Session 3 4
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Transcript of Session 3 4
“We have only two sources of competitive advantage:
1. the ability to learn more about our customers faster than the competition and
2. the ability to turn that learning into action faster than the competition. ”
-- Jack Welch, CEO of GE, outlining his competitive strategy for the next century
Competitive Advantage...
Source: European Interactive Advertising AssociationSource: European Interactive Advertising Association
Number of B2C online Purchases in Europe during January-June 2007
The Internet marketing environment
Micro Environment
• The Marketplace
• Customers
• Suppliers
• Competitors
• Intermediaries
The Marketplace
Refers to the interactions between all the elements
Competitive forces
Value chain
New channel
Location of trading
Commercial agreements
New business &revenue models
Power ofsuppliers
Bargainingpowers ofcustomers
Extent of rivalrybetween
competitors
Threat ofsubsitutes
Threat of newentrants
The business
Competitive forces
Value creation model
New channels
Location of trading
• Virtual marketplace
• Electronic marketplace
• What representation do company have
Types of marketplace
location
Different types of online trading location
Commercial arrangements
Negotiated deal(www.ec21.com)
brokerrred deal(www.screentrade.co)
auction(www.ebay.com)
Fixed price sale(www.dominos.com)
barter(www.intagio.com)Pure markets
(shares dealing online
Alternative perspectives on business models
Customers
Online customers
Demand analysis
&
Conversion modeling
Online
Buyer
behavior
Demand analysis & conversion modeling
Understanding the Potential and actual
Volume of visitorsTo site
The extent to which they convert to the outcomes
Assessing customer demand
Need to assess:
– Access to Internet (ACCESS)
– Proportion of customers influenced by channel (CHOOSE)
– Proportion of customers who buy direct (BUY)
CONVERSION MODELS
Conversion of potential visitor to actual visitor to repeat visitor
• Awareness efficiency
• Attractibility efficiency
• Contact efficiency
• Conversion efficiency
• Retention efficiency
A model of the Internet marketing conversion process
Online buyer behavior
webographics
Usage location
Access drive
Connection speed
Usage type
Usage level
Customer persona & scenario analysis
Thumbnail descriptionOf a type of person
Developed for different personas
Set of tasks a customer wants for desired outcome
Models of online behavior
• Lewis & Lewis (1997)
• E-Consultancy (2004)
• Hierarchy of Response Models
Lewis & Lewis (1997)Five different types of web users
• Directed information seekers: only go for information, not typically plans for buying
• Undirected information seekers: like to browse, mostly clicks on banner advertisements
• Directed Buyers: purchase specific products online, compares the features
• Bargain Hunters: find offers, known as compers
• Entertainment seekers: look for enjoyment and contests
E-Consultancy (2004)
• On the basis of UK retail sites
• Classification on the basis of online shopping behavior
Select supplier(enquire)
‘Tracker’Completing
‘Hunter’Researching
‘Explorer’Browsing
Directed goal-orientedUndirected, exploratory
Destination purchase
(buy)
Definerequirements
Assess supplier
capabilities
‘Inspireme’
‘What’s outthere’
Hierarchy of Response Models
Competitors & suppliers
Intermediaries
• Are the firms that help a company to promote, sell and distribute its products/services.
• Provides info about the destination sites
• Can be independent or owned
• Also known as cybermediaries