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The next sales force

The next sales force

Beneath today's Internet noise, a siren song calls out to marketers, luring them with the promise that the World Wide Web will become the biggest mass market since television. The Internet may not change the way every product and service is peddled, but it will change the way many are sold, and it will redefine relationships between buyers and sellers. The Internet is destined to be an important marketing and sales force. "The Internet will be a major advertising vehicle," says Robert Blatberg, professor of marketing at Northwestern University in Chicago.

The Internet will change the sales process - count on it. For example, although the average car buyer will still visit a dealership to test-drive and tyre-kick, customers who use the Internet generally know more about the cars than those who don't.

That speeds the sales process, says car dealer Jerry Chase. It also puts the salesperson in a more consultative role because the Internet-educated buyer needs advice more than just product information, he says.

Moreover, the Internet becomes self-directive because customers are better able to make their own decisions. "They're qualifying themselves as to what's the best car for them," Chase says.

In fact, the Internet may move marketing from a "push" to a "pull" strategy. In the former, manufacturers, through their sales force and other promotions, push products via distributors and retailers, who in turn promote the products to the consumer. In the latter, manufacturers promote directly to the consumer.

Some companies have long promoted products to the consumer, but their Web sites are an added direct-to-consumer channel and are likely to gain in importance. That will reduce, but not eliminate, the importance of the retail sales force. Moreover, it will give more control of the process to the consumer.

And increased customer control is another marketing trend likely to gain momentum during the remainder of this decade.

With that aim, Andersen Consulting in the US created BargainFinder, an intelligent agent that comparison-shops for the best price among suppliers of music CDs on the Internet. Users tell the agent which CD they want, and the agent reports back on the prices offered by eight sites.

Glover Ferguson, director of technology research at Anderson Consulting, sees this easy comparison shopping as likely to put price pressure on suppliers. Another factor that will create price pressure is the potential for unconventional selling practices. For example, Ferguson thinks the Internet might be the site of auctions for products not previously sold that way.

The converse of this is that the Internet will lower costs, at least for some. Mark Douglas, president and CEO of CenterView Software in San Francisco, says he saves significant amounts of money by distributing software via the Internet.

"Over the Web, we have no physical costs, no collateral costs," Douglas says.

Direct marketing costs may decline as well. "You're able to electronically repackage your offering on a server a lot cheaper than you can print and distribute 100,000 catalogues," says Ray Case, director of marketing at Staples Business Advantage.

Ford's multinational Web site sees 12 million hits a month, a customer response that would be very costly using other marketing media.

The medium itself is generating new business for Premenos in California. Rebecca Young, the company's vice-president of marketing, says that a year ago Premenos' Web site generated 15 per cent of the firm's leads. Now the site generates 35 per cent and has become the single largest source of leads.

Blatberg sees the sales process itself becoming more efficient as information about customers and sales leads are more consistently and effectively handled by the Internet than they are by salespeople, who often fail to follow up adequately.

Changing expectations

The Internet also promises to speed the sales process. Brett Knobloch, manager of brand loyalty and customer marketing at Whirlpool in the US, notes that getting literature to those who call toll-free telephone numbers often takes weeks, while he e-mails Internet requests for information by 10am the day after he receives them.

Such service may change customer expectations. "Consumers will have less tolerance for delays in receiving orders, wrong shipments, mistakes in billing. Everything has to happen at a higher speed," says Webmaster Mohsen Moazami.

Relationships with customers may be transformed by the Internet as sellers capture information about buyers that was difficult, if not impossible, to obtain previously.

"As transactions become electronic, obviously we can store them and mine them. If you know what people are buying and where, that's pretty powerful," says banker Steven Dieringer. But he warns, "We have to be concerned about privacy."

Look for significant changes in the marketing model as a result of the Internet.

Larry Dale, Webmaster at Ford, says his site will eventually provide more interactivity. He expects that prospects will eventually input product requirements, such as engine type or passenger capacity, and the software will list which products fit those criteria. The marketing message will become more customised as vendors learn more about their customers.

"We are moving away from a marketplace which is make-and-sell to a marketplace which is sense-and-respond. Companies will be able to sense what the individual customer wants and quickly respond. You can customise the presentation as it goes along," says analyst Jules Street.

Dave Rush, an industry observer, sees an Internet-inspired merging of information gathering and customised sales messages. He gives an example of a car company that learns from a prospect's online responses that the prospect has two young children. The company thus tailors its sales message to emphasise the car's safety features. A different prospect with lower income might have the same car pitched with an emphasis on economy.

The Internet will move the trend away from mass marketing to customised marketing.

Mass marketing saw its heyday in the 1950s and 1960s, when the relatively low number of media outlets made it easy to reach a huge portion of the populace.

After all, with more than 50 per cent of the television-owning public often watching the same hour-long program, saturation advertising was simple.

The growth of cable television in the US in the 1980s decreased reliance on the major TV networks. This forced marketers to target ever-narrower audiences. The Internet takes this trend another step. The Web is essentially composed of 30 million people each watching and, more importantly, talking back to a customised TV show.

Information for now

"A resource for people to get more information about a product or company - that's probably the largest role the Internet is playing right now," says Clay Ryder, an industry analyst.

Whirlpool finds the Internet an important medium for distributing information, Knobloch says. "Our whole site is designed to give customers what they want, which is product information, and steer them toward their nearest dealer."

Ford's Dale concurs. "I do not believe we will be selling cars over the Internet," he says. "I think you'll see it's a great medium to provide information to let people know and see what you have available."

In a sense, the Internet is being used like printed marketing material, only on a more sophisticated level. "Today, you can publish a 'brochure' [on the Internet] and have it read by people around the world," Ferguson says. "Imagine trying to do that with a real brochure."

The trend is likely to be more of the same, with more businesses placing more product information online.

Speed bumps

The Internet will profoundly affect selling, but the timetable is as dicey as a wireless online connection. Ferguson says that taxes, both in the US and internationally, might slow the impact. A major break-in by a hacker might scare some people temporarily, he adds.

Ryder points out that decades have been spent perfecting packaging designed to create an immediate response - a feature that is largely lost on the Internet. He's not sure how online marketing can compensate. "How do you create the impulse buy on the Internet?," he asks.

Some people just don't like technology, a situation that will hold back the Internet's penetration.

And then there are the unknowns. Who knew three to five years ago that the Internet would take off as it has? Who knows what will happen during the next three to five years?

Winners and losers

The new sales and marketing frontier is wide open right now. But not everybody will strike it rich. For every product or service that takes off on the World Wide Web, you're likely to see one that fizzles. Here are some experts' thoughts on possible gainers and laggards:

WINNERs

Add-on or repeat sales are good candidates for the Internet.

Goods deliverable over the Internet, such as software, music, encyclopaedias and financial services.

Products that appeal to techies, including computers, computer add-ons, even office furniture and equipment.

Commodity products that are easy to purchase, including mundane items such as soap.

LOSERS

Hard goods that need to be physically delivered and have service or other issues that need personal attention.

Products dependent on impulse buys.

Products or services easily delivered via the Internet will harm established categories such as local newspapers.

Companies with established channels of distribution will hesitate to use the Internet to compete with their dealers and might end up losers.

Complex products requiring personal care and feeding by salespeople may not go over well on the Internet. Life insurance has to be sold. When was the last time you saw a guy say, "Gee, I think I'll go shopping for new life insurance?" People have questions, so they have to talk to a person.


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