The Net and b2b marketing

If it's not in the individual consumer space that you're doing business in--in other words, if your customers are few in number, each accounting for large chunks of business--your NCQ can be higher than if you'd been a mass marketer. For, the Net will enable you to build complete relationships with each of your customer, once again using information as the bedrock. Crucially, here you can aim to forge relationships with each one of your customers, actively going out and building links with them instead of waiting for them to contact you--as would be the case in a mass market.

If your market lies in what is referred to as the b2b space in the 24/7 economy, remember that your entire operations must be brought in sync with those of your customers. Their requirements will determine your manufacturing schedule, your product features, your delivery times, and your service parameters.

So, ensuring a seamless flow of information between their operations and yours will ensure that you can meet them just as, where, and when required. The role of the Net? It couldn't be simpler: how else do you integrate the information flows between your company and those of each of your customer's, enabling them to reach into your systems and dictate their needs, except through linkages in the Netspace?

Indeed, the crucial issue here is not the medium of the linkage, which could be through the public channels of the Net, or through protected portions of it sealed off from the rest of the e-world--the so-called extranet. What's important is to move into the e-space by setting up channels of on-line, real-time communication with every customer--and then having that communication flow back into your company's innards so as to reach every relevant part of the organisation that needs to respond: from the shopfloor to the sourcing managers, from the billings people to the delivery people. And, eventually, to your suppliers.

TISCO's b2b drive has begun with the end: the organisation has created an extranet that links 11 of its suppliers. Eventually, the company hopes to ramp this up into a total b2b solution that links the organisation to its customers at one extremity, and its suppliers at the other. Points out V.P. Srivastava, 36, Senior Divisional Manager (Information Technology Services) TISCO: "We have to take cognisance of the fact that our customers are other organisations, and the manufacturing process has to be designed and scheduled based on unique product specifications."

And logistics service provider Blue Dart expects its 1,200 large accounts to be the first to graduate to its soon-to-be-launched e-nabled site. Explains Clyde Cooper, 42, CEO, Blue Dart: "Our existing intranet and logistics services will be posted onto the world wide Net-based system we have created. Soon, anyone from anywhere will be able to use our distribution and logistics services." Indeed, the ability of the Net to facilitate information transactions is what makes b2b the mother-lode of e-Commerce.

The conclusion is obvious: your e-strategy for managing customer relationships must flow from a consideration of your NCQ, given the characteristics of the market that you operate in, and from an exploration of how you can use the e-component to add value to your company's steel-and-glass operations to create unbeatable competitive advantage.

The Net and your company's innards

Let's consider now how to e-fy the insides of your organisation. In other words, how to enhance your NCQ Inside. The trick here is to exploit the benefits of the Netspace for creating a continuous chain of information connecting your company with each and every one of your partners on the value chain: suppliers, vendors, consultants, investors, project-collaborators, distributors, retailers in short, everyone. Why?

You are not alone. That's why. Whether you're a massive vertically-integrated company, or whether you prefer to tango with a team of partners at different points on your value-addition chain, the fact remains that every operation on that chain must now dance to the same beat if your chain is to beat your competitors'. For, it's not competencies that compete any more; it's the entire value chain. Whether your generic competitive strategy is differentiation or cost-leadership, every segment on the value-chain must work together to ensure that the end-product or service meets that description.

And what keeps the different parts moving to the same beat is information. That's why moving as much of your internal operations into e-space as you possibly can is how you can get the click into your bricks. Of course, your assembly-line will still roll in the brickworld, your trucks will still move on concrete roads, and your products will still be lined up on hard shelves. But the data that moves them--what to manufacture, in what quantity, what size and what specs, where to deliver the products, what components to buy--will flow into, and around, your corporation from every one of your upstream and downstream partners using the Net.

Coming into play will be your supply-chain management processes, your customer relationship management processes, and your product movement processes--all of them pulled along in the slipstream of the information flow. Companies have major opportunities for applying e-Commerce to supply-chain activities such as planning, purchasing, and logistics. By sharing up-to-the-minute demand forecasts via extranets with suppliers, for example, organisations can expect to cut inventories and raise in-stock performance. On the purchasing side, many buyers and sellers are cutting administrative costs by implementing on-line catalogs as well as order-management systems.

The e-biz template used by the Chennai-based Ford India may be based on a framework developed by its Dearborn-based parent, but it reflects the complex set of transactions a typical auto company will have to deal with. Thus, there are 4 quadrants to Ford's e-strategy: company to customer; company to dealer; company to suppliers; and intra-company. The backbone? A GAD MFG/ PRO ERP package that ensures that a sales-order is translated into inputs at the bill of materials and scheduling ends; and an extranet that links the company to its suppliers and dealers, and allows it to share information with them. Says S. Balu, 40, General Manager, Ford India: "Eventually, supplier and dealer requisitions will happen over the Net, and the status of the orders can be viewed on-line." Not convinced?

This is exactly what Fiat India has done. Its DSAs (Dealer Stock Availability System) leverages the power of the Net to link the company and its dealers, thereby integrating the information part of the transactions between the sales and marketing functions, and the company's distributors. The result? Better customer management. Affirms Gianni Ravina, 50: "The concept behind the DSAs is that the dealer is our partner in managing the customer."

Remember, the cutting edge of the e-conomy may appear to lie in connecting with the customer in the dot.com world. But as much--if not more--of the competitive advantage that e-Commerce can yield can be sucked up from moving into the Netspace with your internal operations first.

The Net and you: here and now

After the business strategy, the tactics. Having got a fix on your e-strategy, follow the 7 habits of e--ffective bricks-and-clicks corporations:

1. Customise your brand. Conventional marketing forces you to offer the same brand-image to every one of your customers, irrespective of their specific individual requirements. In the Netspace, you can build a dossier on the specific needs of every one of your customers, and then tailor your brand-value for that customer so as to meet her unique need. Your real-world brand will take on all the advantages of a niche label without losing its mass market advantages.
2. Co-opt the customer. Set up a system for continuous on-line feedback from the customer. Channel this feedback into different stages of your company's processes. And, most important, get the customer to collaborate with you on creating designs, fixing product-specifications, test-driving prototypes, and contributing inputs upstream so that your chances of scoring a hit in the maketplace with your product increase.
3. Partner, don't go it alone. Your competencies have been honed in the brick-and-mortar marketplace, but the specific skills needed to thrive in the e-space already belong to companies operating on the Net. Forge alliances with them for specific activities--e-tailing or supply-chain-management, for instance--so as to use their expertise. They'll be delighted to have your brand.
4. Build your human capital. Of all the support functions that you can Net-enable, recruiting top talent will deliver the finest results. Use the Net to shop globally, not just locally. Exploit the interactivity of the medium to conduct on-line, auto-generated tests for fit. And let the prospective hires test-work in your organisation, literally, using the Net.
5. Exploit the infomediaries. If there's one space in the value chain that e-players are inhabiting, it's the spot between the marketer and the customer. These infomediaries are amassing information about products from competing players, and enabling customers to shop for best value and lowest price--using their on-line services. Work with such infomediaries to put your products on the on-line customer's shopping list.
6. Re-examine pricing. The prices of all products sold in the Netspace will be much lower than those in the real world. Complete information for the customer, coupled with the elimination of inventories that the Net system allows, will ensure this. Brick-and-mortar companies will, therefore, have to compete on price in the marketspace, which they can do only by adopting the processes of e-companies.
7. Compete with your peers, not e-ventures. Don't go head-to-head with Net start-ups that are trying to grab some value in the retailing or the information intermediation spaces. They're not your competitors. A smarter idea is to collaborate with them, and to use your combined forces to take on your original competitors in the brickworld.

The last word?

Not only, but also. Sure, you have to be in the Netspace because it's a new market, a new delivery-mechanism, a new business channel--a new everything. But it won't replace the real world. So, the bricks-and-clicks corp must e-nlarge--not e-xterminate--its real-life business.

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