Internet Marketing 1

Internet Marketing

Chapter One

Early Internet Prophecies

“ The Internet is a tidal wave. It will wash over nearly all industries drowning those who don’t learn to swim in its waves”

Bill Gates CEO Microsoft

Online Marketing definitions• “The use of Internet and related digital information

and communications technologies to achieve marketing objectives”.

Institute of Direct Marketing

• ‘the process of building and maintaining customer relationships through online activities to facilitate the exchange of ideas, products and services that satisfy the goals of both parties’

Mohammed 2001

Internet Advantages & Disadvantageso The Internet can increase an

organisation’s geographic coverage beyond its traditional heartland.

o New customers can be reached.o The Internet provides a low cost

effective way of transacting with customers compared to traditional selling costs.

o A site can be open for business all day everyday providing customer convenience.

o The Internet is a fast and flexible communications tool

o Customer resistance to change, especially older and disadvantaged people.

o Public concerns over privacy issues, such as SPAM and chat-rooms.

o Lingering security doubts over fraud and Phishing (hackers) and network security and stability. (Worms).

o Lack of trust with unknown virtual traders.

o The Internet’s sensory boundaries limit senses like taste and touch which influence buyer decisions.

Ten C’s Of Marketing for the Modern Economy

1.Customer

2.Corporate Culture

3.Convenience 4. Competition

6.Consistency 

 10.Control

 9.Coordination 8.Customisation

7.Creative Content

5. Communications

CUSTOMERS

• Customer oriented tools: search engines, price comparisons sites, multi channel offerings with the help of user friendly technology.

• Online communities• Interruption marketing• Hybrid customers: call, click and visit

CORPORATE CULTURES

• IT architecture, front and back end office systems and partnerships

• Electronic data interchange

CONVENIENCE

• Enabled greater freedom, flexibility and convenience

• Digital technologies- mobile convenience-WiFi, PDA’s.

• Streamlining of ordering, invoicing, fulfilment, and payments

• Instant updation of prices, e catalogue

COMPETITION

• Traditional competitors moving online• New online only entrants in domestic markets• New online entrants from over seas• Competition from newly formed online

alliances and partnerships• Competitors introducing or eliminating

channels of distribution• Revitalized traditional businesses

COMMUNICATION

• Memorable domain names• Viral marketing/ bookmarks• Websites, online communities

CONSISTENCY

• Consistency in both online and physical worlds• Eg: Tesco

• Tesco plc (LSE: TSCO) is a British multinational grocery and general merchandise retailer headquartered in Cheshunt, United Kingdom.It is the third-largest retailer in the world measured by revenues (after Wal-Mart and Carrefour) and the second-largest measured by profits (after Wal-Mart).[It has stores in 14 countries across Asia, Europe and North America and is the grocery market leader in the UK (where it has a market share of around 30%), Malaysia, the Republic of Ireland and Thailand.

CREATIVE CONTENT

• Informative• Stimulating • Relevant to the needs of the target segment• Updates• Creative prompts and offers• Site stickiness• Content management systems

CUSTOMISATION

COORDINATION

• Real time dissemination of information from customer to shopping carts to orders and dispatch requests

CONTROL

• Power and ability to test events and activities• Response measurements provide marketers

with statistical and financial accountability• Tools for measuring online activities through

web analytics• E crm

Three Digital Routes

• Grasp the nettle – be visionary and exploit the web’s

potential.

• Follow the leader – a more cautious approach

learning from others’ mistakes.

• Stand Firm – revitalise the offline experience

e-readiness rank 2006

2005 rank Country 2006 e-readiness

2005 score

1 1 Denmark 9.00 8.74

2 2 US 8.88 8.73

3 4 Switzerland 8.81 8.62

4 3 Sweden 8.74 8.64

5 8 UK 8.64 8.54

6 8 Netherlands 8.60 8.32

7 6 Finland 8.55 8.32

8 10 Australia 8.50 8.22

9 12 Canada 8.37 8.03

10 6 Hong Kong 8.36 8.32

Economist Intelligence Unit e-readiness rankings, 2006

The Online Marketing Environment

Organisational Offerings

The Mix and the Ten C’s of Internet Marketing

Microenvironment Suppliers, distributors,Stakeholders & competitors

Macro environment STEP Analysis

The Customer

MICRO ENVIRONMENT FACTORS

• SUPPLIERS:stremlning supply chain management, vertical integration, improved information exchange: XML, EDI

• DISTRIBUTORS:new channels, information based products

• STAKEHOLDERS: emails, websites, intranets• COMPETITORS:

MACRO-ENVIRONMENT FACTORS

• SOCIETAL: Three key developments in customers’ lifestyles and attitudes

• cash rich , time poor• Increased leisure times• Increased technological ownership

Technological

• Database marketing• Packet switching and TCP/IP standards: became

the back bone of the merging web• HTML and GUI: Provide vibrant graphical , video ,

audio and text formatted communication.• FTP and SSL: ensure exchange of files and other

messages in a safe and convenient way.• DSL/3g/Broadband: provide both speed and

capacity for video and audio streaming.

Economic

• Growth of information Age• Buyers and sellers : digital market space• E procurements• Increase competition• Disintermediation and reintermediation of supply

chains. Distribution channels• Effects on employment levels• Improved reach facilitate improved economies of

scale.

Political

• Electronic polling and voting• Electronic communication by police• Coordination of international unions• Establishment of intellectual property acts• Establishment of an efficient regulatory

framework• Establish links with other governments

education or famine.

Thank You