by Jacques Hart
True or False: giving away free online content, services or products will erode offline sales. Conventional wisdom leans toward “True,” but then, Paulo Coelho, one of my favorite authors, is not exactly conventional. For years, Coelho has been distributing digital versions of his books for free over the Internet, a strategy he believes has definitely boosted his offline book sales. Sound familiar? We have seen this story repeat itself in other industries as well, for example:
- The auto industry was initially reluctant to offer pricing online. This gave way to Internet lead-generation companies like Cars.com that jumped to service this need by offering car shoppers online pricing. In turn, they captured car-buying prospects and sold them back to OEM’s and dealerships in the form of leads for windfall profits.
- The music industry has lost millions in revenue to peer-to-peer file sharing companies like Naptster. They are finally developing advertising models around free music content to supplant lost revenue streams.
- 9/11 hammered travel revenue and paved the way for online travel agencies (OTA’s) to offer deep discounting and online booking to stimulate demand. As a result, they converted a foothold in the industry into a stronghold. Because travel suppliers were resistant to change, consumers frequently circumvent travel suppliers and book the majority of their arrangements through OTA’s.
The Internet sorts the winners from the losers. Reactionary companies that have not adapted their models or adequately invested in online channels have been forced to downsize or disappear. Conversely, those that have embraced the new realities have solidified their positions of dominance and profited from the medium’s proliferation.
Case in point: The Conrad Group, one of Roar Media’s clients and an emerging market consultancy. TCG has solidified its position as experts by leveraging the Internet. Instead of hoarding their expertise and insight on global business trends and market conditions, they share it openly through their blog and downloadable whitepapers. These tools substantiate their predictions by date-stamping and recording their claims before trends become reality. By sharing its collective knowledge, TCG allows prospects to preview the value and services it provides, and these curious prospects regularly convert into long-term clients. Owner William Nobrega recognizes that the Internet is the great equalizer and enables his company to compete against conventional industry stalwarts and flourish in the new media economy.
While many blame the Internet for disintermediating their marketplace, the true disintermediaries are the consumers who leverage the utility inherent in the World Wide Web. Self-expression, self-awareness and self-realization are the true drivers of the new millennium of customer acquisition and retention.
As marketers, company owners and executives, we can longer afford to force customers into the channels of our choice; rather, we must provide them with the medium in which they want to interact with our brand. We must empower consumers to discover, engage, purchase and use our products. The business community must infuse the Internet into its company’s DNA, not just as another ancillary touch point, but rather as an integral part of our overall go-to-market strategy. We must think holistically and ensure that our brand’s equity is equally represented online as it is offline. After all, what happens in the digital world does not stay in the digital world.
Coelho says it best: “the Web … is imposing a new way of sharing ideas and defying old economic models.” His business acumen is just as eloquent as his expression of humanity.