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Web Design Business Plan

Ibrio Incorporated

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Market Analysis Summary

Ibrio Inc. will initially focus almost exclusively on small companies looking to develop an Internet presence for the first time. We will market our services to small business owners as a "step-by-step" process, initially starting out with a small, simple website, then gradually improving and adding to the site and their entire online marketing efforts.

Although we plan to bring on many clients who simply will need an online presence and nothing more, our most important and sought after clients will be those business owners who are ready to implement a larger percentage of their company onto the Internet. This type of client will traditionally need one of the following services:

• E-commerce/shopping cart.
• Database driven websites.
• Dynamic content and website features.
• Aggressive online website marketing.

4.1 Target Market Segment Strategy

Ibrio Inc. will focus the majority of sales and marketing efforts toward attracting small businesses. The reason for this decision is simply the low amount of services available for a market with such a high demand. In addition to the very promising supply and demand ratio, it is also technically easier and less expensive to market to and attract small website projects than larger projects.

4.1.1 Market Needs

The need for small business Internet services has existed for several years. Small businesses and start-up businesses alike are migrating onto the Web at an astonishing rate and making their online presence a higher priority than in earlier years. We have noticed an enormous hole however in the small business services that are currently available.

Without a doubt, there is a need for custom, high-end, dynamic services designed exclusively for small businesses. At this point, the majority of our competitors are offering services tailored around big business, to small business owners, or they are offering the exact opposite, one-dimensional, "cookie cutter" type services.

While every small business has now recognized the need for having a presence on the Internet, many do not know where to start, how much it will cost, or even how it will benefit their company. It has been our experience by talking to small business owners that the decision to take advantage of the Web is not a matter of 'if' but a matter of 'when.'

4.1.2 Market Trends

An important market trend right now is the one toward aggressive online and website marketing. Although many small businesses are still waiting to gain an Internet presence, those who already have are beginning to look for more options along the lines of improving their existing efforts. We believe that in the upcoming years, small companies especially, will start to look for more ways to increase the traffic to their websites.

Another important trend is the overall merging of daily business operations with the Internet and World Wide Web. Just as the majority of large companies have already started to use the Web to handle interoffice tasks, we believe that many smaller companies will begin to realize the time and money saving advantages to this strategy.

4.1.3 Market Growth

Our target market has been growing and expanding toward Internet and Web usage at an astonishing rate. In addition, Internet usage by our clients' customers has been growing exponentially. Below are supporting facts on our target market growth:

• By 2001, small businesses (1-99 employees) will spend in upwards of $22 billion to either gain an Internet presence or improve their existing efforts. This number is up from $12 billion in 2000 (Activemedia Research).
• Small and home-based business' Internet usage is at approx. 81%, this is an increase from only 26% usage in 1996. It is estimated to reach almost 95% by the year 2004 (IDC Research).
• Total U.S. business Information Technology (IT) expenditures for 2000 are $119.1 billion and will reach $285 billion by the year 2003. The year 2000 will also be the first year that U.S. businesses spend more of their total IT expenditures on Web-related services than on IT hardware (IDC Research).
• Currently, the total number of online users in the U.S. is 107 million, by 2004 that number will grow to 210 million (IDC Research).
• E-commerce revenue will reach nearly $6.8 trillion by the year 2004, up from $48.6 billion in 2000 (Forrester Research Group).

4.2 Service Business Analysis

Web services and development companies vary greatly in the type of service they offer and the type of client they attract. Ibrio Inc. will be relatively unique in the fact that we are marketing exclusively to small businesses.

This industry consists of many small Web development firms usually less than 10 years old that generally start out offering services to smaller companies but with long-term goals of catering to large, corporate Web accounts.

4.2.1 Main Competitors

1. Teeple Graphics: Located approximately 10 miles from our Palmyra offices, they offer Web development and graphic services.

   Strengths: Teeple has a very strong clientele, by talking to several of their Web development clients, we have come to the conclusion that Teeple offers a very dependable and high-quality service.

   Weaknesses: Teeple Graphics is owned and operated by George Teeple, he is also the only employee working for the company out of his home, and does not run his business as a full-time operation. In addition, Teeple Graphics requires all clients who operate an e-commerce website to pay his company a commission on the revenue generated by the site, this is paid on top of the development fee that Teeple charges.
   

2. Sharp Innovations: Located approximately 30 miles from our Palmyra offices, they offer Web development services to small businesses in the Lancaster, PA area.

   Strengths: Sharp Innovations has a large market share in its area, offering a very broad range of services from Web development, e-commerce, graphic design, and Internet access.

   Weaknesses: Sharp Innovations is a young company with very high overhead. They market themselves as "The Small Business Internet Marketing Professionals of Central PA," but the types of services they offer and their very high prices do not in anyway reflect the needs of small business owners. It is also our opinion, after reviewing Sharp Innovations' portfolio that they lack a certain level of technical and aesthetic design knowledge that so many small businesses are beginning to demand.
   

3. Say1.net: Located approximately 10 miles from our Palmyra, PA location. They offer a wide range of community and business-related Web services in the Lebanon, PA and surrounding areas.

   Strengths: Say1 has established a 'portal' type website designed to serve the Lebanon and surrounding areas with useful information regarding community events and business listings. This could serve as a valuable tool to their clients when marketing to that area.

   Weaknesses: For a company that claims to be experts in marketing for small business, they do virtually no advertising of their own and it appears that they lack in the ability to bring on clients that are outside the city of Lebanon. Even though Web development is a service that Say1 offers, it is only one in a long list of varied services and we believe this will dramatically hinder their focus toward leading the industry in our market.
   

4. WebWorks: Located approximately 25 miles from our Palmyra, PA offices. WebWorks offers Web development and marketing services to businesses in the Greater Harrisburg, PA area.

   Strengths: WebWorks has been in the Web services business for almost six years and has a very experienced team of developers and programmers. They also offer outstanding marketing services.

   Weaknesses: Although WebWorks is a direct competitor, they have begun to focus a large portion of their services toward attracting medium- to large-sized companies. Their pricing is dramatically higher than any competing firms in the Central PA area and they now have put into effect a policy of only excepting jobs of a certain size.
   

4.2.2 Business Participants

The Web services and development industry consists mainly of three different types of firms.

The first type are the very large, high revenue companies who service larger Fortune 1000 corporations and well-funded Internet based start-ups exclusively. In this category are only a few worldwide participants that dominate.

The second type of firm offers pre-fabricated, all-in-one, proprietary type Web services to any size company at a very low cost or without any cost. The participants in this category consist of a few dominating companies that mainly all have additional sources of revenue and only offer Web services as a value-added service or additional attraction.

The third type of firm is our classification, that is the smaller, usually very young companies that market to small- and medium-sized businesses in their local area. Currently there are a large number of participants in this category, but no dominating forces.

4.3 Market Segmentation

Our target market is separated into the four surrounding counties listed below:

Dauphin County: Located to the West, approximately five miles from our location. The number of businesses is estimated at 6,723. It will make up 23% of our four county target area.

Lancaster County: Located Southeast, approx. 20 miles from our location. We would like to begin marketing in this area within four months. The number of businesses is estimated at 11,299. It will make up 40% of our target area.

Lebanon County: Our office is located in Lebanon County. Lebanon is the smallest of the four counties and therefore we will market in proportion to its size. The number of businesses is estimated at 2,547. It will make up 9% of our target area.

York County: Located Southwest, approx. 40 miles from our location. York county is the last of the four counties we will market in. It will be late next year before we begin marketing in this county. The number of businesses is estimated at 8,238. It will make up 28% of our target area.

Our business allows us to offer services to small companies, no matter their geographical location, and we plan to do so, eventually expanding outside our immediate area. The above counties are where we will market most heavily and expect to receive the majority of our work. We do expect to receive a small portion from outside this target area due to ad placement in a national business directory.

The above demographic information can be found through the Geospatial & Statistical Data Center.