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  • CFO IT

Whole New Ball Game

The first decade of E-business was not an unmitigated field of dreams, but some companies are once again ready to take the field.

Home Depot’s Web ambitions don’t run to the revolutionary, but it, too, is thinking hard about new possibilities. “People think of the Net as another channel to sell stuff,” says Shelley Nandkeolyar, president of Home Depot Direct Brands. “We do, too, but our goal is broader.” On Homedepot.com, contractors can create an online bill of order for merchandise that will be picked up at the nearest Home Depot, and consumers can schedule appointments for home installation projects, use an online gift registry, and receive messages about, say, merchandise that matches their interests.

But these are free services, many of which mimic what other brick-and-mortar firms offer on their Websites. Home Depot sees in its Website a chance to increase revenue by selling items that customers would not imagine finding at the nearest store.

“Customers want more access to more products,” Nandkeolyar says, “and we want to give it to them.” On the site, consumers can buy furniture, toys, inflatable swimming pools, and back-to-school products. “We’re leveraging our brand, which is all about the home, by moving it into categories beyond home improvement — but we’re doing it only on the Web,” she says.

Some companies see that the Web provides not only unlimited space, but also new kinds of interactivity. Nike and Lands’ End, for example, are among a growing list of companies that allow site visitors to custom-design products, configuring them on-screen based on their own measurements and style preferences. A consumer could potentially create a one-of-a-kind athletic shoe — or finally get a pair of jeans that fits.

Despite these successes, companies remain cautious. “Many are still leery of the Web even after the hoopla has died,” says Gartner’s Sarner. “They’re failing to realize that the Internet is a different animal.” For one, he says, the infrastructure is better, with many consumers now having high-speed connections. Consumer habits are now better understood—so much so, in fact, that some experts warn that companies should stop waiting for obvious solutions to present themselves and take a measured risk.

“The bottom line is that the Web should enable businesses to grow in ways they couldn’t have done otherwise,” says Jupiter Research’s Evans. “You can be like the newspaper business and let upstarts figure this out, or you can figure it out on your own.”

All for Knot

In the early 1990s, David Liu was a student at New York University’s film school dreaming of making it big. And he did, but not on celluloid. Despite knowing nothing about Internet technology, and having no particular affinity for weddings, he and three fellow students launched The Knot Inc., a business that the group conceived of from the beginning as “an immersive brand” that would embrace all things matrimonial. With www.theknot.com as its flagship property, the company has expanded into magazines and books, even as publishers in those traditional media continue to struggle to monetize the Web. “Whereas most people were focused entirely on the Net,” Liu says, “we were focused on brand extension. This approach shielded us from the insanity of the dot-com world.”


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