Front Lines is a guest viewpoint section offering perspectives on current issues and events from people working on the front lines of Canada's technology industry. Anthony Boright is President of VAULT Solutions Inc., a Toronto firm that provides Web-based communications consulting for the financial-services sector (aboright@vaultsolutions.com).
Canadians use the Web as much as any people in the world. Our rates of Web usage, penetration of broadband Internet connectivity, and on-line banking are very high. But is this why Canadian companies are moving their communications on-line?
Partly. But the main reason they do it is cost.
In any organization, the impact of the Web is lauded by the Finance Department from a profit-and-loss standpoint but condemned by HR from the lost-jobs perspective. The fact is the Internet has spawned billion-dollar organizations and foreclosed on million-dollar homes. It has also:
- Changed work habits and the overall 'life balance'
- Forced organizational restructuring within firms
- Created shifts in marketing strategy
- Prompted budget debates as marketers evaluate the relative benefit of investment in one medium over another.
A few years ago 'Integrated Marketing' was big, as marketing channels (print, TV, radio, kiosks, in-store/branch) were evaluated and the Web was positioned accordingly. The Web was initially an afterthought, but gained in acceptance as organizations grew more comfortable with the technology. But today the communication emphasis is for the 'On-line' channel, with all other channels falling into the 'Non-line'.
More relevant communications
The most commonly cited benefits for the Web over other channels is the immediacy of the channel, the relevancy of the message, and the personalized experience for the user. Twenty years ago when I was a Consumer Packaged Goods marketer, I used a database marketing company to help us identify high-volume/frequency customers, lapsed users and competitive users. I developed incentives for all these users with coupons. We mailed everyone a survey and the survey data was sold to other sponsoring firms. Then we did a follow-up mailing and offered a 50-cent coupon to those who bought our product and a $2 coupon to those who needed a push to buy. But the process took months, was labour-intensive for consumers, vendors and clients, and it was very expensive.
Recently I received a personalized, direct-mail letter inviting me to visit a website where I found a highly relevant, on-line communication. No doubt, I will get a follow-up call and the person will know when I visited the website, what products and services I clicked on, and how long I lingered in each area.
Nowadays many organizations know where you work, where you live, where you shop, what you read and what you watch on TV. Indeed, data is the life-blood of any marketer and it flows freely through the Internet. In fact, just about every marketing communication now includes a URL reference.
Cost savings
Of course, firms do not promote the cost savings associated with on-line communications, but make no mistake, those savings are substantial. While banking customers are sometimes pushed to the Web under the guise of "Improved, 24/7 self-help customer service", this Internet focus is looking at the bottom line. Banks channel transactions to the Web because the average cost per transaction is less than one cent, compared to $1 for a phone call and even higher transaction costs when dealing with a bank teller in the branches.
It's the same thing with annual reports. Few public companies have abandoned the print version, but now many of them create interactive, on-line annual reports that can be more engaging, relevant and personalized than print. While analysts may digest the pages of consolidated financial statements, not all investors want to so why mail everyone the whole document? And let's not forget that on-line annual reports involve less production time and great savings in print and distribution costs.
