When worlds collide: ebusiness in a bricks and mortar world

Now that one or two high-profile dot-coms have gone under and the laggard 'old economy' companies are starting to get their online acts together, some wise heads have been nodding, and saying: "I told you so".

It's all about execution, they say. These dot-com start-ups may have the ideas and the flair, but you need experience to see you through.

To an extent, they're right. A good idea is useless if it's executed poorly (see boo.com for details).

But the young whippersnappers can still win the race - as long as their ideas are genuinely innovative and they have at least a passing knowledge of business.

Innovative is the key word: if you're trying to do something that the big old boys could do just as well, you're on a slippery slope. Because in the online world, just like the offline, brands rule OK.

Not so long ago, the venerable Institute of Directors launched an online portal for small businesses called iod.com.

According to Andrew Main Wilson, CEO of the B2B service, iod.com will be a "one-stop e-shop" for directors of SMEs, offering an online job market, news feeds, distance learning, business information and aggregate buying services.

Nothing revolutionary there, you might think. The IoD is not the first company to unveil such a service. And you'd be right.

But it is the only one with a well-established brand and easy access to an existing community of potential users. This gives it a huge advantage: as Main Wilson said of the challenge of launching a new Internet outfit: "This is not just a case of borrowing £5m a year from venture capitalists for a massive above-the-line advertising campaign and direct mail bombardment. You need a relationship with your brand - and with those businesses - such that they will listen to you in the first place."

Of course, he would say that: iod.com is a commercial outfit operating in a competitive environment. And it should also be said that the market is big enough to support more than one player.

But is he right? Are the days when a group of fresh-faced up-starts can take on the world and win over?

It's true that first-mover advantage is certainly no longer the be-all and end-all. However, start-ups can still succeed of course - they can execute business plans properly (despite what the nodding heads say), and they can establish a good brand without a real world presence.

But in essence, brand is key. As is a good idea. As is the execution.

In other words, the rules that have existed in the old economy for donkeys' years apply equally to the new.

Now there's a surprise. Perhaps it's time to stop making a distinction between the old and new economies.