Marketing in the Information Age
 4rth year course in the Division of Management, University of Toronto at Scarborough, Canada
SECTION A - September 2004
© by Prof. W. Tim G. Richardson
This page last updated 2004 Sep 30
(the changes from Sept 8th are just spelling, and some old links taken out)
Section A Section B Section C Section D Section E
Fundamentals within which Marketing in the Information Age takes place 1. The 4P's - things you can control
2. The the 5 (6) environments - things you cannot control, but, which effect you

link to ppt menu
Chapter 1
The Driving forces (or the 5 Environments effecting e-Business) 
(1st. ed. p. 19)
(2nd ed. p. 17, 18)
Text says
  • Market and economic pressures
  • Societal and environmental pressures
  • Technological pressures
  • The Standard Marketing Terms are
    • Political and Legal Environment
    • Sociocultural Environment
    • Technological Environment
    • Economic Environment
    • Competitive Environment

    • +
    • The goals and resources of the particular firm
    • and for some circumstances, the geographic environment
    (the full unit on the 6 environments)
    - read this - some material applies to international business, it can also be applied to e-business
    . Of all the environments noted above, Witiger personally believes that the Competitive Environment has the biggest impact on E-business since so much of your success and failure depends on what the competition does 

    - and,,,,, if you have no competition, your success will attract people to copy you so you will get competition.


  • Benefits to organizations that use e-Commerce
  • Benefits to consumers that use e-Commerce
  • Benefits to society (when consumers and business use e-Commerce)
  • Limitations of e-Commerce (e-Business) 
    • Technical Limitations
    • Nontechnical Limitations
    click on the screen capture to the left to read this unit on Benefits & Limitations

    Chapter 1

    Managerial Issues
    (2nd ed. p. 29-30)
    . One of the reasons why Managerial Issues should be always considered in the various topics throughout this course - is because there are so many big mistakes you can make in developing an e-business plan that it can prove fatal to your business. The questions sometimes is not "How to be successful?", but rather, "How to avoid screwing up BIG TIME".
    Cyber Rules by Tom Siebel ( published in April of 1999 is not a  textbook but it is a thought  provoking collection of essays on  the whole internet/e-commerce  community. Siebel has an excellent  grasp of the key issues and even if   you only read the first 2 chapters, it  is worth buying the book. Amazon   has it as do many others. There are  many quotable quotes from this  book which we will use in the intro  to IEC 702 

    The foreward to Seibel's book was penned by "the" Charles Schwab. 
    Schwab, who's business has been revolutionized by the WWW, writes;

    "... the internet effects literally everything about the way we do business, and, as such, impacts all our lives ... yet this transformation will only happen for companies that focus on service to the individual customer ... at the heart of E-business growth is an interesting paradox .. E-business has been built by technology, but it's not about technology ... enabled by technology, but not changed by it"
    Charles R. Schwab, founder, The Charles Schwab Corporation

    Seibel follows this foreward with equally intense prose stating that
    "...the Internet will link every home, every business, every government agency, and every distributed database together in a complex weave of information exchange. We will inhabit a world where distance no loner matters, and where communication and data transfer will be virtually instanteous. This will so thoroughly transform the way that transactions are conducted that doing business without the Web will become unthinkable"
    p. 2

    The following are some numbers which may be of some assistance in understanding the scope of the present "penetration" of e-business into business. The problem with listing any numbers in here is that this is a rapidly changing environment and every 4 weeks there are new trends developing and further data available
    Chpt 3
    "Most typical marketing plans quote applicable market statistics ... market statistics are important because they outline, in general and in detail, what the market is all about. Statistics can make or break your company's decision to participate"
    Kim Bayne Chpt 3, page 53

    Do You Really Need Internet Statistics? page 54.
    Gathering and Applying Data. page 56

    .. Some new info has been added - and all the stats related info is under one heading 

    2001 Dec 03

    Who and
    what is

    In this
    section we
    talk about
    the "who"

    . If university and college students studying e-commerce recognize that university and college students have a higher proportion of disposable income than other groups in society, then maybe one of the things we should seriously investigate is the fundamentals of selling e-commerce services and products to university and college students. Would it make sense to say that the demographic group you could analyse best is the group you are part of?

    #1direct link to College Club a portal
    "For years marketers had few ways to reach this affluent market -- in their formative  years when they were making their first purchase decisions.But, on campus -- as in so many other places -- the internet changes everything."

    link to the text of what we discussed in class today - important to review
    essentially we discussed what understandings you need to have to successfully e-tail to 21~34 yr olds

    This page "views.htm" is a work in progress and something we will further build on in this class

    read Teens Increase Online Shopping
    More than 10 million US teenagers will make a purchase online by the year 2002, a dramatic increase from the estimated 2 million teens that shopped online in 1998
 Why do we have a special section for women online 

    " the mid-1990's it is freely aknowledged that persons accessing the internet were predominantly young men in North America - but by the time  the millenium broke, users have included vast numbers of people in Asia, Europe as well as other genders.." 


    Chpt 3
    Organizations and Associations and Trade Magazines

    "Many marketing and industry specific associations offer their members reports, white papers, and research papers on trends in new media".
    page 68 - 69

    . In Canada, there are many associations involved in business. Many of these associations are in competitive situations trying to maintain membership and recruit members therefore they often have extensive web sites and make lots of information available in order to attract interest.
    Most associations encourage their members to have web sites since it facilitates interaction among members as well as allow the association to better market on behalf of the "constituents".
    link to ppt menu
    Chapter 2
    . Before we begin a section looking critically at some of the things you have to do to be successful in e-commerce and e-business, it is worth the time to pause and think about things from the perspective of the consumer.
    Procedure for Internet Shopping: The Consumer's Perspective
    page 55 Turban text

    1. Preliminary requirement determination
    (translation: "looking for something you need")

    2. Search for the available items
    (translation: "anybody got your stuff")

    3. Compare the candidate items with multiple perspectives
    (translation: "who else has the stuff, at the same price, same size")

    4. Place an order
    (translation: spend half an hour filling in tiny boxes and repeating the same info many times, then click on "submit")

    5. Pay the bill
    (translation: your credit card was still a few bucks below its limit)

    6. Receive the delivered items and inspect them
    (translation: after praying to various gods and deities, it finally arrives several months later, you frantically tear open the package to find everything there, expect instructions in a language you can read)

    7. Contact the vendor to get after-service and support
    (translation: send 5 emails to get instructions, only to be caught in a vicious automated response loop)

    (translations supplied by Witiger - no offense intended to the original author)


    own list of
    Do's and Don'ts

    Kelly Mooney - Cyber Shopper
    Mooney converted her findings into a personal, opinionated   Internet-shopping audit: E-Commerce Analyst Watch 2.0.
    What can we learn about her list of do's and dont's
    1. first, do we agree with her do's and dont's
    2. what can we apply from the list to clients and employers you may be working with
    3. Our list of Do's and Don'ts

    Mooney's chart is available to view on-line at
    - just because it's on the Net, "don't make it so"
    - what is there about the chart that is useful?, and what could be explained better?

    Paul Graham's "The 10 Secrets of Selling Online"
     The Biggest Factors Discouraging
    Canadians from Purchasing on the Internet
    Shipping cost is too high
    Item is very large
    Personal sizing
    Item is very high cost
    Item is extremely high cost (luxury item)
    Item is perishable
    Want to see or fell item before purchase
    Concern about security
    Item is fragile
    Concern about privacy
    Colour important to see physically

    Source: Ernst & Young (January, 2000 )as used by Substance Consulting
    on their web site

    "Security Major Concern"


    article 2002 Aug 19
    by Conway Daly

    "Canadians Leery of online Shopping"

    Daly uses a poll by Leger Marketing to support a conclusion that "most Canadians remained wary of online shopping despite the glowing prediction of mass success when electronic commerce first began".

    "Internet users accounted for 60% of Canada's population but 51% of the users pooled said they hadn't shopped or bought anything online in the past year, and weren't planning to do so in the future"

    "Of the survey respondents who hadn't made any online purchases in the previous four weeks, 46% said it was because they didn't want to give out credit card details"

    ? - who is Leger Marketing they have a kewl flash website - but it is hard to navigate to find out specifics of what they do, other than just about everythig to do with marketing - there is not clear reference to any specific e-business capability nor could witiger find anything on the site about any surveys they did


    "Things you have to
    be convincing about"

    Most frequent used methods of accessing shopping sites
    Click on site from favorites file
    Key in known site address
    Go through search site
    Use comparison shopping engine/guide
    Click on banner ad
    Other method used frequently
    Go through an on-line shopping mall
    Click on URL received by unsolicited e-mail

    Source: Ernst & Young (January, 2000 ) as used by Substance Consulting
    on their web site

    . The chart above tells us several things, first, it is worth a lot to get the first visitor to bookmark the page since that seems to be the method by which they make repeat visits. Also, unsolicited email seems to be about as effective as unsolicited postal mail in the offline world. Banner ads aren't so hot and they only are 1/4 as effective as getting ranked high in a search engine.
    "Things you 
    have to be 


    "Things you 
    have to be 

    "Things you 
    have to be 

    List of things you have to be convincing about

    Most of this class will be spent discussing the "convincing.htm" list and adding on to it.

    1. Variations 
    2. warranty service 
    3. functionality 
    4. payment security 
    4b. privacy
    5. offline prescence - that they also have a "brick" establishment 
    6. value - price proportionate to quality and use 
    7. long term use and upgradability
    8. testimonials 
    9. Associations (credibility by membership)
    10. After Sales Customer Service 
    11. Shipping
    12. Competitiveness
    13. Corporate Citzenship 

    • environmental considerations
    • social - cultural considerations
    • gender issues 
    • human rights issues 
    14. Contact Information

    link to ppt menu
    Chapter 2 is mentioned in the beginning of Chpt 2 1st edition
    Chpt 2, 2nd ed. p. 50-51
    For your enrichment, you can look at
    which discusses many aspects of this company

    we will discuss in detail, later in the course


    Chapter 2
    Potential Winners and Losers in E-Business
    (2nd ed. p. 65-66)


    • ISP - Internet Service Providers
    • providers of diversified portals
    • e-commerce software companies
    • proprietary network owners
    • medium sized manufacturers
    • technology suppliers
    • advertising companies
    • a few large re-sellers
    • security services
    • "pure plays" Online only companies
    • click and mortar companies (coventional retailers online)
    • market makers
    • consumers

    (witiger added some of the winners entries to the losers list cause as things develop, e-business brings negatives as well as positives)

    • technology suppliers
      • globalization will force them to be more competitive and many will see lean times
    • advertising companies
      • many firms needing these services will be able to find the info online
    • "pure plays" Online only companies
      • they have seen problems as most customers want a combination of a click and mortar presence
    • consumers
      • many consumers frustrated by TMI - Too Much Information and worried about security issues
    • many wholesalers, especially small ones
    • brokers
      • middlemen being cut out as people use the web to go "straight to the source"
    • salespeople
    • manufacturers that are not innovative
    • manufacturers that are not "lean cost" producers

    Chapter 2
    Impacts on Business Process and Organizations
    (2nd ed. p. 67-73)
    • Improved Direct Marketing
      • important cause traditional advertising no longer effective
    • customization
    • advertising
    • ordering systems
    • the changing nature of work
    • new product capabilities
    • impacts on manufacturing
    • impact on finance and accounting
    • HR training and education
      • a constant concern to remain competitive if you believe people are your greatest resource
    possibly, we might have time to see a short video from the CBC program, Venture
    - if not, the program is on their web site

    you can also go here to look at other Venture programs and the accompanying text

    Points for consideration, why did Chapters web site cost them $22 million and why did they have to hire 130 people
    What are these costs?
    • the technology and associated hardware
    • credit card capability and banking arrangements
    • security features
    • the web site pages, hosting etc.
    • staff time
    all cost about 8 million

    + another $10 million for a new warehouse to house all the books to be mailed out

    Venture Article
    Selling Online
    Air Date: October 5, 1999

    the link below will take you to a text summary of the main points in the program


  • Danier Leather 
  • Boston Consulting Group
  • author and internet expert Jim Carroll and his book
  • UPDATE I showed this video for class in 2000 and 2001 but by 2002 it was out-of-date so it is not part of the course as taught in 2003 or 2004
  • .