CyberSource founder and CEO William McKiernan has been in Internet commerce since launching online software retailer Software.net, now Beyond.com, in 1994. CyberSource offers transaction-processing and fraud-screening services that originated from Software.net's early experiences. IDG's Dylan Tweney spoke with him.
IDG: What does it take to succeed in Internet commerce?
McKiernan: If you're going to be successful as a merchant on the Internet, what you need to focus on are four things. One is marketing - you've got to drive traffic to your Web site. Two is having great content once you get people there. Third, you need to do great merchandising, so you need to have one-to-one promotions, make the site easy to navigate, and so forth. And the fourth thing is end-user support - so if customers have problems, they can call you, and you have to be very responsive to them.
As more people start shopping on the Internet, what are the challenges for traditional merchants?
After Christmas last year, I think people realised that online buying is mainstream. And so while the first wave of merchants was dominated primarily by Internet- centric merchants like Beyond.com and Amazon.com, the next wave is all the traditional merchants. They're saying: "My God, I gotta get there. I don't care what it takes, but I gotta get there." So Victoria's Secret and Macy's and Nordstrom and all the name brands are now moving onto the Net.
Now, I-commerce is often outside of the normal way these companies do business. Merchandising through a 14 inch piece of glass is very different from merchandising through 150,000 square feet at the mall. And so you need different experts to come in and help you with that.
So that accounts for the increasing popularity of outsourced solutions?
Merchants are turning to consultants in many cases. They clearly have a sense of urgency. Time to market is a huge issue for them, so they're trying to move as quickly as they can. Our recommendation to them is to make sure they focus on what's really important: the content, driving the traffic, the merchandising, the support.
When it comes to the back-office stuff - the credit card processing, the sales-tax calculations, the fraud screening, the fulfilment - outsource that to someone who's got scale, who's got experience, who's got expertise in that space. We're doing this now for 400 customers, so we have, by definition, more scale than any of these merchants will have on their own because we're doing it for so many people.
No one's going to shop at your Web site because you do a great job of calculating sales tax or debiting the credit card. All you can do with that stuff is screw it up. So those are classic things to outsource to a company that has the experience.