© 2007 by Prentice Hall 13-1 Internet Purchases What was the last purchase you made using the...

© 2007 by Prentice Hall 13-1

Internet Purchases• What was the last purchase you made

using the Internet?• What percentage of your purchases

are made via the Internet?• What products do you purchase over

the Internet?• What do you think is the future for

Internet businesses?• What has made Google.com

successful?• What obstacles do Internet firms

face?

Discussion Slide

13


Internet Marketing

• Profile of Internet users• Internet marketing functions• E-commerce• IMC and the Internet• Direct and viral marketing• Internet design issues

13 Chapter Overview


Internet Growth• Daily access the Internet

• Americans – 48%• Canadians – 47%• Britons – 36%

• Communication• Voice over Internet Protocol (VoIP)• Web blogs• Internet retail sales

• $144 billion, 7% of global retail sales


• Building databases for e-mail campaigns.• Designing e-mail campaigns linking customers to

Web site information.• Creating fun and innovative games to attract and

keep customers coming back to Web page.• Creating incentive programs.• Translating printed documents, catalogs, brochures,

and newsletters for the Internet.• Adding graphics to the Web site.

Source: Ellisor, “Business-to-Business Offer WWW Opportunities,” Houston BusinessJournal, (September 17, 1999), Vol. 30, No. 7, p. 18B.

F I G U R E 1 3 . 2Internet Services Offered by Marketing Agencies


• Advertising• Sales support• Customer service• Public relations• E-commerce (Retail store)

F I G U R E 1 3. 3

Functions of the Internet


E-Commerce

Selling of goods and services on the Internet Entry into e-commerce

Trend of future Fad Alternative mode of shopping

Source of information for shoppers


Top Cyber Shopping Categories

Source: “Cyber Shopping,” License, Vol. 7, No. 10 (November 1004), p. 12.

$52.4

$15.4 $12.0 $11.7$8.1 $7.5 $5.1 $4.3 $3.7 $3.6

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$20.0

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$60.0

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E-Commerce Components

• Catalog• Shopping cart• Payment

procedure


Reasons People Wary of Online Purchases

• Security issues• Credit card charges• Identity theft• Fraud• History and Advertising

• Purchasing habits• Incentives


E-Commerce Incentives

• Financial incentives

• Convenience-based incentive

• Value-added incentive


Financial Incentives

Attract first-time purchaser Repeat purchasers Cyberbait Most effective incentives

Free shipping & handling Dollar discounts Free gifts

Financial incentive Meaningful Changed periodically


Convenience Incentives

Time Update and change Web site Easy to locate merchandise Convenience services

Weddings Popular items Measurement charts


Value-Added Incentives

Change purchasing habits – long term Personalized shopping Examples

Merchandise available only online Free online courses

Barnes & Noble, Charles Schwab Free information

Tide and Ragu


Business-to-Business E-Commerce

$767

$624$551$517

$466

$272

$95$40$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

1998 1999 2000 2001 2002 2003 2004 2005

Bill

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Source: “Data,” B to B, Vol. 90, No. 5 (April 11, 2005), p. 5.


Business-to-Business E-Commerce

• Excellent for re-buy situations• Brand name recognition important• Requires incentives

• Financial• Convenience• Value-added

• Online exchanges and auctions• Store or warehouse locator


iGo.com

Http://www.igo.com

http://www.igo.com/


International E-Commerce

• Internet allows for sales worldwide.• Areas to address for international business.

• Communication barriers• Cultural differences• Shipping of merchandise• Internet capabilities in other countries• Payment procedures

• Web sites in different languages.• Call centers in different countries.


IMC and the Internet

• Important component of the IMC• Communication between departments

• Marketing• Human resource• Production• Information technology (IT)• Call centers• Shipping departments


• Internet content search (38%)• Word-of-mouth (30%)• Internet banner (20%)• Television ad (7%)• Print ad (5%)

Source: Don Jeffrey, “Survey Details Consumer Shopping Trends on the Net,” Billboard, (May 29, 1999), Vol. 111, No. 22, p. 47.

F I G U R E 1 3 . 7What Drives People to a New Site?


IMC and the Internet

• Search engine key words• Online advertising• E-mail advertising• Blogs• Off-line advertising


Why Dot.com Print Ads Fail to Grab and Hold Attention

• Lack visual power.• Ambiguous illustrations that require too

much time and effort to understand.• Often is not legible. • Contains no optimum “flow.”• Tends to ignore the reader’s question,

“what’s in it for me?”

Research Study by Roper Starch Worldwide (November 13, 2000)


IMC and the InternetBranding

• Brand image important• 82% brand name influenced online purchase

• Web site must support brand image

• Cyberbranding• Brand spiraling• Halo brand effect


Information Online Impacts Brand Impressions

• Travel or lodging 27%• Clothing or apparel 33%• Music 24%• Household products 31%• Electronics or software 40%• Books 29%• Toys 19%• Gifts, flowers, or cards 21%

Information companies had online influenced the impressions consumers had of a brand, even If the product was purchased in a store. The data below indicate the percentage of consumers who said online content changed their view of a brand.

Source: “Far-Reaching Effects,” Marketing News, Vol. 38 (February 1, 2004), p. 4.


• Putting the Web address on printed materials and promotional items. (91%)

• Advertising in trade journals. (74%)• Registering the Web site with search

engines for keywords. (72%)• Buying banners on other sites. (25%)

F I G U R E 1 3. 8B-to-B Techniques to Boost Web Site Awareness


This Juno ad was placed in trade magazines to increase business awareness. It alludes to the difficulty of proper targeting.

Http://www.juno.com

http://www.juno.com/


This Buzzsaw.com advertisementwas placed in trade magazines for the construction industry.

The company promises to help business evolve and survive as the industry undergoes rapid change.

http://www.buzzsaw.com

http://www.buzzsaw.com/


IMC and the InternetBrand Loyalty

• Brand-loyal consumers• Communication key to developing loyalty

• Make shopping or browsing pleasurable• Establish one-to-one communications• Personalization of information• Niche customers


IMC and the InternetSales Support

• Provide information to sales staff• Client information• Product information• Company information

• Provide information to customers• Prospecting• Qualifying prospects• Gathering information


IMC and the InternetCustomer Service

• Cost-effective method• Easy-to-use Web site• Alternative communication channels

• Discussion groups• Chat rooms• Blogs

• Access by businesses• Access by manufacturers


IMC and the InternetCustomer Service

• Response time to inquiries• 37% satisfied with online customer

service, compared to 85% for traditional• Older consumers less satisfied than

younger consumers• Only 34% acknowledge receipt of

customer e-mails• 24% of e-mails or inquiries are never

answered


Steps to Improve Customer ServiceInstitute of Management Administration (IOMA)

1) Knowledgeable service reps

2) Confirm customer’s order or inquiry – provide timeframe

3) Provide personal touch

4) Offer opportunity for personal communication

5) Use good communication skills

6) Be aware of work habits of customers


Direct Marketing• Internet is ideal medium• Direct mail is most effective driver for online

direct marketing• Interactive marketing

• Personalization of content, offers, and e-mails• Blue Martini E-Merchandising

• Http://www.bluemartini.com

• Edify Smart Options• Http://www.edify.com

• Direct e-mails, request permission

http://www.bluemartini.com/

http://www.edify.com/


Viral Marketing

• Prepared ad attached to e-mail• Word-of-mouth advocacy• Message passed voluntarily• Higher percentage pass message

along to others• Scope• Mazda


• Clueless banners• Slow loading front page• Forcing people to go through

numerous screens• Too much verbal information• Too many technical terms• Sites that are hard to navigate

F I G U R E 1 3 . 9Clues to Poor Design


• Decide strategic purpose.• Easy access and quick loading.• Written content should be precise.• Content is key.• Graphics should support content.• Make an offer to encourage a response.• Ask for site evaluation.• Provide easy to use navigation links on every page.• Use gimmicks to gain attention at the beginning.• Change Web site on a regular basis.• Measure results continually.

Source: Based on Ray Jutkins, “13 Ideas That Could Lead to Successful Web Marketing,” Advertising Age’s Business Marketing, (June 1999), Vol. 84, No. 6, p. 27.

F I G U R E 1 3 . 1 0Tips for Creating Winning Web Sites


A Web site with clear navigation.Click image to go to site.

© 2007 by Prentice Hall 13-1 Internet Purchases What was the last purchase you made using the...

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