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Love at First Site

Written in cooperation with the Economist Intelligence Unit

With more business conducted over the Internet, a company's web presence is becoming its defining feature. The business opportunities presented by digital media abound; so do the challenges in using it effectively.

Digital media has become an important tool for companies pursuing business transformation. Digital media includes video and other digital content as well as the web pages or portals where these assets are displayed. How firms wield this media can make or break them. Firms have been developing websites for more than a decade, but many are struggling to advance them from glorified online brochures to true competitive weapons.

Many businesses recognize the importance of offering rich, accessible content on their websites, and some are beginning to use a wealth of digital media to attract users. As web designers know, a site has 10 seconds to draw in the visitor or the person will “go back to Google.” With digital content delivery occurring over computers, mobile devices and TVs, firms are now creating content for “three screens” and allowing customers to select the most convenient one to use at the time. To optimize their users' experience with digital media, enterprises must tune their internal infrastructures, improve data center capacity and manage content delivery

None of this comes easily. “The web is a powerful and still relatively new distribution channel in a fast-changing world,” says David Elms, Partner with consultancy KPMG, “but there's also uncertainty as CEOs seek to use it effectively.” Challenges are by no means confined to technology, or to design. Companies have a range of human, organizational and other issues to address in order to manage their web presence effectively.

Profiting from Openness

Firms that are advanced in their use of digital media not only promote interaction with the public, via features such as blogs and forums, but they also allow customers to exchange experiences with each other. For example, many retailers have found their sales rise when they incorporate online product reviews — a major leap beyond simple product information. Likewise, firms have discovered that customers can obtain more satisfactory service responses if given the resources to contact each other and swap advice over the company's website. Some firms also monitor digital conversations about their products and services on social networking sites.

The world of open discussion enabled by digital media often exposes companies to criticism, but Rohit Bhargava, Senior Vice President, Digital Strategy and Marketing for Ogilvy Public Relations, believes they should not take umbrage. “It's a mistake to think simply that the tools open you up to criticism,” he says. “Dissatisfied customers are already saying something bad.” Web interaction gives firms the chance to respond to problems and put things right, points out Bhargava. To benefit, companies must be able to track and fix complaints quickly and respond internally to commentary on their products and services.

Beyond the Conventional

Firms are also finding they can use digital media to attract customers in more subtle ways than previously. Ben Wishart, CIO of the U.K. hospitality group Whitbread, believes that having website video tours available of its Premier Inn properties can positively shift public perception. Visitors to the site “can take a walk around the hotel and get an idea of the quality of the accommodations,” he says. Guests also receive a pre-arrival text message on their mobile devices, reminding them of their reservation and offering a booking in the restaurant. Wishart has seen an uplift in restaurant business since introducing the text service.

Similarly, astute corporate press offices today offer a range of digital media to inform journalists that go a long way beyond conventional press releases. They include podcasts, blogs, videos of case studies and talks from senior executives, mobile text messages and RSS feeds, as well as tailored email updates.

The Neglected Intranet

Firms' digital media strategies should also encompass the intranet. “Typically the intranet gets little attention, little budget and employees find it aggravating and confusing to use,” says Toby Ward, CEO of Prescient Digital Media, an Internet consultancy based in Toronto. “The state of the corporate intranet is generally quite bad — too many executives see it as a cost center.” Ward believes this is an error. For example, with many companies being hit by talent shortages, a good intranet can serve as a tool for recruitment and retention of employees.

The key to getting the intranet right is around “one part” technology to “four parts” people and processes, Ward says. “You'll sometimes find a good corporate intranet forum but no one using it. It needs marketing and senior management to lead the conversation, such as a CEO who solicits questions from employees and responds quickly.” Once backed by senior management, any intranet or website requires a detailed plan that aligns the site with the organization's business goals, Ward maintains.

Carrying Digital Content Forward

Few companies fully exploit digital media, either on their intranets or websites. To stay ahead on the web, the IT function's operating model may have to become less centralized, with an independent group taking responsibility for the firm's web presence. This group will need to be able to act fast and creatively, with sufficient resources to develop new ideas, and central monitoring to keep it within budgetary bounds.

Web metrics must be applied to discover what kind of digital content attracts and holds customers' attention, and what has drawn them to the site in the first place. However, personal data on customers gained via different forms of web interaction need to be treated with discretion. CIOs such as Whitbread's Wishart keep data gained from online customer surveys quite separate from marketing approaches, while still supplying users with what's closest to their needs.

Digital media can attract visitors and can even help transform entire market segments (see Market View). Most companies have yet to begin developing features on their websites that leading online retailers have utilized for years, such as providing music samples and offers based on previous knowledge of customers' tastes and preferences. The mobile Internet presents new ways to provide value-added services (see Expert Perspective). For companies willing to experiment, opportunities abound.