America Online Inc. on Wednesday invited small businesses in the U.S. and around the world to get on the Web and into e-commerce by using an array of services, many of them free.
Many small businesses don't even have Web sites, but AOL's new portal service, Netscape Netbusiness, hopes to coax the small-business manager into e-commerce through a low-tech approach. It starts with an electronic business card, which the small-business manager is asked to create at the Netbusiness site. This e-business card, which can include a photo and detail about the business, is an identifier that lays the first cornerstone for the online storefront.
The card information can be e-mailed and used in instant-messaging forums dedicated to business topics on AOL chat rooms. AOL will also list the information on each Netscape Netbusiness card in service marketplace directories, as well on Internet-based Yellow Pages and other search directories.
"There are 28 million businesses in the U.S. with under 10 employees," says Frederick Singer, senior vice president of AOL Interactive Services and general manager of Netscape Netbusiness. These small businesses employ about half of the working population and generate almost half of all U.S. sales. But almost three-quarters of these businesses aren't yet active on the Web in any way, Singer claims.
AOL's strategy to capture this small-business market entails offering a slew of free services augmented by others that are paid for -- such as credit-card processing, Web catalog design, and online procurement services. These will be provided by AOL's partners. Start-up Bigstep.com, for instance, is an AOL Netbusiness partner that will provide free Web page hosting and catalog support. Bigstep.com currently charges for credit-card processing and other commerce services.
One Bigstep.com customer, The Foot Nurse -- a Cupertino, Calif.-based podiatry healthcare business owned by registered nurse Patti Glick -- says the $24.98 per month she pays to use several BigStep.com services is reasonable.
"I researched this a lot as I started my own business," Glick notes, adding she sells diabetic test kits online with purchase orders e-mailed to her and credit cards cleared through BigStep.
If they want to try e-procurement, Netscape Netbusiness users will be able to purchase office supplies and other goods at AOL via the volume-pricing service, PurchasePro.com. PurchasePro.com aggregates customer orders to get better deals than a single small-business could typically get.
In addition to a variety of Web-based business services from ADP, Federal Express Corp. and kinkos.com, AOL is setting up Netbusiness to generate content, such as local news and weather, for free to business customers. "We ask for a zip code," Singer says. The Web site content will basically be partitioned into three main areas: My Industry; My Business; and My Life.
If a Netbusiness user is a real estate agent, it will get news suitable to that industry. There will be chat rooms dedicated to particular industries where Netbusiness users can identity themselves by sharing Netbusiness "nametags" that can offer extensive detail about the business and its representative. An online calendar will let the user record and be notified of upcoming personal and business events.
AOL's Singer says its published privacy policies will dictate how AOL may make use of the information it collects through Netscape Netbusiness. That appears to mean that AOL may resell the information with the permission of the individual that provided it.
As to how AOL expects to earn revenues through Netbusiness, with so many services offered for free, Singer responds that AOL will share an undisclosed percentage of revenues that AOL partners earn through Netbusiness. But at this point, most revenues will likely derive from Web-based advertising at Netbusiness, Singer concluded.
The Netbusiness initiative neatly complements AOL's e-commerce activities, which include providing a portal for established larger and Web-savvy business that already sell online and want AOL's consumer visitor traffic.
According to NetRatings, a firm that measures Internet traffic, AOL gets about 35 million visitors per month, making it the second most-visited Web site in the world, behind only Yahoo Inc. with approximately 39 million.