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Chapter 3
Selling on the Web
Learning Objectives
• Discuss approaches to revenue models
• Discuss the transition between models
• Discuss the revenue revenue strategy issue
• Compare and contrast alternatives to create an
effective business presence
• Explain website usability
• Discuss effective communication
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Creating an Effective Web
Presence
• Businesses always create a presence in the physical
world by building stores and office buildings.
• The only contact that customers and other
stakeholders have with a firm on the Web is through its
presence there.
• Creating an effective Web presence can be critical
even for the smallest and newest firm operating on the
Web.
3
Why is it so important?
• 97 Million People Online
• $7 Trillion This Year
• 50 Times More Than 1999
• 1 Billion Emails Each Day in US
• Doubling Every 17 Months
• Within 5 to 10 Years expected to double every 11
Hours
4
The situation today …
5
Online vrs Traditional marketing
• Consumers Want Time
Savers
• Education & Research
• People Communicate
Differently
6
Revenue Models
• Web Catalogue Revenue Models
• Digital Content Revenue Models
• Advertising Supported Revenue Models
• Advertising-Subscription Mixed Revenue
Models
• Fee-for-Transaction Revenue Models
• Fee-for-Service Revenue Models
7
Web Catalogue Revenue Models
• 130 year old idea
• Mail Order catalogue revenue model
• Seller
– establishes a brand name
– using brand strength to sell through catalogs
• order via a toll-free number or website
– important for the web-weary
• Computers, consumer electronics, books,
music, videos, luxury goods, clothing , flowers
and gifts
• http://www.amazon.com
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Digital Content Revenue Models
• Reduction of Printing costs
– Reduction of fees charged
• Examples
– Legal research tools
– Doctoral dissertations and masters thesis
– Journals and Books
– First pioneers where sellers of adult digital content!
– http://search.epnet.com/
9
Advertising Supported Revenue
Models
• As used by network televisions
• Sales grew by 1998 but reached a plateau in
2000
• Now improving gradually
• Major problems
– No standard for advertising charges
– few web sites have enough visitors to interest
advertisers
• Examples: Web Portals, Newspaper
publishers, Niche Market sites
• http://www.timesofmalta.com/
10
Advertising-Subscription Mixed
Revenue Models
• Subscribers pay a fee and accept a limited
amount of advertising
• Used by distinguished newspapers
– New York Times
– Wall Street Journal
• Others provide free access to recent news but
charge a fee for archived news
• Others require subscription to print version for
access to entire site
• http://www.nytimes.com/
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Fee-for-Transaction Revenue Models
• Fee charged based on number/size of transaction
• Disintermediation
– removal of middle-men in selling
• ReIntermediation
– Use of fee-for-transcation sites in selling
• Examples
– Travel Agents
– Automobile Sales
– Stockbrokers
– Insurance Brokers
– Event Tickets
– Real Estate and Mortgage Loan Brokers
– Online banking and Financial Services
• http://www.hsbc.com.mt/
• http://www.bov.com/
12
Fee-for-Service Revenue Models
• Fee charged based on value of service
provided
• Examples
– Online Games
– Streaming of Concerts and Films
– Professional Services
• limited by state-licensed professions
• http://www.java.com/en/
13
Revenue Models in Transition
• Subscription to Advertising-Supported
– Microsoft Slate Magazine
• Advertising-Supported to Advertising-Subscription
– Salon.com
• Advertising-Supported to Fee-forServices
– XDrive
• Advertising-Supported to Subscription
– Northern Light
• Multiple Transitions
– Encyclopedia Brittanica
– info-seller to advertising-supported to advertising subscription
models
14
Revenue Strategy Issues
• Channel Conflict and Cannibalization
– competition between different selling channels
• Strategic Alliances and Channel Distribution
Management
– companies join in an activity over a long period of
time (Amazon)
– web portals and web services
• Mobile Commerce
– Growing, but not as fast as expected
15
Making it sticky!
• Stickiness is critical in creating a presence
that attracts advertisers
• People will spend more time on it and visit it
often
• What makes a website sticky?
• Give some examples with websites you use
regularly
16
Channel conflict and
cannibilisation
• Levi‟s jeans
– Sell through shops
– Sell through website
– Conflict occurs
• In 2000 Levi‟s stopped selling jeans from their
website
17
Identifying Web Presence Goals
• On the Web, businesses have the luxury of
intentionally creating a space that creates a distinctive
presence.
• A Web site can perform many image-creation tasks
very effectively, including:
– Serving as a sale brochure
– Serving as a product showroom
– Showing a financial report
– Posting an employment ad
– Serving as a customer contact point
18
Achieving Web Presence Goals
• An effective site is one that creates an attractive
presence that meets the objectives of the business or
other organization.
• Possible objectives include:
– Attracting visitors to the Web site
– Making the site interesting enough
– Convincing visitors to follow the site‟s links
– Creating an impression of corporate image
– Building a trusting relationship with visitors
– Reinforcing positive images of the organization
– Encouraging visitors to return to the site
– Creates a positive image and reinforces existing ones
19
The Toyota Site
• The Toyota site is a good example of an
effective Web presence.
• The site provides:
– A product showroom feature
– Links to detailed information about each product
line
– Links to dealers
– Links to information about company
– http://www.toyota.com/
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Quaker Oats
• Quaker Oats has created Web sites that did not offer
any corporate presence until 1999.
• In 1999, Quaker Oats changed its Web page to improve
its general appearance and user-friendliness.
• The Toyota and Quaker Oats examples illustrate that
the Web can integrate an opportunity for enhancing
the image of a business with the provision of
information.
21
Quaker Oats in 1998
22
Quaker Oats in 2000
23
Quaker Oats in 2002
24
Not-for-Profit Organizations
• A key goal for many not-for-profit organizations is
information dissemination.
• The combination of information dissemination and a
two-way contact channel is a key element in any Web
site.
• The American Civil Liberties Union and American Red
Cross have created effective Web presences.
• Political parties and museums also use Web site for
their image presences.
25
How the Web is Different
• The failure to understand how the Web is
different from other presence-building media is
one reason that businesses fail to achieve
their Web objectives.
• Firms must use the Web‟s capability for two-
way, meaningful communication with their
customers.
26
Meeting the Needs of Web Site
Visitors
• Businesses that are successful on the Web
realize that every visitor to their Web site is a
potential customer.
• Creating a Web site that meets the needs of
visitors with a wide range of motivations can
be challenging.
• Technology variation can be another concern
to Web presence.
27
Meeting the Needs of Web Site
Visitors
• A good Web site should give the visitor the
option to select smaller versions of the
images.
• A good site design lets visitors choose among
information attributes, such as level of detail,
forms of aggregation, viewing format, and
downloading format.
• Flash Debate
28
Trust and Loyalty
• When customers buy a product, they are also buying that
service element.
• 5% increase in loyalty can yield 25 to 80% profit increase
• A seller can create value in a relationship with a
customer by nurturing customers‟ trust and developing it
into loyalty.
• Customer service is a problem for many corporate sites.
• A primary weak spot for many sites is the lack of
integration between the companies‟ call centers and their
Web sites.
29
Usability Testing
• Firms are now starting to perform usability
testing to their Web sites.
• As the usability testing becomes more
common, more Web sites will meet their goals.
• Eastman Kodak, T. Rowe Price, and Maytag
have found that a series of Web site test
designs help them a lot.
30
Customer-Centric Web Site
Design
• Design site according to visitor‟s navigation,
not company organization
• Avoid jargon and business terms
• Cater for low-end clients
• Consistent features and colours
• Visible text and navigation controls
• Test colour combinations for colour blind
visitors
31
Identifying and Reaching
Customers
• Two general ways of identifying and reaching
customers: personal contact and mass media.
• An important element of corporate Web presence is
connecting with site visitors who are customers or
potential customers.
• Mass media is a one-to-many communication model
• The Web is a Many-to-one communication model,
• Personal contact is a one-to-one communication
model.
32
New Marketing Approaches for
the Web
• The Web is an intermediate step between mass media
and personal contact.
• Using the Web to communicate with potential
customers offer many advantages of personal contact
selling and many of the cost savings of mass media.
• GartnerGroup reported that customer-centered
marketing strategies would be an excellent fit for the
Internet marketplace.
33
10 Marketing Tips
• Grab „em
• Don‟t mix messages
• Feature a call to action
• Retain your branding
• Make it easy to contact you
• Use expected colors and imagery
• Optimize for search engines
• Feature testimonials
• Focus on the visitor
• Adopt a privacy policy
34
Grab‟em
• A good headline…
– Is focused on the visitor, with
words such as “you” and
“your”
– Is the dominant element on
the home page
– Appears larger than even
your logo, company name or
tagline
35
Don‟t mix messages
• Be clear
• Feature what you offer
– Use pictures
– Use relevant text
• Link directly from those images on the home page
to detailed pages with extensive information and
more pictures
36
Always observe the 1-2-3 rule
1 – 2 – 3 … I‟m „Outta Here!
• Can visitors find whatever they want within “3‟
clicks?
• Based on experimental results.
37
Feature a clear call to action
• Tell the site visitor, on the home page,
exactly what you want them to do
• Visitors will read your site content at length
if it answers their questions
• Be sure to ask for the business at the end of
the page or article (get to the point)
38
Retain your branding
• Building upon your existing brand identity is key to
immediately establishing trust…
• These elements need to be consistent with your
brand‟s off-line identity…
– Brand logo
– Brand name
– Key messaging
– Graphics
39
Make it easy to contact you
• Your visitors don’t want to dig for the basics, so make
sure it‟s easy to find the following:
– Telephone numbers
– Contact forms (mini and full)
– E-mail links
– Physical address of your place of business in an
easy to copy format
40
Make it even easier to contact you
• E-mail Signature w/ Contact
– Hyperlink to Your Site
– Peak Interest w/ Free Offers
– Focused E-mail Subject Line
41
No surprises
• Use industry-appropriate color and imagery
– Give your visitors what they expect exactly as they
expect it
– Don’t attempt to re-brand your industry
– This is your opportunity to be consistent and
professional at the beginning of the sales process
42
Optimise for search engines
• Search engine optimization is the art and science of increasing
your website‟s visibility in the major search engines across a
strategically defined set of keywords and phrases that apply to
your products or services
• An estimated 77 percent of Internet users employ search engines
to find Web sites
• 20,000 Search Engines & Directories
• If you are not listed on Google or Yahoo, you are invisible
– It doesn‟t matter how well known your brand is!
– Visitors will not guess your site name but will go through
Google or Yahoo just to be safe
43
But how to market to Search
Engines?
• Unique Content
• Links to Your Site (ask!)
• Design Fundamentals make a difference
• Top Search Engines by Search Share, January 2005, U.S., Home &
Work
Search Engine Searches* in thousands Share of Total Searches
Google Search 1,923,153 47%
Yahoo! Search 868,174 21%
MSN Search 523,188 13%
Total 4,085,880 81%
• Note: Searches are the total number of queries conducted at a search engine
during the specified reporting period, excluding internal site searches.
44
Search Engines count in links …
• Search Engines measure popularity through links
• Don‟t be a copycat – unique content matters
45
Speak the Search Engine language
• Find out what you are
saying to the search
engines
• Keyword Density
• Bloggers Linking to
you?
• Test Your Web Site Here:
http://www.schipul.com/
en/sem/keywords/
46
Buy your way to the top …
47
Get a hand from popular sites …
• Often overlooked quality links
• Make sure your link – is done right!
• Organization sites typically rank well.
48
ETC Website Case Study
49
ETC Website Case Study (1)
• www.etc.gov.mt
• A year after its launch
• How many links does it has?
• www.etc.gov.mt = 83 links
• How many links does the old (deactivated)
website still have?
• www.etc.org.mt = 222 links
50
ETC Website Case Study (2)
• What about keywords?
• Which are the most representative?
• Some stats according to
http://www.schipul.com/en/sem/keywords/ …
– Word count: 131
– Total links: 61
– Percentage of links to words: 102.29 (%)
– And more …
51
52
ETC Website Case Study (3)
• What‟s in a keyword?
• http://inventory.overture.com/d/searchinventory/suggestion/
Vacancies Employment
53
Feature Testimonials
• Assure visitors that you are a “real” company with a solid
reputation
– Gain client approval to use a quote
– Even better, use client logos and link to their Web sites
– Never assume that everyone knows you want their
business
54
Focus on the visitor
• Cater to what the visitor wants and needs from your site,
then give it to them…
– If you are a association, offer online registration and
case studies
– If you are a plastic surgeon, offer dynamic before-and-after
photo galleries
– If you are targeting the younger generation, offer games
or social software tools (myspace.com) that feature your brand
55
Adopt a privacy policy
• Respect the privacy of your site visitors with a
privacy policy
– Link to a written privacy policy at the bottom of
every page
– Be sure policy is written in normal language,
not legalese
56
Privacy Policy contains … 1
• Gathering and using information
– only collects personal information from our visitors on a voluntary
basis.
– We don‟t require this information to obtain access to any of our sites.
– Personal information may include name, address, e-mail address,
age, etc., and may be collected for contest entry forms, requests for
information
– We may also occasionally ask, on a voluntary basis and with parental
permission, if appropriate, for personal information for our internal
use, such as marketing and research.
– Personal information received from any visitor will only be used for
internal purposes and will not be sold or provided to third parties.
– Since the information you submit to us may not be encrypted, we
cannot guarantee the absolute privacy of that information.
– Only those who ask to be added to our update lists or who ask for
information from us will receive e-mail from us.
– If you want to remove your or your child‟s e-mail address from our
files, please let us know.
57
Privacy Policy contains … 2
• Kids and Parents
– Kids
If you are 18 years of age or younger, please be sure to ask
your parents for permission before providing any information
to us.
– Parents
We hope that you and your kids enjoy our web site. In
communicating directly with minors over the Internet, we
recognize the unique issues raised regarding the protection of
your kids‟ privacy. The Children‟s Advertising Review Unit
(CARU), a section of The Better Business Bureau, has issued
guidelines for web sites gathering information from minors.
The company intends to comply with the CARU guidelines in
order to protect your kids and their privacy.
58
Privacy Policy contains … 3
• Cookies
– The company may use "cookie" technology to
obtain non-personal information from its online
visitors. The cookie tracks the total number of
visitors to our sites in an aggregate form (you‟re
one of a group and your information is not singled
out). These aggregated statistics are used internally
to better provide services to our consumers. We
don‟t extract personal information in this process
nor do we provide this information to third parties.
We also do not contact you.
59
Privacy Policy contains … 4
• Links
– The site may contain "links" to other sites, and we
make every effort to only link to sites that share our
high standards of decency, fairness, and integrity.
We try our best to ensure that these links are safe
for kids. However, since we cannot guarantee the
content of every site to which we are linked, kids
should always check with an adult before linking to
any new sites.
60
Privacy Policy contains … 5
• Your Ideas
– We encourage you to share your comments and questions
with us. We promise to read all the mail you send to us, but we
may not be able to respond to all of it. However, please note
that we assume no responsibility for reviewing unsolicited
ideas for our business (like product or advertising ideas) and
will not incur any liability as a result of any similarities
between your ideas and future products or programs. This
means that we have no obligation to treat your idea
submissions confidentially and that we can use them without
paying you for them. Any and all idea submissions will be
owned by the company exclusively and may be used for any
purpose, now or in the future.
61
Privacy Policy contains … 6
• Use of Materials on this Web Site
– Please remember that the trademarks, service marks,
graphics, text, music and other properties appearing within
this web site are protected intellectual properties used by the
company and/or its related companies. These properties may
not be copied, reproduced, republished, uploaded, posted,
transmitted or distributed in any way, except that you may, for
personal and non-commercial use only, download one copy
onto your personal computer. In order to protect these
valuable assets, we must prohibit other uses without its prior
written consent. Except as expressly provided above, nothing
contained herein shall be construed as conferring any license
or right under any copyright or other intellectual property
right.
62
Come back …
• How to make people return to your site?
– What’s New Section
– Ask The Expert or FAQ
– Testimonials
– E-Zines (information rich & focused)
– Giveaways, Surveys & Contests
63
E-Zines
• E-Zinez.com & EzineQueen.com
• Speed to Market
• Low cost – No Cost – Low Risk!
• Wide Distribution
• Easy & Effective
• As easy as
– A) Copy Format & Text
– B) Cut & Paste Your Message
– C) Test & Send BCC
64
E-Zine Subscribers
• Existing Customer Database
• Give something For FREE
• Opt-in Sign Up On Web site
• Buy E-mails From List Companies
• Articles Featuring Your Expertise
• Publicity
• Post On E-zine Directories
65
Website R.I.P
1. Dead Links
2. Site or Page Under
Construction
3. Too Many Fancy
Graphics/Gadgets
4. Backgrounds Take Too
Long To Load
5. Mixed Messages and
Scroll Bars
6. Burying Your Message
7. Overall Unprofessional
Image
66
How to measure website
effectiveness?
• A visit – user requests a page from a website
• A trial visit – the first time a user makes a visit
• A repeat visit – all visits except for the first one
• An advertising view – is a page visited which
contains an advert
• Click through – the number of times an advert
is clicked
67
Time for time travelling …
• Thanks to the Way Back Machine
• http://www.archive.org/web/web.php
68
WayBackMachine
69
Analysis …
• Is the website effective?
– Is/can it being promoted?
– Are there signs of branding? Which?
• Visitors
– What are their needs vis-à-vis the organisation?
– Does it meet them?
– How is trust and loyalty being boosted?
– How is it reaching customers?
– Is it saving them time?
– Does it cater for different customers (Personalisation)?
• Is it usable? Why?
• Is the company diversifying or focusing on core business?
• What business model is being used?
– Web Catalogue Revenue Models
– Digital Content Revenue Models
– Advertising Supported Revenue Models
– Advertising-Subscription Mixed Revenue Models
– Fee-for-Transaction Revenue Models
– Fee-for-Service Revenue Models
• M-Commerce?
70
Suggestions …
• How can it be more effective?
– To Flash or not to Flash? High vrs Low res graphics?
• Visitors
– What needs should be met?
– How can we boost trust and loyalty?
– How can we reach more customers?
– How can we save customers more time?
– Should it cater for different customers? How?
• How can we make it more usable?
• Should the company diversify or focus on core business?
• What business model should be used?
– Web Catalogue Revenue Models
– Digital Content Revenue Models
– Advertising Supported Revenue Models
– Advertising-Subscription Mixed Revenue Models
– Fee-for-Transaction Revenue Models
– Fee-for-Service Revenue Models
71
Question
• You have been employed by Dictionary.com to
explore revenue generating alternatives.
• Consider the revenue models. Which would
you chose and why? Which won‟t you chose
and why?
72
