NET.WORKING: The eight-fold path to e-commerce

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What makes a great business-to-business Web site? When our editors started setting the criteria for ranking this issue's Top 200 b-to-b sites, we first broke down all the key business applications now in use and analyzed them.

It was an interesting exercise. When you start boiling it all down, there are really only about eight broadly strategic business functions taking place on corporate sites, ranging from the basics of simply branding on the Internet to the leading-edge complexity of actually taking payment and fulfilling orders online.

Not surprisingly, of the Top 50 sites in our list, every single one included the two most essential functions: Traditional branding and advertising and some level of customer service.

Moving one step ahead in sophistication, more than 90% of our Top 50 sites also use the Internet to cut costs significantly in printing and mailing, and to generate customer databases, sales leads and partnership opportunities.

For smaller companies, or businesses new to the Internet looking for successful strategies to emulate, these four strategies offer the tried-and-true first-phase Web template: Branding, customer service, cutting costs, and databasing and sales lead generations.

Where things get trickier is on the next four business applications, which make up the second, more complex phase of Web business -- essentially, the transition to a true e-commerce site.

My own belief is that all businesses have to head this way to survive into the 21st century, but they will do so at widely varying speeds. Even among the best of the best, as represented by our Top 50, there's a clear sliding scale on how rapidly these Web pacesetters are moving.

Here's how it breaks down (not including the eighth function, intranets and extranets, which are internal in nature and generally not open to customers):

  • Distribute product via the Internet: Of the Top 50, roughly three-quarters are at this point; obviously, these are primarily software and information-driven companies. But there are subtleties here as well: Federal Express Corp. delivers real-world packages (atoms, not bits, in Nicholas Negroponte's famous formulation), but it distributes valuable information about the status of those packages on its Web site.

  • Accept orders online but not payment: Slightly more than half, 52%, are at this stage.

  • Accept orders and payment online: Less than half, or 48%, can do full transactions via their Web site.

    Over the next year or two, more businesses are likely to reach this e-commerce plateau, which raises an interesting question for marketing departments.

    Because technology -- and the clear understanding of its business uses -- plays an increasingly crucial role at this level, I'd expect to find more marketers putting a high priority on hiring staff with Internet knowledge and experience, as opposed to applicants with a traditional marketing background.

    The marketers in the roundtable discussion echo that. As more businesses follow the lead of our NetMarketing 200, marketers who don't understand the Internet will become obsolete relics of the 20th century.

    David Klein is associate publisher-editor of the Ad Age Group. He can be reached at [email protected].

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