Article 32The Net is moving towardone-to-one marketing-andthat will change how allcompanies do businessNow it’sILLUSTRATIONS BY CHRISTOPH NIEMANNsoon after Jeri Capozzi loggedonto the online nursery GardenEscape Inc. last winter, she washooked. And it wasn’t just be-cause the World Wide Web site of-fered unusual plants, such as hyacinthbeans, firecracker, and dog’s toothviolet. It’s because Garden Escape cre-ated a personal store just for her.Greeted by name on her personal pagewhen she visits, Capozzi can takenotes on a private online notepad,tinker with garden plans using thesite’s interactive design program, andget answers from the Garden Doctor.So far, the 41-year-old insurance case-worker from Lit&field, Corm., hasspent $600 at Garden ,Escape and hasno plans to shop at any other nurserywith service that personal, she says,“I probably will never leave it.”dishing up a morass of informationthat you then have to sift through.But as consumers such as Capozziare discovering, the Net is finally be-ginning to cast off the mistakenidentity of its youth and deliver onits original promise-the ability totailor itself to every one of its 100million users.Personai service on the Internet?Isn’t that an oxymoron? For mostWeb surfers, the Net has been justanother aloof mass medium liketelevision, radio, and newspapers,Don’t think “mass.” Think “me.”Like no other mass medium or mar-ketplace, the Net offers merchantsthe ability to communicate instantlywith each one of their customers.The Net also lets those customerstalk back, so that they can demandunique products and customizedservices. Until now, few Web-site op-erators have taken full advantage ofthis intimate link, but that’s chang-ing. According to a survey of 25 toponline merchants by New York mar-ket researcher Jupiter Communica-tions, 40% say they have begun tooffer personalized features, with93% saying they will within a year.If personalization pops up allover the Net, it could usher in a newera in electronic commerce-onethat threatens to shake the founda-tions of conventional mass market-ing and mass production. Indeed,the real kick from the Net’s personaltouch will go far beyond marketingand sales. Ultimately, it could trans-form not just merchants’ contactwith customers but all their opera-tions, from how they research anddesign products to how they’remanufactured.CHANGING FOCUS. For most ofthis century, mass marketing andproduction have held sway, thank-sto both the exploding populationand the incredible production effi-ciencies of the Industrial Age. It justdidn’t make economic sense to pro-vide products and services custom-ized to each buyer. And without acost-effective way to track the pur-chases and preferences of individu-als, marketers had to resort to200Reprinted from the October 5, 1998, issue ofBusiness Week, pp. 164-166, 170-l 78,byspecial permission.01996 by TheMcGraw-HI11 Companies, Inc.P32. Now It’s Your Web”9 A,M, ,ln thP nffico_. - - . - -,you’re runninglow on floppy disks and printerpaper. Log into your personalaccount on the companyintranet with Office Depot(www.officedepot.com), clicka few boxes, and the stuff’s on.,.., -. ..,. r-o-,you print outmarket researchreports on rivalsyou had askeda software“agent” tosearch for.11 A,MAmerican Airlinese (www.aa.com) justsent an E-mail with a special fareon your usual business route nextw., I*‘.F”11s way.Eom~zeo comacr serwce axPlanetAft Iwww.planetall.com)says your dad’s birthday is nextweek. Log onto the comparisonshopping service MySimon(www.mysimon.com), whichsends out a personal “hot” toscour the Net for the lowest pricon the Sinatra boxed set.2 P*MAn E-mail from+ Amazon.com(www.amaton.comI tells yothe John Grisham book youasked to be alerted about i:out. You hit the hyperlink,land at Amazoncorn, andwith one more click, thebook is on its way to you.dog. Surf over Ralston-Puri-na’s breed finder wwwpurina.corn), fill out the question-naire on your lifestyle and_-.- IIIthe kinds of dogs you IIke,,and the site provloes aranked list. Yikes-a St.Bernard’s at the top.12 PmWhile you’re atI the deli, yourcell phone beeps. The digitalreadout says soine stocks youown hit predetermined sellprices. Tap in your sell orders,and they go out instantly overthe Net to your broker.2%bigger house lo IN.~.-+.?that St. Bernard.‘t~~?~> Log onto Coldwell:;q~-?:j~z Eanker’s Persona!&-Vi Retriever homebuy-your personal purr-L, Lfolio of homes matmeet your criteria.supplier drone onabout-wid--_L- - - IA- t rgers, you surr baroen tscape(www.garden.com), check outlandscaping plans you didonline for your garden, clickthe Plant Finder for what willgrow in that sunny border, andorder the suggestedmarionldc@'.++10 P.M. Timeto relax. At Imag-ine Radio(www. imagineradio.com), clickon “Harry’s JazzStation,” a Webaudio feed pro-grammed with your favorite artists, analet Miles Davis blow your tensions away..a t .,,L d,.,.,b V. . . . . a.-- .V --...-inexact measures, such as demo-graphics, to sell their wares.Now, the Net-and its ability toreach the masses individually yeteconomically-may mark a historicswing back to one-to-one marketing.That could change merchants’ focusfrom gathering a mass of customersfor their products to getting prod-ucts that fit individual customerdemands.“The technology hascaught up to the number of peoplein the world, and we‘ve come full-circle,”says Steve Kanzler, chiefexecutive of LikeMinds Inc., a per-sonalization technology companywith the slogan: “Every individualis a market.”Early signs show personalizationhas a huge payoff. Jupiter reportsthat customization at 25 consumerE-commerce sites boosted new cus-tomers by 47% in the first year-andrevenues by 52%. Even at a cost of$50,000 to $3 million for the person-alization software, along with com-puters to store the customer profiles,personalization generally pays for it-self within a year.Music retailer cnnow Inc. alreadyis signing its virtues. On Sept. 16, itlaunched My cnnow, which lets cus-tomers get a page designed just forthem with music suggestions basedon their stated preferences, past pur-chases, and ratings on artists andCDS. cnnow has seen an immediatebenefit in consumer interest: Thenumber of pages viewed on one ofits features, called Wish List”-which appears on the customizedpages and lets shoppers name CDSthey may buy later-jumped 200%almost immediately “It really is amusic store for each of our