– Clicks-and-mortar is an internet business model conceived when a bricks-and-mortar model is in place... Properties of the Internet and the 5-Cs Internet Properties •Mediating tech[r]
Trang 1Internet Marketing Strategy
Week 5
Trang 2• Defining the business model
• Integrating Internet marketing strategy
• Levels of web development
• A strategic approach to Internet Marketing
Trang 3Defining The Business Model
• the first determinant of a firm’s
performance is its business model
• the method by which a firm builds and uses its resources to offer its customers better
value than its competitors
• and to make money doing so
Trang 4Determinants of Business
Performance
Business Model
•Components & linkages
•Dynamics
Environment
•Competitive
•Macro
Change
•Properties
Trang 5Internet Business Models
• Given such landscape-transforming
properties of the Internet, the question is,
How can a firm take advantage of them and make money.
• The Internet business model is the system – components, linkages, and associated
dynamics – that takes advantage of the
properties of the Internet to make money
Trang 6Internet Business Models
• It takes advantages of the properties of the Internet
in the way it builds each of the components – value, scope, revenue sources, pricing, connected activities, implementation, capabilities, and sustainability – and crafts the linkages among these components.
• Categorized as pure play or clicks-and-mortar
– Pure play Internet business model - if firm does not have a bricks-and-mortar model.
– Clicks-and-mortar is an internet business model conceived when a bricks-and-mortar model is in place
Trang 7Properties of the Internet and the
5-Cs
Internet Properties
•Mediating technology
•Universality
•Network externalities
•Distribution channel
•Time moderator
•Information
asymmetry shrinker
•Infinite virtual capacity
•Low cost standard
•Creative destroyer
•Transaction-cost
reducer
5-Cs
Coordination Commerce Community Content Communication
Business Model
Environment
Performance
Trang 8Determinants of Firm Performance
Business Model
•Customer value
•Scope
•Price
•Revenue sources
•Connected activities
•Implementation
•Capabilities
•Sustainability Internet
Environment
Performance
Trang 9Taxonomy of Business Models
• Brokerage model – firms act as market makers who bring buyers and sellers together and charge a fee for the transaction that they enable.
• Advertising model – the owner of a web site provides some content and services that attract visitors Charge advertisers fees for banners, permanent buttons …
• Infomediary model – a firm collects valuable
information on consumers and their buying habits
and sells it to firms which in turn can mine it for
important patterns and other useful information
Trang 10Taxonomy of Business Models
• Merchant model – is the “e-tailer” model in which wholesalers and retailers sell goods and services over the Internet.
• Manufacturer model – try to reach end users
directly through the Internet instead of going
through a wholesaler or retailer.
• Affiliate model – a merchant has affiliates whose websites have click-through to the merchant.
• Community model – rest on community loyalty rather than traffic A good example is iVillage.
Trang 11Taxonomy of Business Models
• Subscription model – access to a web site is not free Members pay a subscription price and in return receive high-quality content.
• Utility model – firms pay as they go
Activities are metered and users pay for the services that they consume.
Trang 12Internet Marketing Strategy
• Block Strategy – firm erects barriers around its
product market space by having inimitable
capabilities and lowering prices.
• Run Strategy – an innovator often has to run
Running means changing some subset of components
or linkages or business models or reinventing the
whole business model to offer customers better value.
• Team-up Strategy – if a firm can not do it alone Use strategic alliance, joint venture, acquisition, or equity position Share in resources that it does not have.
Trang 13David Teece argued that two things
determine the extent to which a firm can profit from its invention or technology: imitability and complementary assets
Trang 14Who Profits from Innovation
I
Difficult to make
money
II Holder of
complementary assets makes money
IV
Inventor makes money
III Party with both
technology and assets
or with bargaining power makes money
Freely Available
or Unimportant Tightly Heldand Important
Trang 15Strategies for Building Business Models
I
Run
II
Team-up
•Joint venture
•Strategic alliance
•Acquisition Internal development
IV
Block
III
Block Team-up
•Joint venture
•Strategic alliance
•Acquisition
Freely Available
or Unimportant Tightly Heldand Important
Trang 16Internet Technology Life Cycle
•Locate profit
•Build business model
•Defend competitive advantage
•Decide where in the Internet value network you want to be
•Build capabilities
•Build network
•Invest in infrastructure
•Win customers
•Build brand name
Sales
Internet
actions:
Time
EMERGING or FLUID
GROWTH or TRANSITIONAL
MATURE or STABLE
Trang 17Levels of Web Development
1 Image/product
information
2 Information
collection
3 Customer
support/service
4 Internal
support/service
5 Transactions
on al
1 Transactions
2 Customer support/service
3 Image/product information
4 Information collection/market research
Trang 18Simple Framework for IMS development
Develop Internet
marketing strategy
Define Internet
marketing plan
Design site
Implement site
Monitor (metrics)
Review and modify
Trang 19Strategic Marketing Planning Process
1 Mission
2 Corporate objectives
3 Marketing audit
4 SWOT analysis
5 Assumption
6 Marketing objectives & strategies
7 Estimate expected results
8 Identify alternative plans & mixes
9 Budget
Measurement and review
Phase 1
Goal setting
Phase 2
Situation
review
Phase 3
Strategy
formulation
Phase 4