Web Sites We Love
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No sooner had the Internet manifested itself as a key source of competitive intelligence than the wily CEOs of the Inc. 500 started devising crafty ways to use that information for their own purposes. (See "Web Results," below.) But anyone who views cyberspace as a business panacea quickly discovers that the Internet--like the telephone--is only as good as the person who's using it. Here are some examples of how companies on this year's list are using the Web in surprising and advantageous ways.
Finding people and information on the cheap
For John Coleman, CEO of Via Marketing & Design (#287), the Internet is an unequaled business tool, allowing him to do his own on-line research while still holding onto the reins of his fast-growth company. "I can do things myself without blowing an entire week," he says.
For example, the Internet is a great place to sample a competitor's marketing strategy, especially when that competitor is several thousand miles away. When Coleman was working on a marketing plan for a client who was introducing a new industrial water-pumping product into markets like Brazil and China, he found valuable information about the marketing strategies of the client's key competitors on their Web sites. To his eye, at least one of the other sites was bogged down with technical jargon and had little marketing flash, so he made his client's site as clear and as simple to use as possible. Without the Internet, says Coleman, keeping up with international competitors would have required a lot of travel. "One trip to China would eat up the entire on-line-resource department's budget," he says.
The Internet is also a potential boon in recruiting. Coleman posted a listing for a senior marketing strategist at the Harvard Business School site. A few dozen responses followed, from which Coleman culled Chris Lane, a former White House aide with an accomplished career in marketing. Coleman says Lane was one of his best hires, and the price--free--was certainly within reason. However, Coleman has had less luck with other free recruiting sites. "General sites tend to give you general people," he says. So Coleman shelled out $5,000 for University ProNet, and he says it actually wound up being a deal. The site wields a hefty database to track personal and professional information about 131,000 alumni from such top-tier schools as Stanford and Carnegie Mellon. Coleman says he's had about as much success with ProNet as with conventional headhunters, minus one key factor: the headhunters' $30,000 fee.
Additional on-line research recently helped Coleman win a sizable contract. Late one evening Coleman was pacing his living room. The following morning he had to make a pitch to some executives from a New York City financial house, outlining a marketing strategy for its Internet presence. The problem was, Coleman knew next to nothing about on-line marketing for brokerage companies, so he fired up his browser. Stops at BusinessWeek Online , CNNfn, and other more homegrown brokerage sites provided him with a crash course in on-line trading, and he was in bed before dawn. The next day VIA Marketing & Design made a successful pitch for the contract.
Myriam Chen says she's so Internet dependent that if the Web went away, so would her business. "If I'm looking for anything, I go on-line and add 'dot com' to whatever I'm looking for," she explains. When Chen wanted to expand Chen & McGinley (#362), her San Francisco-based information-technology consulting business, into Charlotte, N.C., she entered "www.charlotte.com" on her browser and found a site run by the Charlotte Observer that linked to practically any site an entrepreneur seeking to expand could want. At www.charlotte.com/jobhunter Chen scanned job postings for area IT recruiters and learned that she'd need to corral plenty of local-area-network programmers to be competitive. From a now defunct commercial real estate site, she divined the most strategic places to set up shop to serve potential corporate clients. And from www.homehunter.com/charlotte she saw that Charlotte's real estate market might just be cheap enough to entice even the most citified IT staffer: the median price of a three-bedroom house was $84,000--which was $316,000 less than a comparable one in San Francisco.
Of course, recruiting IT workers in any city is a challenge in the worldwide tech-worker drought. One way Chen deals with that is by posting jobs on-line. Two of her favorite places are www.dice.com and www.careermosaic.com. She also uses www.dejanews.com and www.news.com as gateways to numerous Usenet newsgroups, places where IT nerds go to discuss "bleeding-edge" technologies and where Chen can discuss alternative employment with them.
Another of Chen's cyberhaunts is www.womenconnect.com, a site for women in business that features everything from on-line chats with venture capitalists to stories about entrepreneurs who are also full-time moms. Chen herself was featured on the site in July, and she says the feedback was immediate. "I was pretty surprised at the response," she says. "I got a lot of E-mail from women who thanked me for sharing my experience."
What has your company's Web page helped you achieve?
More widespread marketing 84%
Increased sales 36%
Improved customer service 32%
Greater recruiting/hiring efficiency 30%
Easier to locate new business partners 10%
Better customer-information gathering 9%
Easier mailing-list creation 3%
Source: 1998 Inc. 500 survey.
Company: TynanGroup (#58)
Problem: Finding international clients in a time-sensitive industry
Web solution: Search out industry-specific news sites
John Tynan's company, the TynanGroup, provides real estate consulting for hotels, among other types of clients. A search on www.hotbot.com turned up a valuable Web site: www.hotel-online.com, dedicated to hospitality-industry news. The site gives Tynan immediate access to information that used to take weeks to get from industry trade publications--specifically, locations for planned hotel expansions around the world. Tynan says the site helps him turn sales pitches around that much quicker. "If a developer is planning a new resort hotel for Scottsdale, we need to know in real time," he says. "If we wait to hear from a local paper, it's too late."
Company: PayMaxx (#268)
Problem: Persuading key talent to work for you for less money
Web solution: Locate comparative cost-of-living information
Believe it or not, when Farsheed Ferdowsi, CEO of Nashville-based PayMaxx, offered a prospective chief financial officer in New York City $50,000 less than his then-current salary, the CFO didn't laugh and slam down the phone. Rather, he politely said he'd consider the offer and get back to Ferdowsi. Of particular assistance in this process was a Web site called the " salary calculator," a resource for comparing the dollar's spending power in major cities around the world. Ferdowsi used the site to show the prospective CFO that less is sometimes more: the $100,000 salary Ferdowsi was offering him to move to Nashville was worth $270,000 in New York City. Though he'd be making less in terms of real dollars, his salary's spending power would nearly triple.
Ferdowsi also keeps up with such huge competitors as ADP and Ceridian by creating a "portfolio" of their stocks on America Online (keyword "my portfolio"). That allows Ferdowsi "to drop in" on the competition at least twice a day. He says holding the faux portfolio is doubly sweet, considering it's harder for his competition to watch him--since his company is, of course, private. "If anything major happens--like their earnings decline or they're making an acquisition--they've got to file it with the SEC," he says. "I don't have to file anything."
Company: Geltech (#468)
Problem: Choosing customers with long-term potential
Web solution: Comb prospects' Web sites to gauge their market viability
Knowing how to read between the HTML lines has helped Michael McConnell choose his customers wisely.
The CEO of Geltech, which manufactures high-tech optical components, was recently approached by three competing hardware companies, each of which wanted to sign him on as an exclusive vendor. To help him make his decision, McConnell monitored their Web sites for several weeks. Companies A and B had sites that were flashy, fast loading, and easy to navigate. Company C's site, however, offered little information and even less flair. "It was plain vanilla," says McConnell. Company A updated its site weekly (B monthly, C hardly ever). Company A also advertised the largest number of job openings, listing a bevy of new management positions that to McConnell indicated a rapid expansion. And when it came to product development, Company A's site provided more new-product information than the other two sites combined. The obvious choice for McConnell was Company A. (Tellingly, Company C went out of business soon thereafter.)
Additional reporting for this story was provided by Nicholas Colletta.
WHAT WEB SITES OR ON-LINE NEWS SERVICES DO YOU GO TO FOR NEWS AND INFORMATION?*
|YAHOO!||Internet search engine||www.yahoo.com||48%|
|AMERICA ONLINE (AOL)||On-line service provider||www.aol.com||28%|
| MICROSOFT NETWORK/
|Provider of product information, Web navigation, and news|| www.msn.com, www.microsoft.com,
|CNN/CNNFN||Provider of news and financial information||www.cnn.com and www.cnnfn.com||21%|
|POINTCAST NETWORK||Customized service providing breaking news||www.pointcast.com||20%|
|WALL STREET JOURNAL INTERACTIVE EDITION||On-line version of the newspaper||www.wsj.com||19%|
|IBM||On-line presence of international company||www.ibm.com||6%|
|BLOOMBERG ONLINE||Provider of business news and financial analysis||www.bloomberg.com||5%|
|NEW YORK TIMES ON THE WEB||On-line version of the newspaper||www.nyt.com||5%|
|INC. ONLINE||Inc. articles and additional resources for entrepreneurs||www.inc.com||5%|
|NASDAQ STOCK MARKET HOME PAGE||Provider of stock-market-activity coverage, financial information, and business news||www.nasdaq.com||4%|
|EDGAR||SEC's on-line database, tracking filings of most U.S. public companies|| www.sec.gov/
|CEO EXPRESS||Provider of links to news, business technology, and travel sites||www.ceoexpress.com||4%|
|ALTAVISTA||Internet search engine|| www.altavista.
|CHARLES SCHWAB||On-line presence of Charles Schwab & Co., where members can create portfolios||www.schwab.com||4%|
|HOOVER'S ONLINE||Provider of information on more than 13,000 public and private companies worldwide||www.hoovers.com||4%|
*Out of 166 respondents
Source: 1998 Inc. 500 survey.