From B&M to C&M: hedge your bets now!

From ‘Brick and Mortar’ to ‘Click and Mortar’. That seems to be the

buzz these days. That may, there is never a dull moment in the IT industry. One

thing is sure. No one can accuse ITians of not being creative!!

For lesser mortals, this poses a constant challenge of having to play catch

up. Our software brethern have for long taken the lead in creating

abbreviations, acronyms and what have you, much to the chagrin of the

uninitiated. Whether by design or otherwise, they have managed to create and

continue to create an aura of mystery and intrigue around all kinds of

abbreviated names that sound alien-like to a normal healthy person.

That aside, the serious side of the story is that we are, in fact, in the

middle of a revolution. The changes that are taking place around us are of

historic proportions. And the pace of this change is sweeping everyone, whether

one likes it or not. The revolution of the Internet is now unstoppable. And the

only option left for us is to see how we can harness it to our benefit.

What makes the situation challenging and may be confusing is the fact that

everything is so fluid. The technologies are evolving. New technologies and

developments are being used to change the market place and the way people

interact. We are creating more and more options for people at large. ‘The

customer must have choice’. That is what the technology movers seem to be

crying. (Suddenly everyone appears to have woken up to the idea that customers

didn’t have enough choice!!)

Well, the Internet is the happening place and the fact that connectivity of

this level means that anyone can get in touch with anyone else, definitely means

that limitations of physical location can be overcome in quite a few ways.

Getting in touch is not really an issue.

But that does not mean an automatic expansion of the market place. The Net is

still a chaotic place. And finding what you are looking for isn’t exactly

easy. Ask anyone who goes through a search engine and is presented with hundreds

of options to choose from. No wonder that the B2C market place hasn’t really

picked up the way people would have expected.

One often talks of the Indian buyer as one who likes to go through the

experience of touch and feel. The fact is that even in USA, one talks of the

same sentiment as the reason why the B2C market place has not picked up on the

lines of initial expectations.

In contrast, the B2B business is nearly three times more. Statistics like

these are steering more and more business to focus and establish B2B portals or

exchanges. The question is, whether this business on the Net is additional

business or merely a piece of the same overall business that would have got

conducted by traditional means. For those who conduct business only on the Net,

there is no doubt that the Net is in fact the only medium through which business

is coming in. But for those older established organizations, there may always be

this question of whether those buying on the Net from them, would have bought

from them even otherwise. That is, whether the Net has helped generate `real

incremental business.’

To any mind, that question may be of academic interest only. For, at the end

of the day, these traditional organizations will end up competing with the Net

based organizations. And the customer is going to buy from wherever his buying

experience is better. He will not buy from the Net just because that is what the

latest happening thing is!!

And that is where the ‘brick and mortar’ traditional business’ dilemmas

lie. The kind of developments taking place in the Internet arena are all geared

upto making the customer experience a pleasant one. Hence, can they ignore these

developments, hoping that the customer will always choose the ‘look, touch and

feel’ buying experience over the new ethereal mode?

May be not. For business on the Net is already a reality. The kind of

comparison buying that the Net affords would simply be too exhausting in the

traditional buying mode. And hence more people will take to the Net as they find

that it provides them with exactly the information that they need to make a

decision of their choice.

In fact, the traditional businesses are in the best position to take

advantage of the new developments. They already have strong logistics and order

fulfillment mechanisms, which necessarily have to be in the physical domain.

Adding the ‘click’ option is the best way for them to address the future.

That way they can be sure that they are addressing the market—irrespective of

whether it is shifting, transforming or expanding.

The Internet’s adoption in businesses has been more (in percentage terms)

than in households. It is therefore more feasible for businesses to create and

control the new market place through their associates or supply chain partners,

who are at similar levels of Net adoption. Hence the higher growth in B2B

business volumes as compared to B2C. It is only logical. But B2C isn’t a flop.

Just that it was an over eager response of not so mature netpreneur wannabe to

the Net’s potential ahead of its time.

The time is right for B2B. And those who create early success are the ones

who will stay in peoples’ mind. Transforming to a ‘click and mortar’

company may well be the best way of hedging your bets.