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The Internet Delivers For Small Business
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By Carl Weinschenk

Marketing to small businesses--both startups and established companies--has long been difficult for big vendors and service providers. That's too bad for them, since small companies comprise by far the biggest chunk of American business.

The information technology sector is a great example of how big vendors and small businesses miss each other. Big vendors and service providers--the IBMs and Oracles of the world--have a hard time reaching small and medium size businesses. Big vendors like to march large teams of experts into big enterprises and sit across a table from equally large teams of experts from the buyer. Everyone speaks the same language. Closing the deal may be competitive--teams from other large vendors are likely sitting in the waiting room--but once it is done big bucks flow.

On the other hand, small businesses don't have nearly as much expertise as the vendors or service providers who come calling. A 15-attorney law firm doesnít know much about VoIP. And, since these companies are small, the profit margin for the vendor is less and the cost-per-sale higher.

Of course, this isnít black and white. The big guys do understand that small business' money is green and, cumulatively, there is a lot of it floating around. They market to this sector both through direct and indirect sales channels.

The point is that there always has been a bit of a mismatch.

This is changing. The biggest reason--by far--is the emergence and maturation of the Internet. There are dozens of examples of how the Web erodes the demarcation between large and small businesses. The Internet makes it possible for a small company to act like an enterprise by marketing its services or selling its products without regard to geography. Telephone networks that ride the Internet make it possible for small companies to have a presence virtually anywhere--even where they have no physical office or representation.

The other side of the equation is that the Internet gives the big vendors and service providers tools to efficiently reach smaller companies. Customer relationship management (CRM) is a good example. Software as a service (SaaS), the new moniker for the applications service provider (ASP) business, enables big vendors to sell to small organizations without educating them on the complexities of database management and other sleep-inducing topics. They donít need to convince the small fry to take the time consuming, expensive and man power-intensive steps necessary to integrate hardware into their infrastructures.

The bottom line is that the Internet, as it adds multimedia capabilities and becomes more secure, will make it increasingly possible for everyone to play in each other's sandboxes. This is exciting and, to many players content with the status quo, a great challenge.

Carl Weinschenk is the Editorial Director of SmartBiz.
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