Slide 2 1 Chapter 2 The Internet microenvironment

Slide 2. 2 Learning objectives • Identify the different elements of the Internet environment

Slide 2. 3 Questions for marketers • How are the competitive forces and value

Slide 2. 4 Figure 2. 1 Increase in traffic volume at Handbag. com in

Slide 2. 5 Figure 2. 2 The IMRG retail index shows online sales volume

Slide 2. 6 The Internet marketing environment Figure 2. 3 The Internet marketing environment

Slide 2. 7 Porter’s five forces (or use Fig 2. 3) Chaffey, Internet Marketing,

Slide 2. 8 Figure 2. 4 Value creation model Chaffey, Internet Marketing, 3 rd

Slide 2. 9 Alternative models of the value chain Figure 2. 5 Two alternative

Slide 2. 10 A value network Figure 2. 6 Members of the value network

Slide 2. 11 Disintermediation Figure 2. 7 Disintermediation of a consumer distribution channel showing:

Slide 2. 12 See www. screentrade. co. uk Figure 2. 8 Screentrade insurance intermediary

Slide 2. 13 Figure 2. 9 From (a) original situation to (b) disintermediation or

Slide 2. 14 Figure 2. 10 Example of a channel chain map for consumers

Slide 2. 15 Countermediation • Creation of a new intermediary • Example: – B&Q

Slide 2. 16 Alternative online trading locations Figure 2. 11 Different types of online

Slide 2. 17 Figure 2. 12 Alternative perspectives on business models Chaffey, Internet Marketing,

Slide 2. 18 Assessing customer demand Need to assess: 1. Access to Internet 2.

Slide 2. 19 Figure 2. 13 A model of the Internet marketing conversion process

Slide 2. 20 Figure 2. 14 An example of a conversion model Chaffey, Internet

Slide 2. 21 Figure 2. 15 Global variation in number of PCs per hundred

Slide 2. 22 Figure 2. 16 UK rate of adoption of different digital media

Slide 2. 23 Figure 2. 18 The most popular search terms typed into a

Slide 2. 24 Figure 2. 18 The most popular search terms typed into a

Slide 2. 25 Figure 2. 19 Summary of demographic characteristics of Internet users Source:

Slide 2. 26 Figure 2. 20 Summary of variation in access to the digital

Slide 2. 27 Figure 2. 21 Percentage of businesses that order online Source: DTI

Slide 2. 28 Figure 2. 22 Development of experience in Internet usage Chaffey, Internet

Slide 2. 29 ‘Explorer’ Browsing ‘What’s out there’ ‘Inspire me’ Undirected, exploratory ‘Hunter’ Researching

Slide 2. 30 Figure 2. 23 A summary of how the Internet can impact

Slide 2. 31 Figure 2. 24 Initial product search showing e-retailers available Chaffey, Internet

Slide 2. 32 Figure 2. 25 Comet product comparison facility (www. comet. co. uk)

Slide 2. 33 Figure 2. 26 Kelkoo. com, a European price comparison site Chaffey,

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Slide 2. 1 Chapter 2 The Internet micro-environment Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 2 Learning objectives • Identify the different elements of the Internet environment that impact on an organisation’s Internet marketing strategy. • Assess competitor, customer and intermediary use of the Internet. • Evaluate the relevance of changes in trading patterns and business models enabled by e-commerce. Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 3 Questions for marketers • How are the competitive forces and value chain changed by the Internet? • How do I assess the demand for Internet services from customers? • How do I compare our online marketing with that of competitors? • What is the relevance of the new intermediaries? Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 4 Figure 2. 1 Increase in traffic volume at Handbag. com in selected months when audited. Page impressions are pages served to visitors, visitor sessions are visits up to a maximum of 30 minutes and unique visitors is the number of individuals visiting the site in a given month Source: Compiled from ABC Electronic (ww. abce. org. uk) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 5 Figure 2. 2 The IMRG retail index shows online sales volume in the UK relative to 100 in April 2000 Source: Interactive Media in Retail Group (www. imrg. org) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 6 The Internet marketing environment Figure 2. 3 The Internet marketing environment Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 7 Porter’s five forces (or use Fig 2. 3) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 8 Figure 2. 4 Value creation model Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 9 Alternative models of the value chain Figure 2. 5 Two alternative models of the value chain: (a) traditional value chain model, (b) revised value chain model Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 10 A value network Figure 2. 6 Members of the value network of an organisation Source: Adapted from Deise at. (2000) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 11 Disintermediation Figure 2. 7 Disintermediation of a consumer distribution channel showing: (a) the original situation, (b) disintermediation omitting the wholesaler, and (c) disintermediation omitting both wholesaler and retailer Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 12 See www. screentrade. co. uk Figure 2. 8 Screentrade insurance intermediary (www. screentrade. com) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 13 Figure 2. 9 From (a) original situation to (b) disintermediation or (c) reintermediation or countermediation Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 14 Figure 2. 10 Example of a channel chain map for consumers selecting an estate agents to sell their property Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 15 Countermediation • Creation of a new intermediary • Example: – B&Q www. diy. com – Opodo www. opodo. com – Boots www. wellbeing. com www. handbag. com Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 16 Alternative online trading locations Figure 2. 11 Different types of online trading location Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 17 Figure 2. 12 Alternative perspectives on business models Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 18 Assessing customer demand Need to assess: 1. Access to Internet 2. Proportion of customers influenced by channel 3. Proportion of customers who buy direct See Chapter 4 Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 19 Figure 2. 13 A model of the Internet marketing conversion process Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 20 Figure 2. 14 An example of a conversion model Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 21 Figure 2. 15 Global variation in number of PCs per hundred population and percentage Internet access in 2004 Source: ITU (www. itu. int) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 22 Figure 2. 16 UK rate of adoption of different digital media Source: MORI Technology Tracker, September 2006. See www. mori. com/technology/techtracker. shtml for details Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 23 Figure 2. 18 The most popular search terms typed into a search engine that resulted in traffic to www. ba. com, four weeks ending 18. 03. 06 Source: Hitwise (www. hitwise. co. uk) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 24 Figure 2. 18 The most popular search terms typed into a search engine that resulted in traffic to www. ba. com, four weeks ending 18. 03. 06 (Continued) Source: Hitwise (www. hitwise. co. uk) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 25 Figure 2. 19 Summary of demographic characteristics of Internet users Source: (September 2003) MORI Technology Tracker. See www. mori. com/technology/techtracker. shtml for details Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 26 Figure 2. 20 Summary of variation in access to the digital media according to social group Source: (September 2005) MORI Technology Tracker. See www. mori. com/technology/techtracker. shtml for details Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 27 Figure 2. 21 Percentage of businesses that order online Source: DTI (2004) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 28 Figure 2. 22 Development of experience in Internet usage Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 29 ‘Explorer’ Browsing ‘What’s out there’ ‘Inspire me’ Undirected, exploratory ‘Hunter’ Researching ‘Tracker’ Completing Define requirements Select supplier (enquire) Assess supplier capabilities Destination purchase (buy) Directed goal-oriented Source: Author Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 30 Figure 2. 23 A summary of how the Internet can impact on the buying process for a new purchaser Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 31 Figure 2. 24 Initial product search showing e-retailers available Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 32 Figure 2. 25 Comet product comparison facility (www. comet. co. uk) Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007

Slide 2. 33 Figure 2. 26 Kelkoo. com, a European price comparison site Chaffey, Internet Marketing, 3 rd Edition © Pearson Education Limited 2007