Transcript Chapter 4
Part 1: Designing Customer Oriented Marketing Strategies
1. Marketing: Creating Satisfaction through Customer Relationships 2. Strategic Planning and the Marketing Process 3. The Marketing Environment, Ethics, and Social Responsibility 4. E-Commerce: Marketing in the Digital Age
Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Chapter 4
E-Commerce: Marketing in the Digital Age
Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Chapter Objectives
Define e-commerce and give examples of each function of the Internet.
Describe how marketers use the Internet to achieve their firms’ objectives.
Explain how online marketing benefits organizations, marketers, and consumers.
Identify the goods and services marketed most often on the Internet and the demographic characteristics of the typical online shopper.
Identify the primary online marketing channels.
Explain how marketers use interactive tools as part of their online marketing strategies.
Discuss how an effective Web site can enhance customer relationships.
Describe how to measure the effectiveness of online marketing efforts.
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What is E-Commerce?
Electronic commerce
(e-commerce): Targeting customers by collecting and analyzing business information, conducting customer transactions, and maintaining online relationships with customers by means of computer networks.
Electronic marketing
(e-marketing): Strategic process of creating, distributing, promoting, and pricing goods and services to a target market over the Internet or through digital tools.
Digital tools
: Fax machines, PDAs, smart phones, and DVDs.
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Capability Description Example
Global reach The ability to reach anyone connected to a PC anywhere in the world eBay —the online auction site —links buyers and sellers throughout the world One-to-one marketing Creating products to meet customer specifications, also called personalization Lands’ End offers online shoppers custom-made shirts, slacks, and jeans.
Interactive marketing Buyer –seller communications through such channels as the Internet and interactive kiosks Best Buy stores have a “Computer Creation Station” that lets customers design and order custom-made personal computers.
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Capability Description Example
Right-time marketing The ability to provide a product at the exact time needed UPS customers can place service orders online and track shipments 24/7.
Integrated marketing Coordination of all promotional activities to produce a unified, customer-focused promotional message Southwest Airlines use the slogans “A Symbol of Freedom” and You’re Now Free to Move around the Country” in both online and offline promotions.
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Interactivity and E-Commerce
Interactive Marketing
Buyer-seller communications in which the customer controls the amount and type of information received from a marketer through such channels as the Internet, and virtual reality kiosks.
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The Internet
Over 132 million active users in the USA
Intranets
Internal corporate network that allows employees within an organization to communicate with each other and gain access to organizational information
Extranets
Secure network accessible through a Website by external customers or organization for electronic commerce. It provides more customer-specific information than a public site.
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Four Web Functions
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Four Web Functions
Communication
E-mail; Instant messaging; Chat rooms and bulletin boards; Online communities
Information
Search engines; Online publications; Newsgroups; Internet forums; Electronic bulletin boards; Web communities Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Four Web Functions
Entertainment
Games; Radio and TV programming, including music; Streaming video of live news reports, sports, and musical performances; Electronic books
E-Commerce
Online auctions B2B: electronic exchanges; Extranets and private exchanges B2C: Electronic storefronts and cybermalls; Web kiosks, Online ticketing; Matchmaking Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Accessing the Internet
Internet Service Provider
(ISP): Organization that provides access to the Internet via a telephone, satellite TV service, or cable TV network.
Wi-Fi
Search engines
Portals
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E-Commerce and the Economy
Business-to-Business Online Marketing
Involves professional buyers and sellers Requires less glitz and glamour Much more money involved than business to-consumer online marketing
Electronic exchanges
Search marketing
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Benefits of Business-to-Business Online Marketing
Finding new markets and customers Cost savings in every area of the marketing mix Time reduced in reaching markets Easy commerce Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Online Consumer Marketing
Lower Prices
Bots
(short for robots): programs that check hundreds of sites, gather and assemble information, and bring it back to the sender
Convenience
Worldwide access, Day or night, Customized products and information
Personalization
Improves the quality of the shopping experience Improves customer satisfaction Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Benefits of Online Consumer Marketing
Relationship Building
Crucial to success Online’s personalization helps Easier for small businesses with small budgets Customer service is the key
Increased Efficiency
Greater profit margins Educating customers online frees salespeople from answering routine questions Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Cost Reductions
Reduced start-up costs Reduced operating costs Frees funds for new marketing efforts
A More Level Playing Field
Even small firms with small budgets can compete in the global marketplace Helps eliminate discrimination and allow minority businesses to succeed on their own merits AutoNetwork.com
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Online Marketing is International Marketing
Examples of Global Web Sites
Netsprint.pl
Polish version of infoseek
Us.starmedia.com
Spanish- and Portuguese-language Star Media Network H
omeuol.com.br
Universo Online, the largest Internet portal serving Brazil
Sify.com
Offering users of Indian ancestry “all the India you want to know.” Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Security and Privacy Issues
Critical factors in building a relationship online Electronic signature Credit card security Authenticity of item offered Payment guarantees Fraud protection
Truste
: Ensuring Internet Privacy Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Who Are the Online Buyer and Sellers?
Online buyers
Annual household income of $30K-$75K Demographic continue to change The next generation of online shoppers will be more representative of offline consumers
Online sellers
At first, offered familiar products like books and computer hardware Now offering a wider variety of goods including toys, groceries, consumer electronics and prescription drugs 4-20 Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Interactive Online Marketing
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Company Web Sites
Corporate Web sites and Marketing Web sites
Electronic Storefronts and Cybermalls
Advertising on Other Web sites
Banner ads; Pop-up ads; Search ads
Online Communities
Electronic bulletin boards
Other Interactive Marketing Links
Web kiosks Smart cards Virtual coupon and online sample Blogs Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Creating an Effective Web Presence
Managing a Web Site Building an Effective Web Site Measuring Effectiveness
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Building an Effective Web Site
Establish a Mission for the company’s site Identify the purpose of the site Satisfy customer needs and wants through a clear site design
Managing a Web Site
Update the site frequently Flag new merchandise and services Ensure that site appears to be current Update software as needed Track costs and revenues Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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Measuring Effectiveness of Online Marketing
An elusive task Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
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