With eCommerce set to soar TH_NK explains how companies must embrace the new digital frontier

With more than 63% of the UK population now online and rapidly becoming experienced surfers, simply having a web presence is no longer enough for the majority of businesses.

Under the wave of genuine growth in the dot com sector - where eCommerce is now soaring and set to soar even further - companies must now step up their online real estate, making it a fully integrated part of their total offering. Indeed, rather than simply matching off-line offerings, eCommerce brings businesses an invaluable new dimension, which will help them maximise their revenue potential.

The figures speak for themselves and illustrate how online audiences are continuing to grow and how, as they become more sophisticated in their internet usage, so too do their expectations of online offerings. For example, more than 73% of internet users have been online for at least three years and 18.2 million people in the UK are now using broadband – up 49% on last year.

Online retail is rocketing. 18.5 million of the UK population are now shopping online, spending £19.2 billion online in 2005 – an increase of a third on 2004 - with £5 billion spent during the Christmas period alone. 86% of UK consumers also use the internet to research and compare prices of products and services that capture their interest, whilst 13.3 million do their banking over the internet – indicating a major shift in consumer purchasing behaviour.

Embracing these advancements, North East brand technology and Webdesign company, TH_NK, is working with successful companies, such as Northern Rock and Northumbrian Water, to help them build their digital business – and is already witnessing many of its clients see an increase in profit year on year. Online communication is increasingly the way customers want to deal with businesses and http://www.thinkco.com is at the forefront of developing innovative solutions to help brands make this move online.


As audiences move online, businesses are having to consider digital communication as a means of customer acquisition and retention. The added advantages of relatively low set-up costs and the prospect of national or global exposure have led to a solid shift towards eCommerce.

This growing trend has also led to dramatic technical advancements in analytics, metrics and accountability. eCommerce businesses can now track their key performance indicators with much more precision, and in real time, which ultimately leads to a more focused business and a healthier margin. This is why TH_NK has partnered with world leading web analytics provider, WebTrends, which offers the most advanced and comprehensive analytical reports on consumer usability and behaviour, conversion rates, key performance indicators and return on investment (ROI).

Businesses are not only using digital technology as a form of customer acquisition, but are also recognising the huge potential in digital communication as a means to retain one of its most valuable and lucrative assets - its existing customer base. eCRM (Electronic Customer Relationship Management) is therefore a key growth area within eCommerce. Not only does eCRM allow businesses to significantly reduce the cost to serve, it is also an ideal opportunity to maximise revenue by cross-selling or up-selling further products to existing customers using advanced digital technology.

e-CRM also enables brands the opportunity to provide their online customers with a highly personalised and secure service, which now rivals face-to-face communication. This is not only more cost effective, but also allows true, long term online customer relationships to be developed.

For SMEs and individual entrepreneurs, eCommerce also offers a level playing field on which to compete in a national or global market. Devote enough energy to developing an eCommerce website and an SME can compete with - and even out-perform - a larger competitor.

Businesses can no longer afford to miss out on capitalising on this phenomenal growth while their online competitors reap the benefits.


The Growth of Online Marketing

Where the audience goes, so does the advertising spend. As figures show, this makes online marketing one of eCommerce’s most powerful growth areas.

UK digital advertising increased by two thirds in 2005 to almost £1.4bn and is now driving the market, leaving other mainstream media in decline. Digital now represents 8% of all UK advertising and is forecast to be over 10% by the end of 2006. In 2004 it was 6%. This illustrates how digital advertising has really grown up and is now taking the lead.

As original founder of Lever Brothers, William Hesketh Lever,
said, 50% of all advertising is wasted, but he didn’t know which
50%. This is no longer true. Digital marketeers can now monitor
the true return on investment (ROI) of their online marketing
channels in real time.

If something isn’t working they can identify it and change their campaigns accordingly at a moment’s notice. Ultimately, this means they can focus on the advertising that they know is the most effective and minimise wasting spend on any ‘grey’ areas.

In particular, ‘search marketing’ has seen phenomenal growth, which not only offers the ability to track true ROI but also offers the advantage of being the most targeted form of advertising available to us today. Marketeers can now advertise in ‘search results’ pages allowing them to target a sector of consumers that they know are already receptive to their offerings.

Digital technology has also lead to the growth of affiliate marketing, which offers online merchants the ability to develop a limitless number of virtual sale representatives across the internet. This virtual sales force is paid on commission, based on sales they generate for the merchant. Affiliate marketing also offers merchants a low risk method to advertise online while affiliate publishers have the chance to profit from their online real estate.

Assuming that online audiences will continue to grow, we can expect growth in additional spend towards online brand positioning, which at the moment is relatively uncompetitive.


Businesses are waking up to online marketing as a real return on investment and are therefore searching for experienced agencies that can offer this knowledge, expertise and in-depth understanding of this fast changing media sector.