© 2007 by Prentice Hall 13-1 Internet Purchases What was the last purchase you made using the Internet? What percentage of your purchases are made via the Internet? What products do you purchase over the Internet? What do you think is the future for Internet businesses? What has made Google.com successful? What obstacles do Internet firms face? Discussion Slide 13

© 2007 by Prentice Hall 13-2 Internet Marketing Profile of Internet users Internet marketing functions E-commerce IMC and the Internet Direct and viral marketing Internet design issues 13 Chapter Overview

© 2007 by Prentice Hall 13-3 Internet Growth Daily access the Internet Americans – 48% Canadians – 47% Britons – 36% Communication Voice over Internet Protocol (VoIP) Web blogs Internet retail sales $144 billion, 7% of global retail sales

© 2007 by Prentice Hall 13-4 Building databases for campaigns. Designing campaigns linking customers to Web site information. Creating fun and innovative games to attract and keep customers coming back to Web page. Creating incentive programs. Translating printed documents, catalogs, brochures, and newsletters for the Internet. Adding graphics to the Web site. Source: Ellisor, “Business-to-Business Offer WWW Opportunities,” Houston Business Journal, (September 17, 1999), Vol. 30, No. 7, p. 18B. F I G U R E Internet Services Offered by Marketing Agencies

© 2007 by Prentice Hall 13-5 Advertising Sales support Customer service Public relations E-commerce (Retail store) F I G U R E Functions of the Internet

© 2007 by Prentice Hall 13-6 E-Commerce  Selling of goods and services on the Internet  Entry into e-commerce  Trend of future  Fad  Alternative mode of shopping  Source of information for shoppers

© 2007 by Prentice Hall 13-7 Top Cyber Shopping Categories Source: “Cyber Shopping,” License, Vol. 7, No. 10 (November 1004), p. 12.

© 2007 by Prentice Hall 13-8 E-Commerce Components Catalog Shopping cart Payment procedure

© 2007 by Prentice Hall 13-9 Reasons People Wary of Online Purchases Security issues Credit card charges Identity theft Fraud History and Advertising Purchasing habits Incentives

© 2007 by Prentice Hall E-Commerce Incentives Financial incentives Convenience-based incentive Value-added incentive

© 2007 by Prentice Hall Financial Incentives  Attract first-time purchaser  Repeat purchasers  Cyberbait  Most effective incentives  Free shipping & handling  Dollar discounts  Free gifts  Financial incentive  Meaningful  Changed periodically

© 2007 by Prentice Hall Convenience Incentives  Time  Update and change Web site  Easy to locate merchandise  Convenience services  Weddings  Popular items  Measurement charts

© 2007 by Prentice Hall Value-Added Incentives  Change purchasing habits – long term  Personalized shopping  Examples  Merchandise available only online  Free online courses  Barnes & Noble, Charles Schwab  Free information  Tide and Ragu

© 2007 by Prentice Hall Business-to-Business E-Commerce Source: “Data,” B to B, Vol. 90, No. 5 (April 11, 2005), p. 5.

© 2007 by Prentice Hall Business-to-Business E-Commerce Excellent for re-buy situations Brand name recognition important Requires incentives Financial Convenience Value-added Online exchanges and auctions Store or warehouse locator

© 2007 by Prentice Hall iGo.com

© 2007 by Prentice Hall International E-Commerce Internet allows for sales worldwide. Areas to address for international business. Communication barriers Cultural differences Shipping of merchandise Internet capabilities in other countries Payment procedures Web sites in different languages. Call centers in different countries.

© 2007 by Prentice Hall IMC and the Internet Important component of the IMC Communication between departments Marketing Human resource Production Information technology (IT) Call centers Shipping departments

© 2007 by Prentice Hall Internet content search (38%) Word-of-mouth (30%) Internet banner (20%) Television ad (7%) Print ad (5%) Source: Don Jeffrey, “Survey Details Consumer Shopping Trends on the Net,” Billboard, (May 29, 1999), Vol. 111, No. 22, p. 47. F I G U R E What Drives People to a New Site?

© 2007 by Prentice Hall IMC and the Internet Search engine key words Online advertising advertising Blogs Off-line advertising

© 2007 by Prentice Hall Why Dot.com Print Ads Fail to Grab and Hold Attention Lack visual power. Ambiguous illustrations that require too much time and effort to understand. Often is not legible. Contains no optimum “flow.” Tends to ignore the reader’s question, “what’s in it for me?” Research Study by Roper Starch Worldwide (November 13, 2000)

© 2007 by Prentice Hall IMC and the Internet Branding Brand image important 82% brand name influenced online purchase Web site must support brand image Cyberbranding Brand spiraling Halo brand effect

© 2007 by Prentice Hall Information Online Impacts Brand Impressions Travel or lodging27% Clothing or apparel33% Music24% Household products31% Electronics or software40% Books29% Toys19% Gifts, flowers, or cards21% Information companies had online influenced the impressions consumers had of a brand, even If the product was purchased in a store. The data below indicate the percentage of consumers who said online content changed their view of a brand. Source: “Far-Reaching Effects,” Marketing News, Vol. 38 (February 1, 2004), p. 4.

© 2007 by Prentice Hall Putting the Web address on printed materials and promotional items. (91%) Advertising in trade journals. (74%) Registering the Web site with search engines for keywords. (72%) Buying banners on other sites. (25%) F I G U R E B-to-B Techniques to Boost Web Site Awareness

© 2007 by Prentice Hall This Juno ad was placed in trade magazines to increase business awareness. It alludes to the difficulty of proper targeting.

© 2007 by Prentice Hall This Buzzsaw.com advertisement was placed in trade magazines for the construction industry. The company promises to help business evolve and survive as the industry undergoes rapid change.

© 2007 by Prentice Hall IMC and the Internet Brand Loyalty Brand-loyal consumers Communication key to developing loyalty Make shopping or browsing pleasurable Establish one-to-one communications Personalization of information Niche customers

© 2007 by Prentice Hall IMC and the Internet Sales Support Provide information to sales staff Client information Product information Company information Provide information to customers Prospecting Qualifying prospects Gathering information

© 2007 by Prentice Hall IMC and the Internet Customer Service Cost-effective method Easy-to-use Web site Alternative communication channels Discussion groups Chat rooms Blogs Access by businesses Access by manufacturers

© 2007 by Prentice Hall IMC and the Internet Customer Service Response time to inquiries 37% satisfied with online customer service, compared to 85% for traditional Older consumers less satisfied than younger consumers Only 34% acknowledge receipt of customer s 24% of s or inquiries are never answered

© 2007 by Prentice Hall Steps to Improve Customer Service Institute of Management Administration (IOMA) 1)Knowledgeable service reps 2)Confirm customer’s order or inquiry – provide timeframe 3)Provide personal touch 4)Offer opportunity for personal communication 5)Use good communication skills 6)Be aware of work habits of customers

© 2007 by Prentice Hall Direct Marketing Internet is ideal medium Direct mail is most effective driver for online direct marketing Interactive marketing Personalization of content, offers, and s Blue Martini E-Merchandising Edify Smart Options Direct s, request permission

© 2007 by Prentice Hall Viral Marketing Prepared ad attached to Word-of-mouth advocacy Message passed voluntarily Higher percentage pass message along to others Scope Mazda

© 2007 by Prentice Hall Clueless banners Slow loading front page Forcing people to go through numerous screens Too much verbal information Too many technical terms Sites that are hard to navigate F I G U R E Clues to Poor Design

© 2007 by Prentice Hall Decide strategic purpose. Easy access and quick loading. Written content should be precise. Content is key. Graphics should support content. Make an offer to encourage a response. Ask for site evaluation. Provide easy to use navigation links on every page. Use gimmicks to gain attention at the beginning. Change Web site on a regular basis. Measure results continually. Source: Based on Ray Jutkins, “13 Ideas That Could Lead to Successful Web Marketing,” Advertising Age’s Business Marketing, (June 1999), Vol. 84, No. 6, p. 27. F I G U R E Tips for Creating Winning Web Sites

© 2007 by Prentice Hall A Web site with clear navigation. Click image to go to site.