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Internet ROI: The next big stumbling block?
Return on Investment
Decision-makers, strategists and business leaders are continuing to question the worthiness of the Internet according to the Yankee Group.
The recent economic turmoil, combined with the recent dotcom collapse has compounded fears and led business managers across the globe to seriously question the level of investment required for a successful Internet operation - particularly when they haven't yet figured out to measure returns.
The latest report from the Yankee Group, entitled 'Doing Business on the Internet: Where are we today?' suggests that the business leaders of many corporations are still struggling to understand the worthiness of the Internet. Many in fact simply cannot see how the Internet fits into the company's overall strategic plans.
Worse still, web strategists, those leading the charge of the Internet in companies, feel that the situation has deteriorated considerably since last year. Yankee Group now estimates that twice as many business managers are failing to see the importance of the web.
The problem, as you can well imagine, is that the Internet is increasingly seen as a black hole for finance. Having almost inevitably lost money on Internet stocks and most definitely seen the turmoil of the dot com collapse - and the continuing struggle for success - business managers nowadays want to see hard and fast benefits - not just a gaping, non-refundable, money pit.
This does of course make perfect sense. Whilst we are probably all guilty of thinking that the Internet was going to provide a gold mine rich in customers and partners, few of us have actually seen those benefits materialise.
We all poured money into the schemes in the blind belief that, eventually, we would all retire quite happily to a beach of sun-tanned beauties and bottles of Bolli. But very, very few have actually seen those benefits take the company to the next level, which is pretty much what everyone had predicted.
Now of course, with all of that carved into our rapidly rewritten history books, business managers want to see real returns. They want hard and fast metrics, clear and concise ROI figures and, perhaps most importantly, definite profits and benefits being generated by online operations. And all of that seems perfectly reasonable.
A Government-sponsored study launched yesterday showed that overall, companies can expect to see online sales counting for as little as two per cent of total sales. So any company that embarks down this road without such metrics shouldn't be in operation.