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When Pull Comes to Push

In the first heated year or so of Web business, most of the action has revolved around efforts to tap the consumer market. More recently, as the Web proved to be more than a fad, companies have started to buy and sell products and services with one another. Such business-to-business sales make sense because businesspeople typically know what product they’re looking for, according to Joseph Bailey, an MIT doctoral student who has written extensively about Internet economics.

Nonetheless, many companies still hesitate to use the Web because of doubts about its reliability. “Businesses need to feel they can trust the pathway between them and the supplier,” says senior analyst Blane Erwin of Forrester Research. Some companies are limiting the risk by conducting online transactions only with established business partners who are given access to the company’s private intranet.

Another major shift in the model for Internet commerce concerns the technology available for marketing. Until recently, Internet marketing activities have focused on strategies to “pull” customers into sites. In the past year, however, software companies have developed tools that allow companies to “push” information directly out to consumers, transmitting marketing messages directly to targeted customers. Most notably, the Pointcast Network uses a screen saver to deliver a continually updated stream of news and advertisements to subscribers’ computer monitors. Subscribers can customize the information they want to receive. By clicking on intriguing advertisements, they proceed directly to a company’s Web site. Companies such as Virtual Vineyards are already starting to use similar technologies to push messages to customers about special sales, product offerings, or other events. But push technology has earned the disdain of many Web users. Online culture exalts the notion that the information flowing onto the screen comes there by specific request. Once commercial promotion begins to fill the screen unbidden, the distinction between the Web and television fades. That’s a prospect that horrifies Net purists.

But it is hardly inevitable that companies on the Web will need to resort to push strategies to make money. The examples of Virtual Vineyards, Amazon.com, and other pioneers show that a Web site selling the right kind of products with the right mix of interactivity, hospitality, and security will attract online customers. And the cost of computing power continues to free fall, which bodes well for any enterprise setting up shop in silicon. People looking back 5 or 10 years from now may well wonder why so few companies took the online plunge.

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Tagged: Business, Web

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