E-Commerce Shaping Business 1

Very often, inboxes are filed with e-mails that are least expected. These e-mails are

commercial mails that promote a product or a service and generally ask for a click on a

specific link given in the mail. If the person is interested, then the person will visit that site,

otherwise the mail can just be deleted from the inbox. Technology has become the

predominant element in many businesses. Information Technology has added to the

capabilities of companies enabling them to set new standards in business. The power off the

Internet has transformed everything. E-commerce has redefined markets, industries and the

way one does business. The growth on online marketing has just begun and it is at an early

stage of evolution. The Internet has not only revolutionized personal lives, but has even

transformed the world of business to a great extent. Every company today, irrespective of

whether it is a dotcom company or not, has a presence on the net.

Today, most of the markets of the world have integrated, and are moving towards a

unified global market and the flow of trade has significantly increased. Though the concept

of global marketing has gained significance in the last few decades, companies had begun

trading across borders much earlier. Changes in various environmental factors, especially

technology and economy, have been responsible for companies to go global. Many

organizations today have realized that to achieve economies of scale and survive in todays

competitive world, it is vital to become global, use the strengths of different markets and

market their products globally.

In the recent times, this term - globalization has gained a lot of importance. Even

this has got an impact on the developing E-commerce. Globalization has been defined by

different sources differently meaning various things free markets, economic liberalization,

Americanization, proliferation of information technologies, and as well as we being on the

threshold of realization of unified community without major causes of social conflict.

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One of the most widely accepted definitions of globalization is from International Monetary

fund (IMF) which views globalization as an historical process resultant of continuous

human innovation and technological advancements. Globalization primarily refers to free

movement, access and availability of talent (labor) and knowledge (technology) without

limitations of trans-national borders.

Some view it as a beneficial process and others view it as a key which helps in future

economic development of the world. Globalization is something which is inevitable and at

the same time irreversible. It is believed that Globalization is something which offers an

extensive opportunity for a development which is worldwide. Though globalization is trusted

to be something which tends to provide a scope for worldwide development, it is also true

that this scope is not evenly progressing. Due to the advent of globalization, many countries

are becoming highly integrated into the global economy in a very faster pace. This faster

integration has helped such countries to grow faster and also at the same time reduce even

poverty.

Today, globalization which is defined to be a process of continuing integration of

different countries of the world, has already taken its path in many parts of the world. Many

national economies are being exposed to a higher cut throat competition than earlier. The

sole reason for this being globalization supported by the accelerating pace of the

advancements in technology, the liberalization of the prices and trade practices and also by

the increasing importance to super national rules.

The rapid increase in the growth of online marketing can be attributed to many

factors. Goods, services and ideas can move across continents efficiently at the click of a

mouse. Anyone can link up with anyone else, anytime and anywhere in the world. With the
 E-Commerce Shaping Business 3

advent of e-commerce, the rapid growth of the Internet and online transactions taking place at

all times of the day and night, todays markets, businesses and customer never sleep. This is

not only a new challenge for global businesses attempting to serve a client base that spans

time zones, but also for local enterprises that can no longer afford to restrict themselves to

traditional hours of doing business. Online business is growing with the assistance of new

powerful technologies like satellite communication, mobile telecommunications, interactive

voice recognition, data mining, digital signatures, virtual private networks, and portable

computing. The aim of these technologies is to benefit a firms online marketing efforts, in

terms of both cost and value.

Competition has created great challenges for marketers. Functions like production,

distribution and consumption are being influenced by market forces. Changes taking place

in the business environment have made customer service, quality assurance and price

competitiveness vital for the existence of a firm. Business firms have realized that they

cannot survive without marketing. Marketing plays a significant role in the sustainability of

an organization.

For example, Indias e-solutions are becoming the most sought after products around

the world. Considering the interest shown by the government in the growth of the online

market, e-commerce in India is likely to witness a significant jump over the next few years.

The growth of online marketing in recent times has been phenomenal. It is, however,

important to recognize the factors that led to this growth.

The internet is a global network of many networks connecting millions and millions

of computers together. Currently, almost 30 million computers around the globe are

connected to the internet. Today, the internet is an integral part of business, the environment

and even personal lives. It has become a fundamental tool used to interface with others.
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The internet holds unlimited potential; it is a fast, economical, and a reliable method

to reach out to thousands of potential customers. Its most beneficial aspect is that it

transcends all geographical barriers. It has truly helped to transform the world from being

multinational to being global. To an internet user and an internet marketer, the whole

world appears as a single global entity, no longer fragmented into multiple nations.

Marketing in todays world of e-commerce can be defined as the use of the internet to

advertise and sell merchandise or service. It involves the use of websites and e-mails to reach

customers and inform them about the availability of a product, entertain their queries, and

receive orders and repayments through the electronic medium.

The internet has undoubtedly emerged as a powerful marketing tool. In fact, it has

almost completely revolutionized the way traditional companies are doing business. Until a

few years ago, many companies viewed the internet as only another advertising medium; they

could not visualize its potentials as a marketing channel. Some companies even felt that

developing the internet as marketing tools would interfere in their relations with their

distributors and retailers and with other conventional forms of marketing (Rohm, 2004).

But over the last decade, both consumer perception and the company outlook about

the internet and its capabilities have changed tremendously. Even companies that were fully

dependant on conventional marketing systems admit that Internet marketing, if properly

exploited, can be immensely beneficial. Companies are now incorporating Internet

marketing strategies in their overall marketing plan to be able to take advantage of the

opportunities that e-business has to offer. While designing a strategy, a company must

consider the following.

1. The internet can be used to reduce marketing costs. It should not be viewed as just another

advertisement medium. It can help business by streamlining operations, reducing costs,

 E-Commerce Shaping Business 5

forging customer relations, and generating revenues. E-business can create value for

organizations if they continuously use new technology to improve upon their marketing

system and if customer expectations are continuously met. The internet can be used to build

long-term relationships with customers.

2. The internet can be integrated into an organizations marketing and communication plan

and can be used to build brands. If it is used in combination with other distribution and

media channels, it can contribute significantly in brand building. For example, in order to

drive viewers to the Reebok website, the company introduced a fictional character, Terry

Tate, as a representative of its website, www.rbk.com, in its commercials in the 2003 Super

bowl. Within weeks, 250,000 new users had registered at the website. These new users were

included on Reeboks mailing list and were regularly informed and updated about Reebok

activities and products. This helped to increase the customers involvement with the

company and its products. The Terry Tate commercial was also shown as a news item on

CNBC and this immediately increased traffic on www.terrytate.reebok.com. Thus, by

integrating one medium, i.e. the Super Bowl event, with another medium the website,

Reebok increased the duration for which a viewer was involved with the Reebok brand, and

so increased the brands value for the customer.

3. Conventional marketing channel partners must be appreciated. With the internet, a

producer can directly reach the consumer. But at the same time, the producer should not

isolate the other channel partners. The producer must try to use the internet to build business

for himself and for his distributors.

4. With the evolution of the internet, the customer has become more knowledgeable.

Companies must recognize the fact that most consumers can compare prices of products from

various recognize the fact that most consumers can compare prices of products from various
 E-Commerce Shaping Business 6

companies within minutes on the internet. Therefore, the companies can either compete on

price or convince the user of superior quality, but under all circumstances, they must aim to

deliver what they promise.

5. To use the internet potential to the optimum, organizational heads must understand and

believe in its capability and the uses to which it can be put. Only then will they be able to

creatively tap its potential. It is also important for them to identify the products and services

and the facets of the organization that they want highlighted on the internet.

Internet and E-Commerce is about Communication and not Technology

The internet is primarily a tool for communication. It has various technical aspects

associated with it, but from a marketers point of view, its importance lies in the fact that it

can serve as a powerful global communication tool. According to Sergio Zyman, Customers

dont care if you Web has the coolest technology - -they want to know how it can do

something for them that they need or want and how it can do it differently than any other site

(Miller, 2000).

For a user, the internet acts as a comprehensive source of information. Through it, the

user can get information on virtually every subject. Many organizations are unable to fully

tap the advantages of the Internet because their advertising agencies and marketing experts

still view it as only an extension of their current communication strategy. So, they fail to

define a clear strategy for their websites and their online advertising. Their internet budgets

are also merely a part of their traditional marketing budgets.

But in the past five years, the internet has grown into an independent communication

medium and its biggest advantage is that it permits a one-to-one dialogue with each and every
 E-Commerce Shaping Business 7

individual customer. The internet is also a perfect direct marketing tool, making it all the

more valuable to marketers.

Some important aspects of the internet and the development of the e-commerce platform are

as follows:

1. In 1999, the share of advertising on the internet was a mere 3% but this figure is expected

to reach 14% within a very less span of time.

2. Companies are more data-driven now and are investing heavily in building impressive

knowledge bases. They apply technology to their extensive customer databases to harness

the advantages of a strong database. The internet serves as a major source of information on

customers.

3. The internet can make direct marketing all the more effective and can help eliminate some

of the limitations of advertising. It can help marketers by precisely targeting the interested

audience so as to have maximum Return on Investment.

4. Currently, long-term advertising on the internet has the highest CPM, approximately $4,

because of its efficiency in targeting; so even though the CPM is high, it represents the best

value for marketers.

5. The internet is poised to become one of the most important advertising media. But it will

not remain an advertising medium alone; it will also serve as a means to decide on the best

pricing, positioning, and message strategy for other media as well. This will happen because

the internet will bring the consumer into direct contact with the marketer and will help the

marketer gather authentic feedback about his customers.

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6. In internet advertising, it has been predicted that there will be an immense growth in the

use of multimedia, animations, etc., which will deliver more creative commercials. This will

lead to higher budget allocations for internet advertising.

With the advancement in information technology and the use of internet, today online

businesses have developed drastically. For anybody to survive in the online market and to

sustain the growth of the own online business, traffic generation is the key to success. For

doing this, you are required to market your website well. Due to the existence of millions

and millions of websites, the competition has also grown rapidly. In order to compete

yourself with the other businesses you need to get into rapid advertising of your website

failing which there is a strong chance of losing in your business.

As this is the festive season, most of the shopping for the season has already started

and consumers would like to order gifts online due to the ease of shopping and at the same

lack of time to go out and do shopping in the real world. In such a scenario, most of the

online shopping website owners would start dressing up their web pages in the most attractive

way to attract the maximum number of customers.

Internet marketing, if properly exploited can be an effective marketing tool.

Strategies which suit the e-business environment need to be framed and implemented. As

stated in the article, in order to increase web traffic online marketers need to change the

presentation of their website on par with other competitors. Instead of using the traditional

methods of designing the home page of the website, they need to innovative in their

approach. They also need to introduce special offers like free shipping, combo products, bog

off sales etc. Such attempts will definitely help increase we traffic.
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E-business can create value for organizations if they continuously use new technology

to improve their marketing system and if customer expectations are continuously met. The

Internet can be used to build long-term relationships with customers.

With the evolution of the Internet, the customer today has become more

knowledgeable. Companies must recognize the fact that most consumers can compare prices

of products from various companies within minutes on the Internet. Therefore, the companies

can either compete on price or convince the user of superior quality, but under all

circumstances, they must aim to deliver what they promise.

Search Engine Optimization (SEO) of the website is the first thing that is to be done

in order to get more traffic to the website. It is not a kind of rocket science to advance search

engine optimization. However, it is not something which can be achieved just by repeating

key words or key phrases constantly. An optimum balance is required in order to achieve the

optimization.

A major advantage of free or paid submission of websites to search engines is

available these days. Websites or blogs can be submitted to search engines. Marking the

presence into as many possible search engines is always better. This helps to get noticed by

the maximum number of visitors as possible in various search engines. The higher one gets

noticed, the higher is the scope of increased traffic.

Taking advantage of the social media websites is another method of attracting

customers which in turn may lead to increased sales. With the advent of Information

Technology over the recent past, the way online business is developing has drastically

changed. Currently, many internet marketers have started using social media as one of their

important marketing tools in order to promote their online businesses in competition with
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other players in the e-market. The efforts of online marketing not only influence the service

quality and the quality of the product but also the sales and volumes of business.

The increased competition of websites available today also demands increased

attention towards the measures of promotion that by online marketers in order to promote

their websites and online businesses. If proper care and due attention is not paid towards

promotion of the website, there is a possibility of not being to survive in the cut throat online

competition. A few examples of social media are blogs, forums, and pod casts etc. All of

these social media websites are good sources of attracting people towards websites and

generate huge traffic. Online marketers use these social media in different ways to suit

individual requirements.

A blog can be used as a B2B service. For example, there exists a blog on the website

of Mr. X. Mr. Y can use the same blog used by Mr. X to promote his own website. For

using so, Mr. X can charge a service charge. The other mediums also will be helpful and

generate higher income in the similar manner.

Next important aspect to be considered is the communication with the clients.

Website owners need to be in constant touch with all their customers however busy they

become depending on the sales season and other similar activities. It is a common mistake

that marketers do by ignoring sending mails to customers about various offers when they are

busy during the peak sales season.

Social Networking Community is something that helps you in list building. By

making use of these, it is possible for you to grow you list to a huge number of subscribers in

a very less time. After you grow your list to such a big number of subscribers, you can send

mails to those subscribers in order to train them step by step on what to do next. There are

many people now-a-days who are interested in business opportunities. Such people can be
 E-Commerce Shaping Business 11

found in different forums of websites. By getting into such forums and by listing posts there,

you attract not only the person who is actually looking for a business opportunity, but also

many other people who actually visit such forums.

Away from Mass Communication to Customization

Companies that use conventional marketing strategies target a broad segment of

customers, hoping to capture as many of them as possible. In contrast to this, the internet can

be used to reach out to each individual targeted customer. This is the uniqueness of this

medium. It helps to identify prospective consumers with remarkable accuracy and then

involves them in an interactive dialogue.

The internet can help a marketer trace a potential customer by the use of cookies,

click stream tracking by domain name recognition, by recognizing website pages that have

been bookmarked by a user, and other similar means. This information helps a company

build a database of potential consumers each of whom can then be individually reached by e-

mails.

Once a marketer knows his potential customers, he must:

1. Provide an incentive that will encourage a user to respond. Incentives could be in the form

of instant-win games, prizes drawing, points based rewards programs, quizzes, etc. But to

participate in these activities, a user must generally register on the website.

2. Build on a users responses to learn more about him. The next time the same user visits

the site, an additional incentive must be provided to gather more information about him his

interests, his purchase plans, etc. Each time a person interacts on the site, the communication

must be more personal and more insightful.

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3. Create individualized communication strategies to reach out to the user in a focused and

personal manner. Eventually, a customer will return to the site more frequently and a long

lasting loyal customer relationship can be built up with the customer. However, it has been

seen that most consumers are not loyal to more than 20 sites at a time; so a company must

aim to be among the top 20 favorite sites of a customer.

Internet as a creator of Loyalty

Customer Loyalty on the internet is a complex notion. This is because at the click of

a mouse, a consumer may find a more appealing site or a better bargain and may shift

loyalties to the new site. In fact, according to Fred Reichheld of Boston-based Bain & Co,

most internet users are like butterflies they keep flitting from site to site and offer to

offer. Such customers generally do not create much value for the company (Prewitt, 2002).

It is very important for any company engaged in online business to have loyal

supportive customers. Therefore, for a company to survive, customer loyalty is of paramount

importance. In order to keep people coming back to their site, companies must ensure that

they provide visitors with a good satisfying experience, coupled with adequate customer

support.

The Consumers Expectations in the Future

Sergio Zyman, CEO, Z Marketing, in his book, Building Brand width says, The e-

marketing dialogue is a rich selling environment: You sell, listen, adjust, sell better, listen,

adjust, sell more intuitively what the customers need, listen, adjust, sell better, and sell

more.

It is clear from this that the most important things that a marketer who wants to sell

better has to do are to listen and adjust. Consumers want to be heard and to be understood. A
 E-Commerce Shaping Business 13

consumer now is much more aware of the option the customer has got. The internet and e-

commerce have empowered him with knowledge. A customer is also willing to come into

direct contact with a company via the internet or on the phone, in order to be properly

understood. And he is willing to be loyal to those marketers who can understand the

customer and can deliver what the customer demands. Companies must attune themselves to

this fact and aim to deliver what the customer expects. The internets approach to selling is

similar to that of direct marketing. A direct marketer always focuses on the needs of a

customer and tries to guide him through the various stages of marketing without losing him

on the way. In the same way, a marketer on the internet must establish an interactive

communication with the customer, understand what he want and is looking for, and then

deliver the promised goods.

The Internet and New Intimacy

Companies use the internet to establish communication with their customers. Internet

communication occurs at a totally new level of intimacy. It is neither as formal as a company

brochure not as informal as an interaction with a family member. Yet, the company seeks to

establish intimate contact with user, in order to understand better.

For survival in the internet eta, it is vital for a company to pursue a dialogue with the

consumer. So, most companies now are training people in this aspect. It is important that

such a conversation is relevant as far as the content is concerned, so that the company

benefits by getting real information about the user. At the same time, it is also important that

the conversation is interesting enough to keep the consumer engaged. Apart from e-mails,

customized letters, and targeted information on product availability, companies also use

internet portals to include real-time events and discussion boards or chat rooms to engage the

consumer.
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New Obligations in Internet Era

The development of the internet is the most important revolution in the field of

marketing in recent times. No company can afford to ignore or be indifferent to the power of

e-commerce. Also, companies must realize that a website is not a mere advertisement any

more. In many cases, a website is as important as an expert salesman; it is after all meant to

serve as a connection between the seller and the buyer.

Another important aspect of the internet is that it can be harnessed to encourage a

customer to return to the website. In fact, if the website is good, informative, and

entertaining and offers a new experience every time a user logs on, then a repeat sale is

surprisingly easy. Therefore, companies must pay attention to frequently adding new features

to their websites. As customers become more and more net savvy, the frequency of their

online purchases is bound to increase. In fact, a recent analysis shows that while only 25% of

internet start5ers use the internet for making a purchase, 70% of internet experts are

comfortable purchasing over the internet.

But as purchasing through the internet increase, customers will also get more

demanding. Communication on the internet will have to be on the consumers terms at a

time that is convenient to him and in the form and manner that appeal to him. Most

importantly, companies will be obliged to communicate with the consumer in informal terms

that he or she will easily understand and appreciate. Also, consumers will expect prompt

replies to queries. Speed will be of critical importance in fact, the success of a website will

depend largely on the speed and efficiency with which it can deliver.

Brand Building on Internet

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We wake up in the morning and brush our teeth with Close-Up tooth paste, then take

a bath with Dove and Pantene shampoo. After all this, let us say we wear a Levis Jeans and

a Reebok tee shirt. Then comes the turn of the morning breakfast for which we have a

porridge made of Bagrrys White Oats and then say we have a cup of hot Nescafe caf.

These are the brands which have become part of our daily life. In fact it is difficult to

imagine our lives without them in todays world. But after going through this little

introduction, it is important to know what actually this BRAND means. A brand is a name,

term, sign, symbol or design, or a combination of all these elements that companies use to

convey the identity of its goods and services to customers and differentiate them from the

competitors goods and services (ICMR).

Consumers identify a brands distinctive capabilities based on their perceptions that have

themselves been created by the marketers over a period of time. A genuine brand is the

internalized sum of all the impressions received by the customers and consumers resulting in

a distinctive position in their minds eye based on perceived emotional and functional

benefits (Knapp).

A brand, in general, conveys certain aspects like attributes, benefits, values, culture,

personality and user. Whenever a brand is being described, it should be done as if it is a

person. To be specific, a best description of a brand would be by the use of human

adjectives. This way a brand can be given a personality and hence the brand would come

alive.

For decades, marketers have worked hard to build strong offline brands. Now, the

internet with its unique ability to reach out to millions of people individually and be

connected to them at all times has offered marketers a great opportunity to build big online
 E-Commerce Shaping Business 16

brands. In fact, the internet can help build power brands brands that are so strong that a

customer will not even consider using an alternative brand.

To build strong online brands, companies need to integrate their Brick and Mortar

stores, catalogues, websites, offline advertising, and other marketing strategies into a single

store strategy, so that all of them will uniformly reflect the brand. According to experts, even

though companies must integrate offline and online environments into a single seamless

shopping experience, online brands need to serve the customer in a much wider and a more

personalized manner. A customer expects much more than just the product from online

interaction with the company. The customer wants to feel that the company is taking special

care of his needs to make sure that the online web experience of a customer is rich. They

must manage the customers entire website experience right from the first interaction with the

brand, through delivery, and beyond. The company must also value the customers feedback

on his experience whether it is good, bad or indifferent because that will influence the

customers perception about the brand.

The Value of a Strong Brand to the Producer

For a company, a brand is an intangible asset that has to be nurtured and built up over

time. Many consumer purchase decisions cannot be rationalized and are based on consumer

instincts or are influenced by a brands perceived value. Consumers may buy a product

repeatedly because they form a certain emotional attachment to a brand. It is precisely this

attachment that companies want to strengthen with their brand names.

Building a strong brand name may be a time consuming process but it is of immense

value to the producer. A strong brand name commands more loyalty from consumers and so

provides a larger market share for the producer. Branding also allows marketers to sell their

other products better. For example, Bic, a French manufacturer of ball point pens, has a
 E-Commerce Shaping Business 17

strong brand name in the stationery market worldwide, and has been able to harness its highly

popular brand name to sell its latest product razors. Consumers who have used Bic ball

point pens associate Bics brand name with quality and extend the same quality perception to

the razors, though they are absolutely unrelated to Bics earlier products.

Global Brands and Global Medium

The internet is the first truly global media that the world has seen. Though its usage

and technology still remain more localized to the US and the developed world, it has

transcended all national and international borders. It has also evened out the discrepancy of

time around the world and is available to marketers and users twenty-four hours a day, seven

days a week, all the year through. Another advantage with the internet is that it is available in

the same format everywhere around the world and so due to its uniformity; it is easier to

convert an online brand into a global brand.

The development of such a global medium is helping to build the concept of global

brands as well. A global brand is one that is one that is viewed in the same manner all around

the world, with different users attaching the same value to it. According to David A. Aaker,

global brands are brands whose positioning, advertising strategy, personality, look and feel

are in most respects the same from one country to another.

Brand personality is of immense importance to a firm. This is evident from the fact that most

companies spend a lot of time, money and energy in brand building along with the brands

personality. It would be difficult for a company to imagine existence without the brand name

and brand personality. For example, if a customer is asked to select one of two chocolates

kept in front of him/her, one with the Cadburys brand name on it visible and the other, also a

Cadburys but with the brand name hidden, the customer, in all probability selects the one

with the Cadburys name visible on it. This shows the importance of the brand name.
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Companies have to understand that brands and their personality mean a lot and are at

the heart of any business activity. Hence, it is necessary that a firm has to exercise full

control over its brands. It is often felt that most of the companies have a constrained

perception about their brands. They tend to feel that a brand is just a log or symbol of an

organization. Companies need to have an all round perception of their brands and their

personalities and also need to understand that brands are much more than logos or symbols.

Brand and its personality is a combination of the companys marketing, promotional,

distribution and service efforts with a suitable differentiation of the brand from its

competitors.

Brand Personality can be defined as the immediate take-away or response that

people have to a brand (Larson). Also, the fact is that whenever a customer sees senses or

touches a product, the first involuntary thought that he gets about the product is nothing but

brand personality. Most of the advertising specialists and branding consultants advice that

all the activities of a company that are related to advertisements along with the tagline

company should ensure that the message they communicate to the customers by way of all

these activities should focus on their brand personality.

A first impression means a lot when a first-time customer walks into a place of

business (NFIB). The appearance and atmosphere of the store, the quality of the products that

are displayed at the store as well as the attitude of the service staff can all make that crucial

difference as to whether that customer will choose to do subsequent business at that particular

store. In order to make that first impression the best one, the essential element is the

personality of the store brand. Brand personality is an often overlooked, but crucially

important component to develop when creating brand image. When a customer is making a

purchase, they are not only looking for a solid product, but also a solid connection with that

product.
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Customer Perception of Brand Personality

Perceived quality can be defined as the customer's perception of the overall quality or

superiority of a product or service with respect to its intended purpose, relative to

alternatives. Perceived quality is, first, a perception by customers (Study Marketing). In the

same way as they perceive the quality of the product, customers also do perceive the

personality of the brand. Even this can be defined as the first impression that the customers

create in their minds about the personality of the brand. To be specific, the perception of the

customer about the personality can be defined as the chosen character that best communicates

the brand proposition. It is not the personality of the customers, it is the personality that is

most likely to draw their attention, interest them, and encourage them to take action and buy

the brand.

Value has been recognized as the fundamental basis for all marketing activity

(Halbrook). Value has also been stated as a cognitive-based construct which captures any

benefit-sacrifice discrepancy in much the same way disconfirmation does for variations

between expectations and perceived performance (Patterson, 1997). Therefore, it is the

outcome of a cognitive assessment procedure. Moreover, it is an affective evaluative reaction

(Oliver, 1996).

Customer perceived value in commerce marketplace was defined as the trade-off

between the multiple benefits and sacrifices of a suppliers offering, as perceived by key

decision-makers in the customers organization, and taking into consideration the available

alternative suppliers offerings in a specific use situation (Eggert, 2002). That is, there

existed three elements in this definition: (1) the multiple components of value, (2) the

subjectivity of value perceptions and (3) the importance of competition (Eggert, 2002).
 E-Commerce Shaping Business 20

More and more companies are trying to build strong global brands, but before doing

so, companies must study their products and the differences in the environments in which

they sell.

New forms of advertising

Advertising can be defined as a paid form of non-personal communication about an

organization or products transmitted to a target audience through a mass/broadcast medium.

Advertising offers unique benefits to the advertiser. There is flexibility that permits focus on

a small, clearly defined segment of the market. It is also cost-efficient. An organization can

communicate with a large number of prospective customers at a minimal cost per person.

Further, the receiver of the message gets an opportunity to compare various messages from

different players operating in the market. An advertiser, offering value for money and

communicating the offer, stands to benefit. Advertising has a lot of scope for expression and

dramatization is possible. There is the danger that some companies might misuse this

freedom and suffer as a consequence ((ICMR), 2004).

International advertising involves dissemination of commercial messages to varied

target audiences. In the world context, communication is often complex. The difficulty can

be ascribed to multiple contexts such as differences in language, differences in literacy levels

and differences in culture. Cultural barriers can hamper effective communication. For

example, when the American Dairy Association entered Mexico with its Get Milk?

campaign, The Spanish translation sounded like Are you lactating? It may sound

humorous, but it can be taken as offensive too!! Perhaps, using a visual symbol could have

made this campaign clearer.

This form of communication is ideal to generate quick sales and create a long-term

image for the product. There are some disadvantages as well. There is rarely any generation
 E-Commerce Shaping Business 21

of feedback. The communication is also less persuasive than personal selling. Though cost

per potential customer is low, the absolute outlay needed for advertising is high.

The first principle is - knowing about the target market. Both the international

advertising executive situated at company headquarters and the local advertising executive

should have good market knowledge. They should collect market data continuously on their

products or the competitors, with regards to performance in international markets.

Information like customer demographics like age, sex, income level and occupation etc,

shopping behaviors and product usage have to be on hand (Blois, 2000). Comparative

analysis of this data, collected from different markets, highlights the difference between

them. Such analysis can help decide whether to choose a standardized campaign or a

differentiated one.

The next important step would be to gain knowledge about the foreign executives. It

is important that MNC managers get to know the executives in their foreign affiliates,

operating division and independent distributorships. Getting cooperation is easier when

managers know the strengths, weaknesses, competencies and biases of their counterparts in

other countries. This is equally true when they are working with executives from other

companies.

Advertising on the internet is also developing by leaps and bounds. In the initial days

of internet advertising, banner ads were considered the best possible advertising media. But

gradually, the click thorough rate of banner ads dropped to less than 2% and very soon, users

began ignoring them. Then came the age of bright, animated advertisements coupled with

sound effects. However, pop-ups too are losing their attention grabbing ability. Over the

years, most users have made themselves immune to online advertisements. They simply
 E-Commerce Shaping Business 22

ignore the advertisement and go on with their work. But internet technology developers are

also continuously innovating to find new ways of attracting users.

An advertising campaign involves developing a series of advertisements and targeting them

at the potential customers through different media like the print and broadcast media. Steps

involved in an advertisement program can be broadly classified into

Identifying the target audience,

Specifying advertising objective,

Setting the advertising budget,

Developing the advertising message,

Selecting the right media

Spending a lot on advertising does not automatically guarantee success. Research

suggests that the clarity of an advertising message is more important than the amount spent

on it. Factors that affect the advertising message can be product related and customer related.

Product related factors are its features, usage and benefits. Characteristics of the target

customers such as age, gender, their likes and dislikes, their habits, education, income and

occupation also affect the content and form of advertisements. Other factors that can affect

the message of an advertisement are its objective and platform. For instance, if a firm want

sot create a brand image, its advertising message must focus on its logo and it should be

repeatedly aired through appropriate media. And finally the advertising message must be

carefully drafted and targeted to create the right impact on the target audience.

A successful advertising message should have the following characteristics:

 E-Commerce Shaping Business 23

Meaningful Target customers should find the message of an advertisement relevant and

meaningful. Marketers must pay due attention to the message delivered to make it more

meaningful.

Distinctive An advertisement message needs to be unique so that it captures the customers

attention. For example, the Liril toilet soap advertisement combined a visual a girl in the

waterfall with a unique sound track. The soap could create distinct brand image and

maintained a leadership position in premium toilet soap category (Share, 1977).

Believable the message should convince the customers about the features of the product.

The structure, also known as the body of an advertisement, plays a vital role in

promoting a brand. Advertisements help customers form their opinions of a product or a

company. Messages can be one-sided, i.e. the marketers telling their part of the story, or two-

sided, i.e. comparing their product with competing brands. Conclusions drawing messages

raise issues or questions and then attempt to answer them.

Advertisers primarily evaluate the effectiveness of an advertisement because firms

spend huge amounts of money on advertising. And no marketer would like to spend such

amounts without having any clue about the resultant effects of such expenditure. However,

one might raise a question about the necessity of advertising itself. Although a marketer can

perform his business activities without advertising, he will definitely lose the opportunity of

increasing his sales (Thill, 1992).

Guerilla marketing is another technique that can be used for e-commerce. It is a kind

of promotional strategy which is unconventional in nature. In this method, the customers are

targeted with promotional offer which they would not have expected. It refers to

unconventional and creative attention grabbing direct advertising techniques. Offline

 E-Commerce Shaping Business 24

Guerilla Marketing has become highly popular with advertisers trying new and often

shocking methods to grab the viewers attention. Many online advertisers use guerilla tactics

to generate traffic on their websites or to make their brand names popular. Such tactics are

especially useful when a product is being launched because they bring immediate

recognition.

Internet is just not a source of information but also it is a source of income to many

people today. There are a number of ways through which you can earn a decent income. Let

see what they are.

Online Selling: It is possible to sell product online and earn money. It is an easy way to

make money. There are a number of websites like Amazon.com, EBay etc for this purpose.

Affiliate Marketing: Affiliate marketing is another method of earning money online. The

rule of Affiliate Marketing is very clear and straight forward. This technique requires to

market different products of an affiliate company. The company in turn will pay the person

a commission for each sale made. The payment options may vary according to the chosen

affiliate marketing program.

Direct e-marketing is similar to the direct mail form of advertising except that instead

of a letter, a user will receive an e-mail; e-marketing is a highly popular form of advertising.

A user can register himself for newsletters or services that he wants to use and can get

regular, updated information via e-mail. This system has become popular because it is very

cost effective. It is much cheaper and faster for a marketer to send thousands of e-mails

rather than an equal number of letters. This method is also highly targeted; only those users

who have expressed their interest in a particular product or service receive information about

it and so, a user who receives such information is also more likely to read and act on it.
 E-Commerce Shaping Business 25

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