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NO ONE NEEDS TO BE TOLD THAT THE INTERNET IS REDEFINING modern business, communications, and research. Virtually every newspaper and television station, every day in every country, tells the story of how millions of computer users tap the global network for unparalleled access to information.

In its many forms, e-commerce may be defined as any commercial transaction carried out, facilitated, or enabled by the exchange of information electronically. The true value of the Internet, and the World Wide Web that resides therein, is that it is borderless.

Think of countries as if they were lakes without connecting canals. With the Internet the people from one lake can swim easily to the other lake, where they can sample food, wares, and culture that they never before had access to.

The second edition of this book, updated only five years ago, spoke simply of the potential of the Internet for international e-commerce. Since then, that prophecy has been more than realized-big, crossborder business is being conducted over the Web. The benefit to business is the capability to leverage the Internet to bring customers, vendors, and suppliers closer together, thus getting maximum results. Economies of scale, operational costs, and customer service are improved by communicating directly with the client.

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BACKGROUND

Once the exclusive province of government and university researchers, the Internet has become an information Nirvana for the common business and is growing at a rate of about 10 to 20 percent a month.

Created in 1989 at CERN, a huge Swiss research laboratory, the World Wide Web began simply as a project to link scientists worldwide. But its intuitive, easy-to-use hypertextual design caused the Web to spread beyond its original user community. By accessing the Web with a browsing program, you can now tap a graphical environment in which you move among millions of Web sites that offer everything from sunglasses to Silly Putty. Most Web pages integrate images, sounds, and text to advertise their products and services.

In the 1950s the world sold things on Main Street; in the 1980s it was the mall; in the 1990s it was the superstore; but in the 2000s it will be at www.com. Why? As Bill Gates, the founder of Microsoft, says, "The Net represents frictionless capitalism."

The Global Marketing Opportunity

No supranational organization or head of state has been able to bring continents together, but the Web is uniting the world! There is no president or king of the Internet, so small businesses can sell anywhere in the world.

The obvious advantage of the Internet is the ability to bypass the middle of the supply chain-that is, the many distributors, wholesalers, and storefronts of traditional business-to reach directly to the consumer. Now customers (users and buyers) can be served directly, just like the old direct-mail marketing process, but without the high cost of printing and postage. More important, the Internet knows no boundaries-it can reach the potential customer in every nook and cranny of the world, wherever a person can surf the Web.

In 1998 there were $6.1 billion consumer purchases over the Net and about $15.6 billion business-to-business sales. By 2001 the increase is expected to move to more than $25 billion consumer purchases and more than $200 billion business-to business sales. Yet today e-commerce is only 1 percent of total American gross domestic product (GDP) and only 0.02 percent of total retail sales. However, by 2003 it is expected to reach as much as 6 percent of GDP.

Changing Competition

The Web is also changing competition. On-line businesses have an easier time locking in their customers with plenty of room for further growth. Consider geography. As retailers expand, they must build storefronts and organize distribution networks, settling for smaller and smaller markets after hitting the larger ones. The on-line competitor has the advantage because the business has instant reach. The cost of acquiring a customer in another city or country is the same as finding one locally.

Price is another way that the on-line business wins in the ever-changing competitive

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world. An on-line seller can undercut the non-Web player. In fact, some Web businesses are even offering products and services for free while gaining their income through outside advertising.

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GETTING STARTED

The Internet is not just hype. Companies are making sales on the Net right now, so why not get started? A special section on Internet terms is included in the Glossary at the end of this book.

Requiring the least amount of financial capital, a Web business can be started simply by setting up a virtual officethat is, a computer or television, proper software, and a modem. This virtual office, which could be in the back room of your business, in your home, or on your lap when traveling, gives you the adaptability and flexibility to enter your business environment on an equal footing with the largest companies. In other words, your business is no longer tied to a physical storefront or a desk-your Web page is your storefront. As long as you can plug into a telephone or cable line (even a satellite), you can do business. You can even get faxes through your e-mail system by using services such as efax.com.

The Home Page Presence

The first step in obtaining a presence on the World Wide Web is designing a Web site, which is made up of a home page and several supplemental pages of information (see Figure 4-1). The home page is to the rest of your Web site as a book cover is to its contents. Because your business is international, you should consider allowing the user to click on a choice of language-say, English, French, Italian, or Mandarin. Similarly, you'll need to decide in how many countries you will have home page presence. For instance, Dell Computers has crossed national boundaries by having Web sites all over the world.

The home page design should be bold and visual but lean and mean, so that it can quickly capture attention yet be understood at a glance and lead the reader to the other pages of the site. Keep the home page simple. Don't clutter. Make it easy to navigate. The prospective customer who gets lost or confused while reading quickly is gone. Use your home page to make a few essential points like who you are, what you offer, and what's on the rest of the pages. Don't be too commercial. Internet protocol dictates that you offer free information and entertainment first, then ask for the sale.

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Fig. 4-1. Typical Web site page

No matter what you are selling, there are already many sites devoted to the same products or services. Know your competitors by searching them out. Learn what they have emphasized and what is working for them.

All too many businesses rush into this project without thinking it through. It is essential to plan ahead by identifying and honing your key messages and organizing them in a logical structure, developing a prototype page design, testing it on representative users, and refining it through successive iterations. Even after your Web site is up and running, revisit it often- keep it fresh by giving users something new, a reason to return.

KEYS TO SITE DESIGN

• Start slowly.

• Place emphasis on content.

• Make the site easy for consumers to get around.

• Avoid using too many graphical elements.

• Be entertaining.

• Make your site graphically pleasing.

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• Reach sight-impaired readers.

• Design for overseas markets with multiple languages.

• Add pages to your site.

• Accept credit cards.

• Give payment options.

• Make it easy to order.

• Provide a shopping cart.

• Provide links.

Do It Yourself

Can you design your own Web site? Of course! Many people do. Learning HTML code is not difficult (see Figure 4-2). What is difficult is designing a Web page that captures the attention of customers. The technology of design is easy enough to learn but the art of getting attention is not, so you might want to consider getting professional help. Why? Too many firms turn this task over to a marketing director of the old school who never got past e-mail. What you need is a modern Internet "geek" who can design an entire on-line transaction from first look to showroom tour to a final handshake deal.

Software Guide

There are many software tools available to allow you to get your e-commerce project off the ground. Here is a list of Internet software suppliers; however, neither quality nor rank is implied-be aware that the market is changing rapidly so these may not be around next year.

Partial List of HTML Markup Tags

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Note: For a complete listing of HTML codes, check the following Web site: http://www willcam.com/cmatlhtml/crossname.html Fig. 4-2. Example of HTML

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Fig. 4-2. Example of HTML home page (Continued)

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Have Others Do It

As with any other new endeavor, you will find people in every city who specialize in Web page strategy and design. Many of these are recent college grads who focused their training in this specialty. Others are employees of major advertising companies who have the advantage of the ad firm's years of experience and adapt it to the Web technology of modern communications.

Domain Name

A domain name is what people type into search engines to find your Web site. Most companies use several domain names and aliases such as "yourcompany.com" and even "international business"-a generic label that people might type into a search engine to find your specialty or industry.

The trick is to get your domain name to the top of the search engine list.

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GETTING OUT THERE

It is one thing to have a Web site; it's another to ensure that customers know it exists and how to find it. First of all, put your Web site and e-mail addresses on your brochures, flyers, trucks, ships, billboards, ads, stationery, and business cards. Next get your Web site address listed in an Internet business directory such as www.directory.net. There are many such directories and many do not charge listees to be included. Another approach is to join a virtual mall-a group of Internet businesses using the metaphor of a shopping mall. Last but not least, be certain to get your address on as many search engines as possible.

Search Engines

Search engines compile lists for consumers who surf for a product. The trick is to get your address as high on the search engine list as possible. Because engines use different criteria, there are several strategies. First in importance is your domain name. For instance the name "international business" will bring domain names such as internationalbusiness.com, international-business.com, and internationalbusiness.org to the top of the list. If your business domain name just uses the initials of your company, you will find yourself near the bottom of the list. The right strategy is to use several domain names. The second trick is to use descriptive words in the title of your Web pages. A title such as "ABCD company discount sunglasses" will come up closer to the top than just the company name. The same applies to the HTML document. Sunglass.html will get you closer to the top than 1234.doc or abbreviated names.

TOP SEARCH ENGINES

Finding Foreign Markets

There are more than 200 million on-line users worldwideover half are in the United States and Canada. Yet the potential market is phenomenal because everyone who has a computer

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or television set is getting on the Net.

Finding foreign buyers continues to be a market research problem. As always, start with the country or region. But where to look? Try the following databases.

STAT USA/Internet. A service of the U.S. Department of Commerce, and the site for the U.S. business, economic, and trade community, STAT-USA provides authoritative information from the federal government and includes access to the National Trade Data Bank (NTDB) for country and market research. http://www.stat-usa.gov/

Strategis. A Canadian government trade assistance site, Strategis has international trade information and statistics that can be turned into a graphic presentation of the top 10 markets for most products. Follow the international and trade links. http://www.strategis.ic.gc.ca/eng-doc/main.html

Central Intelligence Agency. The CIA Fact Book is one of the best sources of basic information on any country. http://www.odci.gov/cia/ciahome.html

The SBA Office for International Trade. The SBA provides extensive links and training resources. http://www.sbaonline.sba.gov/OIT/info/links.html

Michigan State University, Center for International Business and Education Research (CIBER)- International Business Resources on the WWW. CIBER has one of the best and most extensive sites for international markets, including trade leads and hotlinks on all aspects of global markets. http://ciber.bus.msu.edufbusres.htm

Tradeport. One of the most extensive international trade resources on the Internet, Tradeport is a free site with market information, guidance, and resource listings as well as trade leads and international events in the Southern California area. http://www.tradeport.org

Finding Foreign Buyers

Of course, there are over 400 trade lead sites; the United Nations (www.un.org) and the World Trade Centers Association (www.wtca.org) have lead services. To reach more than 2 million traders, try these resources.

NEOS-National Export Offer Service. NEOS is a comprehensive site for links and access to foreign buyers, directions, and guidance resources. http://www.exportservices.com/

Europages. With information on 500,000 companies in 30 countries, Europages is an excellent place to search for companies to contact, by product or service search as a buyer or for market research. http://www.europages.com/

Clear Freight. Follow the trade lead links section for an extensive set of contacts and go back to the main page for freight forwarder information. http://.clearfreight.com/clear- internet-trc/trade.htm

Global Electronic Commerce Korea. This is a great site with links to many other

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countries with company directories. Try EC Links for an extensive list of other areas and trade lead sites. http://commerce.ktnet.co.kr/

Import Export Bulletin Board (IEBB). Sponsored by the Journal of Commerce, IEBB is an extensive buy/sell listing and information site with access to STAT-USA (trade research) and UN data. It is fee based for full access. http://www.iebb.com

Beaucoup. This search engine directory lists countryspecific searches of many nations and several directories in each country. http://www.beaucoup.com/

Europeonline. A central access site to all countries in Europe in local languages and English, for business, financial, and general information, Europeonline also provides access to European Union information and Europages. http://www.europeonline.com/

Trade Show Central. This free Internet service provides information on more than 50,000 trade shows, conferences, and seminars as well as 5000 service providers and 8000 venues and facilities around the world. http://www. tscentral.com/

Government Procurement

Ever since the World Trade Organization formalized opportunities for bidding, government procurement competition has become worldwide. Here are a few valuable addresses.

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PRICING AND MARKETING YOUR PRODUCT

Gone are the days of arbitrary pricing. Because the Internet offers worldwide openness, pricing without substance is gone forever. You must continually check the market and competition, and provide additional services and features as necessary to maintain your price. Places to search are www.price.com and mysimon.com.

Marketing Techniques

The Internet is a place where creativity reigns. Here are some techniques that have evolved as the Web grows from childhood to adolescence.

• Set up a chat area.

• Sell advertising on your page.

• Create contests for your customers.

• Build customer lists.

• Offer a free catalog.

• Offer coupons.

• Provide information.

• Publish a newsletter.

• Sell access to your products or services.

• Upload your annual report.

Communications

If you don't have an e-mail address, you may as well pack up and move to the South Pole- in today's business world it is a must.

E-mail is currently being used 10 to 1 over postal services, and the rate of change is growing. Business contracts are being negotiated between nations routinely. The author recently negotiated book contracts with a London publisher by e-mail.

Getting Paid

Yes, you can ask for cash, you can take checks, and you should accept credit cards, but the world's standard method of payment for big sales is still the documentary letter of credit (see Chapter 6 for a complete discussion). The Internet is able to combine technology with standard business systems to continue to use the letter of credit as an easy, trustworthy payment method.

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Internet technologies available include document management software, document imaging, electronic mail, interactive forms within Web browsers, and password security protocols. One source of good information about this subject is www.AVGTSG.com, a company that specializes in payment solutions, including methods for the Internet.

Keeping in Touch

Things are changing so fast in international trade that businesspeople must read and digest enormous amounts of material to keep up. However, here are several publications that manage to keep pace with the trends:

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FURTHER READING

How to Grow Your Business on the Internet (3d ed.), by Vince Emery, published by Coriolis Group Books. A most comprehensive discussion of the best Internet business strategies, marketing strategies, and many aspects of on-line business, based on actual experience and several years of active participation in the field. Also has an active Web site.

Webonomics: Nine Essential Principles for Growing Your Business on the World Wide Web, by Evan Schwartz, published by Broadway Books. An excellent analysis about what works on-line and does not work. Contains fundamental insights into Internet business, global or otherwise.

How to Build a Successful International Web Site, by Mark Bishop, published by Coriolis Group Books. An excellent, detailed instruction manual for creating an international Web site, including software for language editing and information on international search engines.

Marketing Online for Dummies, by Bud Smith and Frank Catalano, published by IDG Books Worldwide. A comprehensive guide to marketing strategies on-line that includes a software package with many tools.

Selling Online for Dummies, by Leslie Heeter Lundquist, published by IDG Books Worldwide. A basic instruction manual for setting up business on-line, developing a Web site, and using the tools needed to enhance business results. Also comes with a package of software tools and tips.

Striking It Rich.com-Profiles of 23 Incredibly Successful Websites You've Probably Never Heard Of, by Jaclyn Easton, published by Commercenet Press. A very exciting account of a wide variety of Web sites and how they achieved success. This book contains the mistakes, ideas, and insights of different on-line businesses and provides a great understanding of what it takes for an emerging site to achieve success. Easton's active Web site contains updates on the subject and keeps the book from being outdated.

Doing Business on the Internet, by Mary Cronin, published by Van Nostrand. This is the handbook for all those serious about making the most of what the Internet has to offer their business. It provides a step-by-step framework for exploiting the business opportunities available on the Web.

The next chapter expands the concepts related to both import and export, developing the fundamentals needed to "complete the transaction"-namely, financing, avoiding risk, shipping, and documentation.

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