1st unit PPT of e-marketing

1. 1st UNIT
Introduction to
E-Marketing
1

2. SYLLABUS
• Introduction to E-Marketing: Landscape – Past –
Today – Future – Internet Marketing Paradigm –
Internet Infrastructure Stack
• Business Models & Strategies: Strategic Planning –
Strategy to Electronic Planning – Strategic Drivers of
the Internet Economy – Business Models to E-
Business Models – E-Business Models– Performance
Metrics – The Balanced Scorecard
2

3. What is E-business?
E-business (electronic business) is the conducting of business on
the Internet, not only buying and selling but also servicing
customers and collaborating with business partners.
uses Internet-based technologies and infrastructure, both internally
and externally, to conduct day to day business process operations.
Stands for electronic business and refers to any kind of sales,
services, purchasing or commerce on the Internet.
A new-tech jargon word used more for marketing than for technical
description. Most commonly it broadly refers to conducting
business over the Internet (email and web) by communicating and
perhaps transacting (buying and selling) with customers, suppliers,
and business partners.



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3

4. Internet
• The internet is a global network of
interconnected networks.
• E-mail and data files move over phone lines,
cables, and satellites from sender to receiver.
• There are two special uses of the internet:
– Intranet: network that runs internally in an
organization.
– Extranet: two joined networks that share
information.
4

5. Internet cont.
• E-business is the continuous
optimization of a firm’s business
activities through digital technology.
• E-commerce is the subset of e-
business focused on transactions.
• E-marketing is one part of an
organization’s e-business activities.
5

6. E-Marketing is Bigger than the
Web
• The Web is the portion of the internet
that supports a graphical user interface
for hypertext navigation with a browser.
• The Web is what most people think
about when they think of the Internet.
6

7. The Web Is One Aspect of E-
Marketing
• Exhibit 1.1
7

8. E-Marketing is Bigger than
Technology
• The internet provides individual users with
convenient and continuous access to information,
entertainment, and communication.
• Communities form around shared photos, videos,
and online profiles.
• The digital environment enhances processes and
activities for businesses.
• Societies are enhanced through more efficient
markets, more jobs, and information access.
8

9. E-Marketing’s Past: Web 1.0
• The Internet started in 1969 as the
ARPANET, a network for academic and
military use.
• Web pages and browsers appeared in 1993.
• The first generation of e-business was like a
gold rush.
– Between 2000 and 2002, more than 500 internet
firms shut down in the U.S.
– By Q4 2003, almost 60% of public dot-coms were
profitable. 9

10. E-Business to Just Business
• Exhibit 1.5
10

11. E-Marketing Today: Web 2.0
• Web 1.0 connected people to networks.
• Web 2.0 connected people with
machines and each other.
• Web 2.0 is the second generation of
internet technology and includes:
– Blogs
– Social networking
– Photo, video, and bookmark sharing
11

12. The Future: Web 3.0
• The newest technologies allow
marketers to focus on user:
– Engagement
– Participation
– Co-creation
• Online gaming represented over $10
billion in revenue and 100 million
players in 2016.
12

13. Consumers Have More
Control
• The internet provides a communication platform for
individual comments, both positive and negative.
– Comments can spread quickly and rapidly.
• New technologies such as digital video recorders
(DVRs) will increase consumer control.
• New service Akimbo maintains a library of over
10,000 programs with access via the internet,
television, or other appliance.
13

14. Power Shift from Companies to
Individuals
14

15. Wireless Networking
Increases
• Cell phones, PDAs, and laptops connect to
the internet via wireless modem worldwide.
– Starbucks
– Hotels and airports
– Queen Mary II luxury liner
– Amtrak train stations
• Customers will have information,
entertainment, and communication when,
where, and how they want it.
15

16. Internet Marketing Paradigm
 Once marketers identify appropriate markets, information
technology facilitates relationships before and after the
transaction with:
 Prospects,
 Customers,
 There are three important markets that both sell and buy to
each other:
 Businesses,
 Consumers,

Governments.
 Partners,
 Supply chain members.
16

17. To Business To Consumer To Government
Initiated by
Business
Business-to-Business
(B2B)
FreeMarkets
www.freemarkets.com
Business-to-
Consumer (B2C)
CDNow
Www.cdnow.com
Business-to-
Government (B2G)
Western Australian
Government Supply
www.ssc.wa.gov.au/
Initiated by
Consumer
Consumer-to-Business
(C2B)
Better Business Bureau
site
www.bbb.org
Consumer-to-
Consumer
(C2C)
eBay
www.ebay.com
Consumer-to-
Government
(C2G)
GovWorks
www.govworks.com
Initiated by
Government
Government-to-Business
(G2B)
Small Business
Administration site
www.sba.gov
Government-to-
Consumer
(G2C)
California state site
Www.state.ca.us
Government-to-
Government
(G2G)
GovOne Solutions
http://www.govonesol
utions.com/
Exhibit 1 - 1 E-Business Markets
Source: Marian Wood (2001) with minor adaptation (p. 2)
17

18. Business Market
- It is huge: more businesses are connected to the
internet than consumers.
- It is transparent to consumers: it involves proprietary
networks that allow information and database sharing.
E.g. FedEx, the package delivery firm:
- Its customers can schedule a package pick-up using the Web
site,
- Track the package using a PC or handheld PalmPilot,
-
Pay the shipping bill online.
18

19. Consumer Market
 E-marketers must understand consumers in potential
geographic segments:
 Consumers in many countries pay by the minute for local
phone access = determine the kind of casual surfing
practiced by Internet users.
 The consumer market is huge and quite active online:
 Large number of consumers are shoping over online –
major shift has happened in the last decade
19

20. Government Market - Issues
 Businesses wishing to sell to governments face challenges
unique to this market:
 Follow rules regarding qualifications, paperwork, etc.,
 Must compete to be on the government list of approved
suppliers + compete for specific contracts through a
bidding process,
 Have to conform to very particular timely delivery of
quality products at reasonable prices.
20

21. HARDWARE SOFTWARE
INTERNET
ACCESS,
SERVICES,
websites
E-payment,
CERTIFICATES,
ADVERTISEMENT
E-business infrastructure
21

22. E-MARKETING TOOLS
E-Marketing tools and strategies include:
• Business websites;
• Search Engine;
• Email;
• Online newsletters/e-zines;
• Online catalogues;
• Online press releases;
• Online surveys;
• Online customer service;
• Banner advertising;
• Affiliate marketing.
• Mobile telephone marketing;
• Online Community (Friendster, YouTube) - new
• Web Log (Blog) - new
22

23. Strategic Planning
 Strategic planning = the “managerial process of
developing and maintaining a viable fit between the
organization’s objectives, skills, and resources and its
changing market opportunities.”
• Paytm credit card
• Microsoft edge
• Amazon wallet
• Google glowroad, crome, android,
 Two key elements of strategic planning are:
- The preparation of a SWOT analysis,
- The establishment of strategic objectives.
23

24. 24

25. 25

26. SWOT Analysis
Strengths, Weaknesses, Opportunities, and Threats
 It examines:
- The company’s internal strengths and weaknesses
with respect to the environment,
- The competition and looks at external opportunities
and threats.
 Opportunities may help to define a target market or
identify new product opportunities, while threats are areas
of exposure.
26

27. 
A company’s strengths and weaknesses in the online
world may be somewhat different from its strengths
and weaknesses in the brick-and-mortar world.

Big Bazar (Future Group) has enormous
strengths in the brick-and-mortar world but these do
not necessarily translate into strengths in the online
world:

Channel conflict = having to explain to channel
partners why customers can purchase for less online
than in the store.
Example
27

28. •
Internal Capability Examples
Customer interactions E-commerce, customer service,
distribution channels
Production and fulfillment SCM, production scheduling,
inventory management
People Culture, skills, knowledge
management, leadership and
commitment to e-business
Technology ERP systems, legacy
applications, networks, Web
site, security, IT skills
Core infrastructure Financial systems, R&D, HR
Exhibit 2 - 1 Key Internal Capabilities for E-Business
Source: Adapted from Kalakota and Robinson (1999)
28

29. Strategic Objectives
The firm sets objectives such as:
 Growth. How much can the firm reasonably expect to
grow in terms of revenues, and how fast?
 Competitive position. How should the firm position
itself against other firms in the industry? Viable positions
are:
- Industry leader (Microsoft),
- Price leader (Priceline.com),
- Quality leader (Mercedes),
- Niche firm (Google.com),
- Best customer service (Dell.com).
29

30. Strategic Objectives
 Geographic scope. Where should the firm
serve its customers on the continuum of local to
multinational?
 Other objectives. Companies often set
objectives for the number of industries they will
enter, the range of products they will offer, the
core competencies they will foster, and so on.
30

31. Strategy
 It is the means to achieve a goal.
 It is concerned with how the firm will achieve its
objectives.
1. The firm sets its growth and other objectives,
2. It decides which strategies it will use to
accomplish them,
3. The tactics are detailed plans to implement the
strategies.
 It is important to note that objectives, strategies, and31

32. From Strategy to Electronic
Strategy
E-business strategy:
• The deployment of enterprise resources to capitalize on
technologies for reaching specified objectives that ultimately
improve performance and create sustainable competitive
advantage.
• Corporate-level business strategies including information
technology components (Internet, digital data, databases, and so
forth) become e-business strategies.
E-Business Strategy = Corporate Strategy
+ Information Technology32

33. P
Legal - Ethical
Technology
Competition
Other factors
E-Business
Strategy
Performance Metrics
SWOT
E-Marketing Plan
E-Marketing
Strategy
E-Marketing Mix
CRM
Markets
Internet
E
S
Exhibit 2 - 1 Focusing on Strategy and Performance
E-business strategy flows from the firm’s environmental
analysis.
33

34. From Strategy to Electronic
Strategy
Marketing strategy becomes e-marketing strategy when
marketers use digital technology to implement the strategy:
E-marketing strategy = marketing strategy
+ Information technology
34

35. From Strategy to Electronic
Strategy
• Most strategic plans explain the rationale for the chosen objectives
and strategies. There are four appropriate types of rationale:
1. Strategic justification shows how the strategy fits with the
firm’s overall mission and business objectives,
2. Operational justification identifies and quantifies the specific
process improvements that will result from the strategy,
3. Technical justification shows how the technology will fit and
provide synergy with current information technology
capabilities,
4. Financial justification examines cost/benefit analysis and uses
standard measures (ROI, NPV).
35

36. Strategic Drivers of Internet
economy
• Information availability
• Transaction and Product availability
• Flexibility and speed of service
• User friendly – no switching costs
• Convenience
• Trust and CRM
• Skilled People
• Technology
• Customers data – behavior 36

37. How does a firm select
the best business models?
Critical components:
• Customer value. Does the model create value through its
product offerings that is differentiated in some way from
that of competitors?
• Scope. Which markets do the firm serve, and are they
growing? Are these markets currently served by the firm, or
will they be higher risk new markets?
• Price. Are the firm’s products priced to appeal to markets
and also achieve company share and profit objectives?
37

38. How does a firm select
the best business models?
• Revenue sources. Where is the money coming from? Is it plentiful
enough to sustain growth and profit objectives over time?
• Connected activities. What activities will the firm need to perform to
create the value described in the model? Does the firm have these
capabilities?
• Implementation. The company must have the ability to actually make
it happen.
• Capabilities. Does the firm have the resources (financial, core
competencies, and so on) to make the selected models work?
• Sustainability. The e-business model is particularly appropriate if it
will create a competitive advantage over time.
38

39. E-Business Models
• The direct connection with information technology makes a
business model an e-business model:
E-Business Model = Business Model
+ Information Technology
• E-business model: method by which the organization sustains
itself in the long term using information technology, which
includes its value proposition for partners and customers as
well as its revenue streams. 39

40. E-Business Models
•
E-business models can
capitalize on digital data
collection and distribution
techniques.
40

41. Value and Revenue
– Whether online or offline, the value proposition involves
knowing what is important to the customer or partner and
delivering it better than other firms.
– Value encompasses the customer's perceptions of the
product’s benefits, specifically its attributes, brand
name, and support services.
– Subtracted from benefits are the costs involved in
acquiring the product, such as monetary, time, energy,
and psychic.
Value = Benefits - Costs
41

42. E-Marketing Contributes to the E-Business
Model
E-Marketing Increases Benefits
Online mass customization Personalization
24/7 convenience
Self-service ordering and tracking
One-stop shopping
E-Marketing Decreases Costs
Low cost distribution of communication messages
Low cost distribution channel for digital products
Lowers costs for transaction processing
Lowers costs for knowledge acquisition
Creates efficiencies in supply chain
Decreases the cost of customer service
E-Marketing Increases Revenues
Online transaction revenues such as product, information, advertising, and subscriptions
sales; or commission/fee on a transaction or referral
Add value to products/services and increase prices
Increase customer base by reaching new markets
Build customer relationships and thus increase current customer spending
42

43. Pure
Play
Enterprise
Business Process
Activity
Pure dot-com
(Amazon)
Click and Mortar
(eSchwab, most retailers)
Customer
Relationship
Management
Brochureware
E-mail
Levelofbusinessimpact
Business transformation
(competitive advantage,
industry redefinition)
Effectiveness
(customer
retention)
Efficiency
(cost
reduction)
Exhibit 2 - 1 Level of Commitment to E-business
Source: Adapted from www.mohansawhney.com
E-Business Models
43

44. E-Business Models at Various
Levels of Commitment
• Each level of the pyramid indicates a number of opportunities for
the firm to provide stakeholder value and generate revenue streams
using information technology.
• Because there is no single, comprehensive, ideal taxonomy of e-
business models, we categorize the most commonly used models
based on the firm's level of commitment.
44

45. Activity
Level
Business
Process Level
Enterprise
Level
• Order processing
• Online purchasing
• E-mail
• Content publisher
• Business intelligence
(BI)
• Online advertising
• Online sales
promotions
• Dynamic pricing
strategies online
Customer
relationship
management
(CRM)
Knowledge
management
(KM)
Supply chain
management
(SCM)
Community
building online
Database marketing
Enterprise Resource
Planning (ERP)
Mass-customization
• E-Commerce, direct
selling, content
sponsorship
• Portal
• Broker models
Online
exchange, hub
Online auction
• Agent models
Manufacturer’s
agent
Catalog
aggregator
Metamediary
Shopping agent
Reverse auction
Buyer’s
cooperative
Virtual mall
Exhibit 2 - 1 E-Business Model Classification 45

46. Activity Level E-Business Models
 Online purchasing. Firms can use the Web to place orders with
suppliers, thus automating the activity.
 Order processing. This occurs when online retailers automate
Internet transactions created by customers.
 E-mail. When organizations send e-mail communications to
stakeholders, they save printing and mailing costs.
 Content publisher. Companies create valuable content or
services on their Web sites, draw lots of traffic, and sell advertising.
Another type of content publishing, the firm posts information about
its offerings on a Web site, thus saving printing costs =
brochureware. Slide share
46

47. Activity Level E-Business Models
 Business intelligence (BI). This refers to the gathering of
secondary and primary information about competitors, markets,
customers, and more.
 Online advertising. As an activity, the firm buys advertising on
someone else’s e-mail or Web site.
 Online sales promotions. Companies use the Internet to send
samples of digital products (e.g., music or software), or electronic
coupons, among other tactics.
 Pricing strategies. With dynamic pricing, a firm presents different
prices to various groups of customers, even at the individual level.
47

48. Business Process Level E-Business
Models
 Customer relationship management (CRM) = retaining + growing
business / individual customers through strategies that ensure their
satisfaction with the firm and its products = keep customers for the long term
+ increase the number and frequency of their transactions.
 Knowledge management (KM) = combination of a firm’s database
contents + the technology used to create the system + the transformation of
data into useful information and knowledge.
 Supply chain management (SCM) = coordination of the distribution
channel to deliver products more effectively and efficiently to customers.
 With community building, firms build Web sites to draw groups of special-
interest users. Firms invite users to chat / post e-mail on their Web sites to
attract potential customers to the site. 48

49. Business Process Level E-Business
Models
 Affiliate programs = when firms put a link to someone else’s
retail Web site and earn a commission on all purchases by
referred customers.
 Database marketing = collecting, analyzing, and
disseminating electronic information about customers, prospects,
and products to increase profits.
 Enterprise resource planning (ERP) = a back-office system
for order entry, purchasing, invoicing, and inventory control.
 Mass customization = Internet’s unique ability to customize
marketing mixes electronically and automatically to the individual
level.
49

50. Enterprise Level E-Business Models
 E-commerce refers to online transactions: selling goods and
services on the Internet, either in one transaction or over time
with an ongoing subscription.
 Direct selling refers to a type of e-commerce in which
manufacturers sell directly to consumers, eliminating
intermediaries such as retailers.
 Content sponsorship online is a form of e-commerce in which
companies sell advertising either on their Web sites or in their e-
mail.
 A portal is point of entry to the Internet, such as the Yahoo! and
AOL Web sites. They are portals because they provide many
services in addition to search capabilities. 50

51. Enterprise Level E-Business Models
 A portal is point of entry to the Internet, such as the Yahoo! and
AOL Web sites. They are portals because they provide many
services in addition to search capabilities.
 Online brokers are intermediaries that assist in the purchase
negotiations without actually representing either buyers or
sellers. The revenue stream in these models is commission or
fee-based:

The brokerage model are E*Trade (online exchange), and eBay
(online auction),

A B2B exchange is a special place because it allows buyers and
sellers in a specific industry to quickly connect.
51

52. Enterprise Level E-Business Models
 Online agents represent either the buyer or the seller and
earn a commission for their work.
 Selling agents help a seller move product.
 Manufacturer’s agents represent manufacturing firms that
sell complementary products to avoid conflicts of interest.
 The catalog aggregator, brings together many catalog
companies to create a new searchable database of products
for buyers.
 A special type of agent = the metamediary, it represents a
cluster of manufacturers, online retailers, and content
providers organized around a life event or major asset
purchase
52

53. Enterprise Level E-Business Models
 Purchasing agents represent buyers.
 Shopping agents help individual consumers find specific products
and the best prices online (e.g., www.mysimon.com).
 The reverse auction, allows individual buyers to enter the price
they will pay for particular items at the purchasing agent’s Web site,
and sellers can agree or not.
 An online purchasing agent is called a buyer cooperative or a
buyer aggregator.
 A virtual mall is similar to a shopping mall in which multiple online
merchants are hosted at a Web site.
53

54. Pure Play
 Pure plays = businesses that began on the Internet, even if
they subsequently added a brick-and-mortar presence.
 E.g. E*Trade is a pure play, beginning with only online
trading
 Pure plays face significant challenges: They must compete
as new brands and take customers away from established
brick-and-mortar businesses.
 One way to change the rules is to invent a new e-business
model, as Yahoo! and eBay did. 54

55. An Optimized System of E-Business Models
E-business is the continuous optimization of a firm’s business activities
through digital technology.
Firms usually combine traditional business and e-business models. E.g.
Metro (cash and carry) = combined its online and offline brokerages
in a unified system.
 The challenge: customers expect a high degree of coordination
between online and offline operations.
 The danger: the established corporate culture might squash e-
commerce initiatives or slow them down with the best of intentions.
 The solution: Many businesses have spun off their e-commerce
operations as wholly owned subsidiaries or pure plays so they can
compete without the weight of the parent business.
55

56. An Optimized System of E-Business Models
A fully optimized e-business that uses the Internet
to sell is the sum of multiple e-business activities
and processes: E-commerce, business
intelligence, customer relationship management,
supply chain management, and enterprise
resource planning as represented in the following
equation:
EB = Emktg+ BI + CRM + SCM + ERP
56

57. Performance Metrics
• The only way to know whether a company has reached its objectives is
to measure results.
• Performance metrics = specific measures designed to evaluate the
effectiveness and efficiency of an organization’s operations.
• Armed with this information, the company can make corrections to be
sure it accomplishes the goal.
• Performance metrics should be defined along with the strategy
formulation so the entire organization will know what results constitute
successful. 57

58. Performance Metrics
Performance metrics used to measure strategy effectiveness:
- Translate the vision, strategy, or e-business model into
components that have measurable outcomes that various
departments can use to create action plans,
- Communicate to employees what results the firm
values.
⇒When employee evaluations are tied to the metrics,
people will be motivated to make decisions that lead to
the desired outcomes.
58

59. Social Media
Performance Metrics
• Unique visitors
• Page views
• Impressions
• Number of searches
• Search engine ranking
• Number of followers, registrations, or
subscribers
59

60. BRAND HEALTH METRICS
60

61. Brand Health Metrics
• Share of Voice (SOV)
• Sentiment
• Brand influence
61

62. Engagement Metrics
• Content viewership
• Tagging, bookmarking or “likes”
• Membership/Follower
• Number of shares
• Content creation
62

63. Action & Innovation
Metrics
• Action metrics
– Click-through to an advertiser’s site.
– Contact form completion or registration.
– Event attendance.
– Purchase.
• Innovation metrics
– Number of ideas shared.
– Trend spotting.
63

64. The Balanced Scorecard
• The Balanced Scorecard provides a
framework for understanding e-marketing
metrics.
• The Balanced Scorecard provides 4
perspectives.
– Customer perspective
– Internal perspective
– Learning and growth perspective
– Financial perspective
64

65. The Balanced Scorecard
(Cont.)
65

66. The Balanced Scorecard:
Customer Perspective
• The customer perspective scorecard includes
ways to measure goals such as customer
loyalty and retention, engagement,
satisfaction, etc.
– Loyalty and satisfaction measures may include
percentage of visitors who return to site, time
between visits, and shopping cart abandonment.
– Customer engagement could include the number of
comments, photos or videos posted.
• Exhibit 2.7 provides a list of customer goals
and measures.
66

67. The Balanced Scorecard:
Internal Perspectives
• The Internal perspective scorecard
includes ways to measure goals related
to the quality of online services and
measures for the entire supply chain.
– Number of customers who use service
– Number of complaints in social media
– Amount of time to answer customer e-mail
– Number of website updates per day
• Exhibit 2.8 provides a list of internal goals
and measures.
67

68. THE BALANCED SCORECARD:
LEARNING AND GROWTH
PERSPECTIVES
• The learning and growth perspective
scorecard includes human resources, product
innovation and continuous improvement of
marketing processes.
– Number of new products and features
– Number of customer complaints and fixes
– Conversions from online leads
• Exhibit 2.9 provides a list of learning and
growth goals and measures.
68

69. The Balanced Scorecard:
Financial Perspectives
• The financial perspective scorecard includes
ways to measure financial goals such as
sales, profit and return on investment.
– Sales growth and market share
– Return on invested capital
– Average order value
– Individual customer profit
• Exhibit 2.10 provides a list of financial goals
and measures.
69