Chapter 2:
Strategic E-Marketing and Performance Metrics
Review Questions
1. What is strategic planning and why do companies prepare a SWOT analysis
during the strategic planning process?
Strategic planning is the “managerial process of developing and maintaining a viable
fit between the organization’s objectives, skills, and resources and its changing
2. How does e-business strategy relate to strategy on the corporate level?
3. Define e-marketing strategy and explain how it is used.
Strategic e-marketing is the design of marketing strategy that capitalizes on the
organization’s electronic or information technology capabilities to reach specified
objectives. In a parallel fashion, marketing strategy becomes e-marketing strategy
when marketers use digital technology to implement their strategy.
Technology and its unique properties have given some new life to traditional
enterprise and marketing strategies. Some uses of e-marketing from exhibit 2-3:
1. E-Marketing Increases Benefits — Online mass customization (different products
2. E-Marketing Decreases Costs — Low cost distribution of communication
messages (e.g., e-mail), Low cost distribution channel for digital products,
3. E-Marketing Increases Revenues — Online transaction revenues such as product,
information, advertising, and subscriptions sales; or commission/fee on a
4. Give examples of e-business models.
An e-business model is a method by which the organization sustains itself in
5. What is the formula for determining value?
6. What are the four levels of commitment to e-business? Give some examples of
each.
See Exhibit 2.3.
Activity Level E-Business Models — Online purchasing, Order processing, E-mail,
Content publisher, Business intelligence (BI), Online advertising, Online sales
promotions, and Pricing strategies. One example is Amazon e-mail to customers that
recommends a new book.
Business Process Level E-Business Models — Customer relationship management,
Knowledge management, Supply chain management, community building, Database
7. What is customer relationship management (CRM) and why do companies
create strategies in this area?
Customer relationship management (CRM) involves retaining and growing business
8. How is e-commerce defined?
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9. What is an Internet pure play, and what are some examples?
10. What are three ways of collecting Web analytics?
Web analytics can be collected using the following methods:
1. Server logs record the user’s IP (Internet Protocol) address, the browser being
3. Page tags can be inserted into a user’s computer to determine when items are
4. Geolocation uses many different technologies to locate an internet-enabled
11. What is the Balanced Scorecard and how do companies use it in e-business?
The Balanced Scorecard is a system that measures many aspects of a firm’s
12. List six important social media awareness/exposure metrics.
1. Unique visitors
2. Page views
4. Number of searches
6. Number of followers, registrations, or subscribers
13. List three important social media brand health metrics.
1. Share of voice
3. Brand influence
14. List four important social media engagement metrics.
1. Content viewership
3. Membership/follower
15. List four important social media action metrics.
1. Click-through
2. Contact form completion or registration
4. Purchase
16. List two important social media innovation metrics.
Discussion Questions
17. Amazon story. Identify the business models Amazon used and at which level of
e-business commitment each falls (Exhibit 2.3).
18. Amazon story. What performance metrics might Amazon use to measure
progress toward its growth and customer service objectives?
To measure progress toward its growth objectives, Amazon might look at the number
of new service products to market in a year, the number of new service features not
check on customer retention percentages.
19. Why is it important for an e-business model to create value in a way that is
differentiated from the way competitors’ models create value?
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20. Based on the opening vignette and your examination of the Amazon.com site (or
your experience as a customer), what strategic objectives do you think are
appropriate for this e-business? What performance metrics would you use to
measure progress toward achieving these objectives—and why?
21. The Balanced Scorecard helps e-business examine results from four
perspectives. Would you recommend that e-businesses also look at results form
a societal perspective? Explain your response.
22. Should e-businesses strive to build community with noncustomers as well as
customers? Why or why not?
23. Do you agree or disagree that the page view metric is nearly useless in the Web
2.0 environment?
24. If you were to write a blog about your experiences at the university you attend
to help high school students understand what college was like, which metrics
would you use to measure the blog’s success, and why?
To determine awareness/exposure of high school students, I would check the number
of unique visitors, page views, impressions, number of searches, search engine
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