HERE’S A SIMPLE TEST: Have you ever used an automated teller machine? Of course you have. Have you ever ordered theater or movie tickets using an automated phone system? Have you ever signed your name on a handheld computer to accept delivery of a package? Have you ever received stock quotes or news updates on your pager or other handheld device? Do you ever receive electronic mail from your customers? Do you receive e-mails or faxes from your suppliers with quotes, product information, delivery status updates? Have you ever gone onto the World Wide Web to get more information about a type of product you’re interested in buying? Have you ever used a Web site to get technical support information to solve a problem you’re having with a product that isn’t working quite right? Have you ever purchased anything over the Internet? Does your company’s Web site let customers order products, check delivery status, get a list of all the products they’ve ordered from you in the past, or correct their mailing address? If you answered “yes” to any of these questions, then you have engaged in electronic commerce.

Would you like to know how your organization can benefit the most from electronic commerce? Would you like to know how your customers can benefit from your electronic business initiatives? That’s what this book is about. This book summarizes the best practices for electronic commerce and electronic business today on the Internet and beyond. Within these pages you’ll walk behind the scenes at more than a dozen pioneering companies—companies that have committed themselves to doing what it takes to make it easier for their customers to do business with them. These companies are reaping the rewards of their efforts today and will continue to do so in the future.

What will happen to your company if you can create a successful e-business strategy? First and foremost, you’ll get to stay in business—no mean feat in today’s fast-paced global information economy! Second, you’ll reap rewards. You’ll be able to:

-    Increase customer loyalty

-    Increase profitability

-    Decrease time-to-market for new products

-    Reach your customers in the most cost-effective way with targeted offers

-    Reduce your costs per transaction substantially

-    Reduce your customer service costs dramatically

-    Reduce customer service time appreciably

Going Beyond the Web

ONE OF THE most significant advances in technology today is the combination of the Internet and the World Wide Web. The ubiquitous nature of the Internet, with its inexpensive Web browser clients and universal access, makes it an excellent platform for communicating more effectively with customers. New companies are springing up whose only presence—at least to customers—is via the Web. These “virtual” companies, such as Amazon.com, Security First Network Bank, and Virtual Vineyards, have had the luxury of designing their businesses from scratch, using the latest Internet technology.

But they have also faced new challenges. They’ve had to figure out how to lure customers and how to keep them without relying on face-to-face interactions. Many people think of the Internet as impersonal. Yet these virtual companies have created very close bonds with their customers without ever meeting them or, in many cases, talking with them.

How do these on-line businesses create fanatical customer loyalty? They carefully streamline every aspect of the customer’s interaction with them. They ensure that nothing ever falls into a “black hole.” And they reassure the customer at every step of the way. Before the customer has time to wonder whether something’s been taken care of properly, he receives notification that it has.

Of course, we don’t all have the luxury of starting from scratch. Most of us have brick-and-mortar companies with people, and sales forces, and distributors, and call centers. Yet we’re also trying to leverage the Web to make it easier for prospects to find out about our companies and products and easier for customers to transact business with us electronically, twenty four hours a day, seven days a week.

One of the things I learned in doing the research for this book is that you cannot do business on the Internet in a vacuum. Instead, Internet commerce needs to be part of a broader electronic business strategy—a strategy that embraces all the ways that you let your customers do business with you electronically: by Touch-Tone phone, by fax, by e-mail, by kiosk, via handhelds, and via the Web. If you don’t coordinate your Web initiatives with the rest of the ways you do business electronically, you’ll probably waste a lot of time and money! For most companies, their Web presence is a logical extension of their existing business model. It’s a new distribution channel and a new marketing medium. Ideally, Internet commerce builds on efforts you’re already making in other areas of your business, initiatives such as customer loyalty programs, one-stop shopping, and customized manufacturing.

Like the companies profiled in these pages, you’ll probably discover that, in order to really use the Internet and the Web effectively, you’re going to need to redesign a number of fundamental, customer-impacting business processes. Then you’ll want those streamlined processes to flow through your preexisting business systems. You’ll also need to consolidate all the disparate pieces of customer-related information you have floating around in your different departments and applications. You’ll want to develop comprehensive customer profiles. As you embark on these rather profound initiatives, you’ll realize that you can leverage the investments you’re making by not limiting their scope to the Web but rather by using the same streamlined processes and information to make it easier for customers to do business with you by telephone, fax, e-mail, or face-to-face. The impetus to make these fundamental changes may arise from your desire to do business over the Internet. But, if you do it right, the changes you’ll make will pay off every time you touch the customer in any way.

It’s the Customer, Stupid!

WHAT’S THE SECRET of a successful e-business initiative? Why have many Internet-based businesses crashed and burned? Who’s really making or saving money on the Internet, and what have they done differently from those who have failed? I stumbled upon the answers to these questions in 1995, when I began researching the best practices in electronic commerce. Once I saw the simple truth that was staring me in the face, I expanded my research. I began to look beyond the Internet and the Web. I found that there were a number of complementary customer-facing technology initiatives—using telephones, kiosks, smart cards, and even “smart cars”—that shared the same properties 1 had discovered among the successful Internet players.

What’s the winning formula? You guessed it! It starts by focusing on your existing customers, figuring out what they want and need and how you can make life easier for them. Then you can expand your efforts to reel in prospective customers. Once you lure prospects to you, closing the sale and cementing a profitable, long-term relationship becomes a snap, because you’ve already made it easy for customers to do business with you!

Sound easy? Well, it’s not! The idea of focusing on making it easy for customers to do business with you is simple. But implementing this vision is difficult. As you’ll see from skimming the sixteen case studies that follow, each of these organizations has been hard at work for more than twenty-four months. This work requires a visionary leader, typically someone with a marketing bent and background. It requires a lot of perseverance. It requires a good deal of investment. It requires a unique partnership between business pragmatists and information technology visionaries. And it requires buy-in by and participation of the entire organization.