nternet portals, well, make sense
Spinning a new look at Web gateways
New! This column marks the debut of NouveauGeek Rebecca Lynn
Eisenberg, a San Francisco writer who will shed light on thorny
Internet issues and business practices. Don't say we didn't warn you!
By Rebecca Lynn Eisenberg, CBS MarketWatch
Last Update: 4:38 PM ET Aug 24, 1998
Also: Internet Daily
SAN FRANCISCO (CBS.MW) -- Only a fool would bank on a Web site
that served no purpose other than to direct traffic off the site, I snickered.
The soaring stock prices of the market's portal darlings -- Yahoo!, AOL,
Excite, Infoseek, Lycos and CNET, to name a few -- kept rising, and my
snicker grew with them.
Then, a string of recent portal acquisitions and announcements -- in
particular, the mass drive to add community-like aspects to portals --
swayed me to the cause. Portals are not doorways to Web content, but
rather, they are personalized shopping malls, e-commerce depots or
customer-brokers. As much as I hate to admit it, with a new name, portals
make sense, and could also make money.
Take Lycos (LCOS). In February, the company
purchased Tripod, a home-page-hosting service with
almost two million members. Then, on the heels of
community-based Website Geocities' IPO, Lycos
stole from Geocities the title of "largest online
community" on Aug. 11 by acquiring WhoWhere?
Inc., a free e-mail, directory and personal page
hosting service with 10.6 million registered members.
Not to be left behind, on Aug. 18, Wallstreet-fave
Yahoo! added "Yahoo Clubs" (clubs.yahoo.com) - to
provide chat, message boards, email and Web
directories for users who create their own groups.
And on Aug. 17, Excite (XCIT) announced its own
communities, in order to "extend relationships" that
already exist in the real world, providing "an online
center for clubs, organizations and people with
similar interests to share what, when, and how they
want, with whomever they want."
All these announcements sounded a lot like the
commercial-cousin-of-portal Amazon.com, which recently purchased
PlanetAll, a database of personal contacts and calendar information, and
Junglee, a Web comparison-shopping services developer, in order to provide
a more personalized (and thus convenient) shopping experience for Amazon
customers.
From mouths of portal execs come gems?
Could it be that communities are merely a ploy to attract more -- and more
easily targeted -- customers to the portals, in order to achieve what perhaps
the only revenue-producing process on the Web: commercial transactions?
So it seems, from the mouths of the portal-execs.
How do communities fit into Excite's business strategy? "We might do
something like book clubs, with Amazon.com, for example," answered Craig
Donato, Excite's vice president for product marketing. "The nice thing about
communities is that they aggregate regular buyers of a particular product,
which makes them valuable from an e-commerce perspective."
In other words, communities help portals connect sellers with customers,
one-to-one marketing-style -- not unlike what the portals already do with
their "shopping" channels -- only more effectively, since customers only join
a community when they are interested in its focus, say books.
As Donato put it, "We have a shopping channel where we do e-commerce.
Right now the actual purchases are done on someone else's site, but we do
all the merchandizing for [the sellers]."
So, portals are not portals. They are brokers, merchandisers or personal
shoppers: shop-ports? Intelligent shopping agents?
"Portal is not a good term," agreed Harry Motro, CEO and president of
Infoseek, which acquired Quando Inc., - a self-labeled "leader in
personalized shopping and local event services," on Aug 11.
Infoseek (SEEK), said Motro, "is more of a service; a destination for all the
things that you want or need to do on the Web," which of course includes
shopping. "If you want to buy a house or car, find information, or get your
sports news for the day, we want you to come here, because you are going
to get a better experience, and it will be easier for you to do it."
To the extent that Infoseek makes a shopping experience easy enough that
the customer makes a purchase, Infoseek turns a buck. "We help sell
products," said Motro. "And we do deals where we get paid based on a
percentage of products actually sold. "
It makes sense. And it also flies in the face of most journalists and analysts,
who have fixated on old-fashioned banner advertising as the primary, if not
sole, source of portals' revenue streams.
After all, the Web is unlike television, radio and print; it is interactive. And
what better use of interactivity exist -- if you are trying to make money, at
least -- than the interaction between customer and merchant?
The thought of communities as e-commerce strategy might offend some
sentimental online community types . But my guess is that when they
receive email notice of the latest Howard Rheingold "Virtual Community"
book from their shop-port, they will go ahead and purchase it. |
