MKT 327 Introduction to Marketing 1st Edition Lecture 22 Virtual Marketplace Outline of Last Lecture A. Channel intensityI. Distribution intensity/ coverage guidelinesII. Distribution III. Channel member selectionIV. WholesalingV. Channel member selection decision frameworkVI. WholesalersVII. Brokers agentsVIII. RetailersIX. Channel member selection decision framework continuedX. Channel management issuesOutline of Current Lecture B. Essence of marketingXI. E-CommerceXII. E-Commerce value creationXIII. Website designXIV. Unique capabilities of internet activity Current LecturePURPOSE>>IMPACT ON VALUE CREATION>>BASIC DECISIONS:1) Essence of Marketinga) To form connections and relationships that can serve as a platform to create, deliver, andcapture value. b) Distinction between communication (the exchange of meanings) and promotion (informing, persuading, differentiating, and reminding specifically to execute an exchange). c) A similar distinction can be made between social media and e-commerce. d) The book gives the technical definition for social media (online media where users submit comments, photos, etcetera). These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.i) Its sole purpose from a marketing perspective though is to facilitate communication to form communities and forge relationships. E-commerce, like promotion, focuses on creating and facilitating exchange.2. E-commerce a. On the other had is clearly about generating sales. b. Marketers now have the option of operating in one of two environments or both.i. First the physical world of the actual marketplace (often referred to as ‘bricks’)ii. Then there is the virtual world created by the Internet called the marketspace (also referred to as ‘clicks’). 1. The market space is one of the fastest growing environments for retail activity. According to research firm Forrester, ecommerce generated 8% of total retail sales in 2012, and this is expected to grow to 10% by 2017. One of the reasons for its rapid growth is the value it creates for both consumers and marketers. 3. E-commerce value creationa. Creates value across the board (time, place, possession, form, and experiential and symbolic). b. It provides the ultimate time and place utility providing making products and information accessible anytime and anywhere. c. Its ability to provide customization enables it to create form, experiential, or symbolic utility; and simplification of the buying process contributes to possession utility. d. In summary, the Internet gives buyers: better information, greater convenience, wider selection, customization, and often better prices. e. It gives marketers: Access to Customers, Reduced Supply Chain Costs, Personalization, and Efficient Two-way Communication.4. Website design a. There are seven website design elements that contribute to the site’s ability to create exchange:- Context- Content- Customization- Connections- Communication - Community and- Commerce5. Unique capabilities of internet activity a. Interactivityb. Individualityc. Choice boardi. An interactive, internet-enables system that allows individual customers to design their own products and servicesd. Interactive marketingi. Two-way buyer-seller electronic communication in a computer-mediated environment in which the buyer controls the kind and amount of information received from the seller e. Collaborative filtering i. A process that automatically groups people with similar buying intentions,preferences, and behaviors and predicts future purchases f. Dynamic pricingi. The practice of changing prices for products and services in real time in response to supply and demand conditionsg. Cross-channel shopperi. An online consumer who researches products online and then purchases them at a retail storeh. Permission marketingi. Asking for a consumer’s consent (called opt-in) to receive e-mail and advertising based on personal data supplied by the consumeri. Viral marketingi. An internet-enabled promotional strategy that encourages users to forward marketer-initiated messages to others via e-mailj. Web communitiesi. Websites that allow people to meet online and exchange views on topics of common interest k. Personalizationi. The consumer-initiated practice of generating content on a marketer’s website that individual’s specific needs and preferences l. Behavioral targeting i. Users information provided by cookies for directing online advertising from marketers to those online shoppers whose behavioral profiles suggest they would be interest in such