Exporting Your Services

E-Trade in Services

Cyberspace, the digital economy environment in which e-trade takes place, is like a new geographic market in which all globally-competitive service exporters need to participate. The following ten questions and answers can provide tips for taking advantage of e-trade opportunities:

What is e-trade?
What are the competitive opportunities of e-trade?
What are the competitive challenges of e-trade?
How do I create a supportive environment for service e-trade?
How can I control costs through e-procurement?
How can I learn if my customers are looking for alternate suppliers?
What e-trade tools are available?
How do I search for new customers online?
Should I expect to sell my services online?
If I want to focus on e-trade, what should I do?

What is e-trade?

E-trade is e-business that involves exporting. It is a broader term than “e-commerce,” which has become identified with transactions conducted using internet.

E-trade differs from traditional exporting not only in terms of the use of information and communication technologies but also in terms of the context in which it takes place. Because the technology supports immediate access, customers now expect 24-hour service (known as 24/7 or 24 hours, 7 days a week). Customers have also come to expect customized, personalized service in a one-stop environment.

What are the competitive opportunities of e-trade?

The volume of trade through internet continues to escalate. Finalizing sales is just a small part of how internet can be used by your firm. You can also benefit from:

Increased international visibility.
Immediate access to worldwide customers.
Efficient monitoring of global trends in your industry.
Easy research into the activities of competitors.
Cost savings through e-procurement.
The ability to integrate service design and delivery among departments and with partners in order to provide one-stop service.
Develop truly customer-centric design and delivery systems that have the ability to create customized services.

What are the competitive challenges of e-trade?

There are a number of challenges, including the following:

Ensuring the privacy of customer information, including a privacy of information policy.
Ensuring the security of online data.
Tracking and analyzing the rapidly expanding number of websites relevant to your service.
Increasing pace of change in the online environment.
Customer expectations for 24/7 services.
Accommodating a wide range of cultures and languages.
Potential loss of customers to online bidders.
Ensuring your website is fast and reliable.

How do I create a supportive environment for service e-trade?

If your service firm began offline, you may have (or have faced) some challenges in making the transition to e-trade. In order to be active in the digital economy, you will need to do five things (if you haven’t already):

Digitalize all administrative, transactional, and customer information so it can be accessed electronically, choosing data formats that are compatible across all departments and with suppliers and trading partners.
Make sure customers only have to give information once about themselves or their service requests.
Structure all customer-related databases so they are searchable by “customer,” and not simply by “transaction.”
Put in place policies to ensure any staff interacting with customers (including staff in partners’ firms) have access to all relevant customer data.
Help all staff become comfortable with new technology by using an internal LAN to provide electronic access to a range of administrative information, including staff benefits.

One of the best ways to test your e-trade readiness is to ask yourself who is responsible for monitoring and managing the online interface with customers and partners. If the answer is “the IT staff” rather than “the marketing staff,” then you have missed the point of cyberspace positioning.

How can I control costs through e-procurement?

Some firms report savings of up to 40 per cent as a result of online purchasing. A growing number of e-markets have been created to match businesses with the supports they need, using one or more of the following automated online procurement processes:

Classifieds
These are websites you can consult as you would the phonebook yellow pages, with any negotiation done offline.
Reverse auctions
Here you post requests for service, along with a time limit for the silent auction. Suppliers bid against each other to see who makes the most attractive offer within the set time period.
Group buying
You can join a buying pool that negotiates bulk purchase rates based on volume.
E-purchasing
You can use online automatic ordering systems where you can create a corporate profile of preferences in order to avoid repeat data entry.
E-clearinghouses
You can bid for time-sensitive inventory, such as hotel rooms and airline tickets, and get them for at least 20-30 per cent below the going market rate.

How can I learn if my customers are looking for alternate suppliers?

As businesses gain worldwide access through internet, you may find some of your traditional customers beginning to look for other suppliers. You may want to check key online bidding websites such as WorldBid to see if any of your customers are posting requests for suppliers.

What e-trade tools are available?

There are a number of application service provider (ASP) sites, as well as e-marketplaces that offer industry-specific productivity tools, such as RealLegal for legal services. There are also generic tools for site visitor interaction your firm can use, such as for Live Chat or HearMe.

How do I search for new customers online?

Your strategy for finding business online should be linked to the manner in which you normally acquire new customers and should be driven by going to the online customer (rather than forcing the customer to hunt for your firm). If, for example, you get customers primarily through advertisements or directory listings, you will want to place classified ads in relevant e-marketplaces and list your firm in all possible online directories. You may even wish to consider purchasing banner ads for placement on complementary sites.

If you usually get new business through responding to Requests for Proposal, you will want to monitor e-procurement sites and e-marketplaces where relevant requests might be posted. You might wish to subscribe to a bid notification service to alert you when relevant requests for bids are posted. Become familiar with the reverse auction process so you are well prepared to respond once a request for bid is posted.

If you usually get new customers through referrals, then your online activities will need to be focused primarily on heightening your credibility. For example, you might wish to submit short articles to your industry's e-marketplaces or participate as an expert on a site offering professional advice.

Should I expect to sell my services online?

Generally speaking, the more customized the service is, the more difficult it is to sell it directly through internet. For example, customers purchase management consulting or legal services based on the reputation of individual practitioners and would be unlikely to make a purchase decision based solely on a website, no matter how professionally presented. Many customers, however, are comfortable purchasing travel services electronically. Potential customers may comparison shop online, but then purchase directly. Here are examples of services typically sold or only marketed online:

Suited to Online Purchase	Suited to Online Marketing Only
Advertising Air transportation Back Office Commercial education and training (distributed learning) Computer services Courier Customs brokers Financial Health (telehealth) Insurance/reinsurance Internet News/broadcasting Market research Multimedia Retail/franchising Software Telecommunication Travel/tourism Translation Web site design/management	Accounting Business services Consulting engineering Design Environmental GIS/Geomatics Maritime services Marketing/Public relations Personnel Quality assurance/technical inspection Science and technology Utilities management

If I want to focus on e-trade, what should I do?

As a start, be sure your administrative and transactional information is in digital form, your staff are comfortable with web-based technologies, and your internal policies support collaboration among staff and with external partners. Then you may want to:

Identify key e-marketplaces for your services, subscribe to any free e-newsletters, and start actively participating in online discussion groups.

Register in as many free databases or in as many e-marketplaces as possible and then monitor what new customer queries you receive from each source.

Select a couple of online e-procurement sites and monitor the bidding that takes place for services similar to your own. Test the procurement process by making small purchases and bidding on small contracts.

Study customers’ needs and expectations. How do they use internet as a resource? What kinds of online interactive contact do they expect? What portals or e-marketplaces do they visit? Where do they search for expertise? Do they expect a one-stop, 24/7 service? What are the implications for the type of web presence your firm will need to have?

Study your competitors’ offerings. Are they already online? If so, in which e-marketplaces are they active? What types of customer interaction do they offer? What are the implications for your business's strategy?

Review current best practices for innovative ideas. If you already have a website, test it against best practices.

Review your service design and delivery process for one-stop service possibilities. Talk with your partners about how to integrate multiple delivery channels. Determine what changes, if any, need to be made to increase customer satisfaction.

Determine your objectives for e-trade and establish performance metrics to see if your objectives are being met.

Design (or redesign) your firm’s online presence to reflect the results of the previous steps; then support your online presence as you would a traditional office.