Marketing Chapter 4 Homework Low income Consumers Provide Significant Market Opportunity For

Chapter 4:

Global E-Markets 3.0

Learning Objectives

Overview of Global E-Marketing Issues

Global e-marketers must understand that a country’s e-readiness profile

significantly influences marketing strategy and tactics. E-marketing strategies

and Internet usage in industrialized nations are generally similar to those in the

U.S., while those in emerging markets are not.

Global Markets

Globalization has changed the way marketers conduct business. Market

places that have been difficult to access because of their physical distance

from company headquarters or because of a consumer buying profile that

did not match the firm’s core customer are increasingly being targeted.

Emerging Economies

Country and Market Opportunity Analysis

Market similarity is very powerful, and the savvy e-marketer will understand

and use it to her or his advantage. According to this concept, marketers often

choose foreign markets that have characteristics similar to their home market for

initial market entry.

Market Similarity

Marketers often choose foreign markets that have characteristics similar to

their home market for initial market entry.

Consider the ‘CAGE’ Acronym:

C: Culture

A: Administration

G: Geography

E: Economic

Diaspora Communities

Technological Tipping Points

Equally important for global e-marketers is the need to understand the seismic

changes occurring in how consumers access online content. A tipping point

occurs when an emerging trend or phenomenon becomes so big that it becomes

irreversible.

Legacy Technologies: Computers and Telephones

Connection to the Internet in industrialized countries has historically been

handled by desktop computers and an ISP (Internet Service Provider). In

emerging economies, computer access is still an issue. Landline-

connected telephones are entering the decline stage of their product life

cycle as wireless technology grows.

Wireless Internet Access: Mobile Phones

The Digital Divide

The division between those who have access to information and those who don’t

is termed the digital divide. It raises challenging questions for global policy

makers, international businesses, and local entrepreneurs.

Building Inclusive E-Markets

It is said that business consists of two activities: marketing and innovation. The

Social Networking

Chapter Summary

Within a worldwide B2C market of 1.2 billion consumers, some countries

have higher penetration of Internet access, usage, and shopping. Among the

many factors affecting Internet penetration are income, infrastructure, computer

ownership, telecommunication availability and pricing, social and cultural

traditions, business attitudes, and wireless Web access. E-marketers must

carefully research each country’s current market conditions and environmental

factors before selecting specific targets for entry.

Internet usage is growing so rapidly outside the United States that users

Chapter Outline

Opening Vignette: Idol Goes Global

Have the class read the opening vignette on the Idol. Discuss how the Internet

and other communication technologies have aided Idol in gaining such a large

market in a relatively short time. At what point will this franchise reach a

saturation point? When, or will, the decline begin?

I. Overview of Global E-Marketing Issues

Users from other countries speaking languages other than English will

increasingly dominate the Internet. The Web’s content and language will become

more diverse. A country’s e-readiness profile influences marketing strategy and

tactics. E-marketers must differentiate between industrialized nations and

emerging economies.

A. Global Markets

2. Africa saw Internet use grow nearly 170% in four years

4. North America has the highest Internet penetration rate at more

than 78%

B. Emerging Economies

1. Bhutan represents ideal emerging economy

2. High levels of economic development (developed)

a. United States

b. Canada

3. Emerging economies

a. Mexico

b. Bhutan

1. In economic development

a. Information technology opens up new, exciting,

2. Unique challenges

a. Slow connection speeds

b. High costs of domestic phone calls

c. ISP costs

d. Privacy concerns

e. Censorship

II. Country and Market Opportunity Analysis

An e-marketing plan guides the marketer through the process of identifying and

analyzing potential markets. Market differences and market similarities must be

measured and compared to determine strengths and weaknesses. Marketers often

first choose foreign markets that have similar characteristics.

A. Diaspora Communities

1. A large number of people living together in a common

neighborhood or city abroad

2. E-businesses in countries with emerging markets use market

B. E-Commerce Payment and Trust Issues

C. Infrastructure Considerations

1. A country’s physical infrastructure also influences online

marketing strategy

III. Technological Tipping Points

A tipping point occurs when an emerging trend or phenomenon becomes so big

that it becomes irreversible. Computer and mobile phone technology, along with

the rapid development of broadband, are changing the way markets access and

understand information, products, and services.

A. Legacy Technologies: Computers and Telephones

1. Computers

a. Historically, Internet connection is with a desktop PC

2. Telephone

a. Telephone land lines are entering the decline stage of

their product life cycle

IV. Wireless Internet Access: Mobile Phones

A. Most significant tipping point in computer information technology

B. Mobile phone users predicted to exceed PC-based internet users by 2016

C. Cell phones do not eliminate challenges:

1. Modifying existing Web site content for smaller screens

3. Developing new content that consumers will want

5. Developing easy, secure payment methods

D. Smartphones

2. Adoption rates are the fastest ever of any technology

innovation

3. Marketers must understand how smartphones influence

E. Broadband

1. Broadband illustrates another significant tipping point

2. Global prices are declining as more individuals and firms

V. The Digital Divide

In addition to the technical challenges they must overcome, e-marketers must

consider the social environment in which their e-business operates.

A. The division between those with access to information and those without

B. Gender creates a digital divide relative to cell phone ownership

C. The digital divide raises challenging questions for:

1. Global policy makers

VI. Building Inclusive E-Markets

2. Microfinance

B. Technological assistance

1. Mobile phones

C. Banking assistance

1. Solve the rural and slum related problem

3. Mobile phones can be used for banking

VII. Social Networking

A. As of late 2011, 82% of the world’s 1.2 billion online consumers

reported using at least one social networking site when online