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IB Business/Management Unit 4.8 E-Commerce

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Chapter Goals Describe the features of e-commerce Analyze how changing technology and e- commerce impacts the marketing mix Distinguish between the three types of e- commerce Discuss the costs and benefits of e-commerce to firms and consumers

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Feature of e-commerce Ubiquity widely available 24/7 Customization messages can be personalized Global reach internet breaks traditional boundaries Integration allows use of audio, video & text to present a marketing message Universal standards one set of global internet standards

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E-commerce & the Marketing Mix Product Wider customer base Wider range of products to meet demand Customers able to tailor products Example - interactive websites to build custom cars Should lead to greater customer satisfaction Price Prices more transparent Consumers can easily check prices Allow the middle man to be cut out Products more affordable

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E-commerce & the Marketing Mix Promotion Additional medium; Many businesses supplement traditional advertising with on- line advertising Provides more ways for businesses to advertise Feedback from customers can be immediate Place Able to reach a global audience at a fraction of the cost Distribution Channels shortened Internet more convenient Language translation can expand markets even further

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Types of e-commerce Business to Business - E-commerce focused on the needs of other businesses Corporate banking; Equipment suppliers Business to Consumer - Directly focused on the end-user, or consumer Consumer to consumer transactions between two consumers

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Benefits of E-commerce to firms Can reach a wider market More cost effective Another place to generate revenue Example Facebook advertising Excessive packaging can be reduced Example computer manuals downloaded, rather than included with produce

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Benefits to consumers Convenience Can shop from your own home any time Increased choice Can easily compare products from many different sites Good customer service = customer satisfaction

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Costs of E-commerce to firms Security concerns regarding payments Need to guard against on-line fraud = expensive Vulnerable to competition May not be suited for every type of business Setting up and maintaining a website can be expensive

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Costs of E-commerce to consumers Consumers dont have the ability to try out the product Not everything can be purchased on-line On-line pop-ups considered a distraction Not all areas have great internet connectivity Information overload!