Download E-Business in Contemporary Marketing

4
CHAPTER
E-Business in Contemporary
Marketing
Chapter Objectives
4 Explain business-to1 Define e-business and
7
discuss how marketers
consumer (B2C) euse the Internet to achieve
marketing.
business success.
5 Identify online buyers and
Distinguish between a
sellers.
2 corporate Web site and a
6 Describe some of the
marketing Web site.
8
challenges associated
with online marketing and
3 List the major forms of
B2B marketing.
e-business.
Discuss how marketers
use the communication
function of the Web as
part of their online
marketing strategies.
Outline the steps involved
in developing successful
e-business Web sites and
identify methods for
measuring Web site
effectiveness.
CHAPTER 4 E-Business in Contemporary Marketing
WHAT IS E-BUSINESS?
• E-business Firm that targets customers by collecting and analyzing
business information, conducting customer transactions, and maintaining
online relationships with customers.
• E-marketing Strategic process of creating, distributing, promoting, and
pricing goods and services to a target market over the Internet or through
digital tools.
CHAPTER 4 E-Business in Contemporary Marketing
CAPABILITIES AND BENEFITS OF E-MARKETING
Global Reach
Personalization
Interactive Marketing
Right-time Marketing
Integrated Marketing
CHAPTER 4 E-Business in Contemporary Marketing
TYPES OF BUSINESS WEB SITES
• Corporate Web site Site designed to increase a firm’s
visibility, promote its offerings, and provide information
to interested parties.
• Purpose is to build customer goodwill and assist
channel members in their marketing efforts.
• Marketing Web site Site whose main purpose is to
increase purchases by visitors.
• Many try to engage visitors in interactions that
move them closer to a desired marketing outcome.
CHAPTER 4 E-Business in Contemporary Marketing
B2B E-MARKETING
• Business-to-business (B2B) e-marketing Use of the Internet for business
transactions between organizations.
• Accounts for 90 percent of all e-business activity.
• Accounts for 10 percent of all B2B transactions.
• Increases efficiency of business transactions, which typically involve more
steps than consumer transactions.
• Electronic data interchange—computer-to-computer exchanges of price
quotations, purchase orders, invoices, and other sales information between
buyers and sellers.
• Web services—Internet-based systems that allow parties to communicate
electronically with one another regardless of the computer operating system
they use.
CHAPTER 4 E-Business in Contemporary Marketing
• Extranets—secure networks used for e-marketing and accessible through
the firm’s Web site by external customers, suppliers, or other authorized
users.
• Private exchanges—secure Web site at which a company and its suppliers
share all types of data related to e-marketing, from product design through
delivery of orders.
• Electronic exchanges—online marketplaces that bring buyers and sellers
together in one electronic marketplace and cater to a specific industry’s
needs.
• E-procurement—Web-based systems that enable all types of organizations
to improve the efficiency of their bidding and purchasing processes.
CHAPTER 4 E-Business in Contemporary Marketing
ONLINE SHOPPING AND B2C E-MARKETING
• Business-to-consumer (B2C) e-marketing Selling directly to consumers
over the Internet. Also called e-tailing.
• Service providers such as banks are an important segment of e-tailing.
• Two types of B2C Web sites
• Shopping sites
• Information sites
CHAPTER 4 E-Business in Contemporary Marketing
ELECTRONIC STOREFRONTS
• Electronic storefront Company Web site that sells products to customers.
• Growth anticipated with the increase in broadband connections.
• Broadband shoppers typically spend 34 percent more online than
narrowband shoppers.
BENEFITS OF B2C E-MARKETING
• Lower prices.
• Convenience.
• Personalization.
CHAPTER 4 E-Business in Contemporary Marketing
ONLINE BUYERS AND SELLERS
• Demographics of customers are changing as Internet penetration grows.
CHAPTER 4 E-Business in Contemporary Marketing
E-BUSINESS AND E-MARKETING CHALLENGES
ONLINE PAYMENT SYSTEMS
• Companies have developed secure payment systems to protect customer
information.
• Encryption, Secure Sockets Layer, and electronic wallets.
PRIVACY ISSUES
• Protection of personal information is customers’ top security concern.
• Cookies and spyware allow companies to personalize Internet experience
but also invade computer users’ privacy.
• To reassure customers, many online merchants have signed on with online
privacy organizations such as TRUSTe.
• Companies install firewalls to protect private corporate data.
CHAPTER 4 E-Business in Contemporary Marketing
INTERNET FRAUD
• Internet Crime Complaint Center logged more than 231,000 complaints in a
recent year.
• Phishing High-tech scam that uses authentic-looking e-mail or pop-up
messages to get unsuspecting victims to reveal personal information.
• Payment fraud is also growing.
WEB SITE DESIGN AND SERVICE
• As many as 70 percent of Internet shopping carts are abandoned before any
purchase is made.
• Companies that have brick-and-mortar experience often have more
experience satisfying customers than Internet-only retailers.
CHANNEL CONFLICTS
• Direct sales to customers can compete with business partners such as
retailers and distributors, disputes called channel conflicts.
CHAPTER 4 E-Business in Contemporary Marketing
USING THE WEB’S COMMUNICATION FUNCTION
• Web has four main functions: e-business, entertainment, information, and
communication.
• Communication is Web’s most popular function.
• Firms use e-mail to communicate with customers, suppliers, and other
partners.
• Spam Popular name for junk e-mail.
ONLINE COMMUNITIES
• Internet forums, newsgroups, electronic bulletin boards, and Web
communities that appeal to people who share common interests.
CHAPTER 4 E-Business in Contemporary Marketing
BLOGS
• Blog Short for Web log, an online journal written by a blogger.
• Some incorporate wikis and podcasts.
• Corporate blogs can help build brand trust.
• Employee blogs can humanize a company, but negative comments can harm
it.
WEB-BASED PROMOTIONS
• Banner and pop-up ads on Web sites, and online coupons.
• Search marketing Paying search engines, such as Google, a fee to make
sure that the company’s listing appears toward the top of the search results.
CHAPTER 4 E-Business in Contemporary Marketing
• Planning and preparation—company’s goal for its Web site determines
scope, content, and design.
• Will the site be maintained in-house or by a contractor?
• What will the site be named?
• Content and connections—important factor for whether visitors return to
a site.
• Relevant to viewers, easy to access and understand, updated
regularly, and compelling and entertaining.
• Most small businesses are better off outsourcing to meet their hosting
and maintenance needs.
• Costs and maintenance—development, placing the site on a Web server,
and maintaining, updating, and promoting the site.
CHAPTER 4 E-Business in Contemporary Marketing
MEASURING WEB SITE EFFECTIVENESS
Click-through rate Percentage of people
presented with a banner ad who click on it.
Conversion rate Percentage of visitors to a
Web site who make a purchase.