1. Consumer Behavior Online E-M ARKETING /6E C HAPTER 7

2. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-2 C HAPTER 7 O BJECTIVES  After reading Chapter 7, you will be able to:  Discuss general statistics about the Internet population.  Describe the Internet exchange process and the technological, social/cultural and legal context in which consumers participate in this process.  Outline the broad individual characteristics and consumer resources that consumers bring to the online exchange.  Highlight the four main categories of outcomes that consumers seek from online exchanges.

3. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-3 T HE C USTOMER ’ S S TORY  A typical one-hour adventure in the life of a 25- year-old professional, Justin:  Tunes his iPod to the latest Diggnation podcast while his TV is tuned to a soccer game and his cell phone and PC are within reach.  Picks up his computer to find a blog mentioned during the podcast, sees a video on the blog and texts a friend about the video.

4. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-4 T HE C USTOMER ’ S S TORY, CONT.  Justin searches for the video title on Google and finds a job posting on Vimeo, an online video-posting site.  He posts a link to the video and Vimeo site to his Twitter stream.  Justin is the new consumer: a multitasker attending to different media simultaneously.  How can a marketer capture dollars from these behaviors?

5. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-5  76% of U.S. consumers use the Internet.  Less connected groups tend to be:  Older  Less educated  In ethnic minority groups  Childless  Rural  Lower income C ONSUMERS IN THE 21 ST C ENTURY

6. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-6 C ONSUMERS IN THE 21 ST C ENTURY, CONT.  In 2009, 1.8 billion people had access to the Internet, 27% of the global population.  Top ten countries account for 38% of all users and adoption rates range from 7- 77%.  Internet usage in developed nations has reached a critical mass, leading marketers to ask more questions about consumer behavior on the Internet.

7. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-7 I NTERNET R EACHES M ATURITY : 1995-2010

8. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-8  Exchange is a basic marketing concept.  It refers to the act of obtaining a desired object by offering something in return.  Exchange occurs within the following contexts:  Technological  Social/cultural  Legal T HE I NTERNET E XCHANGE P ROCESS

9. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-9 T HE O NLINE E XCHANGE P ROCESS

10. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-10 T ECHNOLOGICAL C ONTEXT  63% of online Americans connect to the Internet at home with broadband.  Broadband users enjoy more multimedia games, music, and entertainment than do those accessing from a mobile device or 56K modem.  The typical U.S. home has 26 different electronic devices for media and communication.

11. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-11 U.S. D AILY M EDIA U SE

12. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-12 S OCIAL AND C ULTURAL C ONTEXTS  The cornerstones for attracting customers online:  Reputation  Relevance  Engagement 7-12

13. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-13 E NGAGING C USTOMERS

14. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-14  Despite piracy laws, illegally used software abounds.  In spite of the Can-Spam law, the number of unsolicited emails has increased.  However, when the recording industry sued illegal music file downloaders, consumer behavior changed.  In 2002, 37% of online consumers shared music files.  Only 23% shared files in 2004. L EGAL C ONTEXT

15. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-15  Individual characteristics affect Internet use.  Demographics such as age, income, education, ethnicity, and gender.  Attitudes toward technology.  Online skill and experience.  Goal orientation. I NDIVIDUAL C HARACTERISTICS & R ESOURCES

16. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-16 C ONSUMER R ESOURCES  Consumers perceive value as benefits minus costs.  These costs constitute a consumer’s resources for exchange:  Monetary cost  Time cost  Energy and psychic costs

17. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-17 U.S. C OMBINED H OME /W ORK INTERNET USAGE 7-17

18. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-18 E XCHANGE O UTCOMES  There are 5 basic things that people do online:  Connect  Create  Enjoy  Learn  Trade  Each is ripe with marketing opportunity.

19. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-19 C ONNECTING O NLINE IN THE U.S.

20. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-20 C REATING & U PLOADING C ONTENT IN THE U.S.

21. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-21 E NTERTAINMENT O NLINE IN THE U.S.

22. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-22 T OP 10 S EARCH T ERMS FOR 2009

23. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-23 L EARNING AND G ETTING I NFORMATION

24. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 7-24 T RADING O NLINE IN THE U.S.

25. 7-25 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