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e-commerce - University of Southern California Marshall...

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University of Southern California Marshall School of Business BUAD 307 Lars Perner, Ph.D., Instructor Marketing Fundamentals Fall, 2007 SUMMARY OF CLASSROOM MATERIAL ELECTRONIC COMMERCE USES OF THE INTERNET IN MARKETING Online marketing can serve several purposes: Actual sales of products — e.g., Amazon.com. Promotion/advertising : Customers can be quite effectively targeted in many situations because of the context that they, themselves, have sought out. For example, when a consumer searches for a specific term in a search engine, a “banner” or link to a firm selling products in that area can be displayed. Print and television advertisements can also feature the firm’s web address, thus inexpensively drawing in those who would like additional information. Customer service : The site may contain information for those who no longer have their manuals handy and, for electronic products, provide updated drivers and software patches. Market research : Data can be collected relatively inexpensively on the Net. However, the response rates are likely to be very unrepresentative and recent research shows that it is very difficult to get consumers to read instructions. This is one of the reasons why the quality of data collected online is often suspect. CHALLENGES IN RUNNING WEB SITES There are a number of problems in running and developing web sites. First of all, the desired domain name may not be available— e.g., American Airlines could not get “American.com” and had to settle for “AmericanAir.com.” There is also a question having your site identified to potential users. Research has found that most search engines have a great deal of “false hits” (sites irrelevant that are identified in a search— e.g., information about computer languages when the user searches for foreign language instruction) and “misses” (sites that would have been relevant but are not identified). It is crucial for a firm to have its site indexed favorably in major search engines such as Yahoo, AOLFind, and Google. However, there is often a constant struggle between web site operators and the search engines to outguess each other, with the web promoters trying to “spam” the search engines with repeated usage of terms and “meta tags.” The fact that many computer users employ different web browsers raises questions about compatibility. A major problem is that many of the more recent, fancier web sites rely on “java script” to provide animation and various other impressive features. These animations have proven very unreliable. Sites may “crash” on the user or prove unreliable, and many consumers have found themselves unable to complete their transactions.
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ECONOMICS OF ELECTRONIC COMMERCE: SELLING ONLINE IS USUALLY MORE EXPENSIVE Some people have suggested that the Internet may be a less expensive way to distribute products than traditional “brick-and-mortar” stores. However, in most cases, selling online will probably be
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e-commerce - University of Southern California Marshall...

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