Five companies whose businesses involve the selling of products as diverse as antibody re-agents, industrial microscopes, micro-array robots, dehumidifiers and wind-turbine equipment might appear at first sight to have little in common. Use of the Internet, however, has given them all a significant marketing edge that belies...
These so-called 'sliver' companies have a key characteristic, which is the narrow range of products they produce, but sell on a world scale. And that is where the Internet comes in - boosting their marketing reach. Although 'dotcoms' have been identified with creating business from the Internet, their demise has allowed bricks-and-mortar companies to hold sway. Now, these companies have taken the best of both worlds: the size of the dotcoms and the markets of the traditional companies.
Their success has not gone unnoticed by investors, either. Faced with dotcoms whose share prices have collapsed, soon to be followed by the collapse of the companies themselves as investment capital goes west, investors see major growth potential in these 'sliver' companies. They are also generating something else that dotcoms don't have: profits.
Exponents that have begun to make a name for themselves include UK companies Abcam and Biorobotics, which makes micro-array robots for scientists, Danish wind turbine specialist Vestas, industrial microscope company Leica, and Disetronic, which makes miniature insulin pumps for the treatment of diabetes.
According to Jim Norton, e-commerce guru at the Institute of Directors, and one of the key architects of the government's e-commerce strategy, one of a sliver's key concerns is to get themselves known, in a world where appearing at the top of search engines in a crowded world, is a challenge in itself.
"The challenge is to get access to distant markets. But if they are doing specialised work, how do people know they are there in what has become a very crowded Web?"
Norton believes that electronic marketplaces - last year's e-commerce buzzword, but recently derided amid claims that working exchanges are few and far between - could offer these sliver companies a route to market.
"Although there is going to be a shakeout in exchanges this year, they still offer a way for sliver companies to add value, bringing their products to a wider attention," said Norton.
Abcam, which is in the business of antibody reagents for scientific research, is a prime example of using your website to boost your business. Abcam claims to be the world's number one website for the finding, buying and selling of such reagents. It was founded in 1998 by Dr Jonathan Milner after he realised he was wasting many hours trying to find the antibodies he needed. The website was set up to provide researchers with all the information needed to get the antibodies they want.
Through Abcam's online catalogue, suppliers can each promote their antibodies on the system, which acts as a gateway to compare products. MyAbcam offers a personalised area, including access to the COR researcher network that is designed to connect all life-science researchers throughout the world. The website's popularity has demonstrated how such a 'sliver' company can use its site to best effect.
The company's results for the last quarter of 2000 showed that orders were up 154%, gross margins up 222%, and website visitors up 196%, on the same quarter of 1999.
Other companies have equally leveraged technology to get their name out in the marketplace. For example, the Swedish company Munsters, which makes dehumidifiers for electronics and food factories, gains less than 10% of its income from Sweden. The Internet does the rest. According to the company's CEO, the Net enables it to use the same resources to 100 people that it used to use to sell to five.
While the dotcom experiment of offering whizzy services based around a bizarre URL continues to sink into the mire, the irony is that it is companies selling little-known manufacturing products or providing an essential matching service in an unknown area, which have tapped into the Net to make their business work.
The abcam site upgrade