Chapter 5 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. E-BUSINESS: MANAGING THE CUSTOMER EXPERIENCE 1

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 1. Define Electronic Commerce (E-Commerce). Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience What is E-Commerce? ▮ Electronic 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

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience E-Business ▮ Wide range of business activities that take place via Internet applications ▮ It can be divided into five broad categories: E-tailing Business-to-business transactions Electronic data interchanges (EDI) 4

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience E-Business , instant messaging, blogs, podcasts, vlogs (video blogs), and other Web-enabled communication tools The gathering and use of demographic, product, and other information through Web contacts 5

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 2. Define Electronic Marketing (E-Marketing). Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience E-Marketing ▮ Strategic process of creating, distributing, promoting, and pricing goods and services to a target market over the Internet or through digital tools ▮ Application of electronic tools to contemporary marketing has the potential to: Greatly reduce costs Increase customer satisfaction 7

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience E-Marketing ▮ Online marketing - Activities that connect buyers and sellers electronically through interactive computer systems 8

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 3. What are the many opportunities for E- Commerce? Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Table Marketing Capabilities 10

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 4. Define Interactive Marketing. Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Interactive Marketing ▮ 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.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 5. Define Internet. Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Internet ▮ Worldwide network of interconnected computers that lets anyone with access to a personal computer send and receive images and data anywhere

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience ▮ The Internet Over 143 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.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 6. What are the four web functions? Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience ▮ Four Web Functions Communication ; Instant messaging; Chat rooms and bulletin boards; Online communities Information Search engines; Online publications; Newsgroups; Internet forums; Electronic bulletin boards; Web communities

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience ▮ 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

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 7. What are the benefits of shopping online? Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience ▮ 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

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience ▮ 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

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 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

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 8. How does one build an effective web presence? Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Creating an Effective Web Presence Measuring Effectiveness Measuring Effectiveness Managing a Web Site Creating an Effective Web Site

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience ▮ 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

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Assessing Site Effectiveness ▮ Web-to-store shoppers - Consumers who use the Internet as a tool to aid them at brick-and- mortar retailers ▮ Click-through rate - Percentage of people presented with a banner ad who click on it ▮ Conversion rate - Percentage of visitors to a Web site who make a purchase ▮ Engagement - Amount of time users spend on sites 26

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Figure Measures of Website Effectiveness 27

MEASURING WEB SITE EFFECTIVENESS Click-through rate Percentage of people presented with a banner ad who click on it. Conversion rate Percentage of visitors to a Web site who make a purchase.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 9. What is the future of online marketing? Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Future of online marketing ▮ More information ▮ More innovation ▮ The rise of customer power ▮ The rise of the trust, the fall of the untrustworthy 30

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience 10. What are two concerns of online marketing? Copyright © 2013 by South Western, a division of Cengage Learning. All rights reserved.

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 5 E-Business: Managing the Customer Experience Future of online marketing ▮ Internet profitability ▮ Legal and ethical issues 32