the internet micro-environment

8/14/2019 The Internet Micro-Environment

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The Internet micro-environment
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We have only two sources ofcompetitive advantage:

1. the ability to learn moreabout our customersfasterthan the competition and

2. the ability to turn thatlearning into actionfasterthan the competition.

--Jack Welch, CEO of GE, outlining hiscompetitive strategy for the next century

Competitive Advantage...


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Source: European InteractiveSource: European Interactive

Advertisin AssociationAdvertising Association

Number of B2C online Purchases inEurope during January-June 2007


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The Internet marketing environment


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Micro Environment

The Marketplace

Customers

Suppliers

Competitors

Intermediaries


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The Marketplace

Refers to the interactions between all the elements

Competitive forces

Value chain

New channel

Location of trading

Commercial agreements

New business &revenue models


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P o w e r o f

s u p p l i e r s

B a r g a i n i n gp o w e r s o f

c u s t o m e r s

E x t e n t o f r i v a l r y

b e t w e e n

c o m p e t i t o r s

T h r e a t o f

s u b s i t u t e s

T h r e a t o f n e w

e n t r a n t s

T h e b u s i n e s s

Competitive forces


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Value creation model


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New channels


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Location of trading

Virtual marketplace

Electronic marketplace

What representation do company have

Types of

marketplace

location


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Different types of online trading location


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Commercial arrangements

Negotiated deal

(www.ec21.com)

brokerrred deal

(www.screentrade.co)auction

(www.ebay.com)

Fixed price sale

(www.dominos.com)

barter

(www.intagio.com)Pure markets

(shares dealing online


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Alternative perspectives on business models


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Customers

Online customers

Demand

analysis

&

Conversion

modeling

Online

Buyer

behavior


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Demand analysis & conversion modeling

Understanding the

Potential and actual

Volume of visitorsTo site

The extent to which

they convert tothe outcomes


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Assessing customer demand

Need to assess:

Access to Internet (ACCESS)

Proportion of customers influenced by channel

(CHOOSE)

Proportion of customers who buy direct (BUY)


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CONVERSION MODELS

Conversion of potential visitor to actual visitor to repeat

visitor

Awareness efficiency Attractibility efficiency

Contact efficiency

Conversion efficiency

Retention efficiency

A model of the Internet marketing conversion process


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A model of the Internet marketing conversion process


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Online buyer behavior

webographics

Usage location

Access drive

Connection speed

Usage type

Usage level


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Customer persona & scenario analysis

Thumbnail description

Of a type of person

Developed for

different personas

Set of tasks a customerwants for desired outcome


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Models of online behavior

Lewis & Lewis (1997)

E-Consultancy (2004)

Hierarchy of Response Models

Lewis & Lewis (1997)


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Lewis & Lewis (1997)Five different types of web users

Directed information seekers: only go for information, not typically plans forbuying

Undirected information seekers: like to browse, mostly clicks on banner

advertisements

Directed Buyers: purchase specific products online, compares the features

Bargain Hunters: find offers, known as compers

Entertainment seekers: look for enjoyment and contests


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E-Consultancy (2004)

On the basis of UK retail sites

Classification on the basis of onlineshopping behavior
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Selectsupplier(enquire)

TrackerCompleting

HunterResearching

ExplorerBrowsing

Directed goal-orientedUndirected, exploratory

Destinationpurchase

(buy)

Define

requirements

Assess

supplier

capabilities

Inspireme

Whats out

there



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Competitors & suppliers


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Intermediaries

Are the firms that help a company to promote,

sell and distribute its products/services.

Provides info about the destination sites

Can be independent or owned

Also known as cybermediaries

the internet micro-environment

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