Dr. Marwan Khammash at Summer School in TU Braunschweig, Institut für Wirtschaftsinformatik (wi2). 2009/07/31.

1. 1-1
Welcome to E-MARKETING 2009
Lecture 4: A WORLD OF E-MARKETING OPPORTUNITIES
E-MARKETING 5/E (JUDY STRAUSS AND RAYMOND
FROST)
Chapter 4
Bangor Business Dr. Marwan Khammash
School/Wi2

2. Lecture 4 Objectives
4-2
 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.

3. Lecture 4 Objectives, cont.
4-3
 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.

4. Idol Goes Global
4-4
 American Idol is broadcast in over 100
countries.
 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.

5. Idol Goes Global, cont.
4-5
 Check out international versions that are
streamed over the internet:
 Music Idol in Bulgaria: http://musicidol.btv.bg/news/6
 Ethiopian Idol:
http://www2.jumptv.com/seo/Ethiopian_Idols/Ethiopian_Idols.htm
 Indian Idol: http://sify.com/indianidol/

6. Overview of Global E-Marketing Issues
4-6
 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.

7. Worldwide Internet Usage
4-7
Ex 4.1

8. Internet Use Varies by Country
4-8
 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
users.
 Some smaller countries, such as Norway,
Netherlands and Iceland, have the highest
penetration, over 85% of their populations.

9. Top Ten Internet Usage Countries Ex.4.2
4-9

10. Developed Economies
4-10
 Developed countries are highly industrialized, use
technology to increase efficiency, and have a high
GDP per capita.
 Western Europe
 North America
 Japan
 Australia & New Zealand
 Developed countries are ideal for the e-marketing
activities discussed in the text.

11. Emerging Economies
4-11
 Have low levels of GDP per capita and are
experiencing rapid economic growth.
 Emerging economies can be found on every
continent.
 Mexico, Central & South America
 Baltic States & Eastern Europe
 Russia, Belarus & Ukraine
 Africa
 Central & Southeast Asia
 China

12. Importance of Information Technology
4-12
 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
economies include:
 Fewer computer users
 Limited credit card use
 Lack of secure online payment methods
 Unexpected power failures

13. Market Approaches Ex 4.4
4-13

14. E-Commerce Payment and Trust
4-14
Issues
 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
are scarce.
 For local Nepalis, only Visa, MasterCard, and Himalayan Bank cards
are accepted.
 InBolivia, only 2.3 percent of the population has a credit card.
 Credit card use is virtually non-existent in Ethiopia.

15. E-Commerce Payment and Trust Issues, cont.
4-15
 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.

16. Technological Readiness Influences Marketing
4-16
 E-marketers must deal with daunting issues of basic
technology:
 Limited access to and use of computers and telephones
 High internet connection costs
 Slow internet connections speeds
 Unpredictable power supplies

17. Computers & Telephones
4-17
 Computer access is unevenly distributed throughout
the world.
 Exhibit 4.6 shows computer ownership data for
selected countries.
 Ownership
ranges from 84% in Kuwait to 2% in Bangladesh
and Uganda.
 Telephones (and connectivity) can be scarce and
expensive.
 Many consumers in countries with emerging economies access
the internet from free-standing shops rather than homes.

18. Internet Connection Costs
4-18
 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
in 2006.
 Broadband connections are still expensive in most
countries.

19. Wireless Internet Access
4-19
 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
 Content development
 Pricing and secure payments

20. The Digital Divide
4-20
 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
populations.
 The digital divide raises challenging questions for
global policy, international business, and
entrepreneurship.

21. China: A View of the Future
4-21
 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
30.
 China’s vibrant, growing online market requires
adaption to success.

22. Popular Web Sites in China Ex.4.16
4-22

23. 1-23
Welcome to E-MARKETING 2009
CHAPTER 6: E-MARKETING RESEARCH
E-MARKETING 5/E (JUDY STRAUSS AND RAYMOND
FROST)
Chapter 6
Bangor Business Dr. Marwan Khammash
School/Wi2

24. Lecture 5 Objectives
5-2
 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.

25. Lecture 5 Objectives, cont.
5-25
 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
information.

26. The Purina Story
5-26
 Nestle Purina PetCare wanted to know whether their
Web sites and online advertising increased off-line
behavior.
 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?

27. The Purina Story, cont.
5-27
 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
their customers.
 Can you think of other Web sites besides petsmart.com
and about.com that would be appropriate for Purina
PetCare ads?

28. Data Drive Strategy
5-28
 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.

29. From Data to Decision: Purina
5-29

30. Marketing Knowledge Management
5-30
 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.

31. Uses of Knowledge Management
5-9
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

32. The Electronic Marketing Information System
5-32
 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
data collection.
 Secondary data provides information about competitors,
consumers, economic environment, etc.
 Marketers use the Net and other technologies to collect
primary data about consumers.

33. Source 1: Internal Records
5-33
 Accounting, finance, production, and marketing
personnel collect and analyze data.
 Salesdata
 Customer characteristics and behavior
 Universal product codes
 Tracking of user movements through web pages

34. Source 2: Secondary Data
5-34
 Can be collected more quickly and less expensively
than primary data.
 Secondary data may not meet e-marketer’s
information needs.
 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.

35. Public and Private Data Sources
5-35
 Publicly generated data
 U.S.Patent Office
 CIA World Factbook
 American Marketing Association
 Wikipedia
 Privately generated data
 comScore
 ForresterResearch
 Nielsen/NetRatings
 Commercial online databases

36. Source 3: Primary Data
5-36
 Primary data are information gathered for the first
time to solve a particular problem.
 Primary data collection enhanced by the internet:
 Experiments
 Focusgroups
 Observation
 Survey research

37. Primary Research Steps
5-15
 Exhibit 6.10

38. Advantages & Disadvantages of Online Research
5-38
 Exhibit 6.15

39. Ethics of Online Research
5-39
 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
permission.
 “Surveys” for the sole purpose of building a database.
 Privacy of user data.

40. Monitoring the Social Media
5-40
 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.

41. Other Technology-Enabled Approaches
5-41
 Client-side Data Collection
 Cookies
 Use PC meter with panel of users to track the user
clickstream.
 Server-side Data Collection
 Sitelog software
 Real-time profiling tracks users’ movements through a
Web site.

42. Real-Space Approaches
5-42
 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.

43. Marketing Databases & Data Warehouses
5-43
 Product databases hold information about product
features, prices, and inventory levels; customer
databases hold information about customer
characteristics.
 Data warehouses are repositories for the entire
organization’s historical data, not just for marketing
data.
 Data are stored in the data warehouse system and
used for analysis by marketing decision makers.

44. Data Analysis and Distribution
5-44
 Four important types of analysis for marketing
decision making include:
 Data mining
 Customer profiling
 RFM (recency, frequency, monetary value) analysis
 Report generating

45. Knowledge Management Metrics
5-45
 Two metrics are currently in widespread use:
 ROI: total cost savings divided by total cost of the
installation.
 Total Cost of Ownership (TCO): includes cost of
hardware, software, labor, and cost savings.