Company Web sites: Ineffective.com

By JOHN DELLA CONTRADA
Reporter Contributor

H. R. Rao, associate professor of management science and systems in the School of Management, says that the average company fails to follow basic marketing strategy when advertising products and services on its Web site. As a result, many companies could lose out on millions in sales as record numbers of consumers grow accustomed to Internet shopping.

"The creators of company Web pages do not seem aware of the different cues that impact consumers," says Rao. "They are too concerned with creating jazzy-looking sites and are not concerned enough with giving consumers the type of information they need to make a purchase decision. Consequently, many company Web sites are losing customers."

In analyzing the Web-site content of 125 "consumer-product" Fortune 1000 companies, Rao found that the majority did not contain appropriate informational "cues" commonly used by advertising and marketing professionals to influence consumer choice.

Those cues include information that addresses price or value, quality, performance, components or contents, availability, special offer, taste, package or shape, guarantee or warrantees, safety, nutrition, independent research, company-sponsored research and new ideas.

Eighty-five percent of the Web sites Rao studied did contain at least one of the cues, but a surprising low percentage of sites contained cues that have the most impact on consumer choice – price or value (52 percent), performance (49 percent) and quality (46 percent).

According to Rao, Web sites that do not contain at least half of the cues are turning away a highly motivated consumer who is searching for information to make a purchase decision. He contends that unlike TV or other advertising mediums, Web advertising is most effective when it provides straight-forward and well-organized information that encourages consumers to seek out more information about product attributes.

And with Internet sales expected to reach $500 million by the year 2000, companies with flash-over-substance Web sites are likely to lose a share of a burgeoning new marketplace.