MARKETING STRATEGY

OF

WEB DESIGNING

SERVICE

SUBMITTED TO: SUBMITTED BY:

Mr. SP KETKAR SHUBHADIP BISWAS

[FT-10-948]

EXECUTIVE SUMMARY

The Internet commerce industry in India has seen a manifold increase in the last couple of years,

with the total market size increasing from Rs 19,688 crore by the end of 2009 to an estimated Rs

31,598 crore in 2010.

By the end of 2011, the net commerce market size is expected to grow by 47 per cent and touch

Rs 46,520 crore, the study by the industry body said.

We will initially focus almost exclusively on small companies looking to develop an Internet

presence for the first time. We will market our services to small business owners as a "step-by-

step" process, initially starting out with a small, simple website, then gradually improving and

adding to the site and their entire online marketing efforts.

Although we plan to bring on many clients who simply will need an online presence and nothing

more, our most important and sought after clients will be those business owners who are ready to

implement a larger percentage of their company onto the Internet. This type of client will

traditionally need one of the following services:

E-commerce/shopping cart.

Database driven websites.

Dynamic content and website features.

Aggressive online website marketing.

With more than 930 million inhabitants, a projection of 60 million Internet users and set to grow

rapidly to the third largest Internet user base in the world, the number of Internet users

worldwide is expected to touch 2.2 billion by 2013.

In a time when the outsourcing of projects is favored, many companies and brands in India are

making a stand in the Web industry. Although Indian designers follow the web design trends of

the world, there is a relatively low demand internally. Now that communication is so easy and

uncomplicated with new and constantly improving technologies, overseas companies are

flocking to Indian creative firms. This way, they get quality work done at a lower cost, although

there has been an increase in price evaluation in recent years. Described as the paradise of

outsourcing, however, the reality is that wages are rising in India. The cost advantage for off

shoring to India used to be at least 1:6. Today, it is at best 1:3. Attrition is a frightening concept

but unavoidable. Jobs that are low value-added and easily automated will very likely disappear

within the next decade or so.

There is a lot of talk about India moving up the value chain. Some of that has indeed happened.

An industry that gained momentum is software development. Indian software developers were

tapped to help fix the ―Y2K‖ problems in old software code and the industry have blossomed

beautifully into one that offers a more comprehensive spectrum of services. Yet India is still the

world‘s back office. India‘s tech and web industry has an abundance of worker bees. What

customers expect or want, India will provide no questions asked.

With this boom in offshore outsourcing, India‘s software and services exports are estimated to

grow rapidly. Rates are rising quickly in all markets and the lowest rates are in Pakistan and

Ukraine. While America and India are in the middle, Europe and California are the most

expensive. In the tech world, one must really classify California as a ―country‖ on its own

separate from America. Russia is regional, while there is almost no development services

exported from Japan (low supply) and from the hyper-fast growing economies like China (too

much internal demand).

Given our experience and expertise in both commercial Web development and business-to-

business sales, we believe we can offer a unique and superior service to small business owners,

in comparison to what is currently available.

The demand and growth rate for Web development and marketing services in the small business

market is at an all time high and shows no sign of slowing anytime soon. Even more astonishing

is the fact that very few Web development companies have taken advantage of the opportunity,

as there are no dominating participants in this huge market.

We believe the reason for this virtually untapped market is due to expensive project costs, the

highest profit margins in Web development today are in servicing large- and medium-sized

corporations. We have developed a system that dramatically reduces steep project costs and

henceforth will allow us to offer the same high-end Web development services as larger

companies receive at a much lower cost to the client.

NAME OF COMPANY: WEBSAGA

Objectives

To provide customers the best quality & professional looking website which improves their

business development .

Other objectives:

1. Revenues of rs 600,000/- by month 8 .

2. Net Profit of 26% in year one and 36% in year two.

3. 65% Gross margin by month 8

Mission

Our mission is to provide affordable, accessible, and streamlined Internet and Web services to

small businesses. We have developed a system for offering many different types of Web

services (site development, hosting, marketing, and maintenance) that are exclusively tailored to

fit the needs and resources of small companies. Goal is to achieve high level of customer

satisfaction by delivering projects within stipulated time.

Company Location

Kolkata, West Bengal—close to our target market area--- approximately 1,700 sq. ft. capable of

housing workstations for up to 15 workers.

Services

We focus mainly on the Web, offering the following as our key 'Bread & Butter' website

services:

Design and development.

Marketing and analysis

Website renovations and upgrades.

Application development (i.e. chatrooms, message boards, online polling, live-feed

audio/video, etc.).

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

4000000

4500000

YEAR 1 YEAR 2 YEAR 3

SALES

GROSS MARGIN

NET PROFIT

Website maintenance training.

Internet/website education seminars.

Database construction.

Result-based website marketing.

Sales Literature

We will distribute a sales folder with all the pertinent information about our company and

services. This folder includes our strong points, history, portfolio examples, and pricing packages

info. It also contains facts based on the growth and popularity of the Internet for small

businesses.

We will design website that provides information about the company, plus a variety of helpful

resources for small business owners which we will be constantly updating.

In the next six months, we plan to produce and distribute bulk mail and fax flyers promoting our

Web development and hosting services to small businesses.

We have plans to offer a more compact version of our main sales folder in a brochure format.

This brochure will be available both as a mailer to interested parties and as a sales solicitation in

area businesses.

Fulfillment

For the website design, development, marketing, analysis, and maintenance we will employ

industry professionals to handle our clients' needs. To keep employee costs low, we have

designed a "team" development system that will consist of two full-time sales people and three

full-time Web developers. Of the Web developers, one position will be filled by a highly-

qualified senior Web professional and two lesser-qualified, lower paid developers. All three will

work full-time on separate projects provided to them by the sales people. However, the senior

developer will have the duty of maintaining the same high quality level of work in the junior

developers' projects,

For the website hosting services we will form several alliances with industry leaders to provide

top-rate, reliable hosting solutions. Forming the alliances has allowed us much flexibility in

important hosting features, customizability, and it has drove costs down dramatically. All these

benefits are crucial to preserving the integrity of our company as being a 'fully-rounded Internet

solutions provider' for small businesses.

MARKET ATTRACTIVENESS:

MACRO LEVEL

India has revealed that India‘a E-commerce market is growing at an average rate of 70 percent

annually and has grown over 500 percent since 2007.

The current estimate of US$ 6.79 billion for year 2010 is way ahead of the market size in the

year 2007 at $1.75 billion. The following chart depicts the growth of E-commerce in India in the

last couple of years:

websites have become a door of opportunity, and business contacts

The Internet commerce industry in India has seen a manifold increase in the last couple of years,

with the total market size increasing from Rs 19,688 crore by the end of 2009 to an estimated Rs

31,598 crore in 2010. By the end of 2011, the net commerce market size is expected to grow by

47 per cent and touch Rs 46,520 crore.

Comprising about 81 per cent of the total e-commerce in the country, the online travel market,

which includes booking rail and air tickets, hotel accommodations and tour packages, is

estimated to grow by 50 per cent and touch Rs 37,890 crore by December, 2011.

In the travel portfolio, which was worth Rs 14,953 crore in 2009, domestic air travel contributed

63 per cent, followed by railway tickets (28 per cent).

According to the study, around 7.4 million people in the country bought products over the

Internet in 2009.

In India, Internet user base grew by 35 per over last year and the Internet penetration

combining broadband and mobile Internet have touched over 100 million users, which is

around 7-8 per cent of the 1.2 billion population,‖

Internet Usage and Population Statistics:

YEAR Users Population % Pen.

1998 1,400,000 1,094,870,677 0.1 %

1999 2,800,000 1,094,870,677 0.3 %

2000 5,500,000 1,094,870,677 0.5 %

2001 7,000,000 1,094,870,677 0.7 %

2002 16,500,000 1,094,870,677 1.6 %

2003 22,500,000 1,094,870,677 2.1 %

2004 39,200,000 1,094,870,677 3.6 %

2005 50,600,000 1,112,225,812 4.5 %

2006 40,000,000 1,112,225,812 3.6 %

2007 42,000,000 1,129,667,528 3.7 %

2009 81,000,000 1,156,897,766 7.0 %

2010 100,000,000 1,173,108,018 8.5 %

the boom in offshore outsourcing—cost advantage 1:3

Most of small, medium companies are not using webpage-but realizing the benefit.

Non-users of website have no preference for known and tested brands.

Techno-savy business scenario

3 out of 4 Internet users are now on the net ‗daily‘.

the post 1990s globalization and the free enterprise policies

Statistics about Internet usage considering Age Group and Gender :

2/3rd households have ‗multiple‘ users in them

97% are regular users and 79% use daily

70% of people who know computer have used Internet

19-40 years age group constitutes nearly 85% among Internet users

85% of Internet users are male

11% of working women, 6% non-working women and 2% housewives use Internet which

is not a very good sign

46% of net users are graduate, 26% are post-graduate

Statistics about Internet usage considering cities :

Mumbai has most number of Internet users nearly 3.24 million

Delhi holds the second place with 2.66 million

Top ten cities having most number of Internet users are Mumbai, Delhi, Banglore,

Kolkata, Chennai, Pune, Hyderabad, Surat and Nagpur.

These 10 cities has 37% of the total numbers of Internet users in India.

Statistics about Internet usage considering browsing habits :

94% of total users use Internet for Email purposes

72% of total users use Internet for download music (73%) followed by Chatting (56%)

Other major purposes for using Internet are job searching (56%), social networking

sites(54%) and finding information on search engine (52%)

13,188,580 Facebook users on August 31/10, 1.1% penetration rate of total Internet users

Cyber cafes account for maximum Internet usage with over 37% of all users accessing

Internet through cyber cafes

The supportive policy environment created by the Government of India has played a key

role in the rapid development of this sector. While policies have effected infrastructural

development of leading cities as IT-BPO destinations in India, additional work needs to be done

in developing tier 2/3 cities as viable IT-BPO service delivery locations.

In a globally integrated economy, outsourcing is leading to overall benefits for the source

economies, providing significant monetary and employment benefits.

The silver lining of the economic downturn is the opportunity for the industry to enhance its

overall efficiency. Companies are increasingly looking inwards and focusing on process

benchmarking, enhanced utilization of infrastructure and talent, increasing productivity and

greater customer engagement. Coupled with wage moderation and lower attrition, these

measures will help industry sustain its margins and invest in future growth.

The Government‘s proactive approach towards the IT-BPO industry was further highlighted in

2008 through actions such as the IT Act Amendment, extension of tax incentives by a year,

removal of the SEZ Act anomalies and the introduction of progressive telecom policies that

focus on work from home.

India is the leading country for offshore outsourcing. The offshore outsourcing industry started in

India and it has be able to grow the IT and BPO export sector to $47 billion and capture more

than half the offshore outsourcing industry. That is not to say that India does not have challenges

or is the best location for every offshore outsourcing effort, but it has an unparalleled history and

size.

The Americas and Europe are the largest customers for the Indian outsourcing industry and

account for 60 percent and 31 percent respectively of IT and BPO exports. The largest vertical

sectors are financial services (41 percent), high-tech/ telecom (20 percent), manufacturing (17

percent) and retail (8 percent). In 2009 the IT and BPO export industries employed about 2.2

million people.

IT and BPO services outsourcing first started in India in the mid 1980s. The large, English

speaking, low-cost workforce was the main attraction. The industry grew rapidly through the

1990s aided by the dot com boom and IT upgrades to prepare for potential Y2K bugs. The 2000s

saw similar growth with work moving to India in down cycles to help companies cut costs and in

boom times to capitalize on the readily available talent. cost advantage of offshore outsourcing-

1:3

The 2008-2009 global recession has had a negative impact on outsourcing growth in India, but

the sector was experiencing a turn-around in 2010. Many US and European companies are still

cautions about the speed or staying power of the 2010 economic recovery and thus are looking to

maintain a low cost base in locations such as India.

Offshore Outsourcing Model offers businesses multiple benefits in terms of Cost, Quality and

Technical Excellence. Here are some of the noticeable benefits of Offshore Outsourcing Model:

Realistic cost savings of about 40% as compared to onshore or domestic markets. (Source -

Ventoro Research Report)

Quality Product Delivery by offshore companies using their expertise, extensive domain

knowledge and implementation of Matured Execution Models in their processes. (Source:

NASSCOM)

Technical Excellence offered to clients by capitalizing on quality Human Resource, robust

infrastructure and domain related Research and Development (R&D).

Maximum time benefit by leveraging the time difference between service provider and

service requester.

Reduced project cycle by implementing globally recognized Project Management

systems in their operational activities.

Operational Flexibility by quickly adapting to changes in business requirements.

Better finance management through clearly defined financial obligation and reduced

cost.

Improved competitiveness since offshore companies deliver quality services at

affordable rates.

Renewed focus on company strategic plans by outsourcing certain non-core business

operations to offshore companies.

Exposure to new markets by making alliances with offshore companies and taking

business to unexplored areas.

The country‘s domestic market for business process outsourcing (BPO) is projected to grow over

23 per cent to touch US$ 1.4 billion in 2011, says global research group Gartner. In 2010, the

domestic BPO market was worth US$ 1.1 billion. The firm predicts that the domestic BPO

market would reach US$ 1.69 billion in 2012 and increase to US$ 2.47 billion by 2014.

With the first quarter of the new fiscal 2011-12 offering positive business outlook, hiring

sentiments for sectors like IT, ITeS and telecom have risen by over 20 per cent, says a study by

TeamLease Services Pvt. Ltd. As per the Employment Outlook Report for the period April-June

2011, released by TeamLease Services Pvt. Ltd., hiring intent from IT and ITeS was the highest

in cities like New Delhi, Mumbai, Hyderabad and Pune.

Certain crucial steps taken by the Indian government to propel the sector growth are:

Constitution of the Technical Advisory Group for Unique Projects (TAGUP) under the

chairmanship of NandanNilekani. The Group would develop IT infrastructure in five key

areas, which includes the New Pension System (NPS) and the Goods and Services Tax

(GST)

Setting up the National Taskforce on Information Technology and Software Development

with the objective of framing a long term National IT Policy for the country.

Enactment of the Information Technology Act, which provides a legal framework to

facilitate electronic commerce and electronic transactions.

Setting up of Software Technology Parks of India (STPIs) in 1991 for the promotion of

software exports from the country.There are currently 51 STPI centres where apart from

exemption from customs duty available for capital goods, there are also exemptions from

service tax, excise duty, and rebate for payment of Central Sales Tax.

Plans to formulate Information Technology Investment Regions (ITIRs). These regions

would be endowed with excellent infrastructure and would reap the benefits of co-siting,

networking and greater efficiency through use of common infrastructure and support

services.

India is gaining unprecedented global popularity and more and more companies are turning to

skilled labor in India to provide web development services. Foreign clients have begun to

acknowledge the technical expertise Indians possess in this field. Apart from being technically

proficient, we also have fairly good English language skills that help us to communicate with

foreign customers. Several multi national companies have acknowledged the quality of services

they‘ve received from web development company India and more and more corporations are

coming to us with their assignments.

There are a number of reasons that go towards making India as a hub of web development

services:

1. A well qualified work force that possesses technical skills along with the know-how is a great

bonus that India offers to the world.

2. Foreign companies get the added benefit of lower operating costs as compared to other

countries like America, Canada, UK and Australia.

3. A pro-IT government which supports the growth of IT in this country and formulates policies

around it.

High quality infrastructure like satellite communications and broadband internet which helps us

to stay in touch with our customers, anytime and anywhere.

NASSCOM said that the domestic IT-BPO revenues excluding hardware are expected to have

grown at almost 16 per cent to reach US$ 17.35 billion in FY2011. Strong economic growth,

rapid advancement in technology infrastructure, increasingly competitive Indian organisations,

enhanced focus by the government and emergence of business models that help provide IT to

new customer segments are the key drivers for increased technology adoption in India.

The data centre services market in the country is forecast to grow at a compound annual growth

rate (CAGR) of 22.7 per cent between 2009 and 2011, to touch close to US$ 2.2 billion by the

end of 2011, according to research firm IDC India's report. The IDC India report stated that the

overall India data centre services market in 2009 was estimated at US$ 1.39 billion.

India will see its number of internet users triple to 237 million by 2015, from 81 million

registered in September 2010, according to a report titled 'Internet's New bn', by the Boston

Consulting Group (BCG). BCG said Internet penetration rate in India is expected to reach 19 per

cent by 2015, up from the current seven per cent.

Telecom Regulatory Authority of India (TRAI) is targeting a 10-fold increase in broadband

subscribers to 100 million by 2014. The country has 10.29 million subscribers now. "We will

have 100 million broadband subscribers by 2014," J.S. Sarma, Chairman, TRAI said at the fifth

India Digital Summit 2010 organised by the Internet and Mobile Association of India.

The penetration of the internet in rural areas will see an all time high in 2011. In a survey

conducted by IMRB for the Internet and Mobile Association of India (IAMAI), the total number

of active internet users in rural area will rise by 98 per cent to touch 24 million by the end of

2011 from 12.1 million in December 2010. The survey said that the claimed internet user

category is also set to grow by 96 per cent to reach 29.9 million by December 2011 from 15.2

million in December 2010. (Active users are those, who have used the internet at least once in

the past one month. Claimed internet users are those, who have used the internet sometime but

not necessarily in the past one month.)

India's technology sector is bracing for a potential slowdown in growth after the historic U.S.

credit downgrade over the weekend, which heightened fears of a double-dip recession in the

largest outsourcing market and sparked a sell-off in IT stocks Monday.

Indian technology companies earn more than 80% of their revenue from the U.S. and Europe.

Coupled with a full-blown debt crisis looming over Europe, the Standard & Poor's downgrade of

the U.S. debt rating is raising concerns of a return to the recessionary times of 2008, when the

local software industry bore the brunt of lower spending by cash-strapped clients.

The Bombay Stock Exchange technology index closed 4.3% lower Monday, leading the 1.8%

downfall in the broader Sensex.

The downgrade may lead to a slowdown in business in the immediate term,

MICRO LEVEL

India will see its number of internet users triple to 237 mn from the current 81 mn by 2015,

according to a report.

In a study titled 'Internet's New bn', the Boston Consulting Group said Brazil, Russia, India,

China and Indonesia (BRICI) will have more than 1.2 bn internet users by 2015 - well over three

times the number of internet users in Japan and the US combined.

The number of internet users worldwide is expected to touch 2.2 billion by 2013 and India is

projected to have the third largest online population during the same time

Real estate, healthcare ,retail, manufacturing, telecommunication [vendors] and other

smes have understood importance of website and e-comerce.

We are Ready to provide cost efficient package---domain name registration, web hosting

and development, web designing[novel and SEO friendly]and maintenance.

We will offer round the clock customer support

INDUSTRY DOMAINS

MACRO AND MICRO LEVEL

MACRO

BY PORTER 5 FORCE MODEL

Intensity of rivalry

In India, .com and .net domain names reached a total of 1.037 million domain name registrations.

The total number of domain name registrations in India is estimated to be 2.15 million. These

numbers are no doubt very modest when seen in the overall context – India has 100 million

Internet users4 and nearly 26 million micro, small and medium (MSME) businesses in India.

All of these web pages are created by web designers who often have private intentions to put a

profile of them in the internet but the majority have commercial intentions. There is an

uncountable amount of agencies, self-employed or part-time web designers who all offer the

same product for privates, small companies or whole enterprises just in India. so there is a

constant entry of new competition into the market to cover the high demand of web pages.

Potential customers have a transparent market where they can choose the company they want.

They can compare prices and services very easily through the internet. Furthermore customers do

not make decisions due to barriers they have in a market outside the internet. There are neither

infrastructural obstacles nor problems to get information for them, so web designers work in an

almost perfect competition. They have very low entry barriers because the threshold resources

are only a computer and informatics knowledge. The exit barriers are low as well, because an

agency does not have many employees or expensive goods. So they have neither social

responsibility nor materialistic factors to lose. They have no core competences to distinguish

them from others in their industry.

Web designers do not have the choice to compete on price, each of them possess a very low

market share. In an atomic competition a seller would immediately lose all buyers, if he changes

the price. They cannot compete on the product, either. Although there are differences in the

quality and the way of programming a web page, the result is always the same. Every web page

uses the same standard and has almost the same buttons to standardize it for the users. There is

no space for experimental programming. Those who try to launch an innovative web page lose

users to other pages which maintain the standards. They have to compete in other ways. A

principle of the web design industry is that you have to have a well optimized web page for the

search engines like Google, Yahoo or MSN. In this environment the most important competence

is that people find your business in the search engines and that your own web page presents a

good overview of your work.

Besides they have to fight for every new customer. A lot of time is not needed to create web

pages but is needed to optimize their own one. It often takes half a working day to optimise a

web page for the Google results, because of the extremely high competition. More than 80

percent of the web designers do Benchmarking observing key competences like the corporate

design, the success or the strategy. An intensive discussion of established operators suggests the

possibility of efficient electronic processes to identify as a template for your own e-shop.

Although there are many competitors with very few market shares, the intensity of rivalry is a

weak force. The market is still growing and the financial risks are low.

The number of Internet users worldwide is expected to reach 2.2 billion by 2013 and India is

projected to have the third largest online population by that same time. As more users come

online in the next two years, the Internet will become an even greater force, one that businesses

cannot afford to neglect. This may perhaps provide the required impetus for more MSMEs in

India to register their domain name and build their business identities online.

Bargaining power of buyers

There are three groups of customers. The buyers of a web page could be private or business

customers. But within the group of business customers you also have to differentiate between

those who only want a company presentation on the internet and those who want a complete

online shop with thousands of products.

Non-commercial customers who want to use a web page for personal reasons like their own

biography or their wedding do not have the power to negotiate with the agencies. Normally they

have a lack of the right understanding of important technical aspects of a web page. They often

do not compare different market players and their services or prices. Nevertheless agencies

cannot charge a high price because in comparison to other online services a private web page is a

low involvement product. It is not vital for the buyers to have this product so they can cancel the

project easily, if the price rises too high. Most of the agencies say that customers can negotiate

the price, but in fact there is only a small range. Instead of a professional wedding page they

could create their own page in one of the social media portals like Facebook for uploading their

stories and photos. Another solution for them is to use a home page construction set software

which often costs less than 2000/-.

The second group contains companies which only want a portal for presenting themselves like

small factories, retailers, lawyers or associations. The product they want is more complex than

the previous. The amount of separate pages is higher, they have higher demands on the design

and the textures and their pages need regular updates. These business customers have a greater

awareness of what they want, so they compare competitors and their prices. But their bargaining

power is limited as well, because one third of the web designers have fixed prices for their

services and those who let you negotiate only give only small discounts. Business customers

negotiate on service. They ask for different designs or technical support. In the service sector

there are slight differences and agencies have more scope than self-employed web designers.

Companies who wish to have an online shop or other complicated internet applications where the

user interacts with the system have bargaining power. This is the high price segment and requires

a lot of informatics knowledge and experience from the agency. The involvement is high because

the customers have to have a good knowledge of what they want and need, as well as the

agency‘s needs to convince the customer with their competences. A failure in this area means a

loss of money. Agencies not only need informatics knowledge, but also marketing knowledge to

sell the products to their customers online.

In general it is said that the more complex the web page is, the more bargaining power the

customer has. There is a transparent market without switching costs and brand identity for the

customers and furthermore there is a buyer concentration in the same amount like a firm

concentration. The higher the price of the web page and the higher the internet knowledge of the

customers, the stronger is this force.

Bargaining power of suppliers

Due to increasing demand-google, yahoo, altavista etc have decreased price of web space and

maintenance—8000-8500/- for unlimited for an year.

Web designers sell virtual products, so the suppliers of them do not play a big role. In a classical

business there are needs of raw materials and supplies, but in an online business you only have

costs for office supplies, hard- and software, rent, office furniture, running costs and advertising.

None of these costs are directly related to the product, so the production of a web page only has

fixed costs (except personal costs). Most of these costs are insignificant in comparison with the

benefits of the product. Suppliers do not have any power or influence on these costs because the

ordered quantity of furniture, electricity or office supplies is as high as in private households.

The rent neither is an important factor. A web design agency is not dependent on a certain

location of its office like advertising agencies which need to be centrally located in a city in

order to be findable since the acquisition of customers mostly works online.

There are two types of important costs: On the one hand hard- and software like computers or

new programs. Prices have decreased during the last ten years and there are many different

sellers of computers. In addition to that agencies buy these things normally once every few years.

The power of suppliers is limited because the different computers are substitutes of their selves

and prices are transparent

On the other hand there are advertisement costs. These are the most significant costs in this

sector. Web designers have to make a great effort to spend money for advertising in order to sell

their products. The most common form of advertising for them is Google Adwords. Google is

the most important tool for companies selling online, so they set the price and it has to be

accepted. There are other possibilities to place adverts on the internet, but the whole market

adopts Google‘s prices.

Suppliers are not able to bargain with the web designers, because they do not spend enough

money on them and normally it is easy to switch. Only Google advertisements represent a strong

force. All the other suppliers are extremely weak.

Threat of new entrants

A newcomer has the same costs in producing a web site as those who are established in this

sector. As you can only decrease costs per piece slightly by using already existing templates,

economies of scale do not play a role for a web designer. The cost advantage of experienced

market players is only reflected in the existing soft- and hardware they have. The main resources

for a web page are time and knowledge and the fix costs are low, therefore the possibility to cut

costs is only given on a limited scale. For building up a new web design company there is only

little tangible capital required. Most of the required capital is intangible for instance knowledge

and experience. The knowledge is easily available in blogs and books, but the experience is

needed to put it into practice.

Another entry barrier is the brand identity which is an important factor. Customers do not have

the same brand awareness like in other businesses, but if in the e-commerce business there is a

need of a good online reputation, so you have to present references as well as evidence that you

are able to optimize a customers‘ web site in search engines. It is also a noteworthy obstacle that

web designers who stay in the business for years already have good positions in the search

engines and new entrants have to make a great effort to drive them out of these positions. The

existing companies continue improving their positions as well, so the entrants are obliged to

work much harder than the existing competition when they start up. Established firms have an

advantage in the experience they gained. They already made the mistakes which new entrants

still have to make. They have to contemplate a lot of small matters which can improve a

customer‘s web page.

An advantage for new market player is that they do not have to expect retaliations from existing

agencies. In a perfect competition the market share of each participant is so small that it is not

worth fighting for. On the contrary. In the e-commerce you can only survive if everyone creates

links to each other, thus a community was created on the internet where web designers help each

other and give hints to new ones. The more you help for free, the more clients you can acquire,

because you are demonstrating competence and trust.

It has become more difficult in the last two years to enter the web design industry, but nowadays

it is still possible building up your own business without great capital efforts but with a great

time and knowledge investment.

Threat of substitutes

A substitute is a product with similar features to the initial product. In this context replacements

for commercial web sites are other shops where you could buy the same product, books and

magazines as well as institutions where you can spend leisure time. Actually, the model of the

diversification steps is to amplify own product portfolio, but it is also useful to identify

substitutes.

But a web site is a relatively young product which lately has started to be a substitute for those

products. The buyer propensity of the classical shops is decreasing and even inexperienced

people have started to buy online. The turnover of e-commerce is not only increasing, but also

the possibilities of online leisure time activities. Mostly everything from everyday life can be

done online, and as a result a countermovement is emerging where people wish to have again a

same experience. But this is just a niche movement which really cannot compete with a modern

online shop.

Another substitute of a web page is the mobile internet. Technology goes on and web designers

have to keep their informatics knowledge up to date, because customers start demanding that a

web page has to be accessible with their mobile or blackberry. So future online shopping will

take place on the way. At the moment is not a real danger given that the mobile net drives the

internet out of business. It has to be seen as a complement.

MOBILE INTERNET GROWTH:

The last substitute worth mentioning is the social platforms where companies and privates can

present themselves without having their own web page. In the huge portals like Facebook or

Twitter they can install an interactive page with communication features. Web designers have to

convince their potential clients purchasing their own web page to meet their marketing

objectives. The social platforms are only interesting for those who go without an online shop,

hence for those who do not want to spend much money anyway. The switching costs are

enormously high because they have to change from a free product to a paid product

Conclusion

According to the model of Porter‘s five forces it is worthwhile entering web design industry.

Most of the forces are weak and even the strong ones are not impossible hurdles. In figure below

you see an overview of Porter‘s five forces in the web design industry and the changes that occur

if the complexity of the web site increases.

There is a great competition between the web designers, but there is also a growth which is

enough to enter the industry. But within the last five years the rivalry situation has been stronger

and the market growth lower. With technological advancements the entry barriers and the

knowledge have grown. For a professional web site today you need more than informatics

knowledge, but also a good marketing knowledge and the ability to negotiate with your

customers. With the right strategy it is still possible to make a lot of money online.

MICRO LEVEL

Expertise over variety of platforms—php, .net, html, dhtml, ajax, flash, java etc. allows

us to develop solutions that are not tied to a specific vendor or product.

Offering low price—20 mb space/.com domain/web hosting/web designing/logo design/2

months maintenance free --- Rs.2300/-

Design expertise and experience on various deployment architectures

Creative team of experts has a thorough understanding of the general culture and can deal

with different subjects and can design logos

With professional animators in team-- quality animations at competitive prices.

Employee relation and organization culture—provides value for every employees.

Employees work as a family members. For a junior executive door of Top management

remains always opened.

TEAM DOMAINS

MISSION, ASPIRATION,

PROPENSITY OF RISK

ABILITY TO

EXECUTE CSFs

CONNCTEDNESS

ACROSS VALUE CHAIN

to provide customers the best

quality & professional looking

website which improves their

business development

reference building–

building brand image

Loyalty based programme—for existing

customers

to achieve high level of

customer satisfaction by

delivering projects within

stipulated time

Creative design-cms web

development

each consumer-- a partner

change in technology Timely completion of

customized web page

Technical training to my clients

Financial condition is weaker

than other big players

Proper maintenance and

after sales service

RSS feeds

Target Market Segmentation Strategy

We will focus the majority of sales and marketing efforts toward attracting small businesses. The

reason for this decision is simply the low amount of services available for a market with such a

high demand. In addition to the very promising supply and demand ratio, it is also technically

easier and less expensive to market to and attract small website projects than larger projects.

Demographic—type of company,[0-50 employees], revenue of company, number of

clients of my customer, computer awareness, population

Geographic- east India[rural and urban]and foreign market[offshore outsourcing]

Behavioral—consumer need-type of needs—for information, inclusion of shopping cart,

to make a presence, for networking, to intensify public interest, to serve customers etc.

Choice of design , up gradation of webpage, Usage of website, influence of reference ,

use of media, to increase sales

Market Needs

The need for small business Internet services has existed for several years. Small businesses and

start-up businesses alike are migrating onto the Web at an astonishing rate and making their

online presence a higher priority than in earlier years. We have noticed an enormous hole

however in the small business services that are currently available.

Without a doubt, there is a need for custom, high-end, dynamic services designed exclusively for

small businesses. At this point, the majority of our competitors are offering services tailored

around big business, to small business owners, or they are offering the exact opposite, one-

dimensional, "cookie cutter" type services.

While every small business has now recognized the need for having a presence on the Internet,

many do not know where to start, how much it will cost, or even how it will benefit their

company. It has been our experience by talking to small business owners that the decision to take

advantage of the Web is not a matter of 'if' but a matter of 'when.'

Market Trends

An important market trend right now is the one toward aggressive online and website marketing.

Although many small businesses are still waiting to gain an Internet presence, those who already

have are beginning to look for more options along the lines of improving their existing efforts.

We believe that in the upcoming years, small companies especially, will start to look for more

ways to increase the traffic to their websites.

Another important trend is the overall merging of daily business operations with the Internet and

World Wide Web. Just as the majority of large companies have already started to use the Web to

handle interoffice tasks, we believe that many smaller companies will begin to realize the time

and money saving advantages to this strategy.

Market Growth

Our target market is growing and expanding toward Internet and Web usage at an astonishing

rate.

Service Business Analysis

Web services and development companies vary greatly in the type of service they offer and the

type of client they attract. We will be relatively unique in the fact that we are marketing

exclusively to small businesses.

This industry consists of many small Web development firms usually less than 10 years old that

generally start out offering services to smaller companies but with long-term goals of catering to

large, corporate Web accounts.

COMPETITORS

Main competitors of us are Miracle studios, lnsel, India designers, dimension india, Agts india,

XigmaPro, web design company, mail mantra, century website, 32 bytes, brand mantra, ai future,

websys, glosoft india, adisol, webkriti, Calcutta webdevelopoers, Taragana INC, websoft etc.

WHAT COMPETITORS ARE OFFERING

1.Digital fusion:

Web site designing/portal management/E-commerce solutions

Banners

Logo Design

Email News Letter

Corporate Presentations

Web Hosting-linux and windows

SEO/SEM

2.LNSEL:

Web Designing Services:

- Static Web Design (Table & Div Based)

- Website Maintenance & Re-designing.

- Flash based Web Design.

- Blog Customization.

- Cross Browser Web 2.0 based Web Design.

- W3C Validated Web Design.

- Web Design for Small Business Enterprise.

- Website Template Design

- Logo & Brochure Designing

Web Application Development:

- Portal Development

- Content Management Systems (CMS) Development.

- Community Portals

- Custom Shopping Cart

- Payment Gateways

- Database Solutions

- Ecommerce Development

- E-Market Portal

- Enterprise Portals

- Cgi /Asp Script Installation

Search Engine Optimization:

- Organic Search Engine Optimization (SEO).

- Pay-Per-Click (PPC) Consulting.

- Google Sponsored Link Consulting.

- Search Engine Marketing (SEM).

- Email Marketing.

- Article & Directory Submission.

- Link Building.

- SEO Consulting.

- SEO Copy writing.

- Website Tracking Reports & Analysis.

Web Hosting & Domain Name Registration:

- Windows Hosting with POP3 e-mails Id.

- Preinstalled ASP.net & Ajax.

- Preinstalled CDO Mailer Component.

- Mssql Database Support.

- Catch-all Account, Anti Spam Filter & Email Forwarding Services

- Database Solutions

- 24/7 Server Monitoring Support.

- Email Hosting.

- Domain Registration for .com, .net, .org, .in, .info, .co.in, .biz, .net.in, .org.in.

- Full user friendly Domain & Hosting Control Panel with DNS details

3.INDIA DESIGNERS:

Custom Web Design

Tableless Div Based Design

PSD 2 XHTML Conversion

Web 2.0 Based Design

Industry Based Design

Website Re Design

Web Design Portfolio

Web Design Packages

Client Testimonials

Graphic Designing, Logo Designing, Web Development, SEO Services, E-commerce

Development, Multimedia, Content Writing, Web Hosting

4. MIRACLE STUDIOS:

Website Development

Website Designing

Brand Development

Flash Development

3D Modeling and Animation

Reputation Management

Mobile Application

Search Engine Marketing

Market Segmentation

We will focus the majority of sales and marketing efforts toward attracting small businesses.

following types of businesses are excellent prospective clients:

Retailers- Grocery Stores

Real Estate Farms

Medicine Shops

Clubs

Jewelers

Theaters

Night Clubs

Travel Agencies

Law Firms

Religious Organizations

Restaurants

06-07 07-08 08-09 09-10

0

50

100

150

200

250

300

350

400

450

500

Size of retail

industry in

billlion $

YEAR

Indian retail sector

Market size USD 350 billion

Organisedretail penetration 5 –8 %

Unorganisedretail market 12 million kiranas

Growth rate 15 –20%

Estimated investment by

2011

USD 412 billion

Retail density 6%

The real estate sector in India is on a growth path. The development in the real estate market

encompasses growth in both commercial and residential spheres. Further, it has been estimated

that there would be shortage of 26.53 million houses during the Eleventh Five Year Plan (2007-

12), which provides a big investment opportunity, according to a report by the Technical Group

on Estimation of Housing Shortage.

The above figure clearly states that the online travel industry accounted for 80% of the total e-

commerce market in India in 2010. Although skewed since 2007, the non-travel industry is

slowly capturing the market share percent by percent. The study states that e-Tailing is one the

primary growth drivers and will remain so in the near future too.

The growth in the e-commerce sales is a clear indicator of the growing number of people using

Internet to make purchases. But again, the online purchases are limited to a certain category of

buying like travel purchases, electronic items, online classifieds, buying movie tickets, food

delivery, gaming subscriptions, etc

According to the Bureau of Labor Statistics, healthcare was the second largest industry in 2008-

employing a staggering 14.3 million workers. By 2018, healthcare is expected to be the largest

industry in the nation and with an anticipated 22% growth rate

So we should focus on small enterprises of real-estate, travel agency, healthcare and of other

lucrative market segment.

Our target market is separated into the four surrounding states listed below:

We have chosen our target market from 4 perspective:

1.Distance from our office

2.Literacy rate---which has direct link with computer awareness

3.Population

4.Growth

Financial Year 2010

State

Rank State/Union Territory Region

Population

(2011) in 000

Indian

Rupee

(Ten

Million)

US Dollar

(Billion)

%age of

Total

GDP

Per-

capita

Income

(INR)

6 West Bengal East 91,348 400,561 $84.57 6.43% 41,469

13 Bihar East 103,804 168,603 $35.60 2.71% 16,119

14 Orissa East 41,947 162,327 $34.27 2.61% 33,226

16 Jharkhand East 32,966 106,358 $22.46 1.71% 30,719

Literacy Rate In Indian State: Census 2011

State Literacy rate

(2011

Census)

Literacy

rate-Male

(2011

Census)

Literacy

rate-Female

(2011

Census)

Bihar 63.8% 73.5% 53.3%

Jharkhand 67.6% 78.5% 56.2%

Orissa 73.5% 82.4% 64.4%

West Bengal 77.1% 82.7% 71.2%

SEGMENT ATTRACTIVENESS EVALUATION MATRIX

SEGMENT ATTRACTIVENESS FACTOR

WEIGHT SEGMENT1 WEST BENGAL

SEGMENT2 ORISSA

SEGMENT3 BIHAR

SEGMENT4 JHARKHAND

SCORE TOTAL SCORE TOTAL SCORE TOTAL SCORE TOTAL

EDUCATION AND AWARENESS

15 6 .9 5 .75 3 .45 4 .6

ECONOMICAL POWER

25 6 1.5 5 1.25 4 1.00 4.5 1.125

COMPETITIVE INTENSITY

15 5 .75 5 .75 6 .9 6 .9

GROWTH 25 7 1.75 6 1.5 3 .75 5 1.25

4.9 4.25 3.1 3.875

Jharkhand: 8% of our target area.

West Bengal : Our office is located here.- 50% of our target area-among 4 states it has highest

literacy and highest per capita income.

Bihar : 14% of our target area.

Orissa : 28% of our target area. It comes second from the perspective of per capita income and

literacy rate both.

Our business allows us to offer services to small companies, no matter their geographical

location, and we plan to do so, eventually expanding outside our immediate area. The above

areas are where we will market most heavily and expect to receive the majority of our work. We

do expect to receive a small portion from outside this target area due to ad placement.

Strategy and Implementation:

We will market ourselves as an Internet and Web services organization devoted to offering high-

end services to small businesses exclusively. Our target customer will be the owners of any small

or home-based company who are looking to implement their business into the Web.

Competitive Edge

We have a valuable competitive edge over our local competitors based on the fact that we have

streamlined all our services into the small business market. Through setting up several strategic

partnerships with various Internet and Web-related companies, we will be able to offer our

clients an affordable and efficient proprietary Web package that will meet all their related needs.

Marketing Strategy

As the number of internet users are growing in a rapid pace. website designing, hosting industry

is also growing.

Revenue from web designing Industry (in USD Million)

INDUSTRY 2008 2012

Custom Content Development

Multimedia / Web Design

256 542

Introductory

Stage

Growth

Stage

Maturity

StageDecline Stage

Total

Market

Sales

Time

1995

2011

Market is in growth phase . And our company is a challenger.

From the service point of view we will adopt service differentiation strategy by offering creative,

dynamic webpage --

We will follow guerilla attack marketing strategy because we are operating in limited

geographic areas and our prospects are small /medium enterprises—niche marketing strategy.

Our firm has limited marketing, R&D and competencies.

Successful marketing of Web services to small business owners depends on how you approach

and follow-up every potential client. It is very important to deliver our marketing pitch in a clear,

no non-sense method. Details of the Internet and Web are still relatively unknown by many small

business owners, giving it the tendency to confuse and intimidate easily.

Marketing Programs for promotions:

We plan on doing a large scale marketing project including :

Radio advertising (red fm, radio mirchi, power fm).

Ad placement in local trade publications .

Billboard Ads to promote wide-spread name recognition.

Service and Pricing Strategy

For most small business owners, cost, both residual and one-time are huge influences on the

decisions they make regarding everyday operations of their company. Even though we offer

100% customized services and our pricing is based on an hourly fee, to make it easier and less

confusing for the clients, we have established a packaged pricing system.

Budget Domain Website Package (2300/-): For simple, information based websites.

Popular with companies who just need to gain an Internet presence.

Mid-Level Website Package (3000/-): Information based websites with a large amount

of content. Popular with companies that have a large services/products list and/or want to

implement more of their business into the Web.

Catalog Website Package (4000/-): Usually reserved for product-oriented websites that

are e-commerce enabled. Popular with companies that have a desire to market heavily on

the Internet or sell their products/services directly from the Web.

Website Hosting (free for first 2 months then 500/- per year ): Depending on the type

and size of the website, the price for hosting can vary greatly. The average cost of hosting

for most clients is 500/- per year.

Website Maintenance (500/-): If a client feels as though they will need their website

updated or maintained on a regular basis, packages are available at a discount rate.

Positioning Strategy

Symbolic and Operational positioning:

Service differentiation----dynamic and CMS web development and creative web

designing in a cost efficient package---PRICE QUALITY APPROACH

Online free trial and providing customized service—superior after sales service---

CUSTOMERS BENEFIT APPROACH

Brand positioning:

Our target client is part of a very specific demographic, for this reason, we market and promote

our services in a direct and specifically targeted manner.

Print Ads:

We will advertise in eight separate area yellow page directories. All our ads will appear

under either the Internet Services or Website Design headings.

We will enlist company‘s name in a national business directory under the heading of Web

Developers.

In the near future we will feature ads in several area business

Direct Mail and Fax:

We will send out targeted bulk mail flyers promoting special offerings by our company.

In the near future we will begin a new aggressive, ongoing bulk mail campaign to

promote our Web development and hosting services.

Online free trial :

we will provide online free trial for our clients for promotion.

Social media marketing:

We will use social networking sites to place our advertisement.

Showcasing few case studies:

Showcasing few case studies of firms that have found website being effective in improving their

processes—it will help to catch prospects

Peer reference:

Still people are not fully aware about benefit of website in Indian scenario, Word of mouth/peer

references can be highly effective marketing techniques.

Mass Media Ads:

We will begin advertising on a broader scale within the next six months. Radio spots will

be continuously played during local area talk shows and news programs, this placement is

intended to reach the highest percentage of our target client possible.

Billboard ad placement will be the second mass media marketing campaign we will

implement into our marketing efforts. Billboard ads will be intended as 'name

recognition' advertising.

Educational Seminars:

Plan to conduct Internet and Web-related educational seminars on a variety of topic. In

the near future, we will promote our services through these seminars.

Local Area Commerce Groups:

To promote our services and our name as a participant in the Web services industry, we

will be joining many of the local area Chamber of Commerce groups and various other

strategic partnership clubs.

Strategic Alliances

Currently, we do not participate in any co-marketing or co-development efforts with outside

companies. However, we have specific plans to establish several strategic partnership programs

with area ISPs (Internet Service Providers) and computer consulting companies. These

partnerships are intended to attract more sub-contracting work from potential competitors, in

exchange for a commission to be paid for each lead and resulting new client.

CONCLUSION

Given our experience and expertise in both commercial Web development and business-to-

business sales, we believe we can offer a unique and superior service to small business owners,

in comparison to what is currently available.

The demand and growth rate for Web development and marketing services in the small business

market is at an all time high and shows no sign of slowing anytime soon. Even more astonishing

is the fact that very few Web development companies have taken advantage of the opportunity,

as there are no dominating participants in this huge market.

We believe the reason for this virtually untapped market is due to expensive project costs, the

highest profit margins in Web development today are in servicing large- and medium-sized

corporations. We have developed a system that dramatically reduces steep project costs and

henceforth will allow us to offer the same high-end Web development services as larger

companies receive at a much lower cost to the client.

BIBLIOGRAPHY

1. censusindia.gov.in/

2. economictimes.indiatimes.com/

3. Internet in India in a hyper growth phase | Reuters

4. http://www.mapsofindia.com/

5. http://www.marketresearch.com/

6. http://www.researchandmarkets.com/

7. E-riches 2.0: next-generation marketing strategies for making millions online By

Scott C. Fox

8. Internet Marketing: Strategy, Implementation And Practice, 3/E -By Chaffey,

Chaffey

9. Marketing Planning by Design: Systematic Planning for Successful Marketing

...By Ralf E. Strauss