MAR 6936902

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MAR 6936-902

• E-Commerce Marketing
• Fall 2002Tampa
• Rich Gonzalez
• August 29, 2002

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Agenda August 29, 2002

• Expectations of course
• Survey of course themes/concepts
• LISTERV
• Drucker
• Marketing Concept
• Porter
• Introduction Framework for E-C
• Blown to Bits
• Due for September 5

3
URLs

• coba.usf.edu
• lists.acomp.usf.edu
• www.wurlitzer-jukebox.com
• www.britannica.com/

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LISTSERV

• xhttp//lists.acomp.usf.edu
• No Password
• Sign on by Friday
• Send Intro on Saturday or later

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For September 5

• Chapter 1
• Chapter 2--- SKIM only
• Chapter 3
• Mini-Investigation of Product
• Purchase WSJ Interactive

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Syllabus

• Lets review and answer questions
• Expectations/Grading
• Writing Assignments vs. Midterm

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The Big Concepts

• Information
• Amplification
• Asynchonicity

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Textbooks

• REQUIRED TEXT
•  E-Commerce Marketing
• introduction to e-commerce, Rayport Jaworski,
  McGraw Hill/Irwin (2002). ISBN-0072510242
•  
• REQUIRED TEXT II
• Blown to Bits How the New Economics of
  Information Transforms Strategy, Harvard
  Business School Press, Evans Wurster (2000).
  ISBN 087584877x

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Price Shopping On Books?

• ebay.com
• www.half.com
• bibliofind.com
• ebs.allbookstores.com
• www.bigwords.com

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Weekly Analysis Papers

• Current Topic Will Be Selected
• 1.5 page Discussion Paper
• 6 WAP
• Scoring on 125 Points, Then Averaged
• Better than a Midterm Exam

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WSJ Interactive

• A Good Resource
• 4.95 for 60 Day Trial
• 10 Points
• Do not start up service yet.

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Survey Writing

• Writing exercise5 minutes
• E-commerce is....Just your thoughts, what comes
  to mind.
• E-commerce is important...Just your thoughts,
  put yourself in the role of the businessperson
  and customer

Legibility!!
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Why Is E-Commerce Important?
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• Lets Look at Some Predictions

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"I think there is a world market for, maybe, five
computers."
Prediction 1

• Thomas J. Watson,1943

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There is no reason for any individual to have a
computer in their home.
Prediction 2

• Ken Olson, 1977

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Prediction 3

• Business is going to change more in the next 10
  years than it has in the past 50.
• William H. Gates III, 2000

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Prediction 4

• Everyone will have access to most of the worlds
  information.
• William H. Gates III, 2000

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E-Commerce RJ

• Digital technology has transformed the economy.
• Value Creation shifts from physical to
  information
• E-C is about exchange of information
• E-C is technology enabled
• E-C is technology mediated

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E-Commerce RJ

• ...technology-mediated exchanges between parties
  as well as the electronically based
  intra-organizational activities that facilitate
  such change

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Exemplar Sites

• paypal.com
• cdbaby.com
• www.flyertalk.com
• orbitz.com
• etrade.com
• B2B sites

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(No Transcript)
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Mini-Basic Marketing Review
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Drucker

• What is the purpose of a business?
• Two primary responsibilities of a business

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Elements of the Marketing Mix within an
Environmental Framework
Competitive
Distribution
Product
Political-Legal
Target Market
Social-Cultural
Price
Promotion
Technological
Economic
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Marketing Concept

• A managerial philosophy that on organization
  should satisfy customers needs through a
  coordinated set of activities that also allows
  the org to achieve its goals

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Marketing Concept

• Target Market
•  Customer Needs Wants
•  Coordinated activities
•  Profitability

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Why Is E-Commerce Important?
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Important Facts

• 2002Q2 Internet Access165 million U.S.553
  million Worldwide
• Broadband Penetration
• 200113 million U.S. Households
• 200217 million U.S. Households
• 2007---37 million U.S. Households
• 2002--- 4 European Households
• 2002 35 M AOL Worldwide Subscribers

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Important Facts

• Online Retail Sales in U.S.
• 2002Q2 10 B
• Jul 2002 7 B
• Jul 2002 7.8 M Users Online, Brazil
• 22 Research Online, Shop Offline, Europe

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Information Technology
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Porters Competitive Business Model
New Entrants
BP of Sellers
BP of Buyers
Intraindustry Rivalry
Substitutes
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3 Fundamental Business Shifts

• 1. Most transactionsB2C, B2B and G2C will become
  self-service digital transactions.
• 2. Customer service will become the primary
  value-added function in every business. Personal
  consultancy not routine services.
• 3. The pace of transactions and customer needs
  for customer service will force firms to adopt
  digital processes---for survival.

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Environmental Backdrop of Course Content

• Technology and Economic Forces
• Digitization
• Explosive Innovation---Networks
• Knowledge/Education
• Productivity
• Quality of Life
• Westernization/Globalization

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Break

• About 711 PM

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Example of Digitization Effect

• Atoms vs. Bits
• Bits vs. Atoms

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February 2002
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WurlitzerA Digital Product?

• JukeboxA growing business?
• 250,000 in U.S. Sales 15,000/yr
• MP3 source files from MP3.com
• DSL Connection
• 500,000 songs
• 150/month or 5,000
• All royalties paid
• Surf net, send e-mail, send songs

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(No Transcript)
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Encyclopaedia Britannica

• 1768, Scotland
• 15 Editions
• 1920 Sears Purchases
• EB Is MostComprehensiveAuthoritativePrestigiou
  s

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Encyclopaedia Britannica contd

• EB 40 Million Words
• Superior Sales ForceAggressive Successful
• 1990 Sales 650 Million
• Set Price 1400 to 2200
• EB Dominant Market Share .
• 1990-95 Sales went down by 80
• EB Sold in 1996
• Why?

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Encyclopaedia Britannica contd

• CD-ROM
• Encarta, Grolier, Compton marketed a CD product
• Price 50-75
• Quality of CD vs. Britannica?
• So What Happened?

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Encyclopaedia Britannica contd

• IRACS
• IgnoreRidiculeAttackCopySteal

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Encyclopaedia Britannica contd

• Strategic Competitive Advantage
• Quality Volume
• Sales Force
• 1,500 PriceLarge Margins
• Thoroughness

• Strategic Competitive Disadvantage
• Too Big For CD
• Commissions
• 75--50--0
• Too Slow To React

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Encyclopaedia Britannica contd

• Encyclopaedia Britannica 2003 Ultimate Reference
  Suite
• Contains32 Volume EB, 75,000 articles, 3
  encyclopedias, 2 dictionaries, World Atlas...
• Price 69.95
• Online Premium Services (30)
• http//www.britannica.com/

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Elements of the Marketing Mix within an
Environmental Framework
Competitive
Distribution
Product
Political-Legal
Target Market
Social-Cultural
Price
Promotion
Technological
Economic
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Its Not Just About Marketing

• Impact of technology and change wide
• Business
• Society
• Culture
• Nations
• Classes

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Table 11 Four Categories of E-Commerce

• Business originating from . . .

• Business

• Consumers

• B2B

• C2B

• Business

• And selling to . . .

• B2C

• C2C

• Consumers

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Exhibit 16 A Flow Diagram of the Strategic
Responsibilities
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The Challenges

• Understanding Customer Evolution
• Tablestakes or cost of doing business
• Market research to understand how customer needs
  are evolving
• Charting Changing Technology
• Choosing the right technologies matching
  consumer tastes to technology choices
• Balancing Irrational Exuberance and Irrational
  Doom
• Estimating the impact of technology
• Weathering the storm reassuring stakeholders

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Moores Law
of transistors
1965Double every 12 months 1975---Double every
24 months-----Sometimes 18 months
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Metcalfes Law

• def values the utility of a network as the
  square of its users
• Morse Code
• Telephone system
• Ethernet protocols
• Internet protocols

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Metcalfes Law
Net Utility
Nodes
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The Big Concepts

• Information
• Amplification
• Asynchonicity

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A Step Toward E-Commerce?
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Nokia 9290

• For September 5
• Find out 3 or four things about it.
• Well discuss at the beginning of class

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Student Introduction

• Your career area, a snippet of that
• Your track, semesters in MBA

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Stop Here