Europe forges ahead
with Web innovations
August 14, 2000
BY MICHAEL KRAUSS
Everyone in Europe vacations in August, but business is booming
at Internet Train, a perhaps inappropriately named chain of Internet
cafés in Florence, Italy.
Just over
the Ponte Vecchio, the old bridge joining the Uffizi art gallery
with the Pallazo Pitti, there’s a small storefront with
20 personal computers. Inside, people from around the world peck
away at their e-mail, communicating with friends and acquaintances
from more than a hundred countries -- for just 6,000 lira (about
$3) per half-hour.
To avoid the
riff-raff as well as assassination, the 16th century Medici Grand
Dukes used to take the covered walkway on the Ponte Vecchio between
their Uffizi offices and their palatial estate at the Pallazo
Pitti. The Medici family revolutionized European commerce and
politics, and Florence historically has given the world Michaelangelo,
Galileo and Dante. But in the 21st century, power is shifting
online in Florence at places like Internet Train, which has 10
shops and more than 200 computers for the electronic faithful.
Thousands
of kilometers away in London, near Victoria Station, the scene
is much the same. Stelios Haij-Ioannou, a Greek shipping tycoon
and Internet entrepreneur, has created easyEverything, which he
claims are the world’s largest Internet cafés. Haij-Ioannou
boasts nineInternet cafés with 3,900 PCs ready and available.
"EasyEverything
(easyeverything.com) is wonderful," reports Reade Fahs, CEO
of London-based First Tuesday, a global Internet networking organization.
"You call it an Internet café, but it’s much
more. Most Internet cafés are about the coffee with computers
on the side. This is about 400 thin-screen computers in this very
cool environment with a little coffee on the side."
EasyEverything
opened in June 1999, with the idea that the business would be
about easy online shopping. It ended up being about people doing
their e-mail. EasyEverything now has stores in Paris; Münich,
Germany;Brussels, Belgium; Madrid and Barcelona, Spain; Amsterdam
and Antwerp, Netherlands; and Glasgow, Scotland, as well as London.
According to Haij-Ioannou, who delivered the opening keynote presentation
at The Industry Standard’s Global Internet Summit conference
in Barcelona in May, his easyEverything shops "attract over
150,000 visitors each week."
Of course,
the story in Europe goes far beyond e-mail and Internet cafés.
They’re just the tip of the innovation revolution sweeping
Europe from the North to the South. Consider easyGroup, which
owns easyEverything: easyGroup includes easyJet.com and easyRentacar.com
(all properties controlled byHaij-Ioannou). EasyJet.com bills
itself as the "the Web’s favourite airline" and
markets itself as a discount airline with steep incentives for
buyers to transact online. EasyRentacar.com is "the world’s
first Internet-only rent-a-car company," he adds. He also
plans to start easyMoney.com, offering discount mortgages online.
Haij-Ioannou
believes strongly in simple, easy-to-remember names. He says the
keys to Internet marketing success are to ensure an outstanding
consumer experience and, “when given the opportunity, (to)
fight with a big boy (such as British Airways). Go for it,”
he urges. He credits a portion of his success with easyJet.com
on his playing the underdogrole and, in a feisty move, adopting
a slogan that countered (and angered) British Airways, whose slogan
is “the world’s favourite airline.”
Other European
players to watch include London-based lastminute.com, offering
premium travel packages two-to-three weeks in advance, and Barcelona-based
eDreams.com, whose mission is “to build a community of people
who seek an extraordinary travel experience.” London-based
QXL.com is Europe’s leading online auction site and has
given eBay a run for its money. And EPO.com out of Stockholm is
stirring up a storm with electronic public offerings.
A discussion
of Europe wouldn’t be complete without a reference to wireless
phones and devices. The Industry Standard reported recently that
Amazon.com and Nokia signed a pact to provide mobile shopping
services in Germany, and users of wireless application protocol
(WAP) phones will be able to shop Amazon.com using their phones.
Europe definitely is leading the way with wireless Web connectivity
-- far ahead of North America in this area. The information access
available through wireless phones will be an enormous breakthrough.
Still, the
challenges of European Internet marketing are legion. Putting
a b-to-c or a b-to-b site up in Europe is much more difficult
than in the United States. Among the many complexities facing
pan-European Web sites are the following:
- Developing
a site for multiple languages;
- Developing
a site for multiple currencies;
- Providing
multilingual customer service;
- Shipping
across borders in Europe;
- Handling
the value-added tax (VAT);
- Coping
with strict government regulatory issues; and
- Recruiting
and retaining people in markets that prohibit or curtail stock
options and other economic incentives.
But if The Industry Standard’s Global Internet Summit is
any barometer, the interest in entrepreneurship is flourishing
in Europe. And why not? Despite the challenges, the opportunities
for e-business success in Europe are striking. According to Framingham,
Mass.-based International Data Corp., there are 388 million consumers
across Europe, compared with only 288 million in the United States.
It offers significant opportunities for marketers who understand
the environment and the culture.
Clearly, as
Haij-Ioannou learned in creating easyEverything, business model
design and flexibility in understanding customer needs can be
the key to success in this market as in others. He may have started
out with a business model to provide goods online,but he was savvy
enough to recognize the opportunity in online chat and coffee.
That’s a lesson for all marketers.
If the Medici
Grand Dukes were still around in Florence, I think they’d
admire the business sense of Haij-Ioannou and easyEverything.
One thing’s for sure: They wouldn’t need the covered
Ponte Vecchio bridge to get to the office; they could work online
from home at their Pallazo Pitti estate and rule Europe from there.
Maybe some
Internet Medici is working on that right now.
Michael Krauss is a partner with Diamond Technology Partners in
Chicago.
He can be reached at news@ama.org.
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