Readers of this blog and Smart Company in general will be very well versed in the amazing benefits the web can bring to a smaller organisation – and could well be experiencing them first hand.
Real life case studies of how the web has opened new channels to market, dramatically increased a business’ ‘opening hours’, provided qualified sales enquiries, saved money on traditional promotional expenditure and indeed provide the platform for unprecedented new business opportunities are the stuff Smart Company visitors keep logging in for.
But while some businesses are thriving due to their web exploits – even in near recessionary times, others are struggling to gain even minor benefits from this amazing communications technology.
So why has this occurred? Why have some businesses taken to the web like ducks to water while others have become bogged down in a technology quagmire?
Why have some rapidly adopted the medium while others are avoiding it like swine flu?
The answer to these questions is not clear cut. There is no single answer to the adoption question with some having a predominant obstacle while others deal with a combination of factors.
But let’s see if we can identify the major impediments.
1. Tech-‘savviness’ of owners and managers
There appears to be a strong correlation between the technology ‘savviness’ of owners and managers and online success. Those that follow technology and marketing developments closely will be quick to see the benefits that can flow from a professional and developed online presence.
These ‘early adopters’ are prepared to go in and get their hands dirty by actually replicating their customers’ online experiences and talking to them about what they do online and how they go about it. Instead of relying on the tried and true methods that have served them well in the past, they are open-minded about the benefits new approaches can bring their businesses – and reap the rewards accordingly.
These operators take advantage of the declining barriers to entry of the web and slow incumbent competitors to get a foothold in their markets – often taking on and beating large established companies. Some better-known examples include Seek and realestate.com.au (versus News Corp and Fairfax), Apple (versus Sony in the case of iPod and many telcos in the case of iPhone), Amazon (versus the world’s large retailers) and even Google (versus industry pioneers AltaVista and Yahoo).
Yes these are examples of some fairly major players, but the principles remain across all industries – the fast and nimble player making significant inroads into the markets of slower competitors by being informed and innovative.
2. Line of business
Much of a business’ preparedness to move into the online world can very much depend on what line of business they are in. For example, those that are more computer-based or assisted, or even ‘white collar’ industries such as publishing and entertainment are streets ahead of the more labour intensive industries such as mining and building.
Results from Sensis’ most recent eBusiness report below show that industries like transport/storage and personal services have as many as 73% of their participants taking orders online while finance and insurance is as low as 30%. This is a very interesting statistic given that finance and insurance products (or at least the policies that govern them) can be delivered digitally – perhaps a reflection on their reliance on traditional channels, such as personal selling.
There is also a correlation between adoption and markets. Typically businesses classified as selling to other businesses (B2B) can be seen to adopt the web faster than business to consumer (B2C) because for them the web is more likely to be used to research supplier candidates, whereas consumers still rely on the mainstays of printed directories and mass advertising as much, if not more than the web – a trend which is decreasing as web-savvy young people start to earn more disposable income and use the web to find suppliers.
3. Time and Resources
Unlike larger organisations who have large marketing departments and a seemingly endless supply of consultants to assist them in researching, planning, implementing and maintaining a professional online presence, smaller organisations are often tightly run and simply cannot fund the resources to do the same.
Therefore the impetus of investigating the online opportunities for the business lies with managers who may already have a hefty workload in the face of a challenging business environment. This scenario, of course, presents the Catch 22 situation of the business needing to adopt the web to remain competitive but lacking the resources to properly implement a competitive online strategy.
As discussed in last week’s blog, this is particularly true of the investigation of Social Networking as a promotional tool. Without time or resources to properly investigate the technique, many smaller businesses could well be left behind as web savvier competitors steal the march on appealing to social networkers.
The good news to organisations fitting this description is that barriers to entry or improvement are now lower than ever, allowing more of a trial and error approach than was possible in the past.
4. Complacency
As much as we like to think that Australian businesses are forward thinking and diligent when it comes to keeping abreast of new developments, the truth is that many operators are easily overwhelmed with the rapid pace of technology change and become complacent about it in the vain hope that it’s just a passing fad that will burn itself out (or that they will be getting out of the business before the impacts really kick in).
Of course this approach is akin to sticking one’s head in the sand and can only imperil the fortunes of the business as smarter, faster competitors understand the space and increasingly win business away from them.
As described above, it can be seen that complacency of the part of much of the financial and insurance industry has led to new retailers such as iSelect. With all due respect to salespeople in those industries (including some in my family!), which ‘shopping’ method would you prefer if you were in the market for insurance? A non-invasive service comparison website like iSelect or a more invasive salesperson? You get the drift.
5. Asking the wrong people
Many smaller organisations have failed to successfully adopt eBusiness because they have consulted with the wrong experts – easy to do in a relatively nascent industry.
With the web this occurs because the medium is perceived to be all about technology, when it in fact is about using technology to deliver a marketing, procedural or operations advantage.
So in practice a technology specialist is sought to help the business move online when instead what is really required is a marketer, process specialist or operations specialist who understands the web, rather than an IT person who attempts to understand these and other areas.
This is probably most evident when you come across a website which works beautifully (technology) but looks, reads and navigates terribly. Clearly what has happened in this case is that the business manager has relied on a technical expert to deliver the website in isolation instead of working in consultation with marketing (etc), design and content experts.
As the technology has become more widely understood, businesses then started to look towards creative designers to ensure websites were at least looking good in addition to working well.
Now as eBusiness expands even further into areas such as email marketing, blogging and social networking, designers are now moving further into the background as eMarketers become the first port of call for those seeking more strategic and holistic viewpoints on their online presence.
Given that we are now well beyond asking if the web can benefit business, businesses that can overcome these obstacles will find that the web can indeed be a critical component of their business growth rather than a virtual millstone around its neck.
Craig Reardon is a leading eBusiness educator and founder and director of independent web services firm The E Team which provide the gamut of ‘pre-built’ website solutions, technologies and services to SMEs in
