A global educational resource for e-business and Internet marketing strategies
The Health and Health Care 
e-Business North American Tour
Phase 1:
The Foundation Phase

Phase 2:
The Exploitation Phase

Phase 3:
The Innovation Phase

Phase 4:
The Business Extension Phase

Phase 5:
The Strategic Transformation Phase

AlexDrossos.com
A thorough resource for the use of technology in health and health care

TomVassos.com
A practical global resource for industry specific e-business strategies

UofEbusiness.com
A global educational resource for e-business and Internet marketing strategies

e-Business World Tours
Examples of the e-Business Roadmap applied across several industry sectors

Phase 4: The Business Extension Phase

The Business Extension Phase

22. The Human Interaction Stage

The Human Interaction Stage involves the use of human interaction to provide marketing, sales and customer support to enhance your Web efforts. This could be achieved in a number of ways:

  • Delayed Interaction
    • e-mail
    • Web forms
  • Live Interaction
    • Instant messages (i.e., live one-on-one chat)
    • Traditional phone support
    • Phone support via Call Me buttons
    • Phone support via voice over IP Internet software
It is interesting to note that 90% of online customers prefer human interaction, but only 3% of major e-commerce sites offer live help (according to Jupiter Communications). Providing live support is obviously much more costly than simply having static web pages, but it could make the difference between closing a sale and not closing a sale.

One of the problems with live interactive support is that it is labour intensive and therefore costly to deliver. One way to reduce costs in this area is to only offer live interactive human support in the midst of an e-commerce transaction, but not during much earlier phases of the sales cycle. At that time delayed interactive support or automated interactive support (see stage 23) could be offered.

According to Net Effect, 67% of shopping carts are abandoned before the sale is completed. Datamonitor projects that businesses lost $3.2 billion in sales due to inadequate customer support. Customers are not getting the live human support when they need it. During the ordering process they may be confused about delivery times, shipping costs or currency conversion rates, but there is no one there to answer their questions.

Providing live support during an e-commerce transaction could go a long way towards minimizing abandoned shopping carts. It can also have a direct positive impact on building one-on-one relationships with prospects and customers, resulting in a strengthening of your e-brand.

An important aspect of the Human Interaction Stage is capturing the intellectual capital that is being created. Questions and answers should be captured and added to the Frequently Asked Questions (FAQ) database. Questions could also be analyzed on an ongoing basis to determine why the question was asked in first place. By improving the web pages themselves with more comprehensive and readily accessible information, those questions could be avoided in the future.

In the Health and Health Care industry, we found several examples of human interactive support:

  • At the VitaminShoppe.com site, they provide the capability of calling toll free to speak with a support representative.
  • At the Nutripeak site (which by the way is using eNutrition.com as an invisible brand), there are separate toll free support lines for Orders and general Customer Service.
23. The Automated Interaction Stage

Companies have struggled to provide the kind of human support that was described in Stage 22. Research shows that about 30% of all e-mail queries being submitted to corporate web sites are going totally unanswered. This is unacceptable. One solution is to throw more human support at the problem. Another more effective solution is to automate as much of the support function as possible.

The Automated Interaction Stage involves the use of various Internet tools and technologies in order to automate the process of providing customer support. This could be done in a number of different ways:

  • Infobots (also called auto responders) provide automatic and instant canned replies to e-mail queries
  • Smart Infobots provide automatic and instant personalized replies to e-mail queries
  • Natural language query support via the Web
Infobots should be an important part of any automated interactive strategy. In fact, I recommend that you consider using an infobot response for every e-mail query being submitted to your web site. Infobots can include information such as an acknowledgment to the query, an estimate of the response time from a real human, the answers to some frequently asked questions, and some links to your commonly visited web pages. 

Infobots can be even more valuable if several of them are created for each company division, product, service, etc. By using this approach, the contents of the infobot can be much more targeted. And by using smart infobots, the answer can even be personalized based on the contents of the user's question.

Natural language query support via the Web allows visitors to ask a question, and multiple potential answers are retrieved from a support database. For example, at the Lotus web site you can ask a technical question and get an instant response, 24 hours per day 7 days per week.

An important aspect of the Automated Interaction Stage is capturing the intellectual capital that is needed in order to automate the customer support function. For example, questions and answers and other interactions with customers and prospects could be captured and added to a database. Access to this database could then be provided to stakeholders to improve customer service levels and reduce support costs.

Last year IBM estimates that they supported 14 million self-service user sessions on the Internet, avoiding approximately $300 million in Call Centre and field specialist support costs.

Examples of automated interactions in the Health and Health Care industry include the following:

24. The Database Stage

The Database Stage involves the integration of the Web with real-time back end databases. Visitors can query the database and retrieve a web page which is dynamically created based on the contents of the live database. Contrast this with the Publishing Stage where static html pages are retrieved. By implementing the Database Stage, companies can leverage the investments they have already made in the creation of their corporate databases.

Here are some good examples of the Database Stage in action:

  • Online telephone directories (Canada, U.S.)
  • Postal code databases (Canada)
  • FedEx provides access to their package tracking database
  • Adoption.com provides access to their database of children from around the world that are available for adoption
Building a database and integrating it with a web front end is more difficult than building static html pages, but the benefits can be significant. A database approach can:
  • Significantly reduce ongoing web maintenance costs (Once the database and the web front end are in place, users can ask thousands of questions and get thousands of dynamically generated web pages while the webmaster does not have to write a single line of html code the company simply needs to maintain the database)
  • Reduce customer support costs (Customers can access the database and conduct their own queries)
  • Improve customer service levels (Allowing customers to access relevant data 24 hours per day, 7 days per week)
  • Improve customer retention levels (Once customers become intimately familiar with getting support in this fashion, they will be less likely to move to another vendor and relearn another system)
Here are some examples of the use of the Database Stage in the Health and Health Care industry:
  • On WebMD Health Guide A-Z there is a simple search tool that allows users to enter in keywords about a health topic and search the comprehensive database of health information. 
  • At the Heart and Stroke Foundation of Canada web site, they provide access to their information and articles database which enables their customers to save preferred content to a user profile.
25. The Application Stage

The Application Stage involves the integration of the Web with real-time back end applications. Visitors can execute applications which achieve a specific task. To implement the Application Stage, companies can either create applications from scratch or they can leverage investments they have already made in the creation of their existing corporate applications.

Here are some simple examples of web-based applications:

  • Customers can execute an address change or a beneficiary change
  • Shareholders can run an application to place their shareholder votes
  • Bank customers can move funds between accounts or pay a bill
  • Citizens can run an application to place a vote in an election
  • NYSEG (a New York State utility company) customers can run an application to indicate they are moving in order to generate their final billing
The benefits of building web-based applications include:
  • Reduce ongoing web maintenance costs (Once the application and the web front end are in place, users can execute thousands of tasks via these applications and the webmaster does not have to write a single line of html code the company simply needs to maintain the application and the underlying database)
  • Significantly reduce customer support costs (Customers can access the applications and conduct their own transactions)
  • Improve customer service levels (Allowing customers to access relevant applications 24 hours per day, 7 days per week)
  • Improve customer retention levels (Once customers become intimately familiar with getting support in this fashion, they will be less likely to move to another vendor and relearn another system)
Here are some examples of the use of the Application Stage in the Health and Health Care industry:
  • At the HIMSS WebU web site, they provide access to their online tutorials and lectures application which enables their customers to learn about health informatics topics in a virtual environment.
  • At the About Cancer web site, they provide access to their Discussion Forum / Bulletin Board application which enables the public to share ideas and questions with others. 
  • At the Human Anatomy Online web site, they provide access to their interactive human anatomy application which enables users to learn about human anatomy. Here's an example image that describes how to use the application:

Human Anatomy Online instructions

26. The Workflow Stage

The Workflow Stage involves the creation of workflow applications that can enable improved customer processes and support systems via the Web and/or via e-mail. Workflow applications track all elements of a series of tasks to completion, ensuring that all deadlines are met.

Implementing workflow applications can improve your human interactive strategies by addressing the fact that a lot of e-mail queries are lost in the bit bucket. Rather than 30% of your e-mail queries going unanswered, workflow applications can track every single e-mail query to ensure that they are answered in a timely fashion. And if they are not, the queries can be escalated to more senior levels of management or more advanced levels of technical support.

To implement the Workflow Stage, companies can either create workflow applications from scratch or they can leverage investments they have already made in the creation of their existing corporate workflow applications.

The benefits of building web-based workflow applications include:

  • Improve customer service levels (Ensuring that all customer queries are answered in a timely fashion)
  • Improve customer retention levels (By providing a high level of dependable customer support)
27. The e-Commerce Stage

Imagine that it took us 27 stages before actually talking about selling something via the Web. That just highlights the importance of thinking about your overall e-business strategy rather than just focusing on e-commerce.

In Stage 1, the Assessment Stage, you should have determined if it even makes sense to pursue e-commerce opportunities. This will depend on factors such as whether or not your offering is a good fit for Internet sales, whether or not there is a match with your target market, and whether or not your company is ready for e-commerce. Assuming this is the case, you are now ready to pursue the e-commerce opportunity.

When the typical person thinks of e-commerce, they picture a typical web based e-commerce transaction. A visitor goes to a web site, scans through web pages or an online catalog with product photos and information, places items in their shopping cart, and then finalizes the transaction with a credit card. Currently a huge percentage of e-commerce transactions occur using this formula.

In the future however, e-commerce transactions will take place using a variety of tactics and technologies. These tactics can best be explained in a commerce model called the e-Commerce Prismsm. The e-Commerce Prism helps us to analyze and assess many different kinds of commerce transactions.

B-commerce (Bricks and Mortar Commerce)

B-commerce refers to an online commerce strategy whereby the focus of your efforts is not on conducting online transactions, but in simply attempting to drive foot traffic to your real world stores or dealerships. This could be achieved by providing a store/dealer look-up function, online gift certificates or online coupons that the visitor can print off and bring into one of your stores.

In the Health and Health Care industry, there is some evidence of B-commerce in action. For example:

T-commerce (Telephone Commerce)

T-commerce refers to commerce transactions that are conducted via the telephone (or other voice technologies such as voice over IP telephony). Your web site could be used to move people through the sales cycle, and then the telephone could be used to actually close the sales transaction.

In the Health and Health Care industry, there is some evidence of T-commerce in action. For example:

  • The Red Cross First Aid Services web site offers B-commerce services (see above). It also allows shoppers to call the Red Cross directly to place an order.
  • At the HIMSS Books web site, they offer the option of T-commerce for users that prefer that method of purchase over W-commerce.

P-commerce (Proactive Commerce)

P-commerce refers to commerce tactics that you can take to proactively sell your offerings on web sites other than your own. You can proactively sell your products:

  • To companies posting their purchasing requirements or tender notices on the Web
  • To government agencies and public institutions posting public tenders on the Web
  • On the e-marketplaces
  • On the B2B and B2C auction web sites (new and used)
  • On your channel partners' web sites
  • On the web sites of Internet cybermediaries
  • On Ring Me Now banner ad buttons
In the Health and Health Care industry, there is some evidence of P-commerce in action. For example:
  • The First Aid Source web site sells first aid supplies. They have an auction site on eBay.ca where they sell used and liquidated products.

W-commerce (Web Commerce)

W-commerce refers to traditional web-based commerce that occurs on your corporate web site. As mentioned above, it is a web-based transaction using shopping cart software that is typically finalized using a credit card.

In the Health and Health Care industry, there is evidence of W-commerce in action. For example:

  • At the regular First Aid Source web site (under "Products") products are sold using W-commerce.
  • The HIMSS Books web site allows for W-commerce purchases in addition to T-commerce.

O-commerce (Outbound Commerce)

O-commerce refers to e-mail tactics that can be taken to proactively reach out to potential customers to trigger a commerce transaction. This can be achieved in a number of ways:

  • By sending e-mails to prospects and customers that have subscribed to your opt-in e-mail lists
  • By sending e-mails to prospects that have subscribed to opt-in e-mail lists of marketing companies such as Colonize.com
  • By participating in e-mail discussion lists and gaining marketing visibility through your signature file
In each example above, the e-mail message would contain a link to the web page where the actual commerce transaction could be completed.

In the Health and Health Care industry, there was no evidence of O-commerce in action. However, they could apply O-commerce by sending e-mails to prospects and customers that have subscribed to e-mail lists. These e-mails could contain links to web pages that contain special offers, promotions or even regular items for sale.

R-commerce (Repeat Commerce)

R-commerce refers to conducting repeat commerce transactions with existing customers that have already set up an account in the past (typically a result of a previous sale). A focus on tactics to improve you R-commerce effectiveness is important for a number of reasons. Since customer acquisition costs are typically greater than the profits of your first transaction, generating repeat purchases is critical to long term profitability.

As well, once customers make an initial purchase with a company, they are more likely to continue purchasing from that company as long as they are satisfied. Research shows that repeat purchases on the Internet account for over 40% of all B2C purchases and up to 90% of all B2B purchases.

Amazon.com has reported that repeat purchases accounted for up to 70% of total sales in some quarters. That is why they have introduced features such as their 1-click ordering system which enables existing customers to place an order with a single click of the mouse. Features like this should increase customer retention since customers are less likely to go through the process of setting up an account elsewhere as long as they continue to be happy with Amazon.

In the Health and Health Care industry, there was no evidence of R-commerce in action. However, they could apply R-commerce by maintaining a database of information on previous purchases, making it easier to enable 1-click ordering in the future. This would work well with the HIMSS Books web site which would be analogous to the Amazon.com example mentioned above.

Q-commerce (Quick Commerce)

Q-commerce refers to the ability to actually conduct a commerce transaction within an e-mail message. Imagine receiving an e-mail message that presents an offer to purchase a particular product. And to complete the purchase transaction, all you have to do is click on a single button right within the e-mail message that automatically commits you to the purchase.

At that point, you would then receive an order confirmation in one of two ways:

  • Via an e-mail message automatically sent to you, or
  • Via a link to a web page which would confirm all of the details

In the Health and Health Care industry, there was no evidence of Q-commerce in action. However, they could apply Q-commerce by enabling purchases from within an e-mail message without the need to actually visit the web site. The customer would simply click on the "Purchase" button in the e-mail message.

A-commerce (Automatic Commerce)

A-commerce refers to getting a commitment for an ongoing series of product or service purchases that will happen automatically. Once the automatic order is in place, the user does not have to do anything to confirm each repeat/replenishment order. The frequency of these reorders can be based on a number of factors:

  • Time based reorders (e.g., a standard order that is repeated monthly for goods such as vitamins or wine)
  • Needs based reorders (e.g., repeat orders for goods such as drinking water, diapers or nylons that will vary in size depending on usage)
  • Event based reorders (e.g., on birth dates, anniversary dates, at mortgage renewal time, at car insurance renewal time, etc.)
In the future, imagine a garbage can or a recycling bin with a built in bar code scanner that would know exactly which items you have consumed. A wireless replenishment order could then be automatically transmitted to the grocery store!

In the Health and Health Care industry, there was no evidence of A-commerce in action. However, A-commerce could work effectively in this industry. A prime example would be with prescription medication web sites that need to refill orders after a certain period of time. With prior permission of the customer this refill could occur via A-commerce automatically billing the customer and shipping the product.

e-Commerce Trends

Another interesting thing that is happening in the e-commerce space is the proliferation of different forms of e-commerce such as:

  • Auctions (eBay)
  • Bartering (uBarter)
  • Secondary markets for used goods
  • Micro transactions
In the Health and Health Care industry, there are some interesting examples of non-standard commerce transactions such as:
  • The Nutrition area of TradeAway.com is a bartering web site for nutrition products and resources.
  • Another example is one that was already listed above in the P-commerce section. First Aid Source has an auction site on eBay.ca where they sell used and liquidated products.
Customization of the e-Commerce Prism

The e-Commerce Prism has also been customized for specific industries. For example, the e-Banking Prism and the e-Government Prism are models for conducting banking and government services transactions. I have also created an M-commerce Prism to analyze mobile commerce transactions and a TV-commerce Prism to analyze interactive television commerce transactions.

The M-commerce Prism (Mobile Commerce)

M-commerce refers to commerce transactions that are conducted via mobile devices such as digital cellular telephones, offline personal digital assistants (e.g., Palm) or online personal digital assistants (e.g., RIM Blackberry).

In the Health and Health Care industry, there is some evidence of mobile commerce in action.  For example:

e/MD2 Pocket PC software At the e/MD2 web site physicians can purchase software for their Windows Pocket PC handheld device that allows them to capture charges and billing information for patient encounters.

 

 

 

TV-commerce (Interactive Television Commerce) 

TV-commerce refers to commerce transactions that are conducted via televisions equipped with specialized set-top boxes.

28. The Process Stage

The problem with many corporate e-business efforts is that they are treated as a publishing exercise the company focuses on publishing content on the Web. In reality, there is much more to it than that. A comprehensive e-business strategy is not as much a publishing exercise as it is a reengineering of your business. And if you can invest accordingly, you will have much more success in meeting your e-business objectives.

The Process Stage involves the creation or reengineering of business and employee processes. But rather than paving the cow path and simply automating existing business processes, some companies recognize that this is a great opportunity to build seamless electronic paperless processes between employees, suppliers and customers.

Companies that build an e-commerce business without a proper focus on building back end employee processes are setting themselves up for:

  • Lost sales,
  • Negative word of mouth communications, and
  • A negative impact on their brand image.
Click here to continue to the next phase (Phase 5).
 
Phase 1:
The Foundations Phase
Phase 2:
The Exploitation Phase
Phase 3:
The Innovation Phase
Phase 4:
The Business Extension Phase
Phase 5:
The Strategic Transformation Phase
TomVassos.com
A practical global resource for industry specific e-business strategies
UofEbusiness.com
A global educational resource for e-business and Internet marketing strategies

The co-authors of this report are Alex Drossos and Tom Vassos. Tom Vassos researched, created and wrote the content that relates to the 35-stage e-Business Roadmap. Alex Drossos completed this work as partial fulfillment towards an MBA degree at the Michael G. DeGroote School of Business at McMaster University in Hamilton, Canada. This report was written for the course called Marketing in Electronic Commerce, taught by Tom Vassos, author of the book Strategic Internet Marketing. There are also several more research reports available that cover over 200 other products, services and industries. Your feedback is welcome.


Tom Vassos

© 2002 Alex Drossos
© 2002 UofEbusiness.com