Web to enhance their existing distribution channels, not circumvent them. Even Cisco, one of the most successful E-commerce practitioners, makes 70% of its online sales to resellers, not end customers.
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Other examples abound. Consumers can't buy a motorcycle on Harley-Davidson's Web site, but the manufacturer's dealers can access a Harley extranet whose features include a repair-parts information database and speedy processing of reimbursements for warranty repair work. General Motors' BuyPower Web site lets customers configure and order cars online, but the sale is directed to a dealer in the customer's area. The only companies that can buy direct from Parker Hannifin's Compumotor unit are the very largest customers, such as Boeing and Universal Instruments, that have already bought direct before. In these cases and countless others, the goal is to aid the channel, not bypass it--at least for now. Meanwhile, conventional distributors are embracing the Web. W.W. Grainger Inc., the largest business supplies distributor in the United States with revenue of more than $4 billion, is building an electronic catalog to let customers buy online directly from their SAP R/3 applications. In the computer industry, Dell and Gateway aren't the only companies that let customers configure and buy their PCs online; No. 1 distributor Ingram Micro is adding that capability to its extranet for resellers and retailers. Few companies have leveraged the Web earlier and more effectively than semiconductor and electronics distributor Marshall Industries, whose E-commerce site helped boost sales 24% in fiscal 1998.

But perhaps most notable of all is the rise of new, usually industry-specific Web intermediaries. Almost every industry has one: Chemdex for chemicals, MetalSite for steel, pcOrder.com for computers, PlasticsNet for plastics, Instill Corp. for food services. Because the Internet makes it easier to aggregate information and commerce capabilities for an entire business community, these new intermediaries are bringing buyers and sellers together online.

"As long as you have an industry with a fragmentation of suppliers, you will always have middlemen," says Venky Harinarayan, VP of business strategy at Junglee Corp., a content aggregator acquired earlier this year by Amazon.com. Adds Chemdex president David Perry, "If you have only three or four suppliers, you certainly don't need an electronic marketplace. But most industries have a lot more than that."

MYTH NO. 5: The Web levels the playing field. (Myths And Realities of Web commerce Part five)

AKA: Startups Can Instantly Compete On The Same Footing As Long-Established Companies.
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With a few notable exceptions, such as Amazon, E-Trade, and online greeting-card maker Blue Mountain Arts, the biggest E-commerce players are big, established companies: Cisco, Disney, Dell, Microsoft, Charles Schwab. Companies that want to be successful at Web commerce need the marketing clout, brand identity, and scale to do back-end fulfillment and customer service--and above all, they need the capital (see Myth No. 2). That's why so many startups are either merging (like music retailers CDNow and N2K) or are being bought by big physical-world competitors (note Reel.com's acquisition by Hollywood Video).

A popular line on the conference circuit is, "On the Internet, no one knows you're a dog." But over time, another one-liner holds more weight: Size does matter.

Size, in most cases, means brand power, trust, and consumer confidence. "In theory, anyone can enter any market in E-commerce," says Paul Gaffney, VP of commercial sales at Office Depot. "But the Internet hasn't changed the way you earn credibility, not one iota. That's through actual performance. It has leveled the playing field for exchanging information only. We're the largest in our industry, so it's a fundamental economic law that no one should be able to beat us on price."
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Another aspect of the level playing field myth is the assertion that the Internet gives small companies instant access to global markets. Access is one thing; leveraging it is quite another. "Large physical-world companies have a huge advantage in overseas markets if they leverage their brands online, whether they're Boeing, Eastman Kodak, or Pepsi," says Randy Meyer, VP of financial services and E-commerce at Compaq. Adds Gartner's Satterthwaite, "There's a low barrier to doing E-commerce, but a very high barrier to becoming one of the leading choices."

In business-to-business E-commerce, the Web admittedly does open the door for small companies to bid on contracts and sell to large companies. This truism is usually posited in comparison to EDI, whose prohibitive cost, inflexible formats, and technical complexity locked small suppliers out of relationships with the Boeings and Wal-Marts of the world. There are cases where this maxim holds true. Doing business with more small suppliers is a goal of Los Angeles County's ambitious Web-based procurement initiative, says procurement director Chrys Varnes.

But the Web also makes it easier to do business with the largest suppliers and customers. So E-commerce is actually causing some companies' purchasing departments to reduce their number of suppliers and buy more from the largest ones in order to get bigger discounts and better service.
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That's a stated goal of Chevron, one of the largest companies to launch Web-based procurement. Chevron is moving portions of its staggering $10 billion a year in supplies and services procurement to the Web using software from Ariba Technologies. "We have 200 global suppliers, and we want to channel as much business as we can to those companies to drive our costs down," says Jerry Jacobson, manager of purchasing strategy at Chevron. Indeed, the reduction or elimination of "maverick buying" from unauthorized suppliers is a goal of Web-based procurement initiatives at Bristol-Myers Squibb, Ford, GE, and other companies.

MYTH NO. 4: It's lucrative. (Myths And Realities of Web commerce Part four)

Despite the online sales success of a handful of E-commerce poster children, for every Dell Computer and Cisco Systems there are dozens of companies like Burlington Coat Factory. The company's Web site sells less merchandise than just one of its 250 retail stores, says CIO Mike Prince. "So far, it just hasn't been a major focus for us," he says.
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That's because buyers are less likely to purchase "subjective" items such as coats and dresses over the Web than PCs, routers, and books, says Prince. "When you buy a dress, you want to try it on, see how the fabric feels, check out the color," he says. "There's something very special about that experience that you can't get on the Web."

That said, Burlington Coat Factory is revamping its site to feature more products. Also, the company is considering adding a gift registry that would let shoppers visit its stores, identify the specific articles they like, and then register them on the site so that relatives and others can buy gifts online according to those selections. But even if Burlington increased its online sales to equal the volume of 10 of its stores, "that would be significant for a chain our size--and a surprise," Prince says.

Even by the most generous accounts, online retail sales remain only a tiny fraction of what's sold in physical stores or through mail-order catalogs--even in the Web's most popular product categories. Online book sales will account for less than 5% of all U.S. book sales this year, according to Keenan Vision. Online music sales? Less than 2%. Even online travel sales--which will reach $1.8 billion this year, leading all consumer products (except IT products) sold online--won't even reach 1% of the $488 billion in total U.S. travel spending. Web-based advertising revenue also remains minuscule compared with broadcast and print--just 0.4% of ad agency bookings this year.

What about business-to-business E-commerce, which is projected to leave business-to-consumer cybersales in the dust and soar into the trillions of dollars by 2003? That mostly reflects the fact that business-to-business commerce in the offline world is orders of magnitude larger than sales to consumers
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For most established companies, it's still early in the E-commerce game. It's easy to look at how Amazon.com shook up the book industry in four years and fly into panic mode, fearing that your company could be put out of business tomorrow by a Web startup. But books (and music) are the products best suited to online selling, and Web startups will always get a disproportionate share of attention simply because they're Web startups. Remember: Amazon won't be turning a profit any time soon.

"E-commerce is like the market in China for U.S. companies," says US Web's Laube. "Most probably aren't making a profit there yet, but they're in China because of huge market potential. The returns will be a few years in coming. You have to have deep pockets and be willing to stay with it."

MYTH NO. 3: Everyone's doing it. (Myths And Realities of Web commerce Part three)

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Those living in Silicon Valley, Seattle, or Manhattan can find plenty of evidence to support this myth. And just about every company has a Web site. But brochureware isn't commerce. Dig deeper among multibillion-dollar companies, even among some consumer-focused retailers, and you'll find a different story. Companies on the sidelines of Web commerce include chains Best Buy, Circuit City, and Fry's Electronics.

"Fry's doesn't even post a catalog," notes Vern Keenan, an analyst with research firm Keenan Vision. "It goes along with their conservative management--using merchandising techniques from 50 years ago, like heavy promotion of loss leaders in low-cost ad channels like local newspapers and radio. They still work, and Fry's sees no reason to go on the Web." Fry's doesn't comment on its business strategies.

With a few notable exceptions, such as General Electric, Boeing, and the Big Three U.S. automakers, most old-line manufacturers have yet to move into E-commerce--and may not for quite a while. "In some companies, you almost need the retirement of an entire generation of purchasing and sales staff members before it will happen," says Sam Kinney, co-founder and executive VP of FreeMarkets Online Inc., a company that manages online bidding for industrial requests for quotes. "This is not an overnight thing. There are some massive penetration barriers that will not fall for decades."
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Many companies simply don't see a compelling business reason to move to E-commerce. Maytag Corp., for example, finds that electronic data interchange with its suppliers and distributors works fine, and it's playing the Internet commerce card very carefully. "We all should be cautious. There are very few Amazon.com opportunities out there," says Maytag VP of IT Ed Wojciechowski. "We have informational Web sites where we can engage the customer, and we see commerce as an option in the future. But it's not strategic for us yet."

And even if Myth No. 3 were true, that doesn't mean following the pack is a sound strategy.

MYTH NO. 2: It's cheap. (Myths And Realities of Web commerce Part two)

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Perhaps E-commerce is cheap when compared with a full-blown enterprise resource planning implementation or the purchase of a mainframe. But for a number of reasons, a full-scale online commerce effort is never a low-cost proposition. Business-oriented commerce server software, such as Microsoft Site Server Commerce Edition, may start as low as $5,000, but that's just the first building block in a complex undertaking (see Myth No. 1). Companies spend an average of $750,000 just for the baseline technology, according to a Gartner Group survey of 100 commerce sites.

"It's not like what IBM says in their e-business ad campaign: Just extend what you already have," says Roy Satterthwaite, a research director at Gartner Group. "E-commerce applications are in their first generation, and they just don't do everything you need. Open Market's Transact is great for transactions, for example, but not for content. E-commerce always ends up costing much more than any one vendor's productAnd guess where the big-ticket systems integrators--IBM Global Services, EDS, Computer Sciences, and the Big Five--are starting to aim their sights? "Web software vendors get all the coverage, but the windfall beneficiaries of E-commerce will be the integrators," says Satterthwaite. "After they finish their year 2000 and ERP engagements, they will throw their efforts into this." And that's not going to bring any price tags down.
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Then there are marketing costs and other non-IT infrastructure investments. Amazon.com, the paragon of E-commerce success, lost nearly $25 million on $153.7 million in revenue in the third quarter, and marketing costs were a big reason. Amazon's marketing expenses grew from $11 million in the first quarter to $26.5 million in the second quarter to $37.5 million in the third--more than it spent on technology. The annual cost of a major licensing deal on a high-traffic portal runs well into eight figures, and Amazon has several such deals. Amazon's third-quarter infrastructure costs included more than $550,000 to lease a book warehouse in the United Kingdom and the expense of expanding its main warehouse in Seattle, which now costs more than $450,000 a year.

Is Amazon gaining new customers from its marketing investments? Absolutely. Its revenue for the first nine months of 1998 was $357.1 million, up 337% from the year-ago period, and the company's stock price is up about 1,000% since its initial offering in May 1997. But the company is losing money--lots of it--proving the point that E-commerce isn't cheap.

MYTH NO. 1: It's Easy.(Myths And Realities of Web commerce Part one)

AKA: The Barriers To Entry Have Never Been Lower. Yes, putting up a Web site is easy. And putting up a Web site to handle commerce transactions is pretty easy, too. But add words like effective, scalable, and successful, and it gets a lot harder.
For large, established companies, the No. 1 challenge is integration. "A Web site is like an iceberg," says Delta Air Lines CIO Charles Feld, a longtime IT executive with stints at Frito-Lay and Burlington Northern. "What you see looks small and simple, but below it you have infrastructure integration issues with maybe 40 or 50 databases. So building a Web infrastructure can be a pretty serious risk for older companies." (For more on the technical intricacies of Web commerce sites, see story, "Mega Web Sites.")
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The Compumotor division of manufacturer Parker Hannifin Corp. knows that all too well. Compumotor's extranet for handling orders for industrial automation system products went live last week--but not until after a one-year delay to deal with response time, server upgrade, and integration challenges. "Setting up E-commerce is not easy or fast," says Compumotor IS manager Bud Parer. "Performance and scalability are the biggest issues. This is the way we decided to run our business, so we weren't going to do it until we had acceptable response time and data that is absolutely accurate."

The extranet will handle orders for 12,500 products, warranty and nonwarranty repair-status queries, and many other transactions from 65 distributors, 35 factory reps, 20 direct customers, and 50 internal employees. To ensure performance, Compumotor upgraded its Hewlett-Packard server and moved part of its Oracle database to a Sun Microsystems UltraSparc server to share the load. The company devoted four worker-months to designing and integrating the extranet applications' Active Server pages, with 90% of the coding time spent on data availability and accuracy. "We didn't want to guesstimate anything," says Parer. "Our business depends on this."

For many companies, the business issues of E-commerce are no less daunting. Changes in business processes, customer and supplier relationships, data access, data ownership, distribution strategy, and marketing tactics underpin most Web-commerce efforts.

"The technology integration issues are huge, particularly at the back end, but we feel we're meeting those," says PG&E Corp. CIO John Keast. "The front end is a whole other challenge. What are customers going to use this energy-usage data for, and how do they want to receive it? It's a brave new world, where users have access to information they've never had before--and there's no standard for it."
- www.e-shops-list.com ----- best online shopping list ---- online store list ------ online store list -

For business-to-consumer online efforts, doing E-commerce well starts with driving traffic to your site. Many early sites did a good job harnessing Web technology, but those efforts languished because not enough shoppers came calling. "Many companies didn't realize that a Web site needs a compelling marketing program to go with it," says Sheldon Laube, chief technology officer of Web systems integrator US Web Inc.

US Web has worked with American Airlines and sports-equipment retailer REI Inc. on marketing tactics, such as American's weekly E-mails alerting customers to cheap weekend fares and REI's expansion of its Web presence with targeted links on outdoor-activity Web sites. And equally if not more important, the companies began to advertise their E-commerce capabilities in traditional media. "Let's face it: People still watch TV and read magazines," says Laube. "Building a site is just one piece of the puzzle."

Myths And Realities of Web commerce

Web commerce is changing the way a lot of companies do business, but it's not everything it's pumped up to be. We separate fact from fiction.
few IT trends have been hyped more than electronic commerce--and considering the industry's penchant for hyperbole, that's saying a lot. Stock valuations of E-commerce players defy fundamentals. Predictions of triple-digit market growth abound.
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There's no question that the Internet has emerged as an enormous force for change over the past four years--in IT, in business relationships, and in the way millions of people receive and communicate information. But the resulting gold-rush atmosphere has produced the typical gold-rush side effects: exaggeration and oversimplification of the real issues.

It's time for a reality check. Following are the eight biggest myths about E-commerce, debunked by those best qualified to do so--IT and industry professionals trying to make E-commerce work for them.

2011年3月18日星期五

Ecommerce Ideas For Small Business Owners

If a retail company has a physical store and they want to venture into this world of e-commerce to create an additional revenue stream .... and/or compliment their physical store presence and advertising .... then I would highly suggest working with groupon.com as a strategic marketing campaign.

The normal results after using the service are getting the store on the map of peoples’ minds where many had never seen or heard of the company .... and it will generate first time customers, absent customers and referral customers.
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Many one location shops are only known to a small percentage in the immediate area, however groupon.com would fulfill a strategic marketing plan one could only dream of if one didn’t have a large marketing budget. The other great part about groupon.com’s service is you don’t pay any money upfront, only if the deal gets a green light from members and your cash register starts making a “cha-ching” sound.

•••You will also need a solid merchant account system set up which also accommodates online ordering. Elite Processing has one of the best reputations in the Merchant Account arena. I highly recommend you learn more about what they can do for you by visiting their website here:
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----

7 Tips for Effective E-commerce

Step 1:Well-Crafted Product Descriptions
According to Drew Barton, CEO of Atlanta-based Southern Web Group, the best product descriptions include roughly 75 words of copy, preferably 200. "Under the hood" details should also be readily available on the site, including details such as the size, shipping, and weight of the product. Specifics such as the compatibility of a replacement product or the size of an article of clothing should also be noted.
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Step 2:High Quality Photographs
After content, high quality photographs of your products are "the second most important thing about selling online," says Barton. Photographs should be of the highest quality available and have the ability to be enlarged without becoming pixilated or distorted. Large photos will reduce questions and returns from customers. Photos should also be taken from multiple angles so that there is no question about the relative size or components of the product.
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Step 3: Accessible Policies
By including FAQs, policies, and procedures prominently that list information regarding shipping, returns, defects, customer service hours and numbers, and estimated delivery dates, you can cut down on customer inquiries. Barton also suggests that site owners respond to negative customer reviews swiftly. By doing so, the owner demonstrates good customer service and may be able preempt circumstances that can lead to costly product returns. Says Barton, helpful responses can turn a negative comment into a positive
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Step4 : A Strong Analytics Program
Know where your traffic is coming from and what words they're searching to find your site. "One of the statistics we tell our clients to look out for is the bounce rate. The lower you can get your bounce rate, the better your success rate." Bounce rate is the amount of time spent on a webpage prior to exiting. You also want to know what page your customers exit from. Generally, you want them to leave from either the "purchase success" or "contact" page. You do not want them to exit from the homepage or the product detail page.
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Step 5: Strong Search Functionality
Within your site, you want the ability to track down product specifics such as size, and availability, and also to have the ability for customers to see what other customers who purchased their product bought. Magento and Volusion are great systems to implement that take care of this function. For SEO value, Barton suggests using the Google Keyword Tool or WordTracker to determine the leading search terms that are appropriate for your products and services.
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Step 6: Clear Call-to-Action Buttons
You want your call to action buttons (i.e. buy now, order here, download it here) to be before the first 600 pixels on your Web page. Ideally, these buttons should appear on every page. Each page should lead you to an action, such as a purchase, or to a form. There should be a clear end result to every product on the page.
-- Drew Barton is president and founder of Southern Web Group, a web design firm with clients throughout the country.
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Demystifying Web Page Hosting Setup - A Simple Secret

Starting an online business is a simple procedure if you choose the right options. Instead of doing everything yourself outsource it to the experts to give you enough time to handle your business.
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Many of us flounder once our website is ready. It sits on the computer waiting to be launched on the Internet, but we dither as we are not too sure about how to do it. We know we need web hosting services to do so, but feel incompetent about it.

Actually, it is much simpler than what you think. You really don’t have to know much about how to setup hosting, to launch your website. Wondering how that is possible? It’s a simple secret called outsourcing. You can leave what you don’t know to the experts and concentrate on what you do best, running your online business. All you need to do is find a web hosting service provider who will take care of everything.
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The last thing you want to do is spend your time protecting the site from hackers or struggling with the nitty-gritty of operating systems to fix your network problems. All these and more will be taken care of by your web hosting service.

Shop around for web hosting companies; don’t fall for the cheapest you come across or even for the one who promises the moon at an exorbitant price. There are many low priced hosting providers who will take good care at nominal prices. But if you really need an excellent host you check out the bigger hosts who provide you with a menu of their services and you can customize it to suit the needs of your website and most important your budget.

Now that the website is online and running smoothly thanks to the web host you chose, you can divert your energies to the much needed aspect of your online business - selling. Once you are set with a smoothly running website you can now think about your own customers. With continuous traffic inflow you will now have to see what your customers need.

The Internet is a 24/7 interface, so a customer inquiry can materialize anytime. A prompt response to their queries is a must to keep them happy. But does this mean you have to keep tab on it all the time? It is humanly impossible to be on an alert all the time. Can you afford the customer ire or is there a way to handle this?
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Well, there is a simple solution to this problem too. All you need to do is to install follow up autoresponder software on your website. This software enables you to prepare a library of responses directed at your customers. As soon as there is a query from a potential customer, the autoresponder will send them a general relevant answer adding that you will get in touch as soon as possible.

The next time you sit down to go trough the customer emails, you can respond to each one of them personally with customized solutions to their query and hopefully they will give you business.

You were careful while selecting your web hosting service, do the same with the autoresponder software. Shop around for the software which will provide maximum support within a reasonable budget.
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Well, now you are on your way to a successful online business.

2011年3月15日星期二

Growing Your Business On The Net

by Peter DeWolf

In the last column we looked at the advantages business can realize from a
presence on the Internet. This week I will look at the mechanics of making
those possibilities work for you.
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A Home Page is the usual way in which a business or a person lets the world
know they are there. Most Home Pages are written in a computer language
known as HTML, or Hyper Text Markup Language, a protocol that most
modern computers and navigation programs can read while they are
connected to the Internet. HTML allows for graphics and colour, as well as
text, and can interface with GIF & JPG type pictures. In layman's language,
this means that you can not only show your text ad, but pictures of your
products, logos, and other graphics. Some specialized add-ons can also allow
those people so equipped, to hear sound and watch moving video, advertising
your business. The new Java protocol will soon allow this type of interactive
production to be commonplace, rather than the exception.

The production of your Home Page should be done as carefully as you would
place any advertising, reflecting your professional image. One of the biggest
mistakes, is to put a lot of graphics on your main page. As we have discussed
before, the Internet can be slow at times, and there is nothing more frustrating
than logging onto a site, only to wait several minutes while 10 pictures with
high graphic content, try to squeeze down the pipeline. I can promise it will
be the last time I log onto your site. The best way to approach the problem, is
to have a main page, with Hyperlinks to secondary pages. This way, the
customer can download the main page quickly, make a selection from a
menu, and go directly to the products or services they have a particular
interest in. I don't want a graphic picture of widgets, when it is gidgets I want
to buy.
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Getting yourself listed on the search engines is also critical, as when most
people go looking information, this is where they start. Listings with other
related, but non-competing businesses is another way to increase the number
of visitors to your site. You will be expected to reciprocate of course, so
make room on your home page or site for "links to related sites". This is done
in the HTML format, with a graphic button, or highlighted text, with a URL
or address imbedded. When clicked on by a visitor, it downloads the new
address to their computer, and away they go to the new location.

Several programs are available including HTML Pro, and HotDog, to allow
you to create your own pages, but unless you have some experience, or are
willing to spend the time to learn, I suggest you have someone create the page
for you. It is art as well as programming, and a pretty good knowledge of the
Internet is helpful. There are a number of companies and individuals who do
this professionally, so look around carefully, some are better than others.

To obtain a home page, most Internet Service Providers allow non-
commercial space to private individuals as part of their regular account, but
charge an additional fee, generally in the 25 to 50 dollar range per month for
commercial enterprises, depending on the size and traffic expected. They may
also be able to point you in the direction of a reputable consultant. With 4
billion dollars in direct business on the Internet, it makes sense to get on
board now. In the next column we will look at security on the Internet, myths
and fact. The truth will surprise you. Until then, see you in cyberspace.

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Business on the Net

by Peter DeWolf
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Imagine millions of potential customers exposed to your unique products and services.
Would that increase the chances of your business expanding and thriving in these tough
economic times? Add to that not having to pay a large rent bill every month, or cover the
financial burdens of a large inventory, and have I got your attention? Large and small
companies alike are discovering the Internet, and the potential it represents. A recent
survey found that upwards of 74% of medium and large businesses in North America are
planning to make use of the Internet for intercommunications and a information resource.
Fully 23% are interested in selling their services or goods directly on the Web.

Most Internet users are in the profile that business today wishes to attract, the 25 to 50
year old, with a 30,000 dollar a year or more income, and a few dollars of disposable
income. This group represents the majority of Internet users, and traditionally businesses
have paid big dollars to get their message to this audience. A Home Page, properly
planned and executed, can bring in big rewards by extending the reach of your current
marketing techniques to encompass whole new areas.

Many businesses are already advertising on some of the more popular Internet sites, by
placing their logos at the top of the page. This usually contains a link that a potential
customer can click on to reach the advertiser's Home Page, to get more information, and
in some cases, even place an order. Some sites even have multiple pages that allow the
business to show off its product or services in some detail.

Current technology for home pages includes the protocol HTML, or hyper text machine
language. It can be difficult to work with, but programs are available to allow you to "roll
your own". If you don't have the time or the inclination to learn for yourself, then you
guessed it, there are businesses set up to do the work for you in a professional manner.
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The future is even more exciting. Already, in a few selected sites, is a new protocol called
Hot Java, which will allow for audio and moving video clips to enhance your presentation.
Imagine a TV ad aimed at your potential customer, when he is actually watching, and not
busy at the refrigerator. Best of all, they have chosen to watch, as they have a genuine
interest in your product.

A good non-profit Home Page I have seen recently is for the Optimist Club in the Ottawa
Valley. They are available by asking your search engine for Arnprior, and then click on
Optimist Club. There are multiple links to individual clubs, and related organisations, and
after connecting to the Arnprior Club, I can even get a listing of my favourite Redman
games. That information is available to anyone on the Web, anywhere in the world.

At last count there were 10 million users on the Internet, and that is expected to increase
to well over 100 million in the next five years, and to 200 million by 2005. That is a lot of
potential customers. My server's home page which lists a number of links to area
businesses has had almost 55,000 visitors since mid-summer. Yes, you can even count the
number of times your page has been accessed.
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When I am finished this column, I will be checking into the Net, sending this article to be
typeset, downloading my mail, then renewing a subscription to a magazine, all without
stamps, or a visit to the post office, or writing a cheque; you get the idea. That leaves me
time to enjoy a quiet cup of coffee at my favourite restaurant, before heading into work.

One question I have been asked by several people is what is the gender gap on the Net?
All the research I have seen indicates that in actual users, 25% are women. That gap is
likely to close, as women are now far less intimidated by technology, and are actually
more willing to try new ways of doing things, than many men. With many women now
starting home based businesses, the Internet provides them with great potential for
expansion, so the feeling is that women may soon exceed men in their utilisation of this
technology.

I look forward to the day, not far off, when I can enjoy my coffee at home, and do my
days work without having to leave my house. For many people, Huxley's prediction of a
brave new society without work in the traditional sense, is not far off. Information and the
ability to distribute and accumulate it, is fast becoming the true coin of the realm.

I invite your comments and suggestions, as they allow this column to be relevant to your
interests. Until next time, see you in cyberspace.
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Peter DeWolf is a freelance journalist, and former broadcaster who makes Glasgow
Station Ontario his home. He may be reached concerning this column through this
newspaper, or by e-mail at "whisper@igs.net".

Actually I do hope one day, I could like author’s wish wish,I can stay at home, and money pure in , is it just a hope, or may be one day will be true… “I look forward to the day, not far off, when I can enjoy my coffee at home, and do my days work without having to leave my house.”

2011年3月14日星期一

7 Steps to E-Business Launch(Part 7)

1. Execute Marketing Strategies
You've heard of missile launch countdowns being held at T minus 15 seconds. There are many activities to carry out in this last stage, though some of them can continue after the launch. Many sites don't really have a marketing plan, but without a marketing plan, you can't expect to succeed. Here's my strategy to get the word out.
1. Announce via in-house participant lists. I first send e-mail announcements of JesusWalk.com to a list of 850 recent study participants, personalizing each message using MessageMedia MailKing 2.0 (http://www.mailking.com/?wmt66) and a Microsoft Access database.
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2. Publicize via in-house newsletter lists. My Joyful Heart newsletter list, developed over a period of nearly four years from my Christian Articles Archive site, includes 20,000+ subscribers. I employ this list to announce the JesusWalk.com study several times during December -- each announcement accompanied by a Christmas article. The principle is to give people something they value, and then market something else to them. If I were just to market without offering some free information, I'd lost subscribers, because I would have broken the unwritten value proposition contract I have with subscribers.
3. Provide news releases to key editors of major religious e-mail newsletters, with a request to review the new site. This has been successful in the past.
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4. Use JesusWalk.com as a case study in Web Marketing Today. The article you are reading is marketing, of course, but I provide it within the context of valuable information that has wide application to my readers' online businesses, even though they may have little interest in learning more about Jesus and Christianity.
5. Register with search engines and directories after preparing titles and META description and keyword tags for each webpage.
6. Display banner ads in the Christian Articles Archives site, which enjoys tens of thousands of visitors each week during the Christmas season (http://www.joyfulheart.com/xmas/).
7. Provide a brief text link to the JesusWalk.com study on every page of the Christian Articles Archive site, employing the Server Side Include files already inserted below the headline.
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8. Encourage "viral marketing" (I hate that expression) by deliberately asking subscribers to request that each of their churches include a short blurb in church bulletins and newsletters (http://www.jesuswalk.com/faq/blurbs.htm), as well as on websites and e-mail newsletters.
9. Stimulate "viral marketing" by asking each subscriber to forward a copy of my e-mail newsletter to a friend who might be interested. We strongly discourage people from actually signing up their friends to the study, and make it extremely easy to get off the list in case that happens.
We're well on our way. At this writing 1,044 participants have signed up with two-and-a-half weeks to go before launch. I'm expecting thousands more before too long.
Blast Off! Open Business
7 - 6 -5 - 4 - 3 - 2 - 1 - Blast Off! We "officially" set the launch date for January 1, 2000 -- more for dramatic effect than anything else. People are often open on New Year's Day to making new resolutions, such as nurturing their spiritual side. How much more on the day that begins a new century and millennium!
Every e-business is unique. The one you're operating or considering is doubtless much different than http://www.jesuswalk.com, but I expect that you'll find a number of ideas in this article to improve your site. Why don't you write them down in a To-Do list before your forget. I wish you every success in your e-business in the new millennium!