Each of the Internet's many spaces opens up entirely new dynamics of relationships.
Success in these relationships rests
 on understanding the nature of and what drives the particular
space you focus on. The only common feature across Internet communities is means of access: Anyone
with a standard personal computer, a modem that can access an Internet node, and a registered Internet
address can enter the relationship space. Internet spaces are independent of location and time zone.
The Internet is always open for business, and Sydney is as close as New York or London. The cost of
entering the space is very low; in many instances it costs the user nothing. This presents a very
different situation from earlier technologies of connection, which tended to have high entry fees.
Accessibility opens opportunities for broader relationships across the entire Internet physical space.
Selecting, designing, building, and sustaining relationships is the challenge and opportunity of the Business
Internet. We have drawn this conclusion after reviewing hundreds of companies' experiences, both successes and
failures, in forging and following Internet strategies. It's not enough to get "on" the Internet: The Internet's
population of thirty, forty, or fifty million is not homogeneous. Mere simultaneous presence on the Net will not
lead these millions to respond to a firm's offers. The companies that have been most successful in Internet commerce
are those that have used its technology to create a combination of three types of relationship.
- Transaction: Electronic ordering of goods and services and electronic payments, a market that many firms see as a
digital gold mine but one in which relatively few have as yet made money.
- Information: Electronic catalogs, news, ads, demonstrations, product updates, company data, contact lists, videos;
information ranging from static displays of text to the full range of dynamic multimedia.
- Interaction: Electronic links between company and customer, ranging from passive one-way communication by electronic mail to
two-way flows of messages to participation (providing feedback to the company about products, design, and so on, to which the firm
actively responds) to collaboration.
The common thread among firms experiencing Internet success is that they attend to all of the three parts of the relationship space -
Transaction, Information, and Interaction - rather than try to move forward along just one. They create a relationship cube rather than
a sliver. (See the illustration in Figure 1.)
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Further, despite claims that the Internet is fundamentally an information cornucopia, many companies have found that the information relationship,
too, cannot by itself generate business for them. Their Web pages may get many hits each day, but these don't translate into orders for the goods
and services offered. In some instances, this lack of connection results when the information page requires customers to pick up the phone or
switch to a transaction page containing complex electronic forms. Many potential customers don't bother with the phone and browse elsewhere.
The Interaction approach obviously builds relationships, but the firm must determine the goal of such relationships. Just opening up lines of communication
may or may not build value for both parties. The following two examples show how encouraging interaction can lead to negative rather than positive business
impacts.
Volvo used to have a feedback area on its Web site that invited people to offer opinions and comments. The company quickly discontinued it. Dissatisfied
customers were leaving complaints about their cars and about the poor service they received from their dealers or from Volvo itself. The messages often
ended with the query "What are you going to do about it?" According to Volvo's lawyers, such messages might be legally interpreted under many states' "lemon"
laws as formal notification of problems. If Volvo accepted the messages, as its very invitation that customers send electronic mail via its Web site implied
it would, Volvo would need to catalog, file, and respond to the complaints under those laws. The lawyers' advice was not to accept any complaints - which meant
not reading any of the mail. Once read, Volvo couldn't "unread" it, but would have to treat it as a complaint. Now the site provides a feature headed
"For More Information" that does not include space for comments.
In a second example, one large retailer used a company called CareerMosaic to put information about job openings on the Net. It expected to get resumes,
which it did, but it also received many electronic mail complaints from customers asking how they could get refunds or return goods. Internet analyst Jim
Sterne summarized the lesson: "CareerMosaic dutifully forwarded these missives to the merchant. If you have a Web site, people will use it for customer
service even if you don't want them to.'' 1
Each dimension of the Internet business relationship space has many components, the handling of which will affect customer satisfaction. A few of these
are listed here:
- Transaction: Reliability, security, guarantees, payment mechanism, availability of goods, cost.
- Information: Relevance, responsiveness, privacy, support.
- Interaction: Ease of access, promptness of reply, perceived honesty, openness.
While none of these are unfamiliar to relationships in any business environment, locating the relationship in Internet space adds to the customary
people element involved in their realization - attitude,
expectation, and emotion - technical elements unique to the Net, such as software design,
service access, computer operating systems, and software and hardware capabilities. In addition, in face-to-face transactions and ones handled by
phone or mail, people feel comfortable, on the basis of their experience, familiarity with the organization and/or process, and laws of consumer
protection. Today, only a fraction of consumers have comparable experience, familiarity, and a sense of safety on the Net. The relationship has to
be built, almost from scratch.
Building an Internet Web site should be viewed as the means to the end of building people relationships, not as a technical end in itself. But both
elements must mesh. Designing relationships requires careful attention to the targeted customer as well as to the technology. Both have to be kept
in balance, and they must be allowed to interact with each other. A key issue for any company aiming to sell goods and services over the Internet,
for instance, is security, a complex technical issue. Without evidence that the firm uses the best technical tools to encrypt (code) credit card
information, most people will not feel safe giving their card number over the Net, a complex emotional issue. But even when assured of total
security, users may or may not respond to the firm's offers. The lack of response may reflect technical weaknesses in the design and operation of
the site; for example, it may strike users as too slow to download, awkward to navigate, or cluttered with irritating and distracting "eye candy."
More often, though, the failure to reach consumers reflects a misunderstanding about the Internet's inhabitants: Internet demographics differ
significantly from those of the wider population, to the extent that what works, say, in a store may be a dud on the Net.
1 - Jim Sterne, Customer Service on the Internet (New York: John Wiley and Sons, 1996), 57.
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