1. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 1 chapter 19 Prepared by Angela Zigras, Seneca College Deborah Baker, Texas Christian University INTERNET MARKETING

2. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 2 You Will... 1.Have a basic understanding of the origins of the Internet, e-commerce and e-business. 2. Be familiar with the characteristics and demographic composition of the global population of Internet users. 3. Appreciate the need for timely, accurate information in the new economy.

3. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 3 You will … 4. Understand the impact of Internet technologies on the market planning process. 5. Be able to ask the questions necessary to develop a comprehensive marketing strategy that mixes traditional and new economy methods.

4. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 4 The Birth of the Internet  Internet was used for the first time in 1982.  It began to expand in 1991 with the World Wide Web.  Internet technologies pose managerial implications to business.  Students must learn how technology affects business operations.

5. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 5 The Role of the Internet in Marketing  The fastest growing communications technology.  Within the first five years, 50 million people were connected.  As of November 2000 there were 407.1 million Internet users worldwide.  Capable of interactively sharing information in real time.

6. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 6 A New Tool Pureplay An organization or enterprise operating strictly in an on-line environment Bricks and Clicks An enterprise that integrates both a physical and a Web presence.

7. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 7 Electronic Tools.. Cookies Computer codes that enter users’ hard drives and act as identifiers so that organizations can present repeat visitors with customized sites. Data Mining A technique used by researchers to search for patterns in data sets that will provide insight into consumer behaviour.

8. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 8 New Tool to Reach Consumer Internet Postal Service Television Telephone Radio

9. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 9 Internet Demographics and Trends Push Strategy Television, Radio, Print Pull Strategy Internet

10. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 10 Decision Variables of the Marketing Mix Decision Variables of the Marketing Mix DecisionVariables Organizations moving away from standardized, mass distributed products Customer Service and Relationship building Using technology to provide consumers with “virtual” trial products Pricing Strategies

11. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 11 Basic Forms of Virtual Business Business-to-Consumer (B2C) Business-to-Consumer (B2C) Basic Forms of Electronic Commerce Basic Forms of Electronic Commerce Business-to-Business (B2B) Business-to-Business (B2B)

12. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 12 The Internet Presence Engage in interactive, personalized communications E-mail Web Sites On-line Banner Ads On-line Banner Ads Virtual storefronts and inventory systems Easy access to delivery info Easy access to delivery info Lower storage costs Lower storage costs Reduces Inventory Reduces Inventory

13. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 13 Internet Demographics and Trends FactorsInfluencingOn-Line Buying Behaviour FactorsInfluencingOn-Line Attitude toward technology Income Motivation to use Technology

14. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 14 Internet Buyer Categories Internet Early Adopters “Mainstreamers” Laggards Internet Demographics and Trends

15. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 15 Consumer Characteristics

16. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 16 Consumer Characteristics by Age Group

17. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 17 E-Commerce Facts Cars/Car parts ComputersClothingBooksCDs/Video Top On-line Shopping Categories BooksCDs/VideosComputersClothingSoftware Top On-line Purchasing Categories

18. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 18 Connectivity  Increasing connectivity worldwide.  Users are becoming more homogeneous.  Governments are introducing legislation to restrict how personal information is used.

19. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 19 Research Secondary Research Secondary Research Research based on existing data or information Primary Research Research conducted for a specific purpose at the time it is needed

20. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 20 Internet and On-line Research The Web inMarketingResearch inMarketingResearch Vast information sources for secondary research Vast information sources for secondary research Better primary research Web-based surveys and focus groups Web-based surveys and focus groups Information about competitors

21. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 21 Advantages of Electronic Publications Information content that is more current The ability to make complex searches Easier access to worldwide information Incorporation of multi-media Lower publication costs

22. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 22 The Virtual Community Bulletin Boards Chat Rooms Newsletters Discussion Lists Types of VirtualCommunities VirtualCommunities

23. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 23 Internet’s Influence on The Global Village Broadens and enhances access in developing nations Broadens and enhances access in developing nations Allows businesses to “leapfrog” into development Allows businesses to “leapfrog” into development Levels playing field for disadvantaged countries Levels playing field for disadvantaged countries

24. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 24 The Digital World Value Speed Global Marketing Implications

25. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 25 Strategies for Web Success 1. Offer Customer Driven Products 1. Offer Customer Driven Products 2. Define the Product 3. Set the Price 4. Distribute the goods

26. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 26 Examples of Internet Strategies Increase or enhance exposure Improve customer service Provide new products/services Add value to existing products/services Lower overall company costs Create one-to-one customer relationships

27. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 27 Planning On-Line Positioning  Identify the most important target market  Identify that market’s on-line need  Determine how the company’s Internet presence meets that need  Identify how the on-line presence is better than the competition.

28. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 28 Factors in Internet Marketing Programs FactorsinInternetMarketing Degree of program sophistication Program Magnitude Program Dynamics Prior Internet marketing experience

29. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 29 Uses of Interactive Web Sites Execute Transactions Deliver Electronic Products and Services Collect Demographic and Behaviouristic Customer Data Welcome to my Web Site. You are Visitor Number 495,251

30. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 30 Key Success Factor for Internet Businesses

31. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 31 Internet Marketing Objectives InternetMarketingObjectivesInternetMarketingObjectives Sales Level Repeat Purchase Market Positioning Image Brand Awareness On-Line Market Share

32. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 32 On-Line Promotion Banner Advertisements Button Advertisements Interstitial Advertisements Untargeted E-Mail Marketing Targeted E-Mail Marketing

33. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 33 Charging different prices for different channels can be effective if: Pricing on the Internet  Channel use behaviour is an effective means to segment the market  There is a benefit to encourage use of one channel rather than the other

34. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1919 - 34 Evaluating the Outcome Hits Capturing Web Statistics Capturing Web Statistics Page View Site Registration Cookie Technology