Joel Reedy and Shauna Schullo

1
Electronic Marketing

• Chapter 2 Concept of Electronic Commerce and the
  Traditional Marketing Process

2
Is Anybody Out There?

• A Worldwide Internet Survey (Nua) makes an
  educated guess that 580.78 million people
  worldwide are online as of May 2002.
• In June 2001 Gartner estimated 65 million U. S.
  households were active on the Internet, an 8.4
  million increase over 2000.
• Women (52.1) now outnumber men (47.9) in online
  usage.
• Mediamark research states that 39 million people
  use the Internet at work.
• 9 out of 10 school-aged children (6-17) have
  Internet access at school.

3
Is Anybody Out There?
The Worlds Top 10 Online Populations

• United States (102.0 million)
• Japan (20.0 million)
• Germany (15.1 million)
• South Korea (13.1 million)
• United Kingdom (13.0 million)

• Canada (8.8 million)
• Italy (8.3 million)
• Brazil (6.0 million)
• Australia (5.6 million)
• France (5.5 million)

4
Why Should Companies Consider Using Electronic
Marketing?

• Requires efforts for more situations than one
  standard approach
• The Internet can be used by long-established
  companies looking for fresh approaches
• Entrepreneurs might use the Internet to
  jump-start a startup business or one that has
  some history but no money
• Ongoing domestic company sees a product or
  service fit to a selected market within a
  selected country or region
• Review the reasons why electronic commerce is
  right for the firm

5
Why Should Companies Consider Using Electronic
Marketing?

• How is business using the Internet?
• 52.8 million people use the Internet at work
• Most at work users are gathering information not
  using it for entertainment
• 50 said their firm had its own Web site which is
  an integral part of the way they do business
• A proposed 66 of businesses use the Internet for
  advertising, marketing and PR
• 36 are purchasing products and services
• 34 are conducting industry or market research

6
The Virtual Retailer

• The front door, roof, and back door of a virtual
  store are the flat surface of your monitor
• One of the main driving forces includes the fact
  that each retailer serves customers with
  different demographic, psychographic, and
  behavioral characteristics
• Marketers hire communications specialists such
  as
• In-house designers or Web masters to create and
  maintain the companys Web stance
• Companies might be a one-person operation or a
  national interactive advertising agency
• Third participant is the Internet provider (IP)
  or Internet service provider (ISP)

7
Comparing the Traditional Marketing Process Model

• Marketers must understand the current dynamics of
  the marketplace
• Be aware of shifts in the marketplace before
  making marketing plans
• The first step in the marketing overview is to
  initiate a situation analysis

8
Evaluating the Online Marketing Situation

• Knowing at what point to start is always the key
  to successful marketing efforts the stalwart
  queries of who, what, when, where, and why are
  the conventional, proven embarkation concepts for
  the investigation
• Initiate an online awareness as an extension of
  the products or services promotional program
• An advantage of Web messages is the ability of
  encouraging interactive response

9
Evaluating the Online Marketing Situation

• The capability to improve the dialog and react
  quickly to customer service inquiries
• Considered set of Frequently Asked Question
  (FAQs) can oftentimes substitute as an answer
  key
• Technical support can be enhanced by e-mail
  communications
• Benefit is that technical information can be
  dispensed with a greater quality of consistency
  if fewer people are dealing with customers

10
Evaluating the Online Marketing Situation

• The Web is conducive for testing new product or
  service concepts
• Customer tracking has become much easier and more
  accurate as companies have instituted database
  development programs
• Online marketers are discovering that employee
  recruitment can be conducted on the Web

11
Defining the Information Search

• Relevant market research and input to help set
  direction for the future marketing plan
• Primary research
• Secondary research
• Steps in the research process
• Step one is to define the required relevant
  research
• Step two in the research process is to ascertain
  if and where the information can be obtained

12
Proposed Market Prospect Description

• The environmental factors are defined
• Markets should be described, perhaps two or three
  market segments could be appropriate for
  communications and consumption targets
• Setting expansive prospect parameters allows the
  marketer to begin construction of the marketing
  strategy, as the marketing planning evolves, more
  narrow and clearer profiles will start to emerge

13
New Product or Service Definition

• Concisely describe the concept of the new product
  or service, if the marketer cannot, it is
  unrealistic to expect the audience to work to
  understand
• The product or service must satisfy some need or
  desire of the target market
• A marketer must think in terms of expected
  benefits that are attractive to the intended
  audience

14
New Product or Service Definition

• Framing the product or service concept, there are
  several facets to consider
• General utility of the good
• Convenience of procuring the good
• Timely delivery of the good
• Sales environment where the good is purchased

15
New Product or Service Definition

• Many new products are developed as marketers keep
  tabs on market trends within their industry
• Customer recommendations
• Industry publications
• Online industry resources 
• Services are more difficult to establish than
  products because of intangible nature

16
Environmental Factors and Market Trends

• There are four major categories of environmental
  factors that the marketer must monitor
• Economic environment
• Cultural environment
• Legal environment
• Political environment
• Each of these four environments is equally
  important since an imbalance in one area can
  create unexpected tremors in others

17
Demographic and Other Characteristics

• This is the area of change that applies to the
  people portion of the marketing equation
• Demographic information comes from the ten-year
  census initiated in 1790
• Psychographics are attitudinally constructed, and
  many attitudes are difficult to quantify
• Segmenting populations into similar groups, a
  marketer can analyze many factors as supplied by
  the Census data

18
Demographic and Other Characteristics

• Other interesting information to consider
• Households can be described in several ways as
  total number by county, zip code, Census tract,
  or radius in miles or by heads of households
• Age profiles
• Income clusters
• Educational level
• Occupational status
• Psychographic or lifestyle analysis can uncover
  lifestyle characteristics for which the marketer
  is searching

19
Company History and Competencies

• Behind every successful business lies skills or
  competencies that sets the enterprise apart
• The marketing manager can perform an internal
  audit (or external audit among suppliers, current
  customers, or past customers) to evaluate
  perceived and real strengths and weaknesses
  these competencies should be reflected as
  benefits
• Their contention was that every competitor,
  either company, brand of product or service, vies
  like rivals in product categories, and each is
  ranked in the consumers mind

20
Competitive Analysis and Evaluation

• Conducting research on competitors products or
  services has been facilitated by Web usage
  because so many Web sites contain so much
  information
• Surfing for competitive information is a good
  idea, particularly if the marketer is entering
  new fields or territories

21
Assessment of the Niche Opportunity

• Analysis of the marketing factors and forces, the
  marketer will be able to establish the product or
  service niche, a narrower rather than broader
  market segment
• Probably the best balance in a marketing
  relationship is derived as a market segments
  needs are met satisfactorily while the companys
  operation is profitable and efficient
• The market opportunities can come from existing
  customer bases, such as extending current
  offerings into new products