Elias M. Awad Third Edition ELECTRONIC COMMERCE From Vision to Fulfillment 6-1© 2007 Prentice-Hall, Inc ELC 200 Day 12

6-2 © 2007 Prentice-Hall, Inc Agenda Assignment 4 DUE Assignment 5 Posted –Due Nov 11:05 AM –One of the key skills required of all eCommerce professionals is the ability to evaluate web sites for effectivity and for usability. To help you develop those skills please do Web Exercises 1 & 2 on page 261 and 262 of your text. For Question # 2, Do the exercise as an Individual Project and evaluate only the First National Bank of South Miami, ECommerce Initiative Frameworks –GuidelinesGuidelines –Due May 10 AM Finish Discussion on Web Site Evaluation and Usability Testing Begin discussion on Internet Marketing

6-3 © 2007 Prentice-Hall, Inc Getting Personal Personalization vs. Customization –Personalization is a strategy, a marketing tool, and an art; visitor-oriented rather than product- oriented –Personalization tries to treat all customers as unique –Customization focuses on direct user control –Personalization is driven by artificial software that tries to serve up individualized pages to the user based on a model of that user’s needs (past habits, preferences, and so on).

6-4 © 2007 Prentice-Hall, Inc Components of Personalization

6-5 © 2007 Prentice-Hall, Inc Steps to Operationalize Personalization Customer interaction Data collection and integration Business intelligence Customer interaction personalization

6-6 © 2007 Prentice-Hall, Inc Inference-based Personalization A technique that tracks a Web user’s behavior, identifies other people with similar behavior, and uses those people to recommend products Amazon.com

6-7 © 2007 Prentice-Hall, Inc Intelligent Personalized agents Chatter bots –A salesperson for the web –Gathers information from users to create personalization – –

6-8 © 2007 Prentice-Hall, Inc Approaches to Web Personalization Cookies are bits of code or a text file that sits in a user’s Internet browser memory and identifies that person to a Web site when they return Collaborative filtering software keeps track of users’ movements across the Web to interpret their interests Check-box personalization, users choose specific interests on a checklist so the site can display the requested information Rule-based personalization divides users into segments based on business rules that generate certain types of information from a user’s profile Neural networks use statistical probability algorithms to deliver personalization based on movements such as a visitor’s actions

6-9 © 2007 Prentice-Hall, Inc Do You Want a Cookie? A cookie is an HTTP header with a text-only string placed in the browser’s memory The string contains the domain, path, how long it is valid, and the value of a variable that the Web site sets The original purpose of cookies was to save user’s time Limitations or cause for concern –Cookies utilize space on a client’s hard drive for a Web site’s purposes without permission –They threaten our privacy as Internet users(?) Cookies can be deleted or rejected at will

6-10 © 2007 Prentice-Hall, Inc Popular Myths About Cookies Cookies clog the hard disk Cookies can put a virus on my computer Cookies give companies access to my personal file Disabling cookies in my browser will prevent any Web sites from gathering information about me

6-11 © 2007 Prentice-Hall, Inc Web Site Usability Usability refers to a set of independent quality attributes –Performance –Satisfaction –Ease of navigation –Learnability It means an application that allows the user to perform the expected tasks more efficiently –The integral attributes of a system that affect user performance and productivity

6-12 © 2007 Prentice-Hall, Inc What makes a web site Usable

6-13 © 2007 Prentice-Hall, Inc What makes a web site Usable

6-14 © 2007 Prentice-Hall, Inc Effective Web Site Design The goal of effective Web site design is to give users a good experience –Switching costs on the Internet are low –Churning is the basic measure of visitor dissatisfaction with a site

6-15 © 2007 Prentice-Hall, Inc User Testing Determine testing sample Decide what to look for during the test Look for trends in the way the site is succeeding or failing to reach others Any bugs should be relayed and assigned to developer who can fix them Use Web testing tools –Load and performance test tools –Java test tools –Web site management tools and log analysis tools

6-16 © 2007 Prentice-Hall, Inc Reliability The core of reliability is availability –System availability –Network availability –Application availability Ensure Web site reliability and usability –Provide system backup –Install a disk-mirroring feature –Ensure that the system hardware is fault-tolerant –Be sure applications are self-contained –Be sure there is adequate hard disk space –Buy everything from a single vendor

6-17 © 2007 Prentice-Hall, Inc Site Performance Issues Images and color –Readability testing –Images: GIFs versus JPEGs Caches How many links? The role of the Web server

6-18 © 2007 Prentice-Hall, Inc Managing Content and Site Traffic Content management Web traffic management The Web site administrator –Database server –Application server(s) –Web server(s) –Special-purpose servers for encryption and security checks –Internet bandwidth –Internet performance status

6-19 © 2007 Prentice-Hall, Inc Chapter Summary Web site evaluation Appropriate site design Criteria for evaluating Web sites Approaches to Web personalization Cookies A Web site should be as inviting and easy to navigate as possible User testing Web content management Traffic management Web site management

Elias M. Awad Third Edition ELECTRONIC COMMERCE From Vision to Fulfillment 6-20© 2007 Prentice-Hall, Inc Internet Marketing

6-21 © 2007 Prentice-Hall, Inc The focus of this chapter is on several learning objectives The many offerings of online shopping Various ways to do Internet marketing The steps to take in launching a marketing campaign How to attract and track customers on the Internet The importance of customer service The basics of CRM and how it contributes to adding value to e-commerce

6-22 © 2007 Prentice-Hall, Inc The Pros of Online Shopping Choice Vast selection Quick comparison

6-23 © 2007 Prentice-Hall, Inc The Cons of Online Shopping Certain buying decisions require information that can best be found in traditional brick-and-mortar stores. –Buying personal items like perfume, footwear –Products that require in-store help How does this thing work?? –Product delivery problems Lumber, masonry, large furniture

6-24 © 2007 Prentice-Hall, Inc Justifying an Internet Business 1.Establish presence 2.Serve customers 3.Heighten public awareness 4.Share time-sensitive information 5.Sell goods 6.Answer important questions

6-25 © 2007 Prentice-Hall, Inc Justifying an Internet Business (Cont’d) 7.Market at the international level 8.Serve the local market 9.Market specialized products 10.Reach the youth market

6-26 © 2007 Prentice-Hall, Inc Internet Marketing Techniques Banner ads is advertising with links to a merchant’s Web site Pull marketing is passive Internet marketing, where the user takes the initiative requesting specific information from the Web site In Push technology the Web site “pushes” the information at the customer, irrespective of his or her interest Registering with search engines and directories –SEO

6-27 © 2007 Prentice-Hall, Inc Range of Internet Marketing Techniques and Applications

6-28 © 2007 Prentice-Hall, Inc Aggressive Internet Marketing Aggressive marketing is a marketing technique where the Web site seeks out potential customers; push technology Spamming is sending out millions of s to recipients who never asked for them –Invasion of privacy –Costing corporations millions each year to fight unwanted messages

6-29 © 2007 Prentice-Hall, Inc Pop-up Advertising An advertisement that “pops up” in a new browser window regardless of the user’s wish to open such a new window –Among the most common forms of online marketing –Push marketing –“Kick-through” advertising Don’t even have to click –“Mouse trapping” Getting “stuck” in a web page or series of web pages Among the most controversial forms of online marketing A major source of revenue for ISP Ethical implications to pop-up ads?tgh Pop unders –

6-30 © 2007 Prentice-Hall, Inc Permission Marketing Marketers ask permission before they send advertisements to prospective customers, requiring that people first “ opt in ” rather than “ opt out ” after the ads have been sent

6-31 © 2007 Prentice-Hall, Inc The E-cycle of Internet Marketing The Business Plan is a written document that identifies a merchant’s business goals and how to achieve them. The content of a business plan includes: 1.Mission 2.Product 3.Competition 4.Target audience 5.Marketing 6.Sales plan 7.Operation 8.Technology

6-32 © 2007 Prentice-Hall, Inc The E-cycle of Internet Marketing (Cont’d)

6-33 © 2007 Prentice-Hall, Inc The E-cycle of Internet Marketing (Cont’d) The Product –Viability –Quality –Reliability –Dependability –Integrity Pricing Place

6-34 © 2007 Prentice-Hall, Inc The E-cycle of Internet Marketing (Cont’d) Promotion of a product gets the attention of prospective customers –Banners are the most popular type of Internet ads –Create interest in the product(s) displayed –Build a desire for action

6-35 © 2007 Prentice-Hall, Inc Examples of the “Best” Web Sites

6-36 © 2007 Prentice-Hall, Inc Examples of the “Worst” Web Sites essescustomsewing.comhttp:// essescustomsewing.com For more examples see:

6-37 © 2007 Prentice-Hall, Inc New Format Brand Ads Skyscrapers Bulky boxes Buttons and “Big Impressions” Pop-up Ads

6-38 © 2007 Prentice-Hall, Inc Personalization - the fifth “P” –A technique that combines product and promotion for customers to receive information customized to their needs Technically detailed descriptions are presented to the level of the user’s knowledge Product presentations are customized to suit the user’s interests The user’s expectations are met regarding the amount of relevant information

6-39 © 2007 Prentice-Hall, Inc Important Personalization Rules Prevent resistance to personalization –Users don’t like Forms –Take your time Consider any source of information State preferences of users through forms or similar procedures Focus on privacy in every way possible Make an effort to learn from every move

6-40 © 2007 Prentice-Hall, Inc Important Personalization Rules (Cont’d) Jump-start a personalization relationship by posing the user a set of questions. –Answers to question benefit user Sell the goodness of personalization. Make life easier for users to tell you what they want and what they hate. Make sure there is no delay in a personalization environment.

6-41 © 2007 Prentice-Hall, Inc Marketing Implications Power shift has occurred from the merchant to the consumer Consumer can access any information on virtually any topic Common-sense rules: –Content: Don’t bore your customers with unnecessary content. –Dynamic and attractive sites –Brands: Web site should be most important brand –Get to the point: Conciseness, clarity, and ease of navigation –Promotion –Online events –Free giveaways –Consistency

6-42 © 2007 Prentice-Hall, Inc How to Market Presence Promoting your site on your site Promoting your site on the web –Search engine is a program that uses a logic search to find sites based on a combination of keywords –Directory is an organized listing with specific categories such as yellow and white pages in a telephone directory –Spider is a program that explores the Web, collects keyword information, and stores it on a huge database Promoting your site on the Internet –Use to contact registered customers –Advertise through news groups and mailing lists –Use mobile marketing and wireless “yellow” pages

6-43 © 2007 Prentice-Hall, Inc Guidelines for Attracting Customers to your Site Keep the site content current so visitors continue to return for news Offer free information or products Implement a cross-selling strategy Ensure easy and quick navigation Introduce event marketing Enlist affiliates Try out viral marketing as a tool for getting noticed

6-44 © 2007 Prentice-Hall, Inc Trends in Internet Use Useful to help predict buying behavior The online population is younger, more educated, and wealthier than the overall U.S. population. Most online consumers are white. More than 40 percent reported spending more than 20 hours per week browsing on the Web from home. Most regular use for the Internet is for work and at work. The Internet is used regularly at home to read news and for entertainment.

6-45 © 2007 Prentice-Hall, Inc Personalization First step in personalization is identification Ways to add personalization to a Web site –keywords –collaborative filtering –rule-based personalization

6-46 © 2007 Prentice-Hall, Inc Tracking Customers Gathering Web Data to Track Customers Log files are files on the Web server that keep track of domain types, time of access, keywords used, and search engines used Forms Cookies Clickstream data analysis of Web site visitors’ clicks, which leave footprints representing their behavior –Pinpoint a host of customer behaviors

6-47 © 2007 Prentice-Hall, Inc Common Clickstream Data Where a visitor first landed on the site How a visitor got to the site Number and sequence of pages viewed Number and cost of each product purchased Length of time the visitor stayed on each page and on the entire site Total cost of each visit Point on the site where the visitor clicked away

6-48 © 2007 Prentice-Hall, Inc The Business Case for E-Intelligence Integrates e-business operations into the traditional business environment Helps business users make informed decisions based on accurate and consistent e-business information Assists e-business applications in profiling and segmenting e-business customers to personalize the actual Web pages displayed Extends the business intelligence environment outside of the corporate firewall to trading partners Extends the business intelligence environment outside of the corporate firewall to key corporate clients Links together e-business applications with business intelligence and collaborate processing applications

6-49 © 2007 Prentice-Hall, Inc Customer Service Automation removes the human contact between buyer and merchant “Don’t annoy the customer” Botched logistics can spell disaster –Order taking is the easy part –Fulfillment is where the merchant promotes or destroys customer satisfaction

6-50 © 2007 Prentice-Hall, Inc Main Goals of CRM Better customer service and customer revenues More efficient call center Faster closing of deals by sales staff More effective cross selling of products Simplified market and sales processes Discovering new customers and personalizing relationships to improve profitability and customer satisfaction

6-51 © 2007 Prentice-Hall, Inc Overall Goal of CRM Identify what truly matters for the customer –First, notice what customers are doing –Second, remember what customers have done over time –Third, learn from what is remembered –Fourth, act on what has been learned

6-52 © 2007 Prentice-Hall, Inc Interrelated Elements of Customer Satisfaction

6-53 © 2007 Prentice-Hall, Inc Developing and Understanding Relationship with Customers

6-54 © 2007 Prentice-Hall, Inc CRM-integrating Critical Processing

6-55 © 2007 Prentice-Hall, Inc Managing Implications An important implication for management is return on investment The future of the Internet and e-commerce lies in customer tracking and personalization Internet marketing allows firms to communicate with customers around the clock Companies should reconsider their approach to customer support E-commerce without e-service can be suicidal for a business Successful Internet marketing means high-level executive involvement

6-56 © 2007 Prentice-Hall, Inc Chapter Summary Marketing is the process of planning and implementing the conception, pricing, advertising, and distribution of goods and services to meet the demands of the market Three factors make online shopping attractive: –quick sorting through choices –vast selection of products –quick comparison of products Online shopping has some drawbacks

6-57 © 2007 Prentice-Hall, Inc Chapter Summary (Cont’d) Internet provides a continuum of marketing techniques Internet marketing is made up of an e-cycle that begins with planning followed by the four P’s One marketing implication behind the power shift from merchant to consumer is a unique marketing strategy that follows rules that make sense To promote a site on the Web, it must be available to search engines and directories

6-58 © 2007 Prentice-Hall, Inc Chapter Summary (Cont’d) Attracting customers to a site involves: –keeping site content current –offering free information or products –implementing cross-selling strategies to assist visitors in making a final decision –quick and easy navigation –Introducing event marketing –Enlisting affiliates

6-59 © 2007 Prentice-Hall, Inc Chapter Summary (Cont’d) The first step in personalization is customer identification Successful Internet marketing means: –High-level executive involvement –Thinking about a new way of selling and delivering merchandise –Finding what it takes to implement the company’s e-business vision