Introduction to Marketing

1
Introduction to Marketing

• New Technologies and Marketing

2
Lecture Content

• Types of new technologies
• Areas of marketing affected
• The Internet
• E-Commerce and Web stats
• Goods and Services on the internet
• Internet Vs traditional marketing

3
New Technologies

• Retail Scanners store and customer level
• Loyalty cards
• Television digital, cable, interactive,
  shopping
• Data Processing surveys, refinement of large
  quantities of data
• Video-conferencing efficiency and distance
• Mobile phones voice, text, video, internet
  access
• The Internet communication, information,
  purchasing, shop-front, PR, advertising

4
What areas of Marketing are affected?

• ALL!
• Segmentation more specific information, ability
  to cluster and refine
• Marketing Research speed, administration,
  quantity, elimination of bias, interpretation
• Consumer behaviour information, interpretation,
  clustering, new types of behaviour and buying
  processes
• The Product new product opportunities,
  augmentation, extensions
• The Price costs, pricing search/transparency
• Distribution new intermediary chains
• Promotion new medium, interactivity, design
  capabilities

5
The Internet

• Internet Culture users expect information,
  mostly for free with good content, substance and
  ease of use, speed and accuracy
• Marketing on the internet is a pull activity
  (bring the audience to the site and entice them
  to stay)

6
Web Commerce

• Who is involved in E-Commerce?
• Business to Business (B2B)
• Business to Consumer (B2C)
• Consumer to Business (C2B)
• Consumer to Consumer (C2C)

7
Web Stats.

• Largest and fastest growing area is
• B2B
• Sales in EU
• 2001 77 billion Euro (1 of total trade)
• 2006 2.2 trillion Euro (22 of total trade)
• Predicted that 3 biggest growth regions will be
• UK
• Germany
• France
• Predicted that their combined total volumes
  64 of EU online total

8
Web Stats.

• B2C Sales
• EU
• 2007 (prediction) 172.4 billion Euro (5 of
  total retail sales)
• Web and Demographics
• Age
• UK - 25-49 yr olds (25 online population)
• Over 50s (20 online population)
• 25-34 yr olds (18.6)
• In the USA growing number of older people using
  the internet with over a third having annual
  incomes of over 50,000

9
Web Stats.

• Gender
• Europe
• Feb 2002 25.1M women and 40.1 M men using the
  internet
• Women spending on average 7hrs/month and men
  10hrs/month online
• USA/Canada
• Women more predominant web users
• 52 users women, 48 men
• (www.bgsu.edu/departments/tcom/users.html))

10
Problems with E-Commerce

• Electronic shopping largely confined to narrow
  range of goods
• Numerous complaints re late/non delivery
• Hackers have temporarily disabled websites
• Security

11
Types of Goods and Services

• High Touch goods which consumer often prefer to
  see and poke before purchase e.g. Clothes and
  groceries (limited success on internet)
• Low Touch items not needing close inspection
  and of which customers have good knowledge, e.g.
  CDs, wines, books, computers (high success on
  internet)
• Tailor-made goods computer software, airline
  tickets, financial services (increasingly high
  usage)
• Web is good for products/services that have
  global appeal and for niche markets

12
Internet Vs Traditional Marketing

• It is argued that new models/paradigms needed
  for web marketing BUT marketing concept remains
  the same.
• Will internet overtake traditional marketing or
  is it simply a complementary/alternative channel
  and medium?
• Gains
• Cut out shop-front and intermediary costs
• Cheaper distribution
• Ease of price comparisons
• Economies of scale
• One-to-one marketing
• Efficiency of information dispersal

13
Limitations of Internet

• Running and servicing a reliable website is not
  cheap
• Logistics and distribution costs can be high
• Customer acquisition costs can be high
• Price pressure due to transparency and customer
  expectations
• High risk of cannibalisation
• Channel conflict
• Noise on the internet
• Increased competition (esp.from established
  players)
• Web weariness
• Suitability for product/service
• Security/regulation/fraud

14
Summary

• New technologies having an impact on all aspects
  of marketing
• The internet being increasingly used
• B2B largest and fastest growing area of online
  usage
• Type of goods/services may restrict use of
  internet marketing
• Advantages and limitations to use of the
  internet