The medium is the message

As the Internet continues to become a major sales tool for everything from books to cars, it's time for the telecom industry to take a serious look at the Web as a marketing vehicle for voice and data services.

According to the recently released 1998 PricewaterhouseCoopers Consumer Technology Survey, the Internet was the venue for an estimated $1.7 billion in sales over the past year, and users reported being comfortable spending an average of $295 per purchase. On-line sales are growing in categories such as telecommunications products and services, and computer hardware and software.

Despite that, the promotional Web pages of most carriers stop short of tapping into the true opportunities of electronic commerce.

The demographics of the Internet closely mirror the residential and small to mid-sized business categories, two critical targets for communications companies. Individual Internet shoppers have mean incomes of $50,000 to $75,000 and use the Internet to research goods and services. This group is likely to use the Web as its most useful source of product and service information as opposed to direct mail or billing inserts. Perhaps the most revealing statistic is that 78% of all on-line sales are business-to-business transactions involving small and medium-sized companies.

While very attractive to carriers, Web users are also extremely prone to turnover. By their nature, on-line customers are savvy comparison shoppers who will readily jump to the provider offering the better price, newest feature or other inducement. Fortunately, when developed and executed properly, a Web site can be as effective in reducing churn as it is in creating sales.

Understand the medium: To succeed, communications companies must realize that the Web is a unique medium and tailor their marketing. What works in a traditional medium does not apply to the Web.

The Internet is not a "broadcast to many" environment, as is the case with print media, television spots or direct mail. The Web establishes an interactive and spontaneous channel between the carrier and the individual customer. That means sellers must trade in current hard-copy product literature and telemarketing scripts for a more interactive, targeted approach.

For example, rather than simply posting information on specific products and services, a carrier's Web site should have features that allow customers to develop their own unique service and product packages.

Close the deal: It is critical that carriers allow customers to consummate their on-line purchases immediately. Comparison shoppers looking for bundled services want the immediate gratification that comes from completing the purchase on-line in real-time.

To do this, communications firms must modify legacy systems, creating the "one call and done" orders that are the norm in a successful Web-based selling environment. The fatal flaw in any carrier Web-based marketing strategy is to lead the customer through an interactive sale and then have the last message read, "We'll get back to you about price, availability and install date." The key is to engage the consumer in a way that results in additional purchases over a period of time.

Pre-empt churn: A well-designed, Web-based selling strategy looks toward the future by collecting information about the consumer. Carriers need to pay attention to data mining in terms of customer segmentation, profiling and predictive modeling. This allows companies to better anticipate customer needs, identify defectors earlier, develop and implement targeted win-back programs.

The telcos that get serious about collecting customer data will be more aggressive in developing and rolling out future Web-based campaigns. In addition, these companies will be able to develop a solid dialog through which to collaborate directly with business customers in creating new value-added products and service packages.

Tapping the Internet's significant potential requires a cohesive marketing strategy and a willingness to develop an entirely new dialogue with the customer. The first established telephony providers to do so over the World Wide Web will have an enormous competitive edge.