What's Working in B-to-B Internet Marketing 2001
(DM News, August 21, 2001)

The Internet shake-out rolls on, leaving an ever-growing number of corpses in its wake. In the world of business-to-business, the chief casualty is the so-called "exchanges," the supply-chain consortia where the Internet was supposed to make markets more efficient, and allow purchasing power to be leveraged across large numbers of buyers.

Contrary to expectations, the forces of competition -- and perhaps a bit of good old human nature -- got in the way. The major players were uncomfortable cooperating with their enemies, no matter how attractive the potential savings of exchanges might be. In other cases, businesses were reluctant to cut third parties in on a piece of the action. By now, most of the exchange start-ups are "dot toast."

If B2B exchanges failed to develop, there remain numerous successful Internet applications in business-to-business. Let's review what has caught on, what's really working.

Extranets
A number of vendors, notably IBM and Dell, are developing dedicated extranet sites for each of their largest customers. Password-protected, behind the customer's firewall, and containing the specific purchasing terms pre-negotiated between buyer and seller, these extranets allow customers to log on any time, and buy easily from the list of pre-approved product lines. Purchasing departments appreciate the reporting provided, which allows them a high level of detail into who is buying what around a far-flung corporation. These sites are relatively inexpensive to build and maintain, and they are rapidly becoming a standard service level for large accounts.

E-commerce
Business-to-business mail order companies, like Quill and Hello Direct, were quick to add e-commerce to their channel strategies. Today, e-commerce is everywhere. Rather than replacing catalogs, or phone ordering, e-commerce found its place as a supplement, allowing deeper inventory, real-time price updates, and powerful search. Even in more complex business buying situations, e-commerce has emerged as a useful tool. Sales people allow their customers to submit purchase order paperwork online, or buy aftermarket products at the Website instead of face-to-face.

E-fulfillment
The Internet is a godsend to the world of collateral fulfillment. No more dated printed material gathering dust in a warehouse. Online, inquirers can request the content they need, and even customize it to their specific situations. They fill in the forms themselves, allowing greater speed and accuracy than ever before. Marketers keep the pricing and product specifications updated on the fly. Best of all, the content arrives instantly, improving customer satisfaction and shortening the buying process.

Response/lead management
Email is so far superior to the telephone in response management, it's a wonder why anyone uses the phone these days. Business people are never at their desks any more, but they do tend to answer -- or at least handle -- their email. Marketers are finding that they can double, or even quadruple, the number of qualifiable inquiries by switching to email. And email is the perfect vehicle for delivering leads to sales reps and tracking them to closure. So long, fax!

Email
Email is truly the Web's killer app. Business buyers want to hear from their suppliers. They want information quickly. They want to do business with ease. Email immediately proved itself as an excellent medium for staying in close touch with customers and serving their needs. And, as business email lists continue to come on to the market, it is increasingly being used for successful prospecting.

Banner ads
Banners have disappointed consumer marketers, but in B2B, they are thriving. The secret is targeting. A site that attracts widget buyers is also going to be able to sell advertising to widget sellers -- at consistently high prices per thousand. Why? Because they work. Most business audiences are small, focused, and extremely profitable for anyone who can deliver them.

Webinars
Never mind hiring conference rooms and asking customers to show up for a half a day. The seminar scene has gone online. Customers and prospects can log on from their desks, whether in real-time or after the event. The technology allows for very complex demos, plenty of interaction with the speakers, and a fraction of the cost of flying around the country doing presentations in dark hotel rooms.

Affiliate programs
The Web has revolutionized referral marketing. Known in the Internet world as "affiliate marketing," it allows partners to share access to customers easily, and be compensated for it. Most of the leading affiliate companies offer B2B services. In some very tight marketplaces, the marketers themselves are setting up private online referral deals.

Lights-out campaigning
One of the neatest new Internet applications is variously known as lights-out campaigning, or event-driven, or triggered, marketing. The marketer establishes predefined rules for each customer, or customer segment, and the rules drive outbound messages according to what's going on in the account. A thank-you note, for example, upon receipt of an order. Or a reminder when a product warranty is about to expire. Web-based software makes light-out marketing inexpensive and very effective.

So never mind the shake-out. With all these Internet applications to choose from, business marketers are making great use of the Web, to cut costs and better serve their customers.