Objectives Be able to identify the major forces shaping the digital age. Understand how companies have responded to the Internet with e-business strategies.
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Presentation on theme: "Objectives Be able to identify the major forces shaping the digital age. Understand how companies have responded to the Internet with e-business strategies."— Presentation transcript:
1 ObjectivesBe able to identify the major forces shaping the digital age.Understand how companies have responded to the Internet with e-business strategies.Be able to describe the four major e-commerce domains.
2 ObjectivesUnderstand how companies use e-commerce to profitably deliver greater value to customers.Realize the promise and challenges that e-commerce presents for the future.
3 Charles Schwab c Invented discount brokerage category First U.S. major player to go onlineInitially offered two-tiered trading system to protect profits / stop cannibalizationLater became first true click-and-mortar full-service brokerageNow world’s largest e-commerce site85% online trades; 21% of trade volume; Strong stock return
4 Forces Shaping the Internet Age Figure 3-1:Forces Shaping the Internet Age
5 Major Forces Shaping the Digital Age Digitalization & ConnectivityThe flow of digital information requires connectivityIntranets, Extranets and the Internet
6 Major Forces Shaping the Digital Age The Internet ExplosionKey driver of the New Economy
7 Major Forces Shaping the Digital Age New Types of IntermediariesBrick-and-mortar firms often face disintermediation from click-only competitorsThe click-and-mortar business model has been highly successful
8 Major Forces Shaping the Digital Age Customization and CustomerizationInformation businesses are at the heart of the New EconomyHas enhanced marketer’s ability to customize and “customerize” product offerings
9 Major Forces Shaping the Digital Age Customerization: Reflect.com allows clients to create their own beauty products.What other businesses could implement customization to better serve their customers?
10 Marketing Strategy in the Digital Age E-business:uses electronic means and platforms to conduct business.
11 Marketing Strategy in the Digital Age E-commerce:facilitates the sale of products and services by electronic means.
12 Marketing Strategy in the Digital Age E-marketing:Includes efforts that inform, communicate, promote, and sell products and services over the Internet.
13 Marketing Strategy in the Digital Age Buyer Benefits of E-Commerce:ConvenienceEasy and privateGreater product access/selectionAccess to comparative informationInteractive and immediate
14 Marketing Strategy in the Digital Age Seller Benefits of E-Commerce:Relationship buildingReduced costsIncreased speed and efficiencyFlexibilityGlobal access
16 E-Commerce Domains Major Domains B2C B2B C2C C2B Online consumers Now more mainstream and diverseOffers new targeting opportunitiesOnline behavior differs by ageOnline consumers differ from traditional off-line consumersThey initiate and control the exchange processValue information highlyMajor DomainsB2CB2BC2CC2B
17 E-Commerce Domains Major Domains B2C B2B C2C C2B B2B sales far exceed B2C salesB2B sales are estimated to reach $4.3 trillion in 2005Open trading networksE-marketspace bringing sellers and buyers togetherPrivate trading networksLinks sellers with their own trading partnersB2CB2BC2CC2B
18 E-Commerce Domains Major Domains B2C B2B C2C C2B C2C web sites help consumers exchange goods or informationeBay is one exampleAuction sites facilitate the exchange processAllow access to a much larger audienceNewsgroups / forumsHelp consumers to find and share informationMajor DomainsB2CB2BC2CC2B
19 E-Commerce Domains Major Domains B2C B2B C2C C2B Allow consumers to search out sellers, learn about offers, initiate purchase, or dictate purchase termsEx: Priceline.comSome sites facilitate the feedback process between customers and companiesEx: Planetfeed.comMajor DomainsB2CB2BC2CC2B
21 Conducting E-Commerce Click-Only CompetitorsE-tailersSearch engines and portalsISPsTransaction sitesEnabler sites
22 Conducting E-Commerce Dot.coms failed for many reasonsLack of planning and researchOveremphasis on acquisitionPoor web site design and distribution problemsLow margins
23 Conducting E-Commerce Click-and-Mortar CompaniesChannel conflict was initially a concernE-commerce often created new buyers, rather than cannibalizing existing ones
24 Conducting E-Commerce Click-and-Mortar CompaniesMany firms now enjoy greater success than their click-only competitionTrusted brand names, greater financial resources, larger customer base, industry knowledge and strong supplier relationships were key advantages
25 Setting Up For E-Marketing Figure 3-4:Setting Up For E-Marketing
26 Conducting E-Commerce E-MarketingCorporate web sitesBuild goodwill and relationships; generate excitementMarketing web sitesEngage consumers and attempt to influence purchaseWeb site design7 Cs of effective web site designCreating web sitesPlacing online ads and promotionsCreating or using web communitiesUsing and webcasting
27 Conducting E-Commerce Evaluate the iVillage website with respect to the 7 C’s:ContextContentCommunityCommunicationConnectionCommerceCustomizationClicking the WWW icon will open your web browser and link to the web site pictured in the screen shot.
28 Conducting E-Commerce E-MarketingOnline forms of ads and promotionsBanner ads/tickersSkyscrapersInterstitialsBrowser adsContent sponsorshipsMicrositesViral marketingFuture of online adsCreating web sitesPlacing online ads and promotionsCreating or using web communitiesUsing and webcasting
29 Findwhat.com Video Clip BusinessNowFindwhat.com Video ClipFindwhat.com is a search engine company. Paid search is a key revenue tool.Click the picture above to play video
30 Viral Marketing . . . Creating a Marketing Event BMWFilms.ComViral Marketing Creating a Marketing EventThe Problem:BMW’s market research revealed that the brand was not appealing to younger luxury car buyers. Also, competition was increasing.References:Visit to download a currently playing mini-film. NOTE: Most films are approximately 100 megabytes in size.The BMW mini-film campaign has been discussed in several trade articles:BMW films put 'e' in entertainment; Peter Gwin; Europe, Washington; Jul/Aug 2001, Iss. 408; pg. 5, 1 pgsBMWfilms.com; Jeff Howe; Brandweek, New York; Nov 12, 2001; Vol. 42, Iss. 42; pg. IQ5, 1 pgsBMWfilms.com; Jeff Howe; Mediaweek, New York; Nov 12, 2001; Vol. 11, Iss. 42; pg. IQ5, 1 pgsBMWfilms.com; Jeff Howe; Adweek, New York; Nov 12, 2001; Vol. 42, Iss. 46; Eastern edition; pg. IQ5, 1 pgsSuper Reggie Winner: Crouching brand, hidden bimmer; Karl Greenberg; Brandweek, New York; Mar 18, 2002; Vol. 43, Iss. 11; pg. R4, 4 pgsThrill ride; Barbara Lippert; Adweek, New York; Oct 28, 2002; Vol. 43, Iss. 43; Eastern edition; pg. 22, 1 pgs
31 BMWfilms.com The Solution Objectives:Make BMW cool and relevant to year-old buyers new to the luxury-car market without alienating existing customersCapture qualified buyers and ultimately increase salesTarget Market:Doesn’t watch a lot of TV; tends to resent marketingThinks of technology as their friend85% of this group use the Web to research cars before visiting dealerships
32 BMWfilms.com The Solution BMWfilms.com Instead of using traditional TV advertising, BMW launched five short Internet films in April 2001, featuring edgy stars, action-oriented plots, and famous directors.Web Promotion: Three months prior to the premiere, Internet-movie rumor sites, chat rooms, and fan sites were seeded with information. These efforts formed the core of viral marketing campaign.
33 BMWfilms.com The Solution Off-line PR Strategy:PR firm pitched the films as reviewable movies to Time, Entertainment Weekly, NY Times, and generated reviews in the film section.Off-line Ad Strategy:BMW ran 15-second teasers resembling movie trailers on A&E, Bravo, & Independent Film Channel with tag, “Now playing at BMWfilms.com”
34 BMWfilms.com The Results 85% perception increase among film viewers vs. nonviewersPlanned dealer visits for target market film viewers rose 550%12.5% sales increase in 2001 despite no major product launches; 3-series increase of 37% in 4 months that films ran.As of March 2002, over 11 million people had logged onto the BMWfilms web site.Traditional buyers (median age 32, HH income $88,000) were majority of those requesting more information.
35 Discussion Question Visit the Babycenter.com web site What forms of online ads and promotion does this site feature?Were you surprised by any of the ads featured on this site? Why?
36 Conducting E-Commerce E-MarketingWeb communities allow members with special interests to exchange viewsSocial communitiesWork-related communitiesMarketers find well-defined demographics and shared interests useful when marketingCreating web sitesPlacing online ads and promotionsCreating or using web communitiesUsing and webcasting
37 Conducting E-Commerce E-MarketingmarketingKey tool for B2B and B2C marketingClutter is a problemEnriched forms of attempt to break through clutterWebcastingAuto downloading of customized content to recipients’ PCsCreating web sitesPlacing online ads and promotionsCreating or using web communitiesUsing and webcasting
38 Is this the Future of E-mail? is the golden child of web marketing due to its:low cost per contactquick response timeresponse tracking abilityresponse ratesEnriched executions (see ad at left) are on the rise.What are the drawbacks of using the enriched format for your marketing messages?
39 Promise and Challenges of E-Commerce The PromiseThe future of B2B E-commerce is bright
40 Promise and Challenges of E-Commerce The PromiseA few click-only companies may succeedMost companies will integrate online marketing into the overall marketing mix, rather than treat it as a separate component.
41 Promise and Challenges of E-Commerce Challenges: The Web’s Darker SideFew B2C companies are profitable:Limited exposure, and skewed demographicsNavigating the web is often problematic
42 Promise and Challenges of E-Commerce Challenges: The Web’s Darker SideOnline privacy and security concernsInternet fraudThe digital divideAccess by vulnerable or unauthorized groups