1. 1 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) February 24, 2009 e-Marketing (eBiz/Mktg 543) A Quick Recap Arvind Rangaswamy Web address: www.arvind.info email: arvindr@psu.edu

2. 2 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Recap of Cases/Contexts We Covered  Digital (Paypal, Real Networks) and Non-digital (Dove, Avon, Burger King).  Technology-driven (e.g., Online Grocers, Paypal) and Business-driven (e.g., Four Seasons, Dove).  Successful (e.g., Avon) and unsuccessful (e.g., Webvan) online attempts.  Different business models (e.g., Online grocers, MedNet).

3. 3 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) High-Level Overview  Question 1: To what extent should we digitize our product, service, process, or relationships? What incremental value would that offer to our customers and other stakeholders?  Question 2: Should we “network” our product, service, process, or relationships? What incremental value would that offer to our customers and other stakeholders?  Question 3: Can we improve current “reality” by adopting e-marketing strategies?  Question 4: How do we align online marketing strategies with business strategies to improve one or more of the following: (1) marketing productivity, (2) customer responsiveness, (3) company or product differentiation, or (4) innovation. Marketing in the connected world of tomorrow is going to look very different from marketing in yesterday’s world – it will be more of an interactive and collaborative process.

4. 4 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Learning Points Emerging Strategic Context of Marketing  Technology as an enabler  Seller-centric markets  Physical assets  Decreasing returns to scale  Vertical integration (size)  Market share  Firm-centric marketing strategies  Technology as a transformer  Customer-centric markets  Physical + Knowledge assets  Sometimes increasing returns to scale (network effects)  Virtual integration (speed)  Strategic control  Network-centric and customer- centric marketing strategies (connected and collaborative marketing processes) Yesterday’s Economy Tomorrow’s Economy

5. 5 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Digital-Networked-Mobile Convergence: The Evolution of Information Access Analog Standalone Fixed location Digital Networked Mobile Digital and Networked Digital, Mobile Networked Digital, Mobile Library Mobile Networked

6. 6 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Supplier network Customer/Market network Extranet IntranetInternet e-Operations e-Marketing Company’s digital infrastructure Real-time Enterprise Real-time is an organizational capability, powered by customer-centered information and process management architectures, for anticipating and responding to changing customer and market needs as fast, or faster than, those changes. Customer-driven Activities and flows Emerging Global Real-Time Enterprises Focused on Customers 6 © 1998-2005, Arvind Rangaswamy (All Rights Reserved)

7. 7 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) The Increasing Need for Strategy/IT Alignment Markets Corporate IT Architecture ProcessesResources Processes/ Capabilities Resources Governance IT Scope Systemic Competencies IT Governance Distinctive Competencies (Why?) Business Scope (What?) Governance (How?) Business StrategyIT Strategy Business operations IT operations

8. 8 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Multi-Channel Marketing Corporate Marketing Product Divisions Customers Store/ Retailers Catalog Sales Force Call Center Web Site Third Party Logistics Providers

9. 9 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Marketing Funnel (Example Conversion Rates) $$ Spent $$$ Got 300 100 10% Impressions (can also have multiple impressions per visitor) Clickthroughs Conversion to Sales ROI 1% 5% 10% 1% Visitors

10. 10 © Arvind Rangaswamy, 2005-2009 (All Rights Reserved) Offering Augmentation (1-800-Flowers) Flower / Gift Decision Process Need Recognition Search For Ideas and Offerings Purchase Decision Message Selection Post Sales Support and Perks Education on Flowers and Decoration Gift reminder service Holiday specials Everyday celebrations suggestions Special occasion suggestions Product price Product picture Product description Delivery information Delivery availability Gizmo fully-animated greeting cards Physical cards in gifts Post-Sales Support Order receipt email eQ&A online customer service FAQ Customer service inquiry form Perks Miles earned with flower purchases Free gifts Discounts at AOL & BN with flower purchases Member specials “Care and handling” “Do it yourself” Special events and educational workshops held at stores Evaluation of Alternatives Gift guru Favorite gifts Gift frequency Gift impossible Gift baskets Corporate gift services Ideas and Information Floral ideas Garden ideas Home ideas Gift ideas Gourmet ideas Store locator Recommendations by budget Best sellers Gift Recommendations Shopping basket e-commerce transaction Special shopping features –Delivery outside U.S. –1-800-lasfloras.com Offering Source: Adapted from Rayport and Jaworski