© 2009 South-Western, Cengage LearningMARKETING 1 Chapter 8 E-COMMERCE AND VIRTUAL MARKETING 8-1What Is E-Commerce? 8-2The Growing Importance of E-Commerce 8-3Virtual Marketing and Distribution 8-4The Role of Promotion for E-Commerce CHAPTER 8

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 2 Focus Questions: Do you agree that using the Internet is the same as socializing and shopping with your friends at the mall? What problems might a business encounter if it tries to use the Internet only to sell products without realizing the other ways people use the Internet? Courtesy, CISCO SYSTEMS, INC.

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 3 WHAT IS E-COMMERCE? GOALS Describe the three stages of development for e-commerce businesses. Discuss the importance of the marketing concept to successful e-commerce. 8-1

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 4 The Expanding World of E-Commerce Business on the net From bricks to clicks Stages of development Information stage Interaction stage Full integration stage

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 5 Success in E-commerce Advantages of e-commerce Disadvantages of e-commerce The marketing concept applied to e- commerce

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 6 GROWING IMPORTANCE OF E-COMMERCE GOALS Identify evidence of the growth of the Internet. Describe the various business uses of the Internet for e-commerce. 8-2

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 7 Growth of the Internet Countries with the highest number of Internet users in 2007 (in millions) Number Country of Users United States211 China137 Japan86 Germany51 India40 United Kingdom37 Number Country of Users South Korea34 Brazil32 France31 Italy31 Russia24 Canada22

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 8 Business Uses of the Internet Communicating Gathering information Improving operations

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 9 VIRTUAL MARKETING AND DISTRIBUTION GOALS Differentiate virtual marketing from traditional marketing. Describe distribution methods used in e-commerce. Identify distribution problems experienced by e-businesses and how they can be resolved. 8-3

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 10 Distribution for E-Commerce Finding and buying products Order processing Product distribution

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 11 Cost Savings ProductSavings Computer software99% Banking services89% Airline tickets87% Stocks78% Books56% Toys and gifts48% Average Cost Savings for Businesses when Customers Use the Internet to Make Purchases

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 12 Distribution Problems and Solutions Transaction security Expanded distribution and customer service

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 13 THE ROLE OF PROMOTION FOR E-COMMERCE GOALS Describe how companies use promotion on the Internet. Identify ways to increase the effectiveness of online promotion. 8-4

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 14 Communicating with Internet Users Advertising expenditures Promotion methods Online advertising Web sponsorship Priority placement Information websites Other types of promotion

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 15 Preparing for E-Commerce Marketing Planning the shopping experience Effective promotion methods

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 16 Customer Satisfaction with Types of Shopping Type% satisfied Shopping online73% Shopping in stores60% Shopping with catalogs56%

© 2009 South-Western, Cengage LearningMARKETING Chapter 8 17 Features Likely to Increase Online Purchasing Close-up images of products Information on product availability Product comparison guides An easy-to-use search function Toll-free customer service number Consumer reviews and product evaluations An easy-to-use “shopping cart” and check out feature