Article - Why invest in the Web during a tough economy?
by Paul Eident
It is human nature to settle in and ride out storms. However, as we saw in the recent hurricanes in the Gulf area, that is most times doing nothing and riding out the storm can be deadly. Those who fair well during difficult times are the ones that do something to make their situation better. In business, making your situation better involves finding ways to increase revenue and decrease costs equaling a bigger bottom line.
Increasing Revenue
Here are a couple ways the Web that can be used to increase revenue during a tough economy.
- Make it easier for your customers to buy your products/services - Everyday, more and more people are spending money on products and services they find on the web. Just this past week, I was talking to an "old school" sales professional selling industrial products. He said the new generation of professionals in his industry are using search engines to find products and services instead of the long used Thomas Register.
Another client of ours, jump-on-it.com, rents the inflatable bouncers of which parents rent for their children's birthday parties. Before they had a website, they advertised in the yellow pages and in the local classifieds. About three years ago they asked us to build them a simple website. In the past three years, since the website was launched, they have stopped the traditional advertising and now rely exclusively on receiving new business from their website. Their revenue has increased and they have purchased many new bouncers to handle the demand.
- Expand your products/services by offering with Web based products - Krex Inc. has been in business for many years and has been successful in selling engine lubricants to new car dealerships to help the dealerships retain their customers. Over the years, krex has expanded their product offering to include other benefits dealerships can offer to retain customer loyalty. About three years ago, Krex hired us to build a new product based on the Web. This product helps dealerships retain and advertise to their customer base. Because of this new product offering, Krex's is doing more business with existing customers and attracting more customers who are interested in the new Web based product.
Reducing Cost
The key to decreasing cost is to become more efficient. Labor is expensive. Web technologies can allow you and your current staff become more productive so that you can handle the increased business without adding staff.
We have a client who sold their products through a catalog. When a customer wanted to buy something, they would call our client's customer service department on the phone to place their order. They needed approximately 12 customer service representatives to handle the phone orders. Then our client built an e-Commerce website to take orders. However, customer service reps still needed to enter the website orders in their in-house order system. With the website our client made it easier for customers to buy products(increasing revenue) and also made it a little more efficient(reducing cost) because customer service reps didn't have to take phone orders. Currently, our client is updating their order system and we are now able to enter orders from the website straight into their order system without human interaction(further reducing cost). Furthermore, the website will be updated automatically with order history and shipping information which will increase customer service and decrease phone inquiries. the client has lost some customer service reps and are not planning on hiring replacements.
The Web has changed the World and is more increasing becoming the way business is being transacted. We have many other examples on how the web has increased our client's revenue, reduced costs and helped them compete in their markets. The theme is the same. Investing in smart Web technologies will most likely increase your bottom line.
