Welcome to E-MARKETING 2009
Lecture 4: A WORLD OF E-MARKETING OPPORTUNITIES
E-MARKETING 5/E (JUDY STRAUSS AND RAYMOND
Bangor Business Dr. Marwan Khammash
Lecture 4 Objectives
After lecture 4, you will be able to:
Discuss overall trends in Internet access, usage, and
purchasing around the world.
Define emerging economies and explain the vital role
of information technology in economic development.
Outline how e-marketers apply market similarity and
analyze online purchase and payment behaviors in
planning market entry opportunities.
Lecture 4 Objectives, cont.
Describe how e-marketing strategy is influenced by
computer and telephone access, credit card availability,
attitudes toward internet use, slow connection speeds, Web
site design, and electricity problems.
Review the special challenges of e-marketing on the wireless
internet in the context of emerging economies.
Discuss the controversy related to the Digital Divide.
Explain why China is becoming a major market for e-
marketing innovation and competition.
Idol Goes Global
American Idol is broadcast in over 100
Its popularity has spawned 39 national
versions in countries such as Ethiopia, the
Philippines, and Russia.
The sharing of popular culture has been
enhanced by the convergence of TV, internet,
mobile phones, and messaging services.
Idol Goes Global, cont.
Check out international versions that are
streamed over the internet:
Music Idol in Bulgaria: http://musicidol.btv.bg/news/6
Indian Idol: http://sify.com/indianidol/
Overview of Global E-Marketing Issues
The globe is literally a world of opportunities.
Exhibit 4.1 shows that worldwide internet usage
increased more than 58% from 2004 to 2007.
Asia has the most internet users.
Africa saw the greatest growth in internet use.
North America has the highest penetration as a
percent of the population.
Internet Use Varies by Country
The world’s largest online markets are the U.S. (215
million users) and China (162 million users).
The top 10 countries account for 70% of all global
Some smaller countries, such as Norway,
Netherlands and Iceland, have the highest
penetration, over 85% of their populations.
Developed countries are highly industrialized, use
technology to increase efficiency, and have a high
GDP per capita.
Australia & New Zealand
Developed countries are ideal for the e-marketing
activities discussed in the text.
Have low levels of GDP per capita and are
experiencing rapid economic growth.
Emerging economies can be found on every
Mexico, Central & South America
Baltic States & Eastern Europe
Russia, Belarus & Ukraine
Central & Southeast Asia
Importance of Information Technology
The internet accelerates the process of economic
growth through diffusion of new technologies.
Bangalore, India is the center of India’s explosive
growth in software and IT.
Internet marketing differences in emerging
Fewer computer users
Limited credit card use
Lack of secure online payment methods
Unexpected power failures
E-Commerce Payment and Trust
E-commerce in emerging markets is often hampered by
limited use of credit cards and lack of trust in safely
conducting online transactions.
Nepal,for example, is a cash-based economy and credit cards
For local Nepalis, only Visa, MasterCard, and Himalayan Bank cards
InBolivia, only 2.3 percent of the population has a credit card.
Credit card use is virtually non-existent in Ethiopia.
E-Commerce Payment and Trust Issues, cont.
In addition to credit card usage, e-marketers
working in emerging economies should understand
attitudes toward online purchasing.
A 2007 study in Lithuania found that 51% of internet
users had not made an online purchase because they
thought it was too risky.
To overcome trust issues, eBanka, an internet bank, was
established in the Czech Republic in 1998 to handle
secure online purchases.
Technological Readiness Influences Marketing
E-marketers must deal with daunting issues of basic
Limited access to and use of computers and telephones
High internet connection costs
Slow internet connections speeds
Unpredictable power supplies
Computers & Telephones
Computer access is unevenly distributed throughout
Exhibit 4.6 shows computer ownership data for
ranges from 84% in Kuwait to 2% in Bangladesh
Telephones (and connectivity) can be scarce and
Many consumers in countries with emerging economies access
the internet from free-standing shops rather than homes.
Internet Connection Costs
Countries with emerging economies often have
higher internet-related business costs.
Dial-up connection costs can vary considerably.
Broadband connections are developing quickly.
In 2002, 88 countries had broadband vs. 166 countries
Broadband connections are still expensive in most
Wireless Internet Access
At the end of 2007, there were 3.25 billion mobile
phone subscriptions worldwide.
Countries with emerging economies have
leapfrogged industrial countries in terms of usage.
Challenges of wireless e-marketing:
Modification of Web site content for small screens
Text entry using tiny keypads
Pricing and secure payments
The Digital Divide
E-marketers must consider the social environment in
which e-business operates.
Disparities with regard to technology access can
create a digital divide between countries or
The digital divide raises challenging questions for
global policy, international business, and
China: A View of the Future
China is expected to be the largest economy in the
world by 2015.
China represents both the promise and challenge of
e-marketing in emerging market economies.
70% of all Chinese internet users are under the age of
China’s vibrant, growing online market requires
adaption to success.
Welcome to E-MARKETING 2009
CHAPTER 6: E-MARKETING RESEARCH
E-MARKETING 5/E (JUDY STRAUSS AND RAYMOND
Bangor Business Dr. Marwan Khammash
Lecture 5 Objectives
After attending lecture 5, you will be able to:
Identify the three main sources of data that e-
marketers use to address research problems.
Discuss how and why e-marketers need to check the
quality of research data gathered online.
Explain why the internet is used as a contact
method for primary research and describe the main
internet-based approaches to primary research.
Lecture 5 Objectives, cont.
Describe several ways to monitor the Web for
gathering desired information.
Contrast client-side, server-side, and real-space
approaches to data collection.
Highlight four important methods of analysis that e-
marketers can apply to data warehouse
The Purina Story
Nestle Purina PetCare wanted to know whether their
Web sites and online advertising increased off-line
Nestle Purina developed 3 research questions:
Are our buyers using our branded Web sites?
Should we invest in other Web sites?
If so, where should we place the advertising?
The Purina Story, cont.
They combined online and off-line shopping panel data
and found that:
Banner click-through rate was low (0.06%).
31% of subjects who were exposed to both online and off-
line advertising mentioned Purina.
The high exposure group mentioned Purina more than the
low exposure group.
Home/health and living sites received the most visits from
Can you think of other Web sites besides petsmart.com
and about.com that would be appropriate for Purina
Data Drive Strategy
Organizations are drowning in data.
E-marketers must determine how to glean insights
from billions of bytes of data.
Marketing insight occurs somewhere between
information and knowledge.
Purina, for example, sorts through hundreds of
millions of pieces of data about 21.5 million
consumers to make decisions.
Marketing Knowledge Management
Knowledge management is the process of managing
the creation, use, and dissemination of knowledge.
Data, information, and knowledge are shared with
internal decision makers, partners, channel
members, and sometimes customers.
Examples of the uses of knowledge management
can be found in Exhibit 6.3.
Uses of Knowledge Management
Use in the Telecom Industry Representative Firm
Scanner Check-Out Data Analysis AT&T
Call Volume Analysis Ameritech
Equipment Sales Analysis Belgacom
Customer Profitability Analysis British Telecom
Cost and Inventory Analysis Telestra Australia
Purchasing Leverage with Suppliers Telecom Ireland
Frequent-Buyer Program Management Telecom Italia
Use in the Retail Industry Representative Firm
Scanner Check-Out Data Analysis Wal-Mart
Sales Promotion Tracking Kmart
Inventory Analysis and Deployment Sears
Price Reduction Modeling Osco/Savon Drugs
Negotiating Leverage with Suppliers Casino Supermarkets
Frequent-Buyer Program Management W. H. Smith Books
Profitability Analysis Otto Versand Mail Order
Product Selection for Markets Amazon.com
The Electronic Marketing Information System
Marketers manage knowledge through a marketing
information system (MIS).
Many firms store data in databases and data warehouses.
The internet and other technologies have facilitated
Secondary data provides information about competitors,
consumers, economic environment, etc.
Marketers use the Net and other technologies to collect
primary data about consumers.
Source 1: Internal Records
Accounting, finance, production, and marketing
personnel collect and analyze data.
Customer characteristics and behavior
Universal product codes
Tracking of user movements through web pages
Source 2: Secondary Data
Can be collected more quickly and less expensively
than primary data.
Secondary data may not meet e-marketer’s
Data was gathered for a different purpose.
Quality of secondary data may be unknown.
Data may be old.
Marketers continually gather business intelligence by
scanning the macroenvironment.
Public and Private Data Sources
Publicly generated data
CIA World Factbook
American Marketing Association
Privately generated data
Commercial online databases
Source 3: Primary Data
Primary data are information gathered for the first
time to solve a particular problem.
Primary data collection enhanced by the internet:
Advantages & Disadvantages of Online Research
Ethics of Online Research
Companies conducting research on the Web often
give respondents a gift or fee for participating.
Other ethical concerns include:
Respondents are increasingly upset at getting unsolicited e-
mail requests for survey participation.
“Harvesting” of e-mail addresses from newsgroups without
“Surveys” for the sole purpose of building a database.
Privacy of user data.
Monitoring the Social Media
Companies must now monitor numerous web pages,
blogs, and photo sites in order to learn what is
being said about their brands or executives.
Companies can hire public relations firms or online
reputation management firms to help.
They can also set up automated monitoring systems
using e-mail, RSS feeds, or special software.
Other Technology-Enabled Approaches
Client-side Data Collection
Use PC meter with panel of users to track the user
Server-side Data Collection
Real-time profiling tracks users’ movements through a
Data collection occurs at off-line points of purchase.
Real-space techniques include bar code scanners and
credit card terminals.
Catalina Marketing uses the UPC for promotional
purposes at grocery stores.
Marketing Databases & Data Warehouses
Product databases hold information about product
features, prices, and inventory levels; customer
databases hold information about customer
Data warehouses are repositories for the entire
organization’s historical data, not just for marketing
Data are stored in the data warehouse system and
used for analysis by marketing decision makers.
Data Analysis and Distribution
Four important types of analysis for marketing
decision making include:
RFM (recency, frequency, monetary value) analysis
Knowledge Management Metrics
Two metrics are currently in widespread use:
ROI: total cost savings divided by total cost of the
Total Cost of Ownership (TCO): includes cost of
hardware, software, labor, and cost savings.