Do Business Well

13. Java portal. This is a different form of portal, where you do not have to visit the portal but instead content is downloaded in line with your preferences. Avant Go! uses this technique to download content while a smartphone is being synchronized with a PC.

14. Mobile search. All the main search providers have mobile (WAP)-specific versions of their search engines. These are now becoming more sophisticated. Google Mobile search (www.google.co.uk/mobile) offers Local search to find a local business, and will then display a map (Google Maps is integrated) or phone number with the option of click-to-call on the appropriate handset. Google Local uses listings from Yell.com.

15. Mobile music. Beyond ringtones, many handsets are now designed to play and store MP3 music files and potentially rival the iPod — although we now have an iPod mobile version. As access speeds increase, tunes may be offered in promotions. Continue Reading »

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In recognition of the increasingly strategic importance of privacy issues, in December 2000 IBM announced a new senior management position: Chief Privacy Officer. The company followed this appointment up in November 2001 with a large research initiative on privacy and the formation of an advisory body consisting of public- and private-sector representatives from a range of industry backgrounds. IBM has over 3,200 researchers and eight research and development centres around the world. According to a report by Foremski (2001) in the Financial Times, ’significant numbers’ of these individuals will be redirected to work on technologies that allow large companies to implement privacy policies. The article quotes IBM’s Chief Privacy Officer as saying:

There is a need for IT tools that can help enterprises deal with the many legal and other aspects related to data privacy. We are clearly in a time where deliberations over maintaining the balance between privacy and security are going to intensify in many aspects of society. Continue Reading »

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Some companies, particularly in the financial services sector, have established new online brands rather than use the Internet to reinforce existing brands. In the UK, examples include Egg (www.egg.com), which is owned by the Prudential, and Smile (www.smile.co.uk), which is owned by the Co-operative Bank. Egg has been particularly successful in attracting customers, and enjoys high levels of brand awareness, but the attractive rates of interest that it offers to savers and the high level of advertising expenditure have resulted in a perilous financial position. The bank hopes to achieve profitability by cross-selling more lucrative products to its savings account customers. Establishing new brands for online activity offers traditional banks — which often have a rather staid image the opportunity to ’start again’ and develop a more modern style to appeal to new customer segments online. However, one drawback is the increasingly high cost of establishing an online brand as the marketplace gets ever more crowded. Another is the increasing tendency for customers to expect a choice of channels, and not be forced to conduct all their banking online. Consequently, it is rumoured that Egg is now looking to set up a physical branch network. It has also been suggested that in the early days of the Internet, the strategy of brand creation was a ’safety net’ so that if the online venture failed, the established brand would not suffer by association with it. Continue Reading »

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We considered some of the new business models that are developing online. One of these was the consumer-to-consumer (C2C) model, upon which online communities are based.

These communities have evolved considerably since the early days of news groups and chat rooms. They offer a simple means of overcoming the lack of human contact online and hence can meet consumers’ social activity needs. Consequently, online communities can now represent a significant commercial opportunity. According to Kozinets,

Online social interaction is therefore a unique public—private hybrid never before encountered in human history. Changes in capitalism, social thought and new technologies have imploded the boundaries between home and workplace (and production and consumption). CMC [computer-mediated communication] offers ordinary people access to a mass medium, a stage before a global audience. . . . Opportunities abound not only to broadcast one’s own private information, but also to partake publicly in the private information of others, and also to commoditise and commercialise these relationships. Continue Reading »

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The key role of research in effective marketing planning was introduced. The marketing audit comprises research and analysis of the internal and external environment as follows:

• The internal audit reviews existing marketing activities and assesses their effectiveness in terms of contribution to revenue, brand enhancement, customer service, customer retention, market share or sales leads.
• The external audit considers the micro-environmental influences (customers, suppliers, partners, distributors and competitors) and macro-environmental influences (political, economic, social, technological and legal) within which the company operates.

The circles representing different aspects of the business environment show that from a company’s perspective, the various components of the micro-environment are intimately connected with the operations of its business, but the macro-environment is one step removed. This means that a company has some degree of control over the micro-environmental influences, but cannot directly influence the ‘bigger picture’ of the macro-environment, which would include such issues as interest rate changes, new legislation, etc. By conducting a marketing audit, a company can at least monitor and be aware of the implications of likely changes in the macro-environment, even if it cannot directly control them.

Continue Reading »

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Search engines use ‘link popularity‘ in locating and ranking sites — the term refers to both the number of other sites linking to the measured site and, especially, the importance and relevance of the linking sites. Improving link popularity raises a site in search engine rankings. To measure your own site on AltaVista, Google and Hotbot, visit www.linkpopularity.com.

View a comparison of your site’s link popularity relative to those of your competitors and to other well-known sites at www.marketleap.com/publinkpop.

Build a matrix of linking sites

Instead of having a single site that covers many different keywords, separate each product or service into groupings. Use related specialist sites that all link to the `mother site‘ and to each other. Each should cover its own niche based on a core theme. The sites should be about the same size, say around five pages. Ideally, locate each on a different IS P. A sample matrix can be viewed at www.marketingchallenge. com/ch ron ic I es/2 78/matrix.g if. Continue Reading »

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Disadvantages

Retailers have been slow to take up e-Retailing. This is to some extent under standable in the light of the many disadvantages and problems. Retailers, for example, may lack the technical know-how, the substantial investment required or the order fulfilment capabilities. Set-up costs start from around £20,000 fo a small site, up to £500,000 for a large operation. And set-up costs are only th start: Datamonitor estimates that high street retailers are spending more o ongoing costs than on setting up new sites.

DISADVANTAGES OF E-RETAILING FOR RETAILERS

* May lack know-how and technology

• Substantial set-up, investment and ongoing costs

* Complex logistics of fulfilment

• e-Selling less powerful than face-to-face — uptake slow for goods selected by taste or smell

* Fewer impulse purchases

* Legal problems

Less role for traditional high street retail expertise

• Pressure on margins and prices in-store

* After-sales care difficulties

There can be legal problems. For example, if purchaser and supplier are ni_l
different countries, there may be conflict between the laws of the two countries.’
A further disadvantage is that e-Selling is less powerful than face-to-face selling

(it is easier to say ‘no’ to a computer). This viewpoint is linked to a concern of raditional high street retailers that e-Retailing offers a diminished role for their expertise. For example, there are obvious difficulties with products sold by `atmosphere’ — touch, feel, smell — and with impulse purchases. In addition, consumers have a perception of lower prices online. This puts pressure on margins for e-Retailing, and can lead to shoppers expecting consistent low prices in store. Finally, after-care can be difficult, especially if the shopper is overseas.

Continue Reading »

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`Place’ (Convenience in the 4- Cs) means the elements of the marketing mix that marketers use to enable customers to access the benefits of a product or service. Traditionally, this has meant ‘channels of distribution‘ through (e.g.) various wholesaler and retailer combinations. Viewing from the ‘convenience for the customer‘ (4-Cs) perspective gives a more customer-orientated focus. This is a vital decision area for the e-Business for three reasons. First, relatively small local companies can widen their market and even export (e.g. Botham (www.Botham.co.uk), to be described further in Chapter 9). Second, many e- Businesses aim to gain competitive advantage by using e-Systems to de-layer the distribution chain. For example, Dell (www.dell.co.uk) supplies customers directly, rather than through distributors, wholesalers or retailers. Third, distribution is an area where some e-Businesses have been severely criticized for failing to deliver customer service (see Chapter 9 for more details).

Place elements of the marketing mix have been changing rapidly over recent decades, and these changes impact in many ways on the marketing operations of the e-Business. First, the growth of retailer power has involved major retailers taking more control of their supply chains. The involvement of wholesalers has been reduced, tending to give way to contract logistics (under retailer control). At the same time, supply chains have become more efficient, with computer network links between suppliers and retailers — many still based on EDI. Predating the Internet, EDI is based on privately owned third-party computer networks. Stock levels have been reduced using techniques such as JIT and Enterprise Resource Planning (ERP). Control of the physical distribution, ordering, invoicing and payment systems, particularly for major retailers, is often still carried out using EDI networks such as Tradanet (www.gegxs.com/gxs/ products/product/traser). Increasingly, though, retailers such as Tesco are allowing Internet access to their suppliers for real-time electronic point-of-sale (EPOS) data. Trusted supplier partners can thus respond more quickly to changes in customer demand. Continue Reading »

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