1、Electronic Commerce,BADM 561 Dr. Cara Peters,Key Terms,Marketing: process of exchangeInternet: worlds largest matrix of interconnected computer networksWorld Wide Web: media-rich, commercial information system on the Internet,Stages in Marketing,1. Mass Production 2. Personal Selling 3. Branding 4.
2、Customer Relationship Management,Marketing Trends,Internet Marketing,Marketing in electronic environments or selling Internet-related products Combines technology, networks, economics, & customers Branding remains important But now marketers can focus on the individual customer,Does the Internet cha
3、nge marketing?,Increased personalization Right place, Right time, Right messageLess expensiveHyper-competitionChanges in customer behaviorDifferences in the marketing mix,E-commerce,Any business activity conducted on the Internet, web, or an electronic networkA production process that converts digit
4、al inputs into value-added outputs through a set of intermediariesNot unique to the Internet EDI-Electronic Data Interchange,Modes of E-commerce,Communications: delivery of informationBusiness process: automation of business transactionsService: maintenance of relationshipsTransactions: exchange pro
5、ducts/services,Types of E-commerce,B2B Managing different types of exchange between two business partiesB2C Managing interactions and exchange between businesses and consumers,Types of E-commerce,Intra-organizational e-commerce Called an intranet workgroup communications, electronic publishing, sale
6、s force productivity Inter-organizational e-commerce inventory, channel management, payment management Existence of an extranet,E-commerce has an impact offline,Impact of the Internet on external purchases customer research price comparison relationship to phone & store purchases Industries that hav
7、e seen strong competitive effects travel, books, securities, electronics,E-Business: Advantages,Access to a growing customer population 5.7 billion people yet to go onlineInstant worldwide exposureReduced inventory costsBuild customer satisfaction via CRM Quicker order & delivery time,E-Business: Di
8、sadvantages,Competitive retail environmentpricemore transparent onlineassortment-less expensive to display & stock more products convenience-superior timing, location & buying process entertainmentimportant online,The Internet,The worlds largest matrix of interconnected computer networks.,Beginning
9、of Computing,Abacus (Babylonia, 2500 BC)Babbage: first computing engine Circa 1800, computed Bernoulli numbersBryon: first computer programmer Circa 1800,Beginning of Computing,Hollerith: punch card system Analyzed 1880 census data Became IBM in 1924ENIAC: Worlds first large scale digital computer E
10、lectronic Numerical Integrator Analyzer & Computer University of Pennsylvania, 1945 Prepared bombing tables for WWII,Beginning of the Internet,Non-commercial Military driven, Cold war fears Department of Defense ARPA (Advanced Research Projects Agency, 1958) Created ARPANet national nuclear-proof co
11、mmunication network Wide area, packet-switching, resource- sharing communication network,Beginning of the Internet,Four University computer nodes were linked for host-to-host data exchange UCLA, Stanford, UCSB, & Utah (1969) 15 nodes connected 23 universities, NASA, & other facilities (1971) Nationa
12、l Science Foundation: working on a high-speed network backbone NSFNet, major component of Internet (1986),Beginning of the Internet,Initially banned commercial useLed to development of an “Internet Culture”Tomlin invented email (1971) ARAPNet contractor Became largest Internet service Driving growth
13、 among the masses,Beginning of the Internet,Transmission Control Protocol/Internet Protocol standard became common operating standard (1983) Non-commercial restrictions removed (1986) NSFNet backbone open to all users By 1987, number of Internet hosts 10,000+,Beginning of the Internet,Berners-Lee cr
14、eated a program that created hypertext links (1991) Browser interface & beginning of the World Wide WebThe web took off in the 1990s graphical user interface mix media (picture, sound, video, etc.) ripe for commercialization,Early Internet use,Early web sites lacked features which are common todayHa
15、d to program in HTML code, compared to todays WYSIWIG formatConsumer fascination & commercialization spurred growth of web,Internet Services,Email Usenet Bulletin Boards File Transfer Protocol Telnet Internet Relay Chat CU-See-Me World Wide Web,Advantages of Hypermedia,Open: allows data transfer acr
16、oss different platforms to other computers Interactive: allows instant access to topics within documents, pages, or servers Dynamic: make changes quickly, easily Media rich: allows for simultaneous use of text, pictures, sound, & video,Sharing,Openness Low connection costs lead to sharing Common sta
17、ndards Internet Protocol (IP)/Transmission Control Protocol (TCP) Communication sending standards for the Internet,Ubiquity,Interactive & Dynamic Networks are ever-present anywhere, anytime, any equipment Value of a network increases with the square of the number of participants Metcalfes law Sugges
18、ts value of a network rises when more people participate,Ubiquity continued,So, value depends on growth Reach point of inflection or critical mass Too much growth can be a negative presence of unwanted individuals too many who clog the system spammers crime,Redundancy Keeps it Running,Reliability de
19、centralized, distributed networks with multiple connections Efficiency messages broken into packets with multiple users on one phone connection Scalability open standards, capability to grow the network rapidly,Technology Behind the Internet,Digital underpinnings: its properties & information are st
20、rings of zeros/ones Bytes of information Three factors give power to bytes Moores law Digital environments Convergence,Moores law,Describes falling cost of technology Moore (Intel, 1965) noticed that engineers kept packing circuits more closely together miniaturization was about 30% smaller every 18
21、months in fact, surface area needed for same number of components was about half,Moores law,Each new generation of chip technology, which has been released about every 18 months, can pack the same number of elements into half the spacesmaller, cheaper yet more power Critics: law cannot continue sepa
22、ration becomes too small,Digital environments,Digital technology can create life-like environments Encyclopedic: store information Procedural: follow programmed rules Participatory: user choice, command, or preference Spatial: virtual space,The Power of Digital Environments,Digitization can change i
23、ndustries Adult entertainment These sites generate $2 Billion in sales Most profitable consumer sector on web Over 11 million sites come up when search “Porn” Yet few providers convey most of the content “Sex” is consistently the top term on search engines,The Power of Digital Environments,Adult ent
24、ertainment Preview to pay $25-40 per month for pictures & video High margins Upgrading sites for competition Reliable streaming video Increased customer service Credit cards, personal funds transfer, telephone subscriptions,The Power of Digital Environments,Adult entertainment Playboy Dannys hard dr
25、ive Club Jenna dot comImportance of search engine optimizationWhat will virtual reality bring about?,Convergence,Merging of industries, technologies, and content which used to be separateComputing, communications, & media content coming together AOL/Time Warner Merger (Spring 2000),The Internet Does
26、 Have Problems,Breakdowns/Outages or Delays/Lags Bandwidth: amount of data transmitted through communication channel broadband, direct connection to National Internet Backbone, large bandwidth Cable, DSL dial-up, indirect path through ISP, narrow-bandwidth 77% of Internet users,File size & access ti
27、mes,Diffusion,How Innovations Spread Throughout Society,Technology Diffusion Rates (US)*,Fax Radio Television Personal Computer Internet*To reach 50 million people,75 years 38 years 13 years 16 years 5 years,Diffusion,A process by which an innovation is communicated through certain channels over tim
28、e among members of a social system social change spread diseases, products, ideas Similar pattern,Four Main Elements of Diffusion,InnovationCommunicationTimeSocial system,Diffusion Networks,Opinion leadership Degree to which an individual is able informally to influence other individuals attitudes/b
29、ehavior with relative frequencyAdopters model and imitate their peers behaviors follow other consumers & innovations spread,Diffusion networks,Consumers are linked by relationships and communication both strong and weak tiesEventually get a critical mass of adopters Point at which enough individuals
30、 have adopted an innovation so further rate of adoption is self-sustaining,Diffusion networks continued,S-shaped curve X axis: time/Y axis: rate of adoption Critical mass occurs at point of inflection in curve Marketers can build a critical mass target groups shape perceptions of innovation provide
31、incentives,What affects rate of adoption,Relative advantage degree to which an innovation is perceived as better than what it supercedesCompatibility degree to which an innovation is perceived as consistent with existing values, past experiences, and needs of potential adopters,What affects rate of
32、adoption?,Complexity degree to which an innovation is perceived as relatively difficult to understand and useTrialability degree to which an innovation may be experimented with on a limited basis,What affects rate of adoption?,Observability degree to which the results of an innovation are visible to
33、 othersExamples,Adopter Categories,Consumers can be categorized by their innovativenessAdopter category growth is related to the spread of the innovationFive common categories innovators, early adopters, early majority, late majority, & laggards,Innovators,First group 2.5% of adopters Venturesome Ob
34、sessed with innovations Gate keepers,Early Adopters,The second group 13.5% of adopters Social and Localites Integrated into social systems Often opinion leaders,Early Majority,The third group 34% percent of adopters Deliberate Interact frequently with peers Important link in diffusion process provid
35、e connections in network,Late Majority,The Fourth group 34% of adopters Skeptical Adoption may be economic necessity and /or result of peer pressure Adopt after most others,Laggards,Last 16% of adopters Traditional Almost no opinion leaders Near isolates in social system Suspicious of innovations &
36、change Some people never adopt,Online Auctions,Online auctions,Consumer Auctions as a business model Blurs commerce & fun Affects pricing, research Addictive Many enterprises not figured out how to effectively apply the business model,Ebay,Stickiest e-commerce site 27 minutes per visit Founded in 19
37、95 Has more than 5 million items for sale at any one time Branching out into other auction arenas,Other Technologies,Interactive kiosks, iTV, & m-commerce,Interactive kiosks,Strategically placed in high-traffic areas of stores Information rich, “ultimate salesperson” Low overhead, can provide increm
38、ental sales Acceptance of machines by consumers is vital,Kiosks,Early tests of kiosks not successful slow, broken, not updated, few graphics misapplied content lack of consumer interest sales did not cover cost of machine As problems have been addressed, consumer acceptance has increased 151,000 use
39、d in 2001,Kiosks,Definition: electronic information centersGoal: provide increased level of service at reduced cost to the retailerAnticipate questions & provide information in effortless manner,Kiosks,Applicable to various industries 66% of Kiosks are in retail locations ATMs prepared consumers for
40、 kiosks Wedding or Baby Registry Record stores Service providers, Governments, & Schools Court houses and libraries,Interactive Television,Television with interactive content & enhancements convergence of computer, telephone, & TV Provides richer entertainment, interaction & more information pertain
41、ing to shows, props and people involved programming can include richer graphics, links to Web sites, communication with others, & e-commerce,iTV,Three forms: set-top box- 2-screen TV Mobile phone and to a lesser extent PDA,iTV,Consumers get greater choice of content, when they want to see it, & how
42、to act on it video & information on demand interactive programming diverse communication & purchasing optionsControl shifting to viewer more personalized, relevant content,Possible iTV features,Programming credits available anytime Trivia questions in real time during show Customized/localized infor
43、mation (news/ weather) Constant update across shows Home shopping (movies/CDs) Interactive Entertainment Guides Surveys during a program,Interactive Game Shows Interactive Sports (pick angle) gambling Videoconferencing, distance learning Photo display services. Communications (chat/email) Informatio
44、n acquisition (retail locations; details on a news story; order a sample),iTV,Early tests did not materialize consumers would not fully use nor pay for the service Initial target market: participants in interactive services Use of PC & TV are differentPC/task oriented versus TV/socially oriented,The
45、 Future of iTV,Consumers want additional facts pertaining to programming, alternative commentaries, & Web support enhancements to programming 27+ million US homes have iTV today To grow: must find those applications in which benefits costs Marketing research & product placement,Interactive telephone
46、,In 1980s, marketers programmed phones to do a number of marketing functions build databases, sell products, enhance image, facilitate customer service, collect data prepaid phone cards Now with the growth of cell phones, the telephone has become part of m-commerce,M-commerce,Mobile or Wireless Comm
47、erce cell phones or PDAs 110 million cell phone service subscribers In 2000, 5 million consumers used m-commerce By 2006, 85 million will use m-commerceGrowth due to needs outside the home Europe and Japan,M-commerce,Large profit potential, yet face challenges narrow band-width slow connections & ro
48、aming areas signal blocks & security breaches physical (carpal tunnel/eye strain/cancer) Growth predicted among 10-24 year olds 50% will use m-commerce by 2006,Web Site Construction,Design & Content,Key Terms,HTTP: hyper-text transfer protocol Standard for transferring files on webHTML: hyper-text m
49、ark-up language WYSIWYGApplets: application programs embedded in web pages (JAVA),Key Terms,URL: uniform resource locator Web address that browser readsPortals: gateways to the web AOL, Netscape, AlfyUpfront: what site visitor seesBackend: Technology that supports content,Development Considerations,Goals Targets Content Size Timing Budget Backend,Design,Various software can do this FrontPage, Dreamweaver, Netscape (free) Demonstration Free Web Hosting Siteshttp:/ http:/ http:/ http:/ http:/ http:/ http:/ , http:/ http:/ http:/ Look at site across different browsers,
