Canadian Companies Dabbling In E-Commerce

Few Canadian companies may be ready to compete and thrive in the electronic economy. An Andersen Consulting study released recently found that only 20 per cent of the more than 250 major Canadian companies surveyed could be identified as e-commerce “leaders”, while 41 per cent could be characterized as “dabblers” and the remaining 39 per cent could be labeled “side-line observers”. As well, companies ranked the Internet and developing e-commerce initiatives last (29 per cent) in terms of business priorities. Higher priorities companies cited include: improving customer service (78 per cent); Y2K readiness (76 per cent); increasing customer loyalty (68 per cent); attracting new customers (65 per cent) and cost reduction (62 per cent).

But despite its current low priority with business executives 84 per cent of business executives acknowledged that e-commerce will be increasingly important to their companies within five years.

The study surveyed 293 senior business leaders from Canadian organizations across a variety of sectors including; financial services, resources, communications/high technology, manufacturing and retail.

Infrared System Tracks Employees

The latest weapon in customer service hangs around Tom Condon’s neck. As he traverses the sprawling maze of workstations at W. W. Grainger Corp.’s Custom Solutions Center, his identification badge emits infrared signals. The signals are picked up by receivers on the ceiling that report his whereabouts to the company’s personnel directory on the intranet. If a customer needs Condon in a hurry, the receptionist merely clicks on his name in the company’s personnel directory, finds his location — which is updated every five seconds — and sends him a targeted audio message from an overhead speaker.

Sound like Big Brother watching? No, Grainger said, it’s Big Customer. In the maintenance equipment industry, where the price and quality of competing products are very close, customer service is becoming the differentiator for companies like Grainger. So executives are eliminating phone tag, pagers and public address “carpet bombing” in favour of employee tracking via the intranet. Some 200 employees are connected to a browser-based suite of tools called ArialView from Arial Systems Corp. in Vernon Hills, Ill. Condon said Grainger’s US$100,000 investment will pay off because it helps the company respond to customer calls about five minutes faster.

Got WAM? Your Extranet Needs It

Web Authorization Management (WAM) is a difficult, but highly necessary, feature if an organization plans to let partners and customers into its network.Extranet vendors often claim to have Web authorization “inside” their offerings. Although many have basic functionality, Gartner Group said organizations should be confident of a product’s level of functionality before purchasing. Otherwise, companies may end up filling in the gaps themselves with custom code.

Real-Time Inventory Management Still On-Line Rarity

On-line retailers are so busy trying to attract new customers, they may be missing an important aspect of satisfying the ones they’ve got — ensuring products are available. Real-time inventory is a “major cause for concern for customers,” said Ken Cassar, an analyst at Jupiter Communications Inc. in New York. In a Jupiter survey carried out after the 1998 holiday season, the number one customer gripe was out-of-stock items, Cassar said. Part of the problem: many on-line retailers are spending heavily on customer acquisition, with less attention to customer service and back-end systems.

Web Advertising Tops US$1B

Overall Internet advertising rose 90 percent last year from the previous year, to hit US$1.033 billion, according to a study released by InterMedia Advertising Solutions in New York. While technology companies continued to be the biggest share of Internet advertisers last year, their overall share of the market dropped from 50.5 per cent to 44.7 per cent, according to the InterMedia report. The largest increases in Internet spending came from medicines, up 387 per cent; organizations, including non-profits and government agencies, up 329 per cent; retailers, up 236 per cent; direct marketers, up 215 per cent; transportation, hotels and resorts, up 135 per cent; and financial, up 129 per cent. The company said it tracked about 300 Web sites for its report, as well as advertising trends in 400 different industries. Web ads represented 1.29 per cent of overall advertising expenditures, InterMedia estimated, up from 0.74 per cent in 1997.

The top 50 sites in the report accounted for more than US$965 million in ad revenues, a 93 per cent increase from 1997.

Last year’s top 10 ‘Net advertisers, according to InterMedia: Microsoft (US$35 million, up 9 per cent); IBM (US$29 million, up 59 per cent); Compaq (US$16 million, up 170 per cent); General Motors (US$13 million, up 85 per cent); Excite (US$12 million, up 1.5 per cent); Infoseek (US$9.3 million, up 22 per cent); AT&T Corp. (US$9.3 million, up 44 per cent); Hewlett-Packard Co. (US$8.1 million, up 103 per cent); Barnes & Noble Inc. (US$7.6 million, up 280 per cent); and Datek Securities (US$7.6 million, up 202 per cent).

New Career Chart Toppers

The days of the specialist are over — bring on the generalist. The e-commerce tidal wave has spurred IT shops into providing full-service offerings via the Internet for the business products and services they support. The Internet’s success has caused a new customer focus on data communication as opposed to verbal intercourse. The result: a number of new IT concerns, crises, projects and job opportunities, according to IT recruitment specialists. Current and future critical information technology projects call for multitalented professionals with skills in areas such as the Internet, networking, data security, data warehousing and “sticky” Web content development (keeping the customers on the site and creating value to keep them coming back).

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Jim Love, Chief Content Officer, IT World Canada

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