introduction to

INTERNET MARKETING
What is Marketing?
Marketing is Social and Managerial process by
which individuals and groups obtain what they
need and want through creating, offering, and
exchanging products of value with others.
 Marketing Process
• You need a Product or service to sell

• You need a Place from which to sell the product

• You need to figure out a way to get people to come

to your place
 Marketing Process
• You need a way to accept orders

• You also need a way to accept money

• You need a way to deliver the product or service,

often known as “fulfillment”

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 Marketing Process
• Sometimes customers do not like what they
buy, so you need a way to accept returns
• You need a customer service and technical
support department to assist customers with
products.
The INTERNET

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 In the 1980´s

• Personal computers were connected to a server

also known as mainframe computer.
 In the 1980´s
• The mainframe was connected to another
mainframe of the company in another location
via dedicated lines.

• Only large companies could afford the

expense and investment in equipment.
 Today

• Connections across countries and

continents made through dedicated fast
lines.
• A company may have one local network in
NY, which is connected to the Internet
through a Regional network.

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• Mainframes
- term for very large computers
- used to handle large amount of
data or complex processes
- main advantage is reliability
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• Midrange
- medium sized, less expensive
and smaller
- usually a server

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• Micro-computer
- work stations with computing
capabilities
- single-users systems linked to
form a network

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 What is a network?
• Series of points or nodes interconnected by
communication paths. Node is a connection
point for transmitting data

• Network can interconnect with other

networks to form global networks
 Benefits of a network
• Facilitates resource sharing

• Provides reliability

• Cost effective

• Provide a powerful medium across

geographical divide
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 Geographical Distance
• Local area network (LAN):
small area, share a single server

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 Geographical Distance
• Metropolitan area network (MAN):
a wider network, can bridge several
LAN’s
 Geographical Distance
• Wide area network (WAN):
a broader area covered, can include
several MAN’s
 TCP/IP Protocol
• Each packet is identified by the sender address
and a receiver address.

• The sender´s computer transfers the data

packet to another computer on the Internet,
which transfers it to a chain of other computers
until it reaches the final destination.
Internet addressing system
• Internet uses TCP/IP, therefore every
computer on the Internet has an IP address

• IP address is numerical, separated by dots

• Works with DNS:

- com: for commercial purposes
- net: for Internet Service Providers
- org: for non-commercial groups
- gov: reserved for government 23
 Assimilation of Technology
• Technology first adopted to increase
efficiency – doing the same tasks faster e.g.
word processing instead of typing

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Assimilation of Technology
• Technology next adopted to increase
effectiveness – doing tasks not only faster but
better e.g. spreadsheets transformed finance
and accounting.
 E-Commerce Mechanisms
• Transformation of economic activity into digital
media
- Exchange information, content, agreements,
and services among parties that are connected
to through the Internet.

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E-Commerce Mechanisms
• Enables new ways of creating, delivering and
capturing value to customers.
- Availability
- Convenience
 World Wide Web (WWW)
• World Wide Web (Web):
- A collection of documents that reside on computers,
and that can be accessed by other computers on the
Internet.
• Multimedia documents:
- Text
- Images
- Sounds
- Video
• Hypertext:
- Links to other documents
- Can begin execution of a program 28
 Web Browsers
• Computer programs that can:
- Display Web documents
- Follow links
- Execute other programs
- Enhance applications such as real-time
audio or video

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 Web Servers

• Computers that run server software.

• A server waits for request to arrive from a

user/client.
• The server sends (serves) the document to the
requesting computer.

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 WWW and Internet
• The World Wide Web (WWW) is not the Internet

• WWW works in HTTP

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 WWW and Internet
• Web pages works in HTML

• Web browser provide access to information on

the WWW
Forces Shaping the Digital Age

• Digitalization & Connectivity

– Intranets : connect people within a
company.
– Extranets : connect a company with its
suppliers, distributors, and outside
partners.
– Internet : connects users around the world.

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 Forces Shaping the Digital Age
 Internet Explosion
– Explosive worldwide growth forms the heart
of the New Economy.
– Increasing numbers of users each month.
– Companies must adopt Internet technology
or risk being left behind.

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 Definitions
• Internet:
- A collection of computers that speak a
common language – protocol

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 Definitions
• Intranet:
- Private version of the Internet
- Main purpose to share company information
and computing resources among employees

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 Definitions
• Extranet:
- Private network that users outside the
company can access
- Requires security and privacy
- Collaborate with other companies

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 Forces Shaping the Digital Age
• New Types of Intermediaries:
– Direct selling via the Internet bypassed existing
intermediaries (disintermediation).

– “Brick-and-mortar” firms became “click-and-

mortar” companies.

– As a result, some “click-only” companies have

failed.
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to be continued…
 Forces Shaping the Digital Age

• Customization and Customerization:

– With customization, the company custom
designs the market offering for the
customer.
– With customerization, the customer designs
the market offering and the company
makes it.
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 E-commerce as the
Networked Economy

 Create value largely through gathering,

synthesizing and distribution of
information
 Formulate strategies that make
management of the enterprise and
technology convergent
 Compete in real time rather than in “cycle
time”
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 E-commerce as the
Networked Economy
- Operate in a world characterized by low
barriers to entry, near-zero variable costs of
operation and shifting competition

- Organize resources around the demand side

rather than supply side

- Manage better relationships with customers

through technology
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 E-commerce Today
• The Internet is the perfect vehicle for e-
commerce because of its open standards
and structure.
• No other methodology or technology has
proven to work as well as the Internet for
distributing information and bringing
people together.
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 E-commerce Today
• It’s cheap and relatively easy to use it as a
medium for connecting customers,
suppliers, and employees of a firm.

• No other mechanism has been created

that allow organizations to reach out to
anyone and everyone like the Internet
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 E-commerce Today
• The Internet allows big businesses to
act like small ones and small
businesses to act big.
• The challenge to businesses is to make
transactions not just cheaper and
easier for themselves but also easier
and more convenient for customers
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 E-commerce Today
• It’s more than just posting a nice looking
Web site with lots of cute animations and
expecting customers and suppliers to
figure it out
• Web-based solutions must be easier to
use and more convenient than traditional
methods if a company hopes to attract
and keep customers. 46
 What is a web-based business
• Business that uses the WWW to fulfill
it’s business process
• Four basic business processes:
- information dissemination
- data capture
- promotions and marketing
- transacting with stakeholders
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 Key Drivers of E-commerce
• Technological – degree of advancement of
telecommunications infrastructure
• Political – role of government, creating
legislation, funding and support
• Social – IT skills, education and training of users
• Economic – general wealth and commercial
health of the nation
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 Key Drivers of E-business
• Organizational culture- attitudes to R&D, willingness to
innovate and use technology
• Commercial benefits- impact on financial performance
of the firm
• Skilled/committed workforce- willing and able to
implement and use new technology
• Requirements of customers/suppliers- in terms of
product and service
• Competition- stay ahead of or keep up with
competitors 53
 Limitations of E-commerce
• To organizations: lack of security, reliability,
standards, changing technology, pressure to
innovate, competition, old vs. new technology
• To consumers: equipment costs, access costs,
knowledge, lack of privacy for personal data,
relationship replacement
• To society: less human interaction, social
division, reliance on technology, wasted
resources, JIT manufacturing 54
 Technical limitations
• There is a lack of universally accepted standards for
quality, security, and reliability
• The telecommunications bandwidth is insufficient
• Software development tools are still evolving
• There are difficulties in integrating the Internet and
EC software with some existing (especially legacy)
applications and databases.
• Special Web servers in addition to the network
servers are needed (added cost).
• Internet accessibility is still expensive and/or
inconvenient 55
 Web based technology
• Websites
• E-mail
• Search engines
• Interactive communications

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End of presentation

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