Just being on the Internet is not enough. For small operations like AscotDirect, a partial solution is to situate the site within an online shopping mall, such as one run by Internet service provider, M-Web. For companies not in a Web mall, attracting clients, existing or potential, requires a significant marketing budget. Small companies that take to the Web more successfully are those with an existing trading record. The reason, says Hoadley, is branding.
People associate brands with trust.
They will not hesitate to buy from a Woolworths online because it is viewed as a trusted brand. Integrity and fulfilment are attributes that start-ups have to earn. The current battle between online florists Interflora and Netflorist is a case in point. But banks are cautious about authorising smaller companies as credit card merchants unless they provide huge sureties. Banks say they have to be cautious because of high levels of Internet fraud and customer charge-backs.