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Marketing in the Digital Age

Marketing in the Digital Age

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Marketing in the Digital Age

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  1. 10a Marketing in the Digital Age

  2. ROAD MAP: Previewing the Concepts • The major forces shaping the new digital age. • Marketing strategies in the digital age. • The four major e-commerce domains. • How to conduct e-commerce to profitably deliver more value to customers? • Overview of the promise and challenges that e-commerce presents for the future. Professor Takada

  3. ROAD MAP: • The major forces shaping the new digital age. • Marketing strategies in the digital age. • The four major e-commerce domains. • How to conduct e-commerce to profitably deliver more value to customers? • Overview of the promise and challenges that e-commerce presents for the future. Professor Takada

  4. Forces Shaping the Digital Age Intranets – connect people within a company. Extranets – connect a company with its suppliers, distributors, and outside partners. Internet – connects users around the world. Customization: the company custom designs the market offering for the customer. Customerization: the customer designs the market offering and the company makes it. The heart of the New Economy. Increasing numbers of users. Companies must adopt Internet technology or risk being left behind. Direct selling via the Internet bypassing existing intermediaries (disintermediation). “Brick-and-mortar” firms became “click-and-mortar” companies. Failure of some “click-only” companies. Professor Takada

  5. ROAD MAP: • The major forces shaping the new digital age. • Marketing strategies in the digital age. How have companies responded to the Internet and other powerful new technologies with e-business strategies? How have these strategies resulted in benefits to both buyers and sellers? • The four major e-commerce domains. • How to conduct e-commerce to profitably deliver more value to customers? • Overview of the promise and challenges that e-commerce presents for the future. Professor Takada

  6. Marketing Strategy in the Digital Age Requires a new model for marketing strategy and practice Some suggest that all buying and selling will eventually be done electronically Companies need to retain old skills and practices but add new competencies Professor Takada

  7. E-Business E-Commerce • More specific than e-business. • Buying and selling processes supported by the Internet. • Includes: e-marketing and e-purchasing (e-procurement) • Use of electronic platforms to conduct company business. • Web sites: for selling and customer relations • Intranets: for within-company communication • Extranets: connecting with major suppliers and distributors E-Marketing • The marketing side of e-commerce. • Includes efforts to communicate about, promote, and sell products and services over the Internet. • E-purchasing: the buying side of e-commerce. • Consists of companies purchasing goods, services, and information from online suppliers. Professor Takada

  8. Benefits to Sellers Benefits to Buyers Convenience Powerful tool for building customer relationships Buying is easy and private Can reduce costs Provides greater product access and selection Can increase speed and efficiency Provides access to comparative information Offers greater flexibility in offers and programs Buying is interactive and immediate Is a truly global medium Professor Takada

  9. ROAD MAP: • The major forces shaping the new digital age. • Marketing strategies in the digital age: How have companies responded to the Internet and other powerful new technologies with e-business strategies? How have these strategies resulted in benefits to both buyers and sellers? • The four major e-commerce domains: B2C, B2B, C2C, C2B • How do companies go about conducting e-commerce to profitably deliver more value to customers? • Overview of the promise and challenges that e-commerce presents for the future. Professor Takada

  10. E-Marketing Domains Professor Takada

  11. B2C (Business to Consumer)Amazon, Expedia, Gap, L.L. Bean B2B (Business to Business) Covisint-auto industry “open trading exchange” Trane Co.-air conditioning private trading network (PTN). • More than 500,000 enterprises participate. • Offer product info, purchasing, and support services. • Huge, $4 trillion in 2003. • Specialty e-marketspaces to conduct transactions. • $428 billion in 2004. • Online consumers vs. offline consumers. • Increasing diversity in buyers. • Increasing opportunities for targeting markets. • Customer initiated and controlled. C2B (Consumer to Business) Priceline.com C2C (Consumer to Consumer) eBay, Amazon Auctions, AOL • Forums: chat room, discussion groups located on commercial online services. • Newsgroups: the Internet version of forums. • word of Web (vs. word of mouth) • Consumers can search out sellers, view offers, initiate purchases, and give feedback. Professor Takada

  12. ROAD MAP: Previewing the Concepts • The major forces shaping the new digital age. • Marketing strategies in the digital age. • The four major e-commerce domains. • How to conduct e-commerce to profitably deliver more value to customers? • Overview of the promise and challenges that e-commerce presents for the future. Professor Takada

  13. Types of e-Marketers Professor Takada

  14. Click-Only Companies E-tailers Amazon, Expedia Search Engines and Portals Google, Yahoo Enabler Sites hardware/software providers Types of Sites Content Sites NYTimes,ESPN Internet Service Providers AOL Transaction Sites eBay Professor Takada

  15. Reasons for dot.com Failures • Poor research or planning. • Relied on spin and hype instead of marketing strategies. • Spent too heavily on brand identities. • Devoted too much effort to acquiring new customers instead of building loyalty. Professor Takada

  16. Click-and-Mortar Companies • Most established companies resisted adding Web sites because of the potential for channel conflict and cannibalization. • Many are now doing better than click-only companies. • Reasons: • Trusted brand names and more resources • Large customer bases • More knowledge and experience • Good relationships with suppliers • Can offer customers more options Professor Takada

  17. Setting Up for E-Marketing Professor Takada

  18. Types of Web Sites Corporate Web Site: Designed to build customer goodwill and supplement other sales channels. Offers information to customers. Builds closer customer relationships. Generates excitement about the company. Marketing Web Site: Engages consumers in an interaction that moves them closer to a direct purchase. Provides information about the products. Professor Takada

  19. Context Commerce Content Community Connection Customization Communication Designing Attractive Web Sites • The 7 Cs of Effective Web Site Design Professor Takada

  20. Online Ads and Promotion • Forms of online advertising & promotion: • Banner ads & tickers (move across the screen) • Skyscrapers (tall, skinny ads at the side of a page) • Rectangles (boxes that are larger than a banner) • Interstitials (pop up between changes on Web site) • Content sponsorships (sponsoring special content) • Microsites (limited areas paid for by an external company) • Viral marketing (Internet version of word-of-mouth): Gillette 3-bladed Venus razor for women, “Reveal the Goddess in You” truck tour and beach-site promotions. Professor Takada

  21. ROAD MAP: • The major forces shaping the new digital age. • Marketing strategies in the digital age. • The four major e-commerce domains. • How to conduct e-commerce to profitably deliver more value to customers? • Overview of the promise and challenges that e-commerce presents for the future. Professor Takada

  22. The Future of Online Advertising • Web communities: • Allows members to congregate online and exchange views on issues of common interest • iVillage.com, a Web community for women • E-mail: • Use of “enriched” e-mail messages • Backlash against spam can be problem • Allow people to opt-out of promotions Professor Takada

  23. Legal and Ethical Issues • Online privacy: collection of consumer info. • Online security: Social Security data • Internet fraud: online auction fraud • Segmentation and discrimination: digital divide • Access by vulnerable or unauthorized groups: children’s access to adult sites, eBay. Professor Takada

  24. Rest Stop: Reviewing the Concepts • Identify the major forces shaping the Digital Age. • Explain how companies have responded to the Internet and other powerful new technologies with e-business strategies, and how these strategies have resulted in benefits to both buyers and sellers. • Describe the four major e-commerce domains. • Discuss how companies go about conducting e-commerce to profitably deliver more value to customers. • Overview the promise and challenges that e-commerce presents for the future. Professor Takada