Incentives to Change
For agencies and publishers, adopting e-commerce solutions has never been more urgent.
What a year 2000 is shaping up to be! The fervor of e-commerce for publishing is just beginning and has inspired interest from the press: Business Week highlighted a recent Goldman Sachs study that predicted media and advertising will reduce operational costs by 10 to 15 percent once e-commerce solutions are in place. The analysts conclude that implementing e-commerce will translate to a three to 12 percent improvement in the bottom line.
Just when we've begun to understand Noosh, Collabria, Impresse, printCafe and others, the Wall Street Journal reports that the field is crowded and consolidation is likely. Boy, do things move fast on Internet time!
Industry guru Terry Nagi, while speaking at a recent Communication Graphics Association (CGA) forum, advised: "E-commerce is going to alter business forever. Understand it, before it consumes your business." A printer representative who shared my dinner table that evening exclaimed truculently, "We certainly aren't going to make any e-commerce changes unless our clients make us."
Overcoming inertia to move on to a new business paradigm resembles what some have described as "watching pachyderms procreate." The challenge of change is anticipating how to move forward at the speed of your business, and I'd bet on Nagi's assertion.
For many in this industry, e-commerce is just about Web sites and browsers launched on a desktop. From his podium, Nagi asked the audience how many use the Internet for browsing and e-mail. Most raised their hands. But for the consumer, buying and auctioning, it seems, represents a tiny portion of Internet activity, while business-to-business commerce represents a model that is four times grander.
From a historical perspective, the process of exchanging information related to the manufacture, sale or distribution of product or service, predates the Internet. General Motors, Ford and Chrysler began deploying electronic data interchange (EDI) in the late '80s. National cable systems began exchanging electronic insertion orders and invoices as early as 1997. Replacing phone calls and faxes with automated transactional communication has allowed the cable industry to remain competitive. After implementing an EDI insertion process, gross cable spots billing escalated from $60 million to $300 million for one agency.