International MBA Refresher E-Marketing /Technological Marketing

1. International MBA Refresher E-Marketing /Technological Marketing Professor: Jacques Nantel, Ph.D HEC Montréal Canada

2. Content • Adding value to the business plan (10 min) • Retailing (20 min) • Workout session : Amazon.com (30 min) • Presentations (15 minutes) • Advertising (15 min) • Market places (15 min) • Break (30 min) • Data base marketing (20 min) • Workout session : MSN passport (30 min) • Presentations (15 minutes) • Conclusion (10 min)

3. Starting positions • E-marketing is not a strategy • It is merely a catalyst • To apply it is not necessarily a plus • To ignore it is a minus • It can help the firm by • reducing costs • Increasing revenues

4. The e-sky is falling!(Amazon.com)

5. Yet…. • There are more consumers surfing • Who stay longer on the net • And who buy more and more

6. Taylor Nelson Sofres Interactive - Global eCommerce Report 2001 “…global marketing information from a global research company, with unequalled expertise and experience in internet issues …”

7. E-commerceWorld growth

8. Country average (31%) GeR Internet users across the world 2001 Percentage of total adult population Percentage of the population who have personally used the Internet during the past month Japan results = 68% (data collected in the TNS AP M-commerce study) China results = 23% (data collected in the TNS AP M-commerce study)

9. The USA retains its position as the nation with the greatest proportion of online shoppers at 33%. This compares with the global average of 15%. • In India, the Philippines,Thailand and Turkey, 2% or less of the online population shop online. Country average (15%) GeR Percentage of Internet users Percentage of Internet users who have bought goods or services online during the past month

10. Country average (15%) GeR • The Internet as an information channel for offline purchasing continues to be important. • Hong Kong, demonstrates this well, supplementing online purchasing with substantial offline revenues. Percentage of Internet users Percentage of Internet users who have bought goods or services offline as a result of information found online during the past month

11. GeR Products purchased online Percentage of Internet users who shop online

12. In brief, a growing market but one has to understand the real opportunities • Internet will not be the revolution that some had predicted • It will not be a fad • For most retailers it will be a necessary evil

13. Some dying myths • Building a new distribution network does not create any new demand • There are not two types of consumers one virtual the other one tangible • Forget the first mover’s advantage • Technology is important but having a decent profit making business plan is still crucial.

14. Different strategies for different products

15. Different strategies for different products

16. 1-Digital products • New networks • Cost and price reduction • Standard technology

17. Sales of music on the Internet(000 $ us) Source: Forrester Sept 2001

18. Source: MediaMetrix oct 2001

20. 2- Services • Travel agencies, Law, Medical services • Cost reduction, standardization of basic functions • Cross marketing and up-selling • Ex: Merrill Lynch

21. 3- Convenience goods • Most of them are available within 1 mile from the source of demand • 80% of consumption is made by 20% of goods (Pareto law)

22. Thus... • Consumers will want to shop in store AND surf on the net • Retailers must provide both opportunities • Retailers must provide real time information including their stocks • Sell popular products in store with low margins • Sell products with slow turnovers on line with increased margins

24. 4- Specialty products • Car, furnitures • Inventory cost are often huge • Yet consumers are still waiting often more than a month

26. Workout session:Amazon.com

27. 2- What about advertising ?

31. Yet, there are opportunities • Focus on the consumer not on the content • Keep in mind that the consumer is active and searching • Provide indication for your ROI • Use personalization

33. Various strategies • Banner ads • Permission marketing (yesmail.com) • Viral marketing • Affiliate marketing • Product placement

34. Market Places B2B • The marginal contribution of e-commerce where EDI was already established • True opportunities for the standardization of protocols • Winners: SAP, Oracle etc. • Important order givers gained power over small suppliers • Market places • For commodities and indirect inputs • Verticalnet Vs Dell computers • Changing business models • From registration fees to transaction fees • Volume is the key

37. Market places can be profitable if • The operate in areas where buyers seek and compare several suppliers • Trade indirect inputs or commodities • Are able to capture critical masses

38. CRM systems

39. What they do • The critical importance of owning a central data basis • Data basis must be updated • Sales force must be part of it • ROI must be evaluated

43. Workout session:MSN.com