The Bottom Line

The great net gold rush is over. It's not that the market space has closed - it's just that many companies realize that enormous, easy profits won't be realized just by putting up a website. Businesses are starting to look at the web as a potentially profitable tool, not just a place to hang a business card. Eureka's Mark Mathias likens the '96-'97 rush to the web to "brochure wars." Companies were putting up expensive websites that showcased their products but didn't improve the bottom line. But businesses now want a return on those web investments, a return Mathias sees as ultimately obtainable.

Leverage the Net's Communication Power

The net changes everything, Mathias notes, especially in business. The business to business market is particularly in transition, and he advises companies to keep up with the changes. "Some real efficiencies can be gained through essentially a global network of computers very much like the telephone system," Mathias says. "I think everyone would admit that the introduction of telephones into the world literally changed the whole scope of the way people live in their daily lives. The Internet has the capability to do the same thing." The obvious example to use is Amazon.com, Mathias says, which has gotten a lot of leverage out of its lack of physical inventory. The web was the communication medium, which made that revolutionary distribution possible. That capability was inherent in the web's inception. But it took the vision of CEOs like Jeff Bezos to harness that capability for a business.

Embrace Perfect Knowledge

The web makes it possible to create new business relationships based on the bottom line, not tradition, Mathias says. "There's actually a term called "perfect knowledge" and it's kind of an economist's term," Mathias says. "If a buyer has perfect knowledge - if they know all of the suppliers or vendors, they know all of the information about a product or a service and they know all of the competition, then they will be able to make the best purchase decision." There's a more sensible solution than just buying from the sources you've always bought from, Mathias believes. He thinks the ability to supply perfect knowledge will emerge as one of the web's strongest points for both businesses and consumers. "What is going to happen in the future is that if I want to buy something, I can use the Internet to obtain as close to perfect information as possible," Mathias says. "I have access to the manufacturers information, all of the people that are selling this particular product, all of the competitors. I can send out a little bot (automated shopper) if I want that will do some shopping for me." "That lets me have amazing knowledge of the products and services that are available to me," he continues. "I'm also no longer constrained by geography because I can now shop literally anywhere in the world that participates on the Internet." And more important to businesses, they're no longer limited to the customers in their local areas. "They can position themselves in a much larger geographical region dealing with customers that perhaps they would never even have visibility to and increase the amount of business they have by using the Internet," Mathias says. Even a $10,000 or a $100,000 website is inexpensive compared to the costs of setting up a bricks and mortar store. If a company can extend its reach to new customers, that would be money well spent. Now find out how your business can exploit the web's capabilities and get started on finding a return from your own investments.