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TRANSCRIPT
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Chapter SevenChapter Seven
Electronic Electronic CommerceCommerce
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Functions of the NetFunctions of the Net
CommunicationCommunication- E-mailE-mail- Instant messagingInstant messaging
E-commerceE-commerce- 40% of b2c sites now profitable40% of b2c sites now profitable- B2b transactions lead the wayB2b transactions lead the way
InformationInformationEntertainmentEntertainment
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Web StatisticsWeb Statistics� Average number of hours web Average number of hours web
users spend online in week users spend online in week = = 4-54-5n Percentage using e-mail frequently =Percentage using e-mail frequently = 6363%% Percentage using the Web primarily for Percentage using the Web primarily for
researchresearch == 39%39%� Percent shopping online =Percent shopping online = 31%31% All-time Net searches as of 8-03All-time Net searches as of 8-03
r After 9/11, the Iraq war, Election 2000, Kobe After 9/11, the Iraq war, Election 2000, Kobe BryantBryant
Source: Source: CIO Web Business
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B2C Online Purchases B2C Online Purchases 20042004
Security issues Security issues 3% of retail sales3% of retail sales#1: books,music,videos, #2 apparel, #3 #1: books,music,videos, #2 apparel, #3
traveltravel$63B loss in aborted online purchases$63B loss in aborted online purchases
- 52% of shopping carts are abandoned52% of shopping carts are abandoned- Additional costs like shipping & long delivery Additional costs like shipping & long delivery
timestimes- Sites asking for too much info.Sites asking for too much info.- Lack of product info.Lack of product info.
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ChickClicksChickClicks Females – 51% on online users (2003)Females – 51% on online users (2003) Like AOL, MSN, Yahoo, iVillage, women.com On Like AOL, MSN, Yahoo, iVillage, women.com On
Health, Oxygen MediaHealth, Oxygen Media Seek ease of use & help making lives more Seek ease of use & help making lives more
efficient & productiveefficient & productive- Men spend more time to download software and to Men spend more time to download software and to
make upgradesmake upgrades Female-oriented sitesFemale-oriented sites
- Smart, sassy, progressiveSmart, sassy, progressive- More than just a pink bannerMore than just a pink banner- Spend 2 hrs. less than men onlineSpend 2 hrs. less than men online- Contests, promos & giveawaysContests, promos & giveaways- Multiple channels of typical women’s topics Multiple channels of typical women’s topics
plus more serious topicsplus more serious topics
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Measuring EffectivenessMeasuring Effectiveness
Only 15% of large companies use web Only 15% of large companies use web to generate revenueto generate revenue
Conversion rateConversion rate- Percent of site visitors who make a Percent of site visitors who make a
purchase.purchase.- 3-5% is average3-5% is average
Click-through ratesClick-through rates- Percent of people presented with Web Percent of people presented with Web
banner ad who click itbanner ad who click it- Half of 1 percent (1-2% for direct mail)Half of 1 percent (1-2% for direct mail)
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Web Shopping GuidelinesWeb Shopping Guidelineswww.ftc.govwww.ftc.gov
- 1-877-FTC-HELP (1-877-382-4357)1-877-FTC-HELP (1-877-382-4357)
The FTC enters Internet, telemarketing, identity theft and other The FTC enters Internet, telemarketing, identity theft and other fraud-related complaints into fraud-related complaints into Consumer SentinelConsumer Sentinel, a secure, online , a secure, online database available to hundreds of civil and criminal law database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.enforcement agencies in the U.S. and abroad.
www.shopthenet.orgwww.shopthenet.org- The DMA ConsumerLineThe DMA ConsumerLine
Direct Marketing AssociationDirect Marketing Association1111 19th Street, NW, Suite 11001111 19th Street, NW, Suite 1100Washington, DC 20036-3603Washington, DC [email protected]@the-dma.org
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FTC TipsFTC Tips Be wary of extravagant claims about performance or Be wary of extravagant claims about performance or
earnings potential. Get all promises in writing and earnings potential. Get all promises in writing and review them carefully before making a payment or review them carefully before making a payment or signing a contract. signing a contract.
Read the fine print and all relevant links. Fraudulent Read the fine print and all relevant links. Fraudulent promoters sometimes bury the disclosures they're not promoters sometimes bury the disclosures they're not anxious to share by putting them in teeny-tiny type or in anxious to share by putting them in teeny-tiny type or in a place where you're unlikely see them. a place where you're unlikely see them.
Look for a privacy policy. If you don't see one - or if you Look for a privacy policy. If you don't see one - or if you can't understand it - consider taking your business can't understand it - consider taking your business elsewhere. elsewhere.
Be skeptical of any company that doesn't clearly state its Be skeptical of any company that doesn't clearly state its name, street address and telephone number. Check it name, street address and telephone number. Check it out with the local Better Business Bureau, consumer out with the local Better Business Bureau, consumer protection office or state Attorney General. protection office or state Attorney General.
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Online RetailersOnline Retailers
Ebay-online auctionEbay-online auctionAmazonAmazonTravelocityTravelocityTOYSRUSTOYSRUSDellDellCDNowCDNow
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Most ImportantMost Important Web Site CharacteristicsWeb Site Characteristics Site is updated frequentlySite is updated frequently Links to other relevant Links to other relevant
sitessites Easy to find what you are Easy to find what you are
looking forlooking for Site responds quickly to Site responds quickly to
inquiriesinquiries Site downloads quicklySite downloads quickly
Source: Source: Yankolovich Partners