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Chapter 5E-environment

Learning objectives

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Identify the different elements of the e-environment that impact on an organisation’s e-business and e-marketing strategy.

Assess the impact of legal, moral and ethical constraints or opportunities on a company and devise solutions to accommodate them.

Assess the role of macro-economic factors such as economics, taxation and legal constraints

Issues for managers

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What are the constraints placed on developing and implementing an e-business strategy by the e-environment?

What factors influence the adoption of new digital media and how can we estimate future demand for online services?

How can trust and privacy be assured for the customer while seeking to achieve marketing objectives of customer acquisition and retention?

Activity 4.1

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List all the social, legal and ethical issues that the manager of a sell-side e-commerce web site needs to consider to avoid damaging relationships with users of his or her site or which may leave the company facing prosecution. You can base your answer on issues which may concern you, your friends or family when you access a web site.

Activity answer – this lecture

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Cookies – laws and consumer perception on placing these

Are we limiting access to information from certain sections of society (social exclusion)?

Privacy of personal information entered on a web siteSending unsolicited e-mailReplying promptly to e-mailCopyrightSite content and promotional offers/adverts are in

keeping with the different laws in different countriesProviding text, graphics and personality in keeping with

social mores of different countries

SLEPT Factors

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Macro-environmentSocialLegalEconomicPoliticalTechnological

Social

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Demand analysis (part of micro-environment)

Have access to the channel. Are influenced by using the channel. Purchase using the channel.

Popularity of online activities

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Figure 4.1  Popular online activities in the UK showing variation between October 2000 and October 2002

Source: Copyright © Crown copyright 2002, Crown copyright material is reproduced with the permission of the Controller of HMSO.

Internet access worldwide

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Figure 4.2  Percentage of global population with Internet access

Source: Reprinted from CyberAtlas.com, a publication of Jupitermedia Corporation. Copyright © 2003 Jupitermedia Corporation

Ethical issues and data protection

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Ethical issues concerned with personal information ownership have been usefully summarised by Mason (1986) into four areas:

1. Privacy – what information is held about the individual?

2. Accuracy – is it correct?3. Property – who owns it and how can ownership be

transferred?4. Accessibility – who is allowed to access this

information, and under which conditions?

Ethics – Fletcher’s view

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Fletcher (2001) provides an alternative perspective, raising these issues of concern for both the individual and the marketer:– Transparency – who is collecting what

information?– Security – how is information protected

once collected by a company?– Liability – who is responsible if data is

abused?

The eight principles for data protection

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Fairly and lawfully processed; processed for limited purposes; adequate, relevant and not excessive; accurate; not kept longer than necessary; processed in accordance with the data subject's

rights; secure; not transferred to countries without adequate

protection.

www.dataprotection.gov.uk

Opt-in vs opt-out

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Figure 4.8  (a) Opt-in online form, (b) opt-out form

Opt-in vs opt-out

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Figure 4.8  (c) implicit opt-in

Information flows for data protection

15Figure 4.9Information flows that need to be understood for compliance with data protection legislation

Legal – Sparrow’s eight areas

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1. Marketing your e-commerce business 2. Forming an electronic contract 3. Making and accepting payment 4. Authenticating contracts concluded over the

Internet5. E-mail risks 6. Protecting intellectual property 7. Advertising on the Internet 8. Data protection

Economic / Political

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Ensuring companies competitiveFunding for education and technology:

e.g. www.ukonlineforbusiness.gov.uk Promoting new technology e.g. broadband 12% in UK,

70% Taiwan, South KoreaAchieving government efficiencies

E-government – all UK services online by 2005Singapore ‘Intelligent Island’

Taxation regimesLegislation for offshore trading

E-economy framework

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Figure 4.11  A framework describing the e-economy

Source: Booz Allen Hamilton (2002). Copyright © Crown copyright 2002, Crown copyright material is reproduced with the permission of the Controller of HMSO.

Technological issues

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Rate of changeWhich new technologies should we adopt?

Monitoring for new techniquesEvaluation – are we early adopter?Re-skilling and training

Are our systems secure?

Responses to change in technology

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Figure 4.15  Alternative responses to changes in technology