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Term paper on Internet Marketing

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Term paper on Internet Marketing

Post  PapersQueen on Sat Jan 23, 2010 7:56 am

The World Wide Web has attracted considerable attention from marketers in the popular business press (Verity and Hoff, 1994, p. 80-88) and academic marketing (Hoffman and Novak, 1996, p. 50-68) and practitioner (Watson, Pitt, and Akselsen, 1998, p. 36-56) journals. Understandably, at this early stage, the focus has been on the technology from a general marketing perspective or as a marketing communication medium. With few notable exceptions, less attention has been given to the Web as a potential distribution channel. However, the Web provides direct marketers with the opportunity to exploit various international markets (Harsh 1998)

Overall, the Web is best conceptualized as a developing marketing channel that transcends national boundaries and encompasses elements of informing, investigating, interacting, distribution, transacting, eliciting feedback, and supporting. In the pre-purchase stage, the Web can be used to investigate (e.g., conduct market research into consumer attitudes, needs, and wants; monitor competitors; benchmark other service organizations), for which the flow of information is primarily toward the service provider, and inform (promote, position, advertise, and inform consumers of the service and its options), for which information flows toward the consumer. In the purchase stage, the Web can be used to facilitate transaction, in which the consumer provides information regarding order specifications, payment details, and delivery; interaction, in which the consumer and service provider interact to co create unique customized service packages; and distribution, in which the provider actually distributes the service to the consumer. Finally, in the post purchase stage, the Web can be used to elicit feedback (the service provider gathers information on options, suggestions, level of satisfaction, potential loyalty, future services, and other pertinent areas), for which information flows from the consumer to the service provider, and provide support (e.g., the provider informs the consumer of new services and ways of maximizing benefits from existing services), for which information flows primarily from the service provider to the consumer.

The strength of the Web is its ability to encompass all these elements to a lesser or greater extent. Its weaknesses relate primarily to its inability to transport physical objects. Simply, though the Web is effective for the distribution of symbolic, informational, or knowledge services, it is extremely ineffective for the distribution of matter-dependent or physically embodied services. Thus, for example, though technical engineering information and advice can be conveyed between countries over the Web, the physical parts to which such technical advice pertains cannot. For each of the other elements (informing, investigating, interacting, transacting, supporting), the Web can usefully complement other more traditional marketing channels. However, as with any other medium (e.g., television, radio, print), the Web as an international marketing channel is affected in terms of its efficacy by technological, economic, physical, socio-cultural, and political-legal distance between domestic and overseas markets. Thus, a Web site based on a server in France and written in French may not be understood by a Web surfer in Brazil because of language, cultural, and allied differences.

Most of the firms are using the Internet as an informational tool rather than using it as an interactive tool. The interactive potential of internet is not utilized. An online brochure is the most commonly used internet function. It is found that some existing firms are now using the Internet for the transaction with the customer. A very less number of firms are using Internet for the facilitation of relationship or transaction.

Smaller firms are using less internet tools while larger firms are using significantly more Internet tools. The possible reason may that smaller firms are at the relative cost risk. More research is to be carried out in this regard. The difference between the smaller and larger firms becomes prominent when the Internet is used for the transactional functions. If the correlation is found between the size and the age of the firms then it is found that transactional tools are more used in the younger and smaller firms. Internet is most sophisticatedly used in the larger firms. It is found that both the larger and the smaller firms have very less use of Internet as an interactive tool.

It has been previously suggested that service firms are using more sophisticated internet because they have more to gain while their manufacturing counterparts are not gaining that much so they do not use more sophisticated Internet. But it has been analyzed that no such difference exists. Service firms have not utilized the interactive potential of the Internet although they are taking significant benefits from the Internet. Although there is a chance to target a segment of one for service firms in particular and for all types of firms in general, but this capability has not been utilized in the sample firms used.

It has been explained that the geographic origin of firms count a lot. On the basis of geographic origin, interaction through internet is found at different levels. This is due to the maturity level of the Internet technology. The access of Internet to different markets also matters a lot. It is said that the Internet use in the United States is greater due to its lower call charges. This means that the level of sophistication of Internet marketing should be higher in the United States. But this is has been proved.

It is analyzed that the Internet is currently failed to be proved as a strong interactive tool in the market. But this is not due to the lack of experience of the marketing practitioners. In fact, this is due to the reluctance from the customers to get involved in the internet interaction. The customers fear because they do not consider the Internet as a safe mode to transact through the internet. Security is the main reason for the failure of the Internet and its interactive potential in the market.

There is no difference found for the international firms that have been using the Internet since their first steps or they have started using the Internet after become international. If the firms first internationalized and then they started using the Internet to serve their international markets, or they first started using the Internet and then they become internationalized does not make any difference. What matters actually is the sophisticated use of the Internet if the firms really serve international markets through the Internet. More internet functions are used by those firms that are offering different types of products and services to international markets with the help of the Internet. The process is sensitive and so many internet tools are used. The other groups do not use more internet functions. The firms use more sophisticated Internet when they get involved for the advanced transactional processes. It is found that those firms are more sophisticated users of the Internet in which the new technologies are used for accessing and serving the new or existing international markets. This is because those firms rely on transaction for survival. Other characteristics of the firms also matter. There may be some common things between these firms and those small firms that are using high technology and thus they are growing rapidly towards internationalization. The size of the firms needs not to be small but they should be using a new technology to become internationalized.

There are firms who were international before the Internet but did not take any advantage of the technology are responsible for the extent of differences found between the two groups. It will be wrong to say that the characteristics of the firms that are internationalizing through the Internet are responsible for the extent of differences. It is not necessary that all services and products will benefit from the interactive potential of the Internet. Due to the global and open nature of the Internet, the firms that are already internationalized will take time for adjustment with the new trend in global marketing despite the fact that the interactive potential of internet has been widely acknowledged.

Benefits of Internet Marketing for Professionals
Professional buyers realize unique benefits, uses and gratifications from the Internet market:
• Makes their job easier. Information acquisition and response times are made more efficient.
• Saves them time.
• Reduces communication clutter. A single media with storage and retrieval capacity reduces the clutter of phone and mail messages.
• Reduces stress. Through time savings and clutter reduction.
• Enhances quality control ability. Can more conveniently obtain product specifications and service follow-up?
• Shortens response time. Communications track down parties through virtual linkages.
• Helps them answer questions and solve problems quickly.
• Reduces paper processing.
• Relieves in-office schedule stress. Lessens missed communications and the need to sit by the phone.
• Contributes to work schedule flexibility. Restrictive office hours less needed.
• Allows contemplation of information without slowing response time. Virtual media allows time to consider the message on-line.
• Reduces interruption down time. Fewer interrupting phone calls.
• Facilitates office work multi-tasking. Helps with managing many tasks simultaneously.
• Reduces the work backlog impact of traveling. Less mail to process, phone calls to catch up on.
• Broadens the base of support from suppliers. Makes it easier to gain access to customer support personnel beyond primary sales representatives.
• Facilitates "quick recovery time" from a problem situation. Facilitates immediate contact and alternative suppliers.
• Contributes to ones contemporary & professional image. (Anderson, 1995, p. 149-62)
Benefits of Internet Marketing for Individuals
The Internet market provides a unique collection of uses and gratifications to consumers. Below are listed a collection of possible uses and gratifications that consumers could gain from virtual marketing.
• A sense of power and control. Computers are powerful devices controlled at the click of a mouse. Individuals may maximize, minimize, save, print and delete content at their pleasure. This relationship to media content does not exist with television, magazines, radio or other traditional media used for commercial communication.
• A sense of "owning" the media source. There may be an altered sense of attention to media content that consumers see through a machine they own and that is connected to linkages they pay for.
• A capacity to manipulate information instead of information manipulating them. The notion of advertising designed to manipulate consumers is well known. This belief may be lessened for commercial content on the Internet due to consumers' ability to manipulate the information to their liking.
• Enhanced ability to exercise information selectivity. Commercial media deliver a set, inflexible, programmed format. In virtual marketing channels consumers may pick and choose content and the time of exposure.
• Enhanced ability to comparison shop. Conventional product and information channels require consumers to expend a good deal of effort to comparison shop clipping and saving ads, phone calls, store visits, etc. Virtual marketing collapses all this into an electronic medium-virtual marketing.
• Consolidation of buying activity time. Today's consumers are time scarce. The virtual marketplace enhances the ability to consolidate shopping time-24 hours a day with assured access to products and information.
• Sense of accomplishment through command of technology. Electronic shopping may add a sense of accomplishment to the shopping experience, perhaps similar to finding a great deal through smart shopping--one feels clever and accomplished by accessing the virtual market.
• Provides a source of recreational escapism. People long for pleasant diversions from their hectic and stressful lifestyles yet have difficulty finding the blocks of time needed for traditional out-of-home recreation. The virtual market allows immediate access to recreational escapism usable in small blocks of time, 24 hours per day.
• Provides a sense of privacy. The virtual market provides privacy through consumer control and security passwords.
• Provides a sense of outreach. People can feel more "connected" to others through a network of virtual contacts.
• Satisfies the yearning for exploration and out-of-home experiences. The virtual market provides partial satisfaction of the longing to travel and to "get away." (Berthon, Pitt, Watson, 1996, p. 43-54)

Conclusion
The extent of the use of the Internet as an interactive tool is discussed in this paper. The interactive potential of the International will be responsible for the failure or success of the technology. This is because the interactive potential has the ability for the facilitation and development of individual relationships with customers on a global scale. Unfortunately, the interactive potential is very less used. Currently, the Internet is used as an informational tool. The Internet as an interactive tool is used particularly for larger firms that are internationalized and are serving the international markets with the help of the Internet. Most sophisticated Internet is used in these firms. A question is raised about the failure of the sophisticated use of the Internet for the mature US Internet market. This is perhaps due to the fear of customers about the security for the use of the Internet for transaction. Customers are not ready fro the use of the interactive tools of the Internet due to the under developed transactional tools and their evolution as well. The firms that are already internationalized will go through a large number of challenges that will be faced due to the global and open nature of the technology before the potential is maximized.

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PapersQueen

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Great paper!

Post  MBAstudent on Tue Jan 26, 2010 5:09 am

Hi PapersQueen,

Thank you for the great paper! Got many ideas from it.

MBAstudent

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