Working Wonders on the Web

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Ralph S. Heath III, founder and CEO of the 25-year-old business, says that from the beginning the project's return has been intuitive: "We just knew it was going to have greater value than the costs we put into it." Vice president of client services Kim Larson elaborates: ClientNet wins customers' love by helping them save time and money. One client, for example, reported a 25% reduction in time spent approving work and retrieving information from Ovation. Another said that the system cut the costs of shipping, copying, and long-distance calls between the two businesses by 80%.

Such customer gains have been at ClientNet's heart since 1995, when a cross-departmental executive team dreamed up a system that would house a central database accessible to the agency and its clients, streamline work processes, and make it easy for customers to give feedback. To vice president of technical services Jack Felsheim fell the task of making it flesh; he led two programmers in hand-coding the entire site. The creative services group weighs in on the design, and maintenance chiefly involves creating sections for new clients and improving ease of use. "We don't want the technical department holding the keys," says Felsheim. "Users should manage their own clients' spaces."

Ovation tests each new client offering on that client's platform before taking it live.

Account managers ask new clients what features they'd like on their slice of the site: Photo approval? An interactive calendar? A complete archive of all creative material produced by Ovation and other agencies for that client? (The Anheuser-Busch section of ClientNet, for example, houses more than 7,000 images created over four years.) Larson also surveys clients twice annually, asking among other things how the extranet can be improved. Ideas from inside the company percolate up through weekly management meetings and biweekly IT "geek meetings" attended by a rotating assortment of guests from other departments. "We want everyone to have a voice in this," says Felsheim.

Heath says that more than three-quarters of clients use the extranet--in part because it's been made so dang easy for them. Ovation keeps handy one of most types of computers and operating systems and tests each new-client offering on that client's platform before taking it live. The technology department guides each new client user remotely through an hourlong screen-by-screen orientation using WebEx software.

Ovation is similarly conscientious when prepping for its "webinars"--free 35-minute online tutorials launched last year. A new-business initiative, they demonstrate Ovation's expertise in everything from photographing food to building a brand. About 25 to 50 prospective clients attend each; two of them have been converted to paying customers in the past six months. A few days before the event Ovation does a brief test run with all attendees to ensure they can experience the slides, audio, and video in all their glory.

Ovation initially outsourced development and hosting of the webinars--as it does with all experimental applications--bringing them in-house when their value became clear and Heath was convinced his staff could create something comparable for less money. The company is taking the same approach with Web-based videoconferencing. Says Heath: "We're going to build a room and use it to do all our broadcasting over the Internet, including webinars, teleconferencing, and videoconferencing.

"This is never anything I've ever had to push," says Heath. "Everyone knows it's about getting closer to our clients. There is no resistance."

The Company

MagicTricks.com

4 to 10 employees (seasonal)

The Site: An e-commerce site selling tricks, videos, and memorabilia; an extensive library on magic

The Cost: A few thousand dollars to construct; $2,000 a month to operate and $3,000 a month for promotion

The Team: MagicTricks.com's vice president developed the site and works on it almost exclusively; the president devotes a few hours a day to online customer service; and an employee spends one day a week typing in product information.

Peter Monticup's most mystifying feat in a long career of mystifying feats is this: that he ended up the owner of a dot-com. Monticup is a guy who eight years ago ran a business that didn't use a single computer. Yet today, after more than three decades of operating magic stores that never reaped more than $100,000 in sales, he's the owner of a Web business that employs as many as 10 people and has been growing 30% to 50% a year.

For small and midsize businesses with basic commerce sites, host outsourcing can reduce the total cost of ownership 25% to 80%.

Certainly magic is nonintuitive content for the Web, which presents no physical reality to subvert. At the three stores he owned, Monticup, a professional magician, would first astound customers with his tricks, then demonstrate their ease of execution, and finally close the deal. But in each location, "there are only so many people who are going to buy magic," he explains. "You saturate the market, and you have to move to another location and open another store."

In 1995 Monticup's wife suggested they experiment with the Web. Jackie Monticup is an M.B.A. and former advertising executive. (The couple met when she was handling the McDonald's account for a major New York agency and he was the East Coast Ronald McDonald.) As head of marketing for the business, she was chiefly looking for ways to promote the couple's latest store, Magic Tricks, and maybe move a little inventory as well. A computer-literate insomniac, she taught herself Web programming at night, using free online resources like HTML Goodies, PageResource.com, and Bravenet.com. She then built a site using Microsoft's FrontPage, a gift from one of that product's original developers, who happened to be an amateur magician.

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Leigh Buchanan

Leigh Buchanan is an editor at large for Inc. Magazine. A former editor at Harvard Business Review and founding editor of WebMaster magazine, she writes regular columns on leadership and workplace culture, and she contributes Inc.'s capsule book reviews, "A Skimmer's Guide to the Latest Business Books."

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