1) Which Internet properties strongly affect marketing and describe the important

fundamental changes the Internet has brought to marketing.

According to Strauss and Frost (2009), the Internet properties have affected the way marketing

should be done and delivered to the consumers. Internet data is sent in bits and not in atoms – all

the data and information are being stored and sent to the consumers in digital form. The digital

form cannot be touch, tasted or smelled. In contrast to other types of marketing, the seller does

not need to deliver the items itself for inspection by the consumer before it is being purchased.

1. Internet is a mediating technology – anywhere in the world, music and other data is being

passed on and shared. This encourages communication for businesses in a supply chain.

2. Internet encourages global reach - regardless of location, the internet is accessible to all.

Businesses can be conducted globally easier while encourages worldwide partnership and

products distribution even better than before.

3. Internet works as network externality – target markets are being reached easily and faster with

automated communication.

4. Internet is a time moderator – time is a valuable essence where consumers would expect faster

service as in the communication with the company itself and faster feedback response.

5. Internet is an information equalizer – information on the product is easily accessible to

consumers via the internet, therefore consumers have better access upon the information and

pricing of the product itself

6. Internet practices open standard – Large and small companies have the same standard where

both types of companies can access each others’ database and customer relationship management

7. Internet practices task automation – most of the costs are lowered due to the self serving

functions where automated payment and transactions are being done by the consumers

The strengths involved internet properties emphasizes the profound changes in today’s market,

and most of these changes have truly changed traditional marketing in fundamental and critical

ways such as :-

The balance of power is shifting to buyers—one of the most fundamental changes to

marketing. Marketers have practically lost control of brand images due to blogs, online bulletin

boards, and other online communication, and must consistently under promise and over deliver.

Other changes:

Market fragmentation. The Internet put finality to this trend by extending to its ultimate—a

market size of one customer—and prompted marketers to create products and communication to

small target groups.

Death of distance. Geographic location is no longer a factor when collaborating with business

partners, supply chain firms, or customers, or just chatting with friends.

Time compression. Time is not a factor with Internet communication between firms and their

stakeholders. Online stores can be open 24/7; people can communicate as their schedules permit;

times zones disappear for managers collaborating with partners on other continents.

Critical knowledge management. In the digital world, customer information is easy and

inexpensive to gather, store, and analyze. Managers can track marketing results as plans are

implemented, receiving play-by-play reports. However, turning huge databases into meaningful

knowledge to guide strategic decisions is a major challenge.

Interdisciplinary focus. Marketers must understand technology to harness its power. They do

not have to personally develop the technologies, but they need to know enough to select

appropriate suppliers and direct technology professionals.

Intellectual capital rules. Imagination, creativity, and entrepreneurship are more important

resources than financial capital. 

2) a. How does differentiation differ from positioning?

Differentiation is what a company does to the product and this is one of objective that

positioning team put to achieve the firm’s goal. Differentiation is to make a product more

attractive by contrasting the uniqueness of the qualities with other competing products.   Philip

Kotler, American academic focused on marketing was defines “differentiation” as the process of

adding a set of meaningful and valued differences to distinguish the company’s offering from

competitors’ offerings. A company can differentiate their market by five dimensions; product,

services, personnel, channel, and image. The advantages of the product differentiation are can

creates product value, build brand loyalty, no perceived substitute and non-price competitions.

However, positioning can be defined as the process by which marketers try to create an image or

identity in the minds of their target market for its product brand, or organization. Positioning is

an important concept in marketing and the goal of product positioning is to keep your product on

top of your customers’ mind when they’re considering a purchase. The firm was using a lot

strategy to position their product such as price-quality positioning strategy and product features,

benefits positioning strategy, product attributes and ect. There are five steps to do in positioning;

step 1: Understand your target market, step 2: Understand your competition, step 3: Map

buying criteria against competitive positioning, step 4: Assess your product’s strengths against

the buying criteria and Step 5: Analyze the gap.

2) b. List six new-product strategy categories and provide Internet examples of each.

Product is a bundle of benefits that satisfies the needs of the consumer or for which they are

willing to exchange money or other items of value. The products can be a tangible goods,

services, ideas, people, and places. There are have six of new-product strategy; the first one is

discontinuous innovations also known as disruptive innovation represent as a new-to-the-world

products that people has yet experienced it before and never seen like the first shopping agent,

the search engine, web authoring software and PDA combination. The second one is new product

lines. It happens when firms take an existing brand name and creates new products in a

completely different category like when Microsoft introduced the Internet Explorer Web browser

to compete against Netscape and the Windows media player against Real Player. Besides that,

Additions to existing product lines, it was occur when organizations make an addition to current

product such as add a new flavor, size and other variation. The examples are including the GTE’s

SuperPages be an interactive line extension to its Yellow Page directories and stockbrokers

Schwab has opened up Internet operations.

The fourth is, make an improvements or innovation or revisions of existing products the products

have been introduced as “new and improved.” Examples of internet are include Web-based e-

mail systems such as outlook improved on client-based e-mail systems and also the media

players who was try to adapt new standards to make it functionality like Winamp with the ability

to play, convert, and extract music into numerous file formats. The fifth of the new product

strategy is repositions products. Reposition product means the current products that are either

targeted to different markets or promoted for new uses. The internet example is when Yahoo!

began as a search directory on the Web and then they repositioned itself as a portal. A me-too

lower-cost product is the last new product strategy is a product that is very similar to products

manufactured by other companies and already on the market by offering a price advantage.

Examples include when America Online and other ISPs were charging per hour rates for Internet

access, several other providers introduced unlimited use at flat rate pricing and the Eudora Light

was be a free e-mail reader product to build the market.

3. Discuss briefly how Internet can have both upward and downward pressures on online

prices.

4) a. What is a distribution channel and who make up a distribution?

The chain of businesses or intermediaries through which a good or service passes until it reaches

the end consumer. A distribution channel can include wholesalers, retailers, distributors and even

the internet. Channels are broken into direct and indirect forms, with a "direct" channel allowing

the consumer to buy the good from the manufacturer and an "indirect" channel allowing the

consumer to buy the good from a wholesaler. Direct channels are considered "shorter" than

"indirect" ones.

Distribution channel refers to the series of business firms which together facilitate distribution of

products from their manufacturers to the end customers and users. These firms constituting the

distribution channels are called middleman or intermediaries. Typically a distribution channel

consists of different types of intermediaries like wholesaler and retailers.

Manufacturers prefer to distribute their goods through distribution channels rather than sell

directly to end customer because of several useful functions performed by them. These include

the following:

Physical distribution or transportation of products from place of manufacturing to places more

convenient to customers for buying.

Storage of products at various locations so that customer can get immediate delivery of the

products they want without waiting for transportation from manufacturing locations.

Bulk breaking, or dividing large order quantities of product from supply manufacturers to smaller

quantities that are more suitable for customers.

Assortment, or making a large variety of products available to customers at one location.

Typically, u sell just one type of products, whereas retail outlets stock a very wide range of

products from many different suppliers.channel?

4) b. In what ways do companies use the Internet for marketing public relations, sales

promotion, and direct marketing?

The 4 Ps of marketing are product, price, place and promotion. All four of these elements

combine to make a successful marketing strategy. Promotion looks to communicate the

company’s message across to the consumer. The four main tools of promotion are advertising,

sales promotion, public relation and direct marketing.

Advertising

Advertising is defined as any form of paid communication or promotion for product, service and

idea. Advertisement is not only used by companies but in many cases by museum, government

and charitable organizations. However, the treatment meted out to advertisement defers from an

organization to an organization. Advertising development involves a decision across five Ms

Mission, Money, Message, Media and Measurement. Mission looks at setting objectives for

advertising. The objectives could be to inform, persuade, remind or reinforce. Objective has to

follow the marketing strategy set by the company. Money or budget decision for advertising

should look at stage of product life cycle, market share and consumer base, competition,

advertising frequency and product substitutability. Message’s development further is divided into

four steps, message generation, message evaluation and selection, message execution, and social

responsibility review. Once the message is decided the next step is finalizing the media for

delivering the message. The choice of depends on reach of media, frequency of transmission and

potential impact on customer. Based on this choice of media types are made from newspaper,

television, direct mail, radio, magazine and the internet. After which timing of broadcast of the

message is essential as to grab attention of the target audience. Checking on the effectiveness of

communication is essential to company’s strategy. There are two types of research

communication effect research and sales effect research.

Sales Promotion

Promotion is an incentive tool used to drive up short term sales. Promotion can be launched

directed at consumer or trade. The focus of advertising to create reason for purchase the focus of

promotion is to create an incentive to buy. Consumer incentives could be samples, coupons, free

trial and demonstration. Trade incentive could be price off, free goods and allowances. Sales

force incentive could be convention, trade shows, competition among sales people.

Sales promotion activity can have many objectives, for example, to grab attention of new

customer, reward the existing customer, increase consumption of occasional users. Sales

promotion is usually targeted at the fence sitters and brand switchers.

Sales promotional activity for the product is selected looking at the overall marketing objective

of the company. The final selection of the consumer promotional tools needs to consider target

audience, budget, competitive response and each tool’s purpose.

Sales promotion activity should under-go pretest before implementation. Once the activity is

launched it should be controlled as to remain within the budget. Evaluation program is a must

after implementation of the promotional scheme.

Public Relations

Companies cannot survive in isolation they need to have a constant interaction with customers,

employees and different stakeholders. This servicing of relation is done by the public relation

office. The major function of the public relation office is to handle press releases, support

product publicity, create and maintain the corporate image, handle matters with lawmakers,

guide management with respect to public issues.

Companies are looking at ways to converge with functions of marketing and public relation in

marketing public relation. The direct responsibility of marketing public relation (MPR) is to

support corporate and product branding activities.

MPR is an efficient tool in building awareness by generating stories in media. Once the story is

in circulation MPR can establish credibility and create a sense of enigma among sales people as

well as dealers to boost enthusiasm. MPR is much more cost effective tool than other

promotional activities.

Direct Marketing

The communication establishes through a direct channel without using any intermediaries is

referred to as direct marketing. Direct marketing can be used to deliver message or service.

Direct marketing has shown tremendous growth in recent years. The internet has played major

part in this growth story. Direct marketing saves time, makes an experience personal and

pleasant. Direct marketing reduces cost for companies. Face to face selling, direct mail, catalog

marketing, telemarketing, TV and kiosks are media for direct marketing.

Advertisement, Promotional activity, Public relation and direct marketing play an essential role

in helping companies reaches their marketing goals.