Let's assume you're more likely to have a website than not. We can say that because BT Openworld's latest Pathfinder research says 59% of its small to medium sized business customers have their own website, as opposed to 51% last year. So it's still marginal, but less marginal than it was in 2001 - you're slightly more likely to have one than not. Business Link for London says 51% of small businesses have websites.

The more interesting question is what you're doing with it. Large numbers of websites are still largely at the "brochureware" level - in other words they look like an online version of a paper brochure with no chance to order products online or to engage with the company very much.

The same BT figures suggest that customers with non-trading websites rose from 21% to 33%, while customers with trading websites went from 11% to 20%. Business Link for London puts the number of businesses with sites from which you can actually order something at 31%.

Do bear in mind the Business Link figures are exclusively London-based, while BT found an unusually high preponderance of web activity in Wales and the west. And, in spite of the variance within the figures, they do suggest that most people who opt to use technology in their business are using it for publicity and little else.

In fact there's plenty of room for doing something more sophisticated without necessarily spending a fortune. And it needn't all be web-based - have you thought, for example, about using text messaging to keep in touch with your customers?

By far the most important thing to ask before embarking on any electronic campaign (or, as is more likely, an ordinary campaign with electronic elements) is how sophisticated you actually want to be. WebtraffIQ is a business that analyses clicks onto websites and customer behaviours associated with them. European director Marcos Richardson is cautious. "Basic is not necessarily bad," he says. "The website needs to put across the key benefits of business and site navigation needs to be simple and interlinked. It needs to effectively and efÞciently produce the results that are sought from the business."

But the central message Richardson is keen to promote is that sophistication doesn't necessarily mean technical complexity, and that whatever you plan to do with a website needs to be done as part of a coherent business strategy. There are in fact still a lot of organisations that have a website purely because they think they ought to. David Harrison, managing director of search engine marketing campaign company WSPS, says: "Too frequently people have a website built but don't integrate it with the rest of the business. By making links between your website, marketing and customer relations activities, you can start to judge your return on investment."

He offers a number of means of measuring the success of a web campaign.

Publicising an email address on your hard copy materials that is different from the one on your website, for example, will enable you to find out exactly who's coming to you from each avenue at a glance. "I've often found that a contact form page or pop-up rather than a simple email hyperlink can encourage people to email immediately; potential clients can fill in a request without having to open their email programs."

Well, maybe, but they can also have pop-up killers installed on their systems which frankly won't help. If your web designer is up to it, though, there are other ways around getting in touch. The "call me now" button, in which a viewer clicks on a link and fills in a number which then comes to your company is useful as long as there's a real person on the end of it at all times to answer. "You could rent a new telephone line that is only advertised on the site," says Harrison. "That way whenever it rings you'll know where the lead has come from." Web-only offers are another way of tracking when people have seen your site - if they haven't logged on they don't know about it, so if they ask for the right discount you can track them easily.

E-commerce is a complex area. But, in brief, if you wish to sell products over the internet the standard advice is that the technology is easier than the logistics. E-shopping products like Actinic Catalog, Shopcreator or Erol will allow you if you have the right skills or a web developer to put a shop together online that looks and feels exactly like the rest of your site, and the starting price is around £350 for a 10-product e-catalogue from Erol. The tricky bit is in keeping the customers satisfied. They won't want to wait around for product and are accustomed to books arriving from Amazon within a day or two; they'll expect the same for you or a good explanation as to why not.

Customer relations can often be enhanced electronically and not just through email follow-ups to purchases. A sales process that's integrated with your website can allow customers to log on and look at the progress of their purchase: link into your courier's website and they'll be able to track product when it's left your premises as well (see Creative Labs' online shop and its links with Parcelforce, for example - enter your package number on the Creative site and the Parcelforce site pops up and tells you where it is in the delivery process). Something that is often overlooked is the idea of using text to keep in touch. A product that has just launched in the UK is Q200 from Quios, which should bring this within the reach of small enterprises. Chief executive Marc Vanlerberghe explains that it's not a spamming tool but a way of saving money: "Clubs, for example, can use it to tell local people there's a promotion on that evening - you get a text message saying there's 10% off beer during whichever is your slack time and you go along." Once again he stresses this needs to be done with the full knowledge of the participants, although he stresses that this sort of marketing is unlikely to attract the spammers. "It's best for local customers - someone texting about a club, for example, is going to be looking for local people."

The concern about spamming via text is a valid one, but to a lesser extent in this country. Massoud Marzban, EMEA marketing director for messaging specialist TeleCommunication Systems (TCS), explains that in the UK and the rest of Europe the mobile phone companies operate closed systems. They have cross-billing agreements and other commercial arrangements that would make it all but impossible for someone to send out mass texts without costing themselves a fortune. In the US it's not so regulated and the spamming problem is starting to grow.

On October 31, much of this will become academic at least as far as Europe is concerned when the Communications Directive comes into effect. This will legislate for marketing electronically only through lists into which customers have opted. "The problem will be how you define a soft opt-in," says Marzban. For example if a company you've never heard of offers you Viagra then of course that's junk mail. If on the other hand a company from whom you've bought items previously offers you something they could argue it as customer care. Another interesting wrinkle for text marketers will be the element of the new law that says you must explain how people can get off a list; it's fine if you're using email, you have the space. Too many words on how to get off a text message list and you've used up all the available characters.

Presumably someone will work out a way around that - it's only giving customers what they want anyway. In the meantime people with static sites should be aware that for a minimum cost they can start doing a lot more with them.

Keswick Flooring

Some goods, such as books and CDs, are obvious candidates for internet selling. But one firm has made a highly profitable business out of selling something much less likely online - floors.

Adrian Lee, managing director of Keswick Flooring, had been running a profitable two-man business in Norfolk for 14 years, selling and installing wooden floors, when he decided to set up a website in 1999. The first site just had information about the company and a few prices; a few months later, the company started to sell their products online, and by 2000 was offering home deliveries. "It started taking off immediately," says Lee. In the four years since creating the site, the company's turnover has increased from £250,000 to £4m a year, with roughly 98% of that business coming as a result off the website.

Knowing that no one outside Norfolk would have heard of Keswick Flooring, Lee registered www.flooring supplies.co.uk and www.woodenflooring.co.uk. "Because we were in quite early, when people did searches for wooden flooring, we started getting to the top of the searches on Google." That, plus word of mouth reputation, means that Lee no longer bothers with conventional advertising, and isn't even in the Yellow Pages.

The site itself benefits from being "clear and uncluttered" and "incredibly customer-focused," says Annalize Cuthill, managing consultant at web marketing firm Skill4. "I can see what it looks like once I've put this floor down. I can imagine what the end result would look like - a difficult thing to achieve on the web."

These days only about 5% of the company's customers are based in Norfolk. Keswick Flooring promises free next day delivery to anywhere in the country, and has just started taking orders from Holland, France and Germany. Only about 15% to 20% of orders come over the website, however, because people prefer to look at the products on the site, then phone the company to discuss their choice.

Coping with rapid growth hasn't always been easy. Lee now employs 10 other people, including two full-time IT staff. The hardest part of the expansion, he says, is fulfilment. He has had to build up a network of installers throughout the country, and went through 10 courier firms before finding one he was happy with. "Many people come into this and think there's money to be made, but then to sit down and try to deliver a ton of flooring from Norwich to Cornwall tomorrow, and get that organised so it's all picked up and packed properly and the customer knows what time it's going to be there - you only get round that with years of doing it."

The Gentleman's Shop

In 1997, Robert and Charlotte Johnston began selling a few shaving brushes and toiletries in a little room adjoining their barber's shop in Hungerford, Berkshire. The products proved surprisingly popular, particularly among American visitors to the town. So, in 1999, the Johnstons bought their first computer and set up The Gentleman's Shop (www.gentlemans-shop.com).

They set up their own site using Actinic Catalog software at a cost of £350, and paid a further £500 annual fee to have the site hosted. Then the orders started to pour in - not, as they expected from people who had visited the shop, but from a completely new set of customers.

The Johnstons had identified and tapped a niche market. A shop selling luxury grooming products for men, costing £50 or £100, is not going to attract much trade on the high street. Put it on the internet, however, and you have access to a global market - more than half the site's income is from customers in the US.

Much of the company's trade comes from repeat business, says Robert Johnston, and perhaps this is the real key to the site's success. The Johnstons set huge store by customer service. They pack and send out deliveries as soon as the orders arrive. Emails are checked throughout the day - right up to 11pm.

In 2001, says Johnston, the website saved them during the foot and mouth crisis. when fewer people visited the town.

Earlier this year the Gentleman's Shop moved to bigger premises, which now bring in as much business as the website. "Suddenly we've got the shop that meets people's aspirations."

Langloffan cheese

Leon Downey had been making cheeses in Llangloffan, Pembrokeshire for 20 years when he set up his website, www.welsh-cheese.co.uk in 1997. By that time, he had built up a solid reputation as an independent producer offering high quality cheeses, so the website was a natural extension of his existing family-run business.

The initial outlay was small: the site cost £350 to set up, and at the beginning ISP charges were only £300 a year. Downey got in early - he was the first Welsh cheesemaker, he says, to have a website, and he was astute enough to register the domain name, reasoning that no-one would have heard of Llangloffan cheese. "If someone's looking for Welsh cheese, they're going to put 'Welsh cheese' in the search engine." The decision has paid off - the site now gets 29,000 hits a month.

Customers based in the UK can buy cheese directly from the website, but the site is also an important a way of letting people know about Llangloffan Cheese. Downey points out that despite the remoteness of the business's rural location, the internet has given it a much wider reach. "The whole world finds out where you are." What happens, he says, is that people visiting Pembrokeshire look around on the internet first to see what they can visit, and discover his website. "They come and see the cheese making, then they buy the cheese and some of them order for Christmas."

Despite the popularity of the cheeses, he has no plans to expand. Instead, he hopes to improve profitability by selling a higher proportion of cheese directly rather than through retailers. "We are artists and cheese makers. Quality has to come before quantity."

The do's and don'ts of electronic marketing

· Don't send out vast amounts of unsolicited commercial mail - this will become illegal in November as the new European directive comes into play

· Do tell your customers you'll be using their information for marketing purposes

· Do consider list swaps and sales but make absolutely certain your customers agree to this in advance - it's not law yet but it will be, so if you're doing it already you'll be covered

· And when someone asks you something by email, remember to reply - amazing amounts of sales are lost through e-marketers taking days to respond and seeing their customers go elsewhere as a result