Ebusiness in Contemporary Marketing

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• Chapter 4
• E-business in Contemporary Marketing

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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.
• Identify the primary online marketing channels.

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Objectives

• 6. Explain how marketers use interactive tools
  as part of their online marketing strategies.
• 7. Discuss how an effective Web site can enhance
  customer relationships.
• 8. Describe how to measure the effectiveness of
  online marketing efforts.

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The ability to reach anyone that is connected
is demonstrated through this Monster.com
commercial.
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E-Commerce Capabilities
EXAMPLE
DESCRIPTION
CAPABILITY
Major car makers, such as Ford, Nissan, and
Volvo, use the Web to reach car buyers around the
world.
The ability to reach anyone connected to a PC
anywhere in the world.
Global reach
Customers can order customized clothingfrom
jeans to shirts to shoesonline.
Creating products to meet customer
specifications also called personalization.
One-to-one marketing
Intouch Groups iStations are interactive kiosks
placed in retail music stores that allow
customers to listen to thirty-second music clips
before they purchase compact discs.
Buyer-seller communications through such channels
as the Internet, CD-ROMS, toll-free telephone
numbers, and virtual reality kiosks.
Interactive marketing
FedEx customers can place service orders online
and track shipments twenty-four hours a day.
The ability to provide a good or service at the
exact time needed.
Right-time marketing
Nike marketers use the familiar Swoosh logo and
Just Do It slogan in both online and offline
promotions.
Coordination of all promotional activities to
produce a unified, customer-focused promotional
message.
Integrated marketing
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Mondera.com is designed as an online retailer
targeting buyers of fine jewelry.
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E-Commerce

• Electronic Marketing and the Internet for
  Dot.com and Brick- and-Mortar Marketers
• Interactive marketing - Buyer-seller
  communications in which the customer controls the
  amount and type of information received.
• Internet (NET) - Worldwide network of
  interconnected computers.
• Intranets - Internal corporate network.
• Extranets - Secure network accessible through a
  web site by external customers or organizations
  for electronic commerce.

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One company that has enhanced its success by
including the internet as a part of its overall
marketing strategy is Nike Shoes.
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Four Functions of the Internet

• Communication
• E-mail
• Instant messaging
• Chat rooms
• Online communities

• E-Commerce
• Electronic exchanges
• Extranets and private exchanges
• Electronic storefronts
• Online ticketing
• Auctions

• Information
• Search engines
• Online publications
• Newsgroups
• Portals

• Entertainment
• Games
• Radio and TV programming
• Music
• Electronic books
• Short movies

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The History of The Internet

• The history of the Internet begins at the height
  of the cold war in the 1960's. People at the Rand
  Corporation, America's foremost military think
  tank, were trying to figure out an important
  strategic problem how could US authorities talk
  to each other in the aftermath of a nuclear
  attack?
• Source the pbs home page

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Benefits of B2B Online Marketing

• New markets and customers.
• Cost savings in every aspect of the marketing
  strategy.
• Greatly reduces the time involved in reaching
  target markets.

Potential for increased profits.
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Benefits of Business-to-ConsumerOnline Marketing
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Online Consumer Benefits
Three Categories

• Lower Prices
• Ideal method for savvy shoppers to compare prices
  from dozenseven hundredsof sellers.

• Convenience
• Cybershoppers can order goods and services from
  around the world at any hour of the day or night.

• Personalization
• One way is to welcome you back.
• A second way is to send you periodic e-mails
  informing you of specials or new products.

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E-Commerce and Security

• Marketing research indicates that privacy is the
  top concern.
• Consumers want assurances that any information
  they provide wont be sold to others without
  their permission.
• Prominently displaying privacy policy is an
  effective way to build customers trust.

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Who is Online?

• The heaviest Internet users make 75,000 or more
  a year.
• Live in urban areas.
• States with the highest percentage of Internet
  users include
• Alaska
• New Hampshire
• Washington
• Utah
• Colorado
• Racial group most likely to use the Internet
• Americans of Asian and Pacific Island origin.
• 75 percent of employed people use the Internet at
  work.
• 87 percent of college graduates use the Internet.
• Over half of all people currently looking for
  jobs go online.

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E-tailing Successes 2005

• 1 Amazon.com, 2 Dell
• 3 Office Depot
• Online sales 25 of its revenue
• Greatest market large corporate clients
• Web café events including online chats

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Building an Effective Web Site
Three basic steps for hitting the bulls eye.

• Establish a mission for the companys site.
• Identify the purpose of the site.
• Satisfy customer needs and wants through a clear
  site design.

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Measures of Web Site Effectiveness

• Profitability

Traffic counts
Click-through rates
Conversion rates
Research studies
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Marketers Scan Blogs, Etc. WSJ 6-05

• Blog-analysis on unsolicited opinions off-hand
  comments (15M online)
• Quick trend analysis consumer reactions
• Fees 30,000-100,000/yr.
• Intelliseeks free site - BlogPulse
• U. S. Cellular Corp Increased call me minutes
  against teens fear of exceeding minutes
• Sports videogames, sneakers, jerseys Lebron
  1, Bryant 2 among Gen Y boys
• Food maker interest in Atkins dropping

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Simultaneous Media Usage Threatens Effectiveness
of Marketing Campaigns

• When online
• 65 say they regularly or occasionally watch TV
• 60 say they regularly or occasionally listen to
  the radio
• 40 say they regularly or occasionally read the
  mail
• When reading mail
• 75 say they regularly or occasionally watch TV
• 58 say they regularly or occasionally listen to
  the radio
• 35 say they regularly or occasionally go online

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No Zapping Network Offerings2005

• 25 venues to reach viewers of a specific TV show
• Web programs with trivia, images games to
  accompany a TV show
• Alias video clips on Internet, show memorabilia
  online
• Email voicemails reminding fans to tune in
• Pepsi Lime on MTVs Laguna Beach 9-05
• text alerts, special Web site, DVD wrapping
• Live web chat with TV show stars
• Mobisodes, videos for cellphones

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Interactive Buzz Marketing July 2007

• The Seeker The Dark is Rising
• Teenage boy travels through time
• Hidden images of the 6 signs collected to save
  the world mirror the movies story
• Movie trailers to billboards to cardboard cutouts
  in movie theaters
• Microsofts Halo game
• Treasure hunts with clues in flyers, online
  comics, retail kiosks
• Discover background character stories
• The Simpsons Movie
• 12 7-Eleven stores converted to imitate the
  movies fictional convenience store

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Over half of all people currently looking for
jobs go online. One of the web sites job seekers
turn to is HotJobs.com.
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Online Marketing Channels
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Company Web Sites

• Two types of company Web sites exist.
• Corporate Web sites to increase their visibility,
  promote their goods and services.
• Often include information about company history,
  products, locations, and financial information.
• 2. Cybermalls which can link as many as 400
  participating online retailers.
• Cybermalls typically feature a popular national
  retailer with high customer traffic as an anchor
  tenant.
• Stores included in the mall are selected to
  produce a good match of merchandise.

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Viral Online Marketing Campaign

• Pass the word on to others
• Gap 9/05 www.watchmechange.com
• Create a their computer likeness
• Model sheds clothes dances furiously
• No advertising of site
• You think you know us. We can be pretty bold,
  too.
• No celebs this time Joss Smith, Madonna, Willie
  Nelson, Sara Jessica Parker
• Created by Crispin, Porter, Bogusky

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Online Experience

• Leading online retailers Amazon.com, Barnes
  Noble, Circuit City, Ebay, Wal-mart, Costco
• Direct correlation between customer experience
  online conversion purchase impact rates
• Vividence research firm (research of 2,000
  consumers in 2005)

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Sephora.com Makes Cosmetics fun

• Light-hearted approach
• Fragrance Finder
• Beauty expects available at call centers
• Gift registry
• Top 10 gift requests

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Sephora

• Home page clearly articulates the brand position
  as a high-end beauty merchant.

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J.C. Penney

• The JCPenney Experience
• Virtual store (3-06) premiered at Academy Awards
• 15,000 sq. ft. Time Squares store
• Samples of merchandise highlight all that is new
  at the company
• Shop only on web-based kiosks
• Web host its commercials
• Hotspotting
• Click video for info on the models outfits

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Store.BabyCenter.com 2007

• New site search engine
• Personalization options for the home page and
  content navigation
• Customize shopping based on the stage of their
  pregnancy or childs age (preconception
  preschooler)
• Proprietary engine creates a customer-specific
  home page and site experience by integrating
  different content into a visitor's navigation
  through the site, based on initial data provided
  by the visitor.

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Illuminations.com Entertainment

• Consumers expect entertaining shopping experience
  digital version of catalog
• Flash to show variety of Halloween season
  products using compelling imagery (style
  gallery)
• Now that 60 of homes have broadband

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NordstromSilverscreen.com

• Web channel with fashion-forward content in fun
  engaging forms
• Re-created pop music and dance videos to
  interactives
• Go-Gos Our Lips Are Sealed remixed by Fatboy
  Slim (5-06)
• Behind-the-scenes video with narratives
• How dance moves require new type of apparel
• Interview with Diane von Furstenberg about her
  designs
• How dancing and fashions have changed since the
  original version

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Ad Model on Google's YouTube - 2007

• Simple flash-based ad overlay across lower 20 of
  the screen shortly after video launches
• Stays for 10 seconds
• Closes if not clicked to enable longer video ad

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Subaru Turns to the Web

• B9 Tribeca mid-sized SUV (4-06)
• Dust in the Wind TV spot
• Track online response of thousands of anonymous
  online consumers across 25 car-related web sites
  within 2 days of product launch

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Hybrid Pod Spots 07 by NBC

• Part show promo part ad
• Sprint on Heroes
• 15 sec. comic-book like message to create their
  own hero online THEN Sprint ad airs

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07 Fashion Designers Outsource Web

• Yoox.com
• www.emporioarmani.com
• Outsourced skills to navigate online commerce

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FutureTech 2007

• Mass customization of custom shirts, chinos,
  jeans, sneakers, candy
• Tommy Hil, Target,Lands End, JC Penney, Zazzle
  (t-shirt), MMs, Nike
• OptiTexLtd.,TC2 Lectra step into scanner for
  custom clothing model
• LookStailorX from digital imaging ltd. Of Osaka
• Check virtual fit of a garment before making a
  sample(70 shirt).
• Selve stores in Germany London
• 3D foot scanner used to try on sample shoes to be
  manufactured (300)

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International Web sites Color Counts

• White
• China death, mourning
• Funeral clothing, packages
• U.K. Leisure, sports
• Sportswear
• U.S. purity, innocence
• Bedding, wedding gowns, hospital uniforms
• Black
• U.S. death, sophistication, formality
• Formal wear
• Mexico mourning, respect
• Clerical robes
• Red
• U.S. excitement, warning, sex
• Stop signs, fire trucks, red light district
• China communism, celebration, luck
• Wedding dresses, lucky money envelopes,
  obituaries (red ink)

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International Differences

• Micromarketing
• Sears Lands End dedicated web sites in
  Germany, UK, Japan
• Swedens Ikea localized international web sites
• Nike in Middle East, 05
• Shoe with flame design similar to Arabic script
  for Allah
• Brief boycott of Nike

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Web Awards

• 2004 winner http//www.behr.com/behrx/ (Arc)
• http//www.arcww.com/ for Cadillac Ariel

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Whos Bigger Online in 07?

• Neiman Marcus, Nordstrom or Macys?
• Coach, eBags.com or Prada?
• Ann Taylor, Liz Claiborne or Ralph Lauren? DSW,
  Foot Locker, Nike, Shoes.com?
• Williams-Sonoma, Crate Barrel, Bed, Bath
  Beyond or Linens n Things?
• QVC, IAC (Home Shopping Network) or ShopNBC.com?
• Baseball (MLB), Basketball (NBA), Football (NFL),
  Hockey (NHL), Auto Racing (NASCAR) or Golf (PGA)?