Transcript No Slide Title

Information Systems/Technology
Management
e-Business Focus
Key Strategic Choices: :04
Presented by
Professor Dan Remenyi
[email protected]
18 July 2015
1
Internet Savvy Organisations
An Internet Savvy Organisation is one
which understands the potential of
using the Internet and the Web and has
been prepared to unsure that it has
obtained a suitable degree of benefits
from their use.
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Definitions
How do you define the best web site
and how do you define the worse web
site?
It has been claimed that the best web
sites are Dell, Hothothot, EasyJet,
Danni Hard Drive, Intuit, Harry and
David, DoveBid, Intel?
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Strategy and the Web
The web can be used to enhance
strategy in a number of different ways
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One-way Information Dissemination Focus
Two-way Communications Focus
Transactional Ability Focus
Distribution Capability Focus
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The Four Virtual Spaces:Albert Angehern
Channels for economic agents
to display and access company
product and service related
Virtual
information
information space
VIS
Virtual
communication space
VCS
Channels for economic agents
to engage in relationship building
activities
Traditional
market
space
Virtual
transaction space
VTS
Channels for economic agents
to initiate and execute business
related transactions
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Virtual
distribution space
VDS
Channels for economic agents
to distribute products and services
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Evolution of Internet
strategies - Albert Angehern
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2
VIS
1=Simple, generic presence
2=Advanced, generic presence
3=Simple, customised presence
4=Advanced, customised presence
VCS
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2
1
4
3
1
Traditional
products &
Services
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4
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2
3
VDS
VTS
2
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4
Initial internet strategy adopted
by the large majority of
providers of traditional products
and services
Specific Internet strategy
adopted by providers of digital
goods such as media and
software publishers
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One-way Information
Dissemination Focus
Using internet technology for one-way
information dissemination:
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Sales materials
Product information
Service details
Staff particulars
Terms and conditions of sale
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Benefits of one-way
information dissemination
Centrally updateable
Minimal distribution costs
Tight version control
Reduced costs especially development,
printing and stationery costs
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Competencies for information
dissemination focus
Determination of material to be
published
Creative presentation skills
Web-database technologies
Ensuring information is always up to
date
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One-way information
dissemination costs
Relatively inexpensive to set up
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depends on volume of information involved
Substantial costs involved in
maintaining the system and keeping upto-date
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Changes in products, staff, conditions of
sale etc.
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Two-way Communications
Focus
Using internet technology for two-way
communications - provides a channel
for conversation with stakeholders:
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e-Mail and conferencing
Product and service feedback
Suggestions of new ideas
Possibility for strategic alliances
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Benefits of Two-way
Communications
Facilitates corporate learning by allowing easy
access to a conversation between the
organisation and its stakeholders
Nature of benefits delivered by two-way
communications is dependent on
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the market
the product
the type of industry
etc...
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Competencies for Two-way
Communications Focus
Staff with appropriate technical
competencies
Business communications staff
An understanding of the value of
sharing and of course an active will to
achieve this
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Two-way communications
costs
Relatively inexpensive to set up - in fact
likely to be less expensive that
information dissemination
Cost is related to the two-way traffic
between the organisation and the
stakeholders
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Replying to feedback, criticism etc can
absorb very substantial amounts of time
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Transactional Ability Focus
Using internet technology for transactions
Allows offers for sale to be made, sales to be
concluded and payments to be received for
most products and services.
Especially the case with homogeneous (airline
seats) and commodity (textbooks) type
products
Processing goods returned documentation will
also be handled by the same systems
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Transactional Focus Benefits
Primary benefit is speed of processing
and reduction in administrative costs
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Competencies for
Transactional Focus
Staff with appropriate technical
competencies
Staff with appropriate administrative,
financial and negotiating competencies
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Transaction focus costs
Depends on whether sales process is fully
integrated into the organisations inventory,
transport and ledger systems
On a standalone basis – i.e. no backward
integration the cost is relatively low - but
leads to logistic nightmares
Fully integrated systems with connections to
physical distribution require extensive
tailoring of software with the inevitable costs
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Distribution Capability Focus
Using internet technology for distribution
facilitates access to products and services
that lend themselves to digitisation.
Currently constitutes
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Financial institutions - banks, insurance and
betting
Airline, hotel, theatre reservations
Software
To some extent music and video (bandwith
restrictions which will increasing be removed)
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Benefits of Digitised or Virtual
Distribution
Fast access to the marketplace
Inexpensive (potentially) global
presence
Tax free
Reduced paperwork
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Competencies for Distribution
Focus
Entirely dependent on the product or
service being distributed which could
range from books, music, consultancy
or help or call desks
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Distribution Costs
May be relatively inexpensive with the
final amount spent being affected by
the sophistication of the product or
service, the amount of control required
and degree of automation and
integration into the corporate systems
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Potential strategic impact
Extracting value from market space
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Reach out to a greater market
Get to know the client base better
Add new products and services
Combine products and services
Create experiences
e-Business
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In the Eye of the Public
e-Business happens in the eye of the
public
It is therefore strategic in the sense
that it directly affects your market place
Make sure you are showing the best
face of your company
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e-Business and marketing
e-Business opens up new marketing
opportunities which can make a big
difference
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Traditional Richness Vs Reach
Dilemma
Richness
Reach
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E-Business Richness Vs Reach
Richness
Reach
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The RRA Cube
High
Richness
Medium
High
Low
Medium
Low
Low
Medium
High
Reach
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Old principles don’t work so
well any more?
Interruption marketing has reigned in
the media for the last half century
Consumers have had enough!
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It is estimated that an average consumer
sees about one million marketing messages
a year – that is 3,000 per day
A trip to the supermarket can offer you
10,000 marketing messages
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Old principles don’t work
We have a finite amount of attention
We have a finite amount of money
The more products we are offered, the less
money there is to go around
In order to capture our attention and get us
to spend more, marketers spend more money
And the more that is spent, the less effective
is the result ……..
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Marketing speak for the Webage
Permission marketing
One-2-One marketing
Personalised marketing
Opt-in versus opt-out
Viral marketing
Customer relationship management
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Permission Marketing on the
Web
The marketer offers the prospect an incentive for
participating
Having got the consumers attention, the marketer
offers a curriculum over time, teaching the
consumer about the product or service
The incentive is reinforced to guarantee that the
prospect maintains the permission
The marketer offers additional incentives to get
even more permission from the consumer
Over time, the marketer leverages the permission to
change consumer behaviour and turn it into profit
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Permission marketing
Anticipated
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People look forward to hearing from you
Personal
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Messages directly related to the individual
Relevant
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Marketing is about something the prospect
is interested in
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Incentives to participate
Must be overt, obvious and clearly
delivered
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Information
Entertainment
Free gifts
Money
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Remember the user
“Amazon sends me newsletters when it
wants, not when I want them. I receive
about 100 e-mails a day. At least fifty of
them are commercial. I don’t even want
to open them, never mind read them”
Clearly there is no permission here!
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Use attention gained over
time
Use the attention gained to teach the
consumer about the product or service
over time
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Every step must be relevant, interesting
and useful
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Reinforce the incentive
Adjust the incentives being offered and finetune them for each individual prospect
and
Begin to increase the level of permission
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To gather more personal data
To offer a new category of product
To provide a product sample
Range of permission is really only limited by
its relevance to the customer – get this wrong
and you are out!
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Permission marketing at work
Kids camp owner in the US knows parents won’t
choose a summer camp for their kids from a
newspaper ad.
She advertises at camp fairs and in magazines for
permission to send a video and/or brochure about
the camp
The only goal of the video/brochure is permission to
have a meeting
The consumer, now fully qualified, having seen
testimonials, photos, camp facilities and happy
campers is ready to be sold the camp, … in person
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What is the cost of permission
Nothing comes for free!
A brokerage house on Wall Street pays
$15 in media acquisition costs for
permission to call a potential customer
on the phone
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One-2-One marketing
Focus on increasing sales to existing
consumers as opposed to finding new
ones
Know the lifetime value of your
customers
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