online marketing & e-commerce session two moghimi

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Online Marketing & E-Commerce session two Bahman Moghimi. University of Georgia

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2. E-MARKETING COURSE SESSION Two Lecturer: Bahman MoghimiDoctor of Business AdministrationM.Sc. Of Industrial Marketing & e-Commerce University of Georgia 3. 3 4. What is Paradigm Shift? Information Age Buy-Side Market Place CompetitorsB.Moghimi@yahoo.co.uk High Expectations High Rate of Change inCultures & Behaviors E-Life !!!! 5. Old Economy V.S. New EconomyOld Economy New EconomyOrganize by product units Organize by customer segmentsFocus on profitable transactionsFocus on customer lifetime valueLook primarily at financial scorecard Look also at marketing scorecardB.Moghimi@yahoo.co.ukFocus on shareholders Focus on stakeholdersMarketing does the marketingEveryone does the marketingBuild brands through advertisingBuild brands through behaviorFocus on customer acquisition Focus on customer retention and growthNo customer satisfaction measurementMeasure customer satisfaction & retentionOver-promise, under-deliver Under-promise, over-deliver5 6. Meeting Increasing Customer NeedsB.Moghimi@yahoo.co.uk6 7. What is Marketing? ... a process by which companies create valuefor customers and build strong customerrelationships in order to capture value from customers in return.B.Moghimi@yahoo.co.uk It involves building profitable, value exchange relationship with customers.7 8. Simple Model of Marketing Process B.Moghimi@yahoo.co.uk8 9. Customer-Driven Marketing Strategy Whats the target Market? Market Segmentation Target MarketingB.Moghimi@yahoo.co.uk Whats the value proposition? Set of benefits & values to satisfy needs Differentiation & Positioning9 10. Integrated Marketing PlanThe companysmarketing strategy should develop anintegratedmarketingprogram that actually deliverthe intended- value to targetcustomersB.Moghimi@yahoo.co.uk 10 11. Building Customer Relationships ?CRM is the overall process of building andmaintaining profitable customers relationships byB.Moghimi@yahoo.co.ukdelivering superior customer value and satisfaction Customer (Perceived) VLUE (customers evaluation of differentiation) Customer SATISFACTION (Product Perceived Performance) 11 12. The Changing Nature of Customer Relationships More Carefully selected Customers Long-Term Relationships Connecting DirectlyB.Moghimi@yahoo.co.uk12 13. B.Moghimi@yahoo.co.uk 13 14. Functions of marketsThree main functions of markets Matching buyers and sellersFacilitating the exchange of information, goods,B.Moghimi@yahoo.co.ukservices, and payments associated with markettransactions Providing an institutional infrastructure, such as alegal and regulatory framework, that enables the14efficient functioning of the market 15. Definition of e-CommerceB.Moghimi@yahoo.co.uk15 16. B.Moghimi@yahoo.co.uk 16 17. THE GROWTH OF E-COMMERCEB.Moghimi@yahoo.co.ukRetail e-commerce revenues grew 1525 percent per year until the recession of 20082009, when they slowed measurably. In 2010, e-commerce revenues are growing again at an estimated 12 percent annually.17 18. Why e-commerce is different 8 unique features1. UbiquityInternet/Web technology available everywhere: work,home, etc., anytime.Effect:B.Moghimi@yahoo.co.uk Marketplace removed from temporal, geographic locationsto become marketspace Enhanced customer convenience and reduced shoppingcosts18 19. Why e-commerce is different 8 unique features2. Global reachThe technology reaches across national boundaries, around EarthEffect:B.Moghimi@yahoo.co.uk Commerce enabled across cultural and nationalboundaries seamlessly and without modification Marketspace includes, potentially, billions ofconsumers and millions of businesses worldwide19 20. Why e-commerce is different 8 unique features3. Universal standardsOne set of technology standards: Internet standardsEffect: Disparate computer systems easily communicate with eachB.Moghimi@yahoo.co.ukother Lower market entry costscosts merchants must pay tobring goods to market Lower consumers search costseffort required to findsuitable products20 21. Why e-commerce is different 8 unique features4.RichnessSupports video, audio, and text messagesEffect:B.Moghimi@yahoo.co.uk Possible to deliver rich messages with text, audio, and video simultaneously to large numbers of people Video, audio, and text marketing messages can be integrated into single marketing message and consumer experience21 22. Why e-commerce is different 8 unique features5. InteractivityThe technology works through interaction with the user Effect:B.Moghimi@yahoo.co.uk Consumers engaged in dialog that dynamically adjusts experience to the individual Consumer becomes co-participant in process of delivering goods to market22 23. Why e-commerce is different 8 unique features6. Information densityLarge increases in information densitythe total amount and quality of information available to all market participantsB.Moghimi@yahoo.co.ukEffect: Greater price transparency Greater cost transparency Enables merchants to engage in price discrimination23 24. Why e-commerce is different 8 unique features7. Personalization/CustomizationTechnology permits modification of messages, goods EffectB.Moghimi@yahoo.co.uk Personalized messages can be sent to individuals as well as groups Products and services can be customized to individual preferences24 25. Why e-commerce is different 8 unique features8. Social technologyThe technology promotes user content generation and social networkingB.Moghimi@yahoo.co.ukEffect New Internet social and business models enable user content creation and distribution, and support social networks25 26. Types of e-commerce Business-to-consumer (B2C) Business-to-business (B2B)B.Moghimi@yahoo.co.uk Consumer-to-consumer (C2C) Mobile commerce (m-commerce)26 27. E-commerce business models Portal E-tailer Content ProviderB.Moghimi@yahoo.co.uk Transaction Broker Market Creator Service Provider27 Community Provider 28. E-Market-space A marketplace in which sellers and buyersexchange goods and services for money (orfor other goods and services), but do soB.Moghimi@yahoo.co.ukelectronically.28 29. E-Commerce Website selling products/info is a useful serviceto customers Serves 2 purposes: Marketing Allowing consumers to shop when on their own timeB.Moghimi@yahoo.co.uk If you dont sell online, you might be missing anopportunity to serve your customers Some E-Commerce sites are replacing high-street shops29 30. What is E-Marketing & E-Business? 1 EB=EC+BI+CRM+SCM+ERP EB = E-Business EC = E-Commerce BI = Business IntelligenceB.Moghimi@yahoo.co.uk CRM = Customer Relationship Mgmt SCM = Supply Chain Management ERP = Enterprise Resource Planning (SAP) 31. What is E-Marketing & E-Business? 2 E-Marketing Increases efficiency in traditional marketing Pure Pure dot-com(E*Trade)Level of business impact Business transformation (competitive advantage, Playindustry redefinition) functions.EnterpriseClick and Mortar (eSchwab) Technology of e-EffectivenessCustomer (Incremental sales,Business Processrelationship marketing transforms customer retention)managementB.Moghimi@yahoo.co.uk Efficiency Brochureware,Activity marketing strategies.(Cost reduction)Order processing This results in new business models that add value and profits. 32. What is E-Marketing & E-Business? 3 Level of commitment to E-Biz can vary Individual Business Activity - aim for efficiency(cost reduction) Ex. Website for brochure-ware Business process - aim for effectivenessB.Moghimi@yahoo.co.uk(incremental sales, retention) (ex. CRM) Enterprise - the firm automates many businessprocesses in a unified system(ex. Click+Mortar) Pure Play-business transformation (dot.com) (competitive advantage, industry redefinition)32 33. The challenges/ opportunities with E-Marketing Consumers Empowered Consumers now have more control. They want: Speed (ex. answer emails quick) Privacy, safeguards, permission to contact and useinformationB.Moghimi@yahoo.co.uk Low prices, convenience, self-service Service, personal attention/personalization (treatcustomers important) Value (exceed expectations) Mass customization (adds value and can be33automated). 34. The challenges/ opportunities with E-Marketing Consumers want in a website: 1 stop shopping with integrated solutions. Effective web navigation Quick downloadsB.Moghimi@yahoo.co.uk Clear site organization Attractive/useful site design Secure and private transactions Free information/services - consumers used toonline culture of getting something for free.34 35. The challenges/ opportunities with E-Marketing Businesses must address: Competition, changing value chain structures, conflict,and coordinating the front/back end. Technology Costly and changing, but may offer LR savingsB.Moghimi@yahoo.co.uk But can offer value to both firms and consumers if doneright: Benefits of customization, personalization Decrease Costs - 24/7 convenience, self-serviceordering and tracking, one stop shopping.35 36. E-Bay an example of E-Marketing success Still successful despite slowing E-Bay on track for $8 billion ineconomy as both consumersrevenues in 2008 and 70%and firm searching for stuff toearnings growth in next 2-3sell.years. E-Bay takes a cut of every Has 85% of online consumertransaction - low risk as they auction market. Firms also setB.Moghimi@yahoo.co.ukdont have to addressup shops to sell at fixed prices.inventory, warehousing, orfulfillment issues. 37.6 million users in 200countries. 1/2 of usersreferred to by other users.36 37. B.Moghimi@yahoo.co.uk 37 38. B.Moghimi@yahoo.co.uk 38 39. Size of the Internet? The Internet is a big place. How big? Try gigantic. The attemptsto visually representing some of the mind-boggling numbersthat defined the Internet circa 2010 , still not very easy to wrapyour head around. How, for example, does one simply imagine the 2 billion videosbeing watched on YouTube each and every day? How is itB.Moghimi@yahoo.co.ukpossible that 35 hours of video can be uploa