New bCentral Services Help Smaller Companies Thrive In the New Economy

REDMOND, Wash., Oct. 31, 2000 — One year after its launch, the Microsoft bCentral small-business portal took its first steps toward a new vision: delivering .NET services that help make core business processes easier for small businesses — any time, any place and on any device. Today, bCentral announced several new subscription-based services that will enable small businesses to more effectively sell products on the Web, communicate and market, and manage their customers and business operations.

In a conversation with PressPass, Kathleen Hebert, vice president of Microsoft’s Small Business Division, discusses Microsoft’s vision for bCentral and how the power of the next generation of software delivered as a service will transform the way small businesses work.

PressPass: At Forum 2000 in June, Microsoft announced that it would significantly expand bCentral. What is Microsoft’s overall vision for the growing small-business market?

Hebert: bCentral is only one part of Microsoft’s vision for the small-business market. Overall, our company builds software that helps small businesses connect, communicate and manage their everyday business tasks — and we want to continue to make that easier with the next versions of software like Microsoft Office, Publisher and Small Business Server. However, with the evolution of the Internet and initiatives like .NET and UDDI, we have a truly unique incremental opportunity — to bring the power of Internet technologies to small businesses and vastly simplify processes that today are incredibly complex and manual. This latter opportunity is what bCentral is all about — delivering software as a service that
“rewires”
the processes small businesses have today, enabling them to more actively participate in the new economy.

PressPass: What new services did bCentral announce today, and how will small businesses benefit from them? How do the new services fit in with Microsoft .NET?

Hebert: bCentral was launched in September 1999 to help small businesses take advantage of the opportunities offered by the Internet. bCentral features include email, a banner exchange network, tools that help businesses get listed on search engines, and a service that helps companies manage lists and keep in touch with customers.

Small-business owners will benefit from our newest services by virtue of the ease with which they’ll be able to do things that have been difficult to do before. bCentral’s Business Web Services, which we launched in September, helps business owners quickly and easily create a complete business Web presence by giving them easy-to-use tools to build a professional-looking Internet site with additional features to conduct online sales. Business Web Services also provides business email and calendar functions that small-business owners can access from the road or from a home computer.

Today, we’re announcing three new subscription-based services that will help small-business owners sell online.

bCentral’s Commerce Manager, which will be available in early November, will help small business owners manage every aspect of their e-commerce activity. Once a business starts taking orders online, those orders have to integrate with accounting, bookkeeping and customer data.

Available in early 2001, Finance Manager will enable small businesses to manage their finances and accounting efficiently and effectively, and, more importantly, integrate them into business processes such as online commerce and customer management. The integration of customer data with financial data is critical so that business owners don’t have to deal with multiple data sets of information.

Finally, bCentral’s Customer Manager, which will be available later this fall, will enable small-business owners to keep track of customers, manage customers and understand who their best customers are — critical factors, especially in a world where customers are making purchases around the clock. Consumers’ expectations are changing, and small businesses need to be able to respond to those changing expectations.

To take advantage of the new features, small businesses simply need a PC with Internet access and a browser, and a subscription to bCentral services. That’s one of the beauties of software as a service, and that’s how bCentral fits into the .NET platform. bCentral will build on top of the .NET platform, leveraging its foundation services, and thus deliver a .NET user experience that is developed expressly for the unique characteristics of the small-business market.

PressPass: Most small businesses now have Internet access, but relatively few are using the Internet to its full potential. How do you see bCentral changing that?

Hebert: To date, the Internet has been relevant to a fairly limited subset of small businesses. Also, bandwidth constraints have made the adoption of certain kinds of solutions difficult or unrealistic for small businesses. The increasing penetration of broadband solutions should make accessibility much more realistic.

bCentral will help businesses use the Internet through the services that we offer to address their unique business processes. We did years of research on the small business market from a segmentation perspective, and then we assessed what would impact small businesses based on that segmentation. For example, retail shop owners will find traditional Web-based e-commerce interesting because they have products to sell. They’re excited by the prospect of expanding their customer base this way. However, retail is only 25 percent of the small-business market. It’s very hard for people in professional services — such as architects or physicians, who sell their services for a living — to get excited about this kind of e-commerce. bCentral addresses the unique segments of the small-business market — professional services, production operations, and retail — by determining how our services can address their businesses.

PressPass: What is the role of bCentral in Microsoft’s E-Business Acceleration initiative, and how will small businesses benefit?

Hebert: E-Business Acceleration allows suppliers of all sizes to extend their sales over the Internet. One way it does so is by enabling these businesses to more easily and inexpensively get their online catalogues onto the growing number of online marketplaces. bCentral Commerce Manager provides a monthly subscription service that allows small businesses to get product catalogs online within 24 hours after signing up for service. Another key benefit for small businesses is that they don’t have to purchase any of the additional hardware or software usually required to load catalogs onto marketplaces.

PressPass: Can you describe bCentral’s ideal customer?

Hebert: Our target market is companies with 20 or fewer employees, primarily in the retail and services sectors. One of the great promises of Internet-based services is that they enable very small businesses that have struggled with technology issues to integrate technology into their businesses.

This underserved segment of the small-business market needs the kind of services we offer that allow them to address business processes through technology without requiring incredible complexity at the site of the business.

It’s a very broad, very diverse market. Around here we often say,
“There’s no such thing as a typical small business.”
It’s not a homogenous group. Many individuals go into business to pursue something that they’re passionate about or that they’re good at; some go into business because they like the freedom of being their own boss. Generally, small-business owners don’t go into business to deal with books or other business processes or to manage customer data — and that’s where we think we can help.

PressPass: In addition to your own services, there are also third-party resources on bCentral. What role do partners play in enhancing bCentral or in providing services?

Hebert: You can think about partners in three ways. The first is through the role that partners play in distributing bCentral services to small businesses. We work with a lot of companies that see value in the services that bCentral provides and would like to integrate those services into their own portals or their own customer-service relationships. We work with a variety of partners and companies that actually make our products and services available through their own Web sites as a complement to what they sell or the services they provide.

The second way that partners factor into bCentral is customization. We’re very focused on building bCentral as a platform that can be customized by partners. This is the traditional Microsoft business model, where we build a platform to which others can add unique value.

We also work with partners by adding their services or products to our own. There are some services that we don’t provide, but that might make bCentral a more compelling destination, especially if they integrate with the services that we offer. For example, through our agreement with Office Depot, bCentral customers now have online access to all Office Depot products and services. Additionally, Automatic Data Processing Inc.’s Emerging Business Services division provides bCentral customers with access to its industry-leading payroll and tax-filing solutions for small businesses. Being able to bring in third-party services, even if we do not build them, is a great opportunity to extend or add value to the bCentral destination.

PressPass: As small-business owners make the switch to automating their businesses with Web-based services, when can they expect to see bottom-line results?

Hebert : The great thing about software as a service is that deployment is immediate –you can be up and running literally in minutes with some of our services, so customers can start realizing benefits right away. With bCentral services, small-business owners can streamline the way they work, and that will have a number of different paybacks — from increasing sales opportunities through better customer management or broader product distribution to lowering costs through improved efficiency.

PressPass: With more than 1 million registered users, bCentral is already the leading small-business service of its kind. How did that evolve? What is Microsoft doing to reach out to expand its small-business clientele?

Hebert: bCentral started with a variety of services that were part of the acquisition of a company called Link Exchange. Link Exchange had some very compelling services that are now integrated into and part of the bCentral offerings. Many people continue to see huge value in services that came out of the original version of bCentral and that continues to grow as we launch new services like Business Web Services.

bCentral is linked to MSN, so many of the businesses that go to MSN for news or information find us through that network. Some people find us through Microsoft.com, where they go to find out how Microsoft helps small businesses. And we’re also doing a lot of marketing directly on the radio, in magazines, and with direct mail.

Our bCentral research team is dedicated to understanding what small businesses need. We’re expanding our customer base by investing in those services our customers find most compelling.

PressPass: Based on today’s announcement, bCentral seems to have evolved considerably from a traditional portal to delivering critical business services. Where do you see bCentral in three years?

Hebert: We see bCentral as the business that cracks the code on technology for small business. We also think of ourselves like a dot-com start-up, and we want to continue to bring that kind of energy and pace to our business.

Some of our key milestones in three years will be a very rich set of services across all of the key segments of the small-business market, and a very rich and robust set of partners on all levels.

We also foresee our customers using bCentral’s services across multiple devices. Not every small-business owner is married to a PC. The contractor who remodels houses lives and dies by his cell phone. We want that person to be able to take advantage of bCentral’s services through the device that works best for him.

It’s exciting to think about a world where technology truly becomes accessible to small businesses. For years, we’ve been talking about how the Internet levels the playing field for small businesses, and that’s never been truer than with the services we are offering today on bCentral.

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