Past, Present, and Future E-M ARKETING /6E C HAPTER 1

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-2 ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL C HAPTER 1 O BJECTIVES  After reading Chapter 1, you will be able to:  Explain how advances in Internet and information technology offer benefits and challenges to consumers, businesses, marketers, and society.  Distinguish between e-business and e-marketing.  Explain how increasing buyer control is changing the marketing landscape.  Understand the distinction between information or entertainment as data.  Identify several trends that may shape the future of e-marketing.

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-3 T HE B ARACK O BAMA C AMPAIGN S TORY  Barack Obama’s Internet strategy targeted year-old voters because 93% are online and used the Internet to get information and connect with friends.  Facebook displayed over 8 million Obama friends.  Two-thirds of all campaign funds came from Obama’s online channel.

M OVIE : M AN OF THE Y EAR (2006)  This movie is a political comedy-drama film directed and written by Barry Levinson and starring Robin Williams. The film also features Christopher Walken, Laura Linney, Lewis Black, and Jeff Goldblum.  In the film, Williams portrays Tom Dobbs, the host of a comedy/political talk show. With an offhand remark, he prompts 4 million people to their support; then he decides to campaign for President.  The film was released October 13, 2006 and was filmed in Toronto and Hamilton, Canada and parts of Washington, D.C. 1-4

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-5 I NTERNET 101  The internet is a global network of interconnected networks.  and data files move over phone lines, cables and satellites.  Internet three roles: providers, clients & technology.  There are three types of access to the Internet:  Public internet  Intranet: network that runs internally in an organization.  Extranet: two joined networks that share information.

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-6 E- BUSINESS, E- COMMERCE, E- MARKETING  E-business is the continuous optimization of a firm’s business activities through digital technology.  E-commerce is the subset of e- business focused on transactions.  E-marketing is the result of information technology applied to traditional marketing.

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-7 E-M ARKETING I S B IGGER THAN THE W EB  The web is the portion of the Internet that supports a graphical user interface for hypertext navigation with a browser  The web is what most people think about when they think of the Internet.  Electronic marketing reaches far beyond the web.

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©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-9 E-M ARKETING I S B IGGER THAN T ECHNOLOGY  The Internet provides individual users with convenient and continuous access to information, entertainment, and communication.  Communities form around shared photos (Flickr), videos (YouTube), and individual or company profiles (Facebook).  The digital environment enhances processes and activities for businesses.  Societies and economies are enhanced through more efficient markets, more jobs, and information access.

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-10 G LOBAL I NTERNET U SERS

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©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-12 E-M ARKETING ’ S P AST : W EB 1.0  The Internet started in 1969 as the ARPANET, a network for academic and military use.  Web pages and browsers appeared in  The first generation of e-business was like a gold rush.  Between 2000 and 2002, more than 500 Internet firms shut down in the U.S.  By Q4 2003, almost 60% of public dot-coms were profitable.

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©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-14 T HE E D ROPS FROM E-M ARKETING  Gartner predicted that the e would drop, making e-business just business and e- marketing just marketing.  Nevertheless, e-business will always have its unique models, concepts, and practices.  Online search  Online data collection

INTERNET TECHNOLOGY AND EDUCATION IN S AUDI A RABIA  In 1993, KFUPM becomes the first Saudi institution to connect to the internet.  In 1994, Internet was first introduced to KSA when state academic, medical and research institutions got access to it.  In 1997, public access to Internet was allowed.  In 1999, the Internet was provided for college and government use.  In the early 21st century, Saudi universities use Interactive Television Technology (ITT) transmitted via fiber optic lines. 15

E MERGENCE OF E - LEARNING  In 2003, Aum Alqura University and KFUPM calibrated to establish e- learning center  In 2004, King Abdulaziz University established the Deanship of e-Learning and Distance Education.  In 2007, National Center for E-learning and Distance Learning was established. Also, Saudi television channels broadcast educational programs with assistance from the Ministry of Higher Education and the Ministry of Education. In addition, KSU established the Deanship of e- Learning and Distance Education.  In 2009, the first international conference e-learning and distance learning was held and organized by the Ministry of Higher Education and National Center for E-learning and Distance Learning. Also, University of Tabuk established Distance Education Unit.  In 2010, the list of distance education in higher education institutions in the KSA was officially published and approved.  In the school year , there were first distance education graduate students of King Abdulaziz University among Saudi universities. 1-16

1-17 S AUDI A RABIA I NTERNET U SERS ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-17 The number-(million) & the percentage of the population of internet users in Saudi Arabia (2001–2011)

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WEB 1.0 V. WEB

M ARKETING I MPLICATIONS OF I NTERNET T ECHNOLOGIES E-business & e-marketing opportunities flowing form the internet’s unique properties:  Lower costs.  Trackable measurable results.  Global reach.  Personalization.  One-to-one marketing.  More interesting campaigns.  Better conversion rates (increased purchases)  Twenty-four-hour marketing. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-20

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-21 E-M ARKETING T ODAY : W EB 2.0  Web 2.0 technologies connect people with each other through social media, which have created opportunities and challenges for marketers.  Power shift from sellers to buyers. Consumers trust each other more than companies. Market and media fragmentation. Online connections are critical

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CHALLENGES IN WEB 2.0  Inbound Marketing  Web companies getting found online, as opposed to interrupting customers to get them to pay attention to the ads, Website, products, and so forth…  Customer Engagement  Engagement involves turning on a prospect to a brand idea enhanced by the surrounding context.  Social Media Metrics  Voice of the customer  Does not measure site engagements  Does not track amount of conversation ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-23

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-24 A CQUIRING A C USTOMER FROM S OCIAL M EDIA

1-25 ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 25 OTHER OPPORTUNITIES AND CHALLENGES IN WEB 2.0  Internet adoption matures.  Online retail sales reach 4% of all sales.  Search engines are now reputation engines.  Content is still king.  Improved online and offline strategy integration  Intellectual capital rules  60% broadband adoption at home  The long tail

©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-26 T HE F UTURE : W EB 3.0  Appliances are converging and becoming “smart.” (LG)  Lines between traditional and new media are confusing.  Wireless networking is increasing (3G).  Semantic web will provide worldwide access to data on demand without effort.

1-27 A PPLIANCE CONVERGENCE (LG) 27

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©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-29 H OW DO EXPERTS CHARACTERIZE W EB 3.0?  Interactive media will cannibalize traditional media (Forrester Research).  Semantic web will be achieved and the mobile device will be the primary Internet connection tool by 2020 (Pew study).  Web 3.0 will ultimately be seen as applications which are pieced together…run on any device…are very fast…are distributed virtually (Eric Schmidt CEO of Google).

INTERNET-TIME ANALOGY ©2014 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL Atomic1929 Quartz Crystal1600’s Mechanical1583 AD Pendulum3500 BC Sundial Internet is here in 2013

E VOLUTION FROM W EB 1.0 TO W EB 3.0 ©2014 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 1-31 Web 1.0 Web 2.0 Web 3.0 Semantic Web Content creator (cc)Consumer (c) cc & c

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1-33 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2012 Pearson Education, Inc. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall