EBUS/520 2/16/05- Joanne T. Witt1 EBUS 520 e-Marketing Theory and Application Week One Instructor: Joanne T. Witt February 16, 2005

EBUS/520 2/16/05- Joanne T. Witt2 Goal Learn about the theory and application of electronic marketing –What new tools or approaches are available, because of the internet, as a means for delivery and capture of information? –How does e-marketing differ from classical marketing?

EBUS/520 2/16/05- Joanne T. Witt3 Introductions Who am I? –Joanne T. Witt Who are you? –Name –Current position and company –How has the internet changed the way you live and work?

EBUS/520 2/16/05- Joanne T. Witt4 Class Information Name cards Course schedule – course ends 10/6 All materials can be found on the resource page All presentations can be found at Review topics Breaks – 7:00 /7:15 for 30 minutes and at 9:00 p.m.

EBUS/520 2/16/05- Joanne T. Witt5 Class Information Assignments Grading Learning teams Breaks – 7:00 /7:15 for 30 minutes and at 9:00 p.m.

EBUS/520 2/16/05- Joanne T. Witt6 Moore’s Law Metcalfe’s law © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt7 DIFFUSION OF INNOVATIONS © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt8 Growth of Various Media © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt9 Timeline History: – e/ e/

EBUS/520 2/16/05- Joanne T. Witt10 Internet How do you and your family and friends use the internet?

EBUS/520 2/16/05- Joanne T. Witt11 e-Marketing Implications CRM Response Time – Expectations Information Integration

EBUS/520 2/16/05- Joanne T. Witt12 THE CUSTOMER HAS NO MORE TIME The Struggle to Acquire Customers is Exceeded Only by the Struggle to Retain Them. Marketer Visitor Internet Time is not Readily Devoted to the Advertising There. © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt13 Organizational Transformation Focus: Customer MIS Managing and Using Knowledge Marketing Intelligence

EBUS/520 2/16/05- Joanne T. Witt14 External Environmental Factors Social and Cultural Political and Legal Competitive Technological Environmental Demographic

EBUS/520 2/16/05- Joanne T. Witt15 UNIQUE CHARACTERISTICS/BENEFITS Common Platform Perfect Information Interactive Global Distance Is No Longer Relevant –Size Is Relevant to Brand Strength and Resources Always on Many-to-many © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt16 IT IS POSSIBLE TO CALCULATE DEMAND WITH PRECISION Information Flows –Quickly –Freely Up and Down the Value Chain Winners and Losers Can be Spotted Quickly © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt17 COSTS FOR MANY PRODUCTS FOLLOW A MODEL OF HIGH FIXED DEVELOPMENT COSTS AND VIRTUALLY NO VARIABLE COST OF PRODUCTION. High Up-Front Costs for Necessary Technology Serving An Incremental Customer Almost Cost- Free Except for Distribution Stair-Step Fixed Costs © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt18 SCALE IS MORE LIKELY TO BE DEFINED BY NUMBER OF CUSTOMERS THAN BY PRODUCTION CAPACITY. Fewer Resources Devoted to Physical Production Serving a Large Customer Base is Cost Effective BUT It is Important to Devote Sufficient Resources to Distribution and Customer Service © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt19 REVENUE MODELS What are they?

EBUS/520 2/16/05- Joanne T. Witt20 ECONOMICS OF E-BUSINESS 1.Shift From An Economy of Scarcity to One of Abundance. 2.Both Businesses and Consumers Have a Glut of Marketplace Choices. 3.Transaction and Coordination Costs are Disappearing. 4.It is Possible to Calculate Demand With Precision. 5.Switching Costs Approach Zero in the Absence of Actions by Marketers. 6.Costs for Many Products Have High Fixed Costs of Development and Virtually No Variable Cost of Production. 7.Scale is More Likely to be Defined by Number of Customers Than by Production Capacity. © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt21 SHIFT FROM AN ECONOMY OF SCARCITY TO ONE OF ABUNDANCE Amazon is a Good Example of Information Becoming More Valuable As It Is Shared Broad and Deep Assortment of Products Abundance of Content Provided by Visitors Use of Data to Provide Personalized Purchase Recommendations Customer Behavior on Site Behavior of Similar Customers © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt22 TRANSACTION AND COORDINATION COSTS ARE DISAPPEARING Affiliate Marketing as Portrayed By Amazon Used with permission of Amazon.com © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt23 External Environmental Factors Social and Cultural Political and Legal Competitive Technological Environmental Demographic Which one of these impacts your organization? Which one impacts your job?

EBUS/520 2/16/05- Joanne T. Witt24 B2B Supply Chain Business Suppliers

EBUS/520 2/16/05- Joanne T. Witt25 FORECASTS OF B2B E- COMMERCE © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt26 Horizontal versus Vertical mlhttp:// ml

EBUS/520 2/16/05- Joanne T. Witt27 Programmed Relationship Transactional Bargain Hunter B2B CUSTOMER SEGMENTS © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt28 B2B INTERNET MARKET SEGMENTS © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt29 B2B INTERNET MODELS Marketplace/Exchange Application Service Provider Infomediary © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt30 B2C Portals Communities Search Engines Product Service

EBUS/520 2/16/05- Joanne T. Witt31 MARKETPLACE SUCCESS FACTORS © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt32 MANY MARKETPLACES HAVE FAILED ‘LIQUIDITY’ IS MAJOR REASON © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt33 B2E Intranets –Best Designed Intranets of 2003 – Jakob Nielsen eRoom oration/

EBUS/520 2/16/05- Joanne T. Witt34 Genesis: From An Internal System To A Successful Information Product Used with permission of Sabre. © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt35 ORGANIZATIONS IN THE NETWORKED ECONOMY The Flexible, Market-Focused Organization © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

EBUS/520 2/16/05- Joanne T. Witt36 G2C City Government – Houston County Government State Government US Government

EBUS/520 2/16/05- Joanne T. Witt37 C2C Auctions – Bulletin Boards –

EBUS/520 2/16/05- Joanne T. Witt38 Mohan Sawhney’s Pyramid Activity Business Process Enterprise Pure Play

EBUS/520 2/16/05- Joanne T. Witt39 Discussion Questions How has your organization integrated e- marketing into its marketing activities? –If it hasn’t, why hasn’t it? –What recommendations would you have for integrating e-marketing?

EBUS/520 2/16/05- Joanne T. Witt40 Discussion Questions What external environmental factors effect e- marketing? –How? How do you determine the appropriate level of organizational commitment to e-business? –What factors would you consider in your evaluation? –Why?

EBUS/520 2/16/05- Joanne T. Witt41 E-Marketing Challenges Two teams: Profit, Non-Profit or Government e-marketing In team: Discuss the e-Marketing challenges and trends specific to your sector