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Principles of Internet Marketing

Principles of Internet Marketing. Chapter 1 An Overview of the Web. Objectives. In this chapter you will learn about: The rise of the Web from obscurity to commercial revolution The evolution of the Web after the Web bubble burst

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Principles of Internet Marketing

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  1. Principles of Internet Marketing Chapter 1 An Overview of the Web

  2. Objectives In this chapter you will learn about: • The rise of the Web from obscurity to commercial revolution • The evolution of the Web after the Web bubble burst • Social networking on the Web and its effect on social relationships and marketing Principles of Internet Marketing: New Tools and Methods for Web Developers

  3. Objectives (continued) • Important trends and demographic differences in Internet usage • Predictions for the future of the Web and how these developments might further impact society Principles of Internet Marketing: New Tools and Methods for Web Developers

  4. A Brief History of the Web Through 2001 • Commercialization of the Web (1990’s) • Commercialization began when Tim Berners-Lee’s introduced the ability for links to be made between various pieces of information • Continued in 1993 with release of HTML • Early browser wars between Netscape and Internet Explorer put IE in dominant position Principles of Internet Marketing: New Tools and Methods for Web Developers

  5. A Brief History of the Web Through 2001 (continued) Commercialization of the Web (1990’s) (continued) Web growth propelled by increase in computer ownership, falling tech prices and low interest rates Only 19,000 sites in mid-1990’s, compared to 176M in 2008 Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 5

  6. A Brief History of the Web Through 2001 (continued) • Importance of venture capitalists • Invested over $10 billion in 1996, mostly to tech companies • Massive economic growth • Web investments fueled the stock market to new peaks in 2000 • Tech-related growth helped drive unemployment rate to 40 year low of 3.8% • Massive Web growth of the 1990’s known as the “Web bubble” Principles of Internet Marketing: New Tools and Methods for Web Developers

  7. A Brief History of the Web Through 2001 (continued) Figure 1-1: Graph of NASDAQ exchange between 1994 - 2003 Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 7

  8. A Brief History of the Web Through 2001 (continued) • The bursting of the bubble • Around 2000, investors became anxious for profits from Web companies • High profile bankruptcies of eToys and Webvan caused investors to sell, causing stock market to plummet ending many Web companies • Other key failures included: • Pets.com • Kozmo.com (order absolutely anything for free delivery) • Flooz.com (new, online currency) Principles of Internet Marketing: New Tools and Methods for Web Developers

  9. A Brief History of the Web Through 2001 (continued) Key points in Web history, between 1991 - 2001: 1993: CERN decides to make Web technology and codes free for all to use 1995: Amazon.com is launched 1995: Internet Explorer introduced 1998: Google launched 2000: Dow Jones and NASDAQ markets reach their peak Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 9

  10. A Brief History of the Web Through 2001 (continued) • Key points in Web history, between 1991 - 2001 (continued): • 2001: Wikipedia is launched • 2001: eToys and Webvan bankruptcies spark the end of the Web bubble Principles of Internet Marketing: New Tools and Methods for Web Developers

  11. A Brief History of the Web From 2002 Forward • Changes in technology helped usher in next generation sites • Faster connection speeds • More powerful computers • Broader color range for monitors • Better understanding of Web and better communication between designers and programmers led to improved site designs that were more attractive and easier to use Principles of Internet Marketing: New Tools and Methods for Web Developers

  12. A Brief History of the Web From 2002 Forward (continued) Figure 1-3: McDonald’s Web site, before 2002 and after Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 12

  13. A Brief History of the Web From 2002 Forward (continued) Figure 1-5: NBC’s Web site, before 2002 and after Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 13

  14. A Brief History of the Web From 2002 Forward (continued) Figure 1-7: New York Post’s Web site, before 2002 and after Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 14

  15. A Brief History of the Web From 2002 Forward (continued) Figure 1-9: Brookstone’s Web site, before 2002 and after Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 15

  16. A Brief History of the Web From 2002 Forward (continued) Web growth despite bubble bursting Market crashed did not diminish Web’s importance; it simply weeded out bad ideas E-commerce grew from $27M in 2000 to $139M in 2008 Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 16

  17. A Brief History of the Web From 2002 Forward (continued) Figure 1-10: E-commerce retail sales growth 2000-2008 Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 17

  18. A Brief History of the Web From 2002 Forward (continued) • Web transformed into social platform and entertainment outlet (as well as commercial outlet) • YouTube viewership rose while network TV viewership declined • Key points in Web history, from 2002 forward: • 2002: Release of Flash Player 6 (the first version to support video files, setting the stage for the later explosion of online video) • 2003: Launch of MySpace social network Principles of Internet Marketing: New Tools and Methods for Web Developers

  19. A Brief History of the Web From 2002 Forward (continued) Key points in Web history, from 2002 forward (continued): 2004: Amazon.com proves Web-based companies can generate positive income with first annual profit 2004: Launch of Facebook social network 2005: Launch of YouTube video sharing site 2005: More new users (17M) go online in 2005 than in all of the 1990’s Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 19

  20. Social Networking on the Web: Its Impact on Relationships and Marketing • Social networks aren’t exclusive to Web • Social networks exist in physical world • Defined as a structure of nodes (people and /or organizations) tied together by one or more specific types of interdependency such as values, friends, ideas, etc. • Social networks operate among nations, families, friends, and play a role in problem solving and achieving goals Principles of Internet Marketing: New Tools and Methods for Web Developers

  21. Social Networking on the Web: Its Impact on Relationships and Marketing (continued) Figure 1-12: Graphical representation of a social network Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 21

  22. Trends and Demographic Breakdowns Understanding trends and demographics help marketers reach their target audiences Overall Internet usage ballooned from 14% of population in 1995 to 70% in 2007 Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 22

  23. Trends and Demographic Breakdowns (continued) Figure 1-13: Growth rates of Internet usage 1995 - 2007 Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 23

  24. Trends and Demographic Breakdowns (continued) Various demographic breakdowns use Web differently: Men log on more often than women and spend more time online Younger users more likely to create blogs, watch videos Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 24

  25. Trends and Demographic Breakdowns (continued) • Marketers have significantly increased their use of the Web to reach audiences • Over 71% of companies planning new Web sites • 50% planning to take advantage of online consumer feedback • 25% plan to create their own marketing-related blog Principles of Internet Marketing: New Tools and Methods for Web Developers

  26. Trends and Demographic Breakdowns (continued) Figure 1-14: How marketers are adopting various Web tools Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 26

  27. Where Do We Go From Here? • Many experts see increased global use of Web helping turn English into a global language • Web users may increasingly fragment their personalities, creating separate but equal online personas due to ability to remain anonymous. • Entertainment will continue to shift from off-line outlets to online outlets Principles of Internet Marketing: New Tools and Methods for Web Developers

  28. Where Do We Go From Here? (continued) Increased standardization of online advertising will improve Web landscape for marketers Banner ad size Video length File size Cost calculations Principles of Internet Marketing Principles of Internet Marketing: New Tools and Methods for Web Developers 28

  29. Summary • Since 1991 introduction of links, Web growth has been on a fast track • 1990’s saw the introduction of Web commercialization, fueled by cheaper tech prices, low interest rates, and increased computer purchases • Potential profits attracted venture capitalists, who poured money into new Web companies, driving up the stock market, which later burst after key Web failures Principles of Internet Marketing: New Tools and Methods for Web Developers

  30. Summary (continued) • After Web bubble burst, Web evolved into a more serious marketing tool, thanks to smarter investments, better design, and improved technology • More people logged on as the Web further became a place for entertainment and socializing • Marketers increasingly looked to the Web for opportunities to reach their audiences Principles of Internet Marketing: New Tools and Methods for Web Developers

  31. Summary (continued) • Various demographic groups use the Web differently, which helps marketers more easily find the people they want to reach • In the future, many experts believe that the global use of the Web will effect language, and that the anonymity afforded social networking could effect offline relationships • Online advertising will become standardized, improving the Web for marketers Principles of Internet Marketing: New Tools and Methods for Web Developers

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