1. Internet Marketing & e-Commerce Ward Hanson Kirthi Kalyanam Requests for permission to copy any part of the material should be addressed to: PERMISSIONS DEPARTMENT THOMSON BUSINESS and ECONOMICS 5109 Natorp Boulevard Mason, OH Phone: (800)

2. Part One: Chapter Two A Digital World
“When if ever will the astounding increase in the productivity growth, and in the growth of productivity growth, of computers end?”
W. Nordhaus, The Progress of Computing

3. The State of Being Digital
Something is digital when all of its properties and information are stored as a string of zeroes and ones

4. The State of Being Digital
Something is digital when all of its properties and information are stored as a string of zeroes and ones
Those zeroes and ones are called bits

5. The State of Being Digital
Something is digital when all of its properties and information are stored as a string of zeroes and ones
Those zeroes and ones are called bits
Everything on the Internet is digital

6. The State of Being Digital
Something is digital when all of its properties and information are stored as a string of zeroes and ones
Those zeroes and ones are called bits
Everything on the Internet is digital
The falling cost of digital technology is one of the most powerful forces in the modern economy

7. Understanding Moore’s Law
Intel co-founder Gordon Moore observed that each generation of computer memory chips – released about every 18 months – could pack the same technology into half the space
Source: AP/World Wide Photos

8. Understanding Moore’s Law
Moore’s Law applies broadly to computing and technology costs
Computer speed since the 1970s has increased roughly 75 billion times
The cost of technology and storage, meanwhile, has dropped sharply

9. The Fast Fall of Digital Storage Costs
Source: Brian Hayes, “Terabyte Territory,” American Scientist 90 (May–June 2002)

10. Putting Moore’s Law to Work Substituting digital material when possible can lead to substantial savings

11. Putting Moore’s Law to Work Substituting digital material when possible can lead to substantial savings
Sun Microsystems as early as 1995 saved hundreds of thousands of dollars by moving to online customer support

12. Putting Moore’s Law to Work Substituting digital material when possible can lead to substantial savings
Sun Microsystems as early as 1995 saved hundreds of thousands of dollars by moving to online customer support
Online software distribution saved Sun an estimated $1.5 million per quarter compared to traditional distribution

13. Digital Substitution Other examples:
Online banking services, such as automatic payroll deposit
Wireless laptops for sales representatives working in the field
Other potential uses:
Automatic online language translations

14. Digital Environments
Technology allows users to create virtual spaces to display information, tell stories, educate or amuse
For marketers, new ways to reach consumers and promote a product

15. Digital Environments Augmented reality and the virtual first down line
Source: ELIOT J. SCHECHTER/EPA/Landov

16. Key Features of Digital Environments
Procedural: Computers must be taught what to do in a digital environment

17. Key Features of Digital Environments
Procedural: Computers must be taught what to do in a digital environment
Participatory: Effectiveness depends on ease of consumer use and interactive potential

18. Key Features of Digital Environments
Procedural: Computers must be taught what to do in a digital environment
Participatory: Effectiveness depends on ease of consumer use and interactive potential
Spatial: Realistic features are important but hard to create in business setting

19. Key Features of Digital Environments
Procedural: Computers must be taught what to do in a digital environment
Participatory: Effectiveness depends on ease of consumer use and interactive potential
Spatial: Realistic features are important but hard to create in business setting
Encyclopedic: Low cost allows almost endless storage capacity

20. Digital Convergence
Cheap and powerful digital technology has contributed to the merging of industries, technology and content

21. Digital Convergence
Cheap and powerful digital technology has contributed to the merging of industries, technology and content
One crucial area: convergence of computing, communications and media content

22. Digital Convergence
Cheap and powerful digital technology has contributed to the merging of industries, technology and content
One crucial area: convergence of computing, communications and media content
When barriers between industries fall, marketers have greater flexibility to choose the best medium for the pitch

23. Digitizing the Marketing Process
Retain and digitize existing materials
Substitute digital materials into marketing process
Change marketing processes to better use digital features
Archive
Substitute
Redesign

24. Digitizing the Marketing Process
Digital capabilities allow businesses to better understand their customer
Key example: The online focus group

25. Digitizing the Marketing Process
Digital capabilities allow businesses to better understand their customer
Key example: The online focus group
Digital capabilities allow businesses to redesign and streamline transactions
Key example: Airlines and the evolution of e-ticketing