©2006 Prentice Hall MRKG 2312 E-Commerce. ©2006 Prentice Hall4-1 E-Marketing 4/E Judy Strauss, Adel I. El-Ansary, and Raymond Frost Chapter 4: Global.

©2006 Prentice Hall

MRKG 2312 E-Commerce

©2006 Prentice Hall 4-1

E-Marketing 4/EJudy Strauss, Adel I. El-Ansary, and Raymond Frost

Chapter 4: Global Markets

©2006 Prentice Hall 4-2

Chapter 4 Objectives

• After reading Chapter 4 you will be able to:• Discuss overall trends in in Internet access, usage,

and purchasing around the world. • Define emerging economies and explain the vital

role of information technology in economic development.

• Outline how e-marketers apply market similarity and analyze online purchase and payment behaviors in planning market entry opportunities.

©2006 Prentice Hall 4-3

Chapter 4 Objectives, cont.

• Describe how e-marketing strategy is influenced by computer and telephone access, credit card availability, attitudes toward Internet use, slow connection speeds, Web site design, and electricity problems.• Review the special challenges of e-marketing on

the wireless Internet in the context of emerging economies.• Discuss the controversy related to the Digital

Divide.

©2006 Prentice Hall 4-4

The FIFA Story• Federation Intérnationalé de Football

Association (FIFA) partnered with Yahoo to create the most popular sports site in history.• http://fifaworldcup.yahoo.com/ was seen by 3.7

million people from 17 countries May 1-June 23, 2002.

• Site offered continual updates of information, photos and video highlights.

• Do you think FIFA’s subscription model ($4.95-$19.95) for video access would work for U.S. sports events? Which ones?

World Internet Users

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Worldwide Internet Usage

• All statistics in the book are out of date!

• http://www.internetworldstats.com/stats.htm

• http://www.isoc.org/internet/stats/

• http://www.clickz.com

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Internet Use Varies by Country

• What countries are top 5 countries with the highest number of Internet users? Where does Viet Nam rank?

• What percentage of users do the top 10 countries account for?

• What are Asia top 10 Internet countries?

• What is the percentage of internet user penetration in Viet Nam?

©2006 Prentice Hall 4-8

Developed Economies

• Developed countries are highly industrialized, use technology to increase efficiency, and have a high GDP per capita.• Western European countries• North American countries• Japan• Australia & New Zealand

• Developed countries are ideal for the e-marketing activities discussed in the text.

©2006 Prentice Hall 4-9

Emerging Economies

• Have low levels of GDP per capita and are experiencing rapid economic growth.

• Emerging economies can be found on every continent.• China• Central & Southeast Asian countries• Mexico, Central & South America• Baltic States & Eastern Europe • African countries

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Technology plays an important role.

• The Internet accelerates the process of economic growth through diffusion of new technologies.• Bangalore, India is the center of India’s explosive growth in

software and IT.• 330-acre Electronic City(http://www.bangaloreit.com/html/itscbng/ecitycomp.html)

• Greatest technological obstacles to e-commerce in emerging economies include:• Slow connection speeds• Costs of domestic phone calls (per min) • ISP costs• Lack of local content and content in one’s own language

Country and Market Opportunity Analysis

• Marketers often choose foreign markets that have characteristics similar to their home market for initial market entry.

• E-business in countries with emerging markets make parallel target market decisions.

• One of the biggest differences between developed countries and countries with emerging economies is the limited use and acceptance of credit cards in underdeveloped countries.

©2006 Prentice Hall

©2006 Prentice Hall 4-11

Credit Cards & E-Commerce Payments• Convenience and ease of transactions are two

of the Internet’s greatest benefits.

• Credit cards and secure online payment systems are the basis for Web-based transactions in developed countries.

• Marketers must analyze relevant buyer behaviors within a market.• Number of credit cards in circulation.• Consumer attitudes toward credit.

©2006 Prentice Hall 4-12

Technological Readiness Influences Marketing

• Limited access to and use of computers and telephones.

• High Internet connection costs• per minute charges

• Slow Internet connections speeds.

• Unpredictable power supplies.

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Computers & Telephones

• Computer access is unevenly distributed throughout the world.

• Exhibit 4.8 (page 82) shows computer ownership data for selected countries.

• Many consumers in countries with emerging economies access the Internet from free-standing shops, rather than homes.

• Telephones (and connectivity) can be scarce and expensive.

©2006 Prentice Hall 4-14

Internet Connection Costs

• Dial-up is still the most common way to connect to the Internet worldwide.

• Broadband and mobile phone connections are developing quickly.• Sometimes faster than land-lines• Cambodia

• Dial-up connection charges vary considerably in emerging economies.

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Connection Speed & Web Design

• Most Internet connections in the developing world are still dial-up.

• Connection speed has significant implications for Web site design.

•Graphics usage

• Sound

• Google’s simple, text-only format supports rapid downloads worldwide.

• High speed access is gaining momentum worldwide.

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Broadband Penetration for Selected Countries

Country Broadband Subscribers as a percentage of total population

Italy 0.77

Hungary 0.31

China 0.21

Brazil 0.19

Bulgaria 0.12

Colombia 0.05

Turkey 0.03

Russia 0.02

Nigeria 0.01

©2006 Prentice Hall 4-18

Other Issues

• Electrical problems can pose another challenge for e-marketers.

• Lack of electricity can force an e-business offline.

• Explosive diffusion of cellular telephones is changing e-marketing dramatically.

• Countries with emerging economies can leapfrog industrial countries in terms of usage.• Short messaging service (SMS) is very popular

worldwide.

©2006 Prentice Hall 4-19

The Digital Divide

• E-marketers must consider the social environment in which e-business operates.

• Disparities with regard to technology access can create a digital divide between countries or populations.

• The digital divide raises challenging questions for global policy, international business and entrepreneurship.

• http://www.digitaldivide.net/

• http://laptop.org/