Principles of Internet Marketing Chapter 1 An Overview of the Web.

Principles of Internet Marketing

Chapter 1An Overview of the Web

Objectives

In this chapter you will learn about:

•The rise of the Web from obscurity to commercial revolution

•The evolution of the Web after the Web bubble burst

•Social networking on the Web and its effect on social relationships and marketing

Principles of Internet Marketing: New Tools and Methods for Web Developers 2

Objectives (continued)

• Important trends and demographic differences in Internet usage

• Predictions for the future of the Web and how these developments might further impact society



A Brief History of the Web Through 2001

• Commercialization of the Web (1990’s) – Commercialization began when Tim Berners-Lee’s

introduced the ability for links to be made between various pieces of information

– Continued in 1993 with release of HTML– Early browser wars between Netscape and Internet

Explorer put IE in dominant position

Principles of Internet Marketing 5

A Brief History of the Web Through 2001 (continued)

• Commercialization of the Web (1990’s) (continued)– Web growth propelled by increase in computer

ownership, falling tech prices and low interest rates– Only 19,000 sites in mid-1990’s, compared to 176M

in 2008

5Principles of Internet Marketing: New Tools and Methods for Web Developers



• Importance of venture capitalists – Invested over $10 billion in 1996, mostly to tech

companies

• Massive economic growth – Web investments fueled the stock market to new

peaks in 2000– Tech-related growth helped drive unemployment rate

to 40 year low of 3.8%

• Massive Web growth of the 1990’s known as the “Web bubble”



Figure 1-1: Graph of NASDAQ exchange between 1994 - 2003




• The bursting of the bubble – Around 2000, investors became anxious for profits

from Web companies– High profile bankruptcies of eToys and Webvan

caused investors to sell, causing stock market to plummet ending many Web companies

– Other key failures included:• Pets.com

• Kozmo.com (order absolutely anything for free delivery)

• Flooz.com (new, online currency)



• Key points in Web history, between 1991 - 2001:– 1993: CERN decides to make Web technology and

codes free for all to use– 1995: Amazon.com is launched– 1995: Internet Explorer introduced– 1998: Google launched– 2000: Dow Jones and NASDAQ markets reach their

peak




• Key points in Web history, between 1991 - 2001 (continued):– 2001: Wikipedia is launched– 2001: eToys and Webvan bankruptcies spark the

end of the Web bubble


A Brief History of the Web From 2002 Forward

• Changes in technology helped usher in next generation sites– Faster connection speeds– More powerful computers– Broader color range for monitors

• Better understanding of Web and better communication between designers and programmers led to improved site designs that were more attractive and easier to use


A Brief History of the Web From 2002 Forward (continued)

Figure 1-3: McDonald’s Web site, before 2002 and after




Figure 1-5: NBC’s Web site, before 2002 and after




Figure 1-7: New York Post’s Web site, before 2002 and after




Figure 1-9: Brookstone’s Web site, before 2002 and after




• Web growth despite bubble bursting– Market crashed did not diminish Web’s importance; it

simply weeded out bad ideas– E-commerce grew from $27M in 2000 to $139M in

2008




Figure 1-10: E-commerce retail sales growth 2000-2008




• Web transformed into social platform and entertainment outlet (as well as commercial outlet)– YouTube viewership rose while network TV

viewership declined

• Key points in Web history, from 2002 forward:– 2002: Release of Flash Player 6 (the first version to

support video files, setting the stage for the later explosion of online video)

– 2003: Launch of MySpace social network



• Key points in Web history, from 2002 forward (continued):– 2004: Amazon.com proves Web-based companies

can generate positive income with first annual profit– 2004: Launch of Facebook social network– 2005: Launch of YouTube video sharing site– 2005: More new users (17M) go online in 2005 than

in all of the 1990’s



Social Networking on the Web: Its Impact on Relationships and

Marketing• Social networks aren’t exclusive to Web

– Social networks exist in physical world– Defined as a structure of nodes (people and /or

organizations) tied together by one or more specific types of interdependency such as values, friends, ideas, etc.

– Social networks operate among nations, families, friends, and play a role in problem solving and achieving goals


Social Networking on the Web: Its Impact on Relationships and

Marketing (continued)

Figure 1-12: Graphical representation of a social network



Trends and Demographic Breakdowns

• Understanding trends and demographics help marketers reach their target audiences

• Overall Internet usage ballooned from 14% of population in 1995 to 70% in 2007



Trends and Demographic Breakdowns (continued)

Figure 1-13: Growth rates of Internet usage 1995 - 2007




• Various demographic breakdowns use Web differently:– Men log on more often than women and spend more

time online– Younger users more likely to create blogs, watch

videos




• Marketers have significantly increased their use of the Web to reach audiences– Over 71% of companies planning new Web sites– 50% planning to take advantage of online consumer

feedback– 25% plan to create their own marketing-related blog



Figure 1-14: How marketers are adopting various Web tools26Principles of Internet Marketing: New Tools and Methods for Web Developers


Where Do We Go From Here?

• Many experts see increased global use of Web helping turn English into a global language

• Web users may increasingly fragment their personalities, creating separate but equal online personas due to ability to remain anonymous.

• Entertainment will continue to shift from off-line outlets to online outlets


Where Do We Go From Here? (continued)

• Increased standardization of online advertising will improve Web landscape for marketers – Banner ad size– Video length – File size – Cost calculations



Summary

• Since 1991 introduction of links, Web growth has been on a fast track

• 1990’s saw the introduction of Web commercialization, fueled by cheaper tech prices, low interest rates, and increased computer purchases

• Potential profits attracted venture capitalists, who poured money into new Web companies, driving up the stock market, which later burst after key Web failures


Summary (continued)

• After Web bubble burst, Web evolved into a more serious marketing tool, thanks to smarter investments, better design, and improved technology

• More people logged on as the Web further became a place for entertainment and socializing

• Marketers increasingly looked to the Web for opportunities to reach their audiences


Summary (continued)

• Various demographic groups use the Web differently, which helps marketers more easily find the people they want to reach

• In the future, many experts believe that the global use of the Web will effect language, and that the anonymity afforded social networking could effect offline relationships– Online advertising will become standardized,

improving the Web for marketers

Principles of Internet Marketing Chapter 1 An Overview of the Web.

Documents

web history

new tools

massive web growth

internet explorer

new peaks

internet usage predictions

brief history

s continuedweb growth