copyright © 2015 pearson education, inc. publishing as prentice hall 13-1

Copyright © 2015 Pearson Education, Inc. publishing as Prentice Hall 13-2

Chapter 13

Copyright © 2015 Pearson Education, Inc. publishing as Prentice Hall.

The most successful companies embrace the Internet as a mechanism for transforming their companies and for changing everything about the way they do business

E-commerce has launched a revolution, a new industrial orderShowrooming

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In the world of e-commerce, speed and flexibility matter much more than size

High-volume, low-margin, commodity products are best suited for selling on the Web

Globally, people spend 35 billion hours online per month

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Copyright © 2015 Pearson Education, Inc. publishing as Prentice Hall. 13-5

How People Spend Their Time Online


Global B2C E-Commerce Sales by Region: Percentage of Global Total


U.S. Online and Web Influenced Retail Sales, 2011-2016 (in Billions of $)


Ad-ology study shows that 82% of small companies have Web sites, but many do not engage in e-commerce because their web sites cannot accept payments

Roadblocks:Lack of knowledgeCostUncertainty about the value of a web siteOnline security issues

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Before launching an e-commerce effort, consider:Success requires a company to develop a plan for

integrating the Web into its overall strategyHow a company exploits the Web’s interconnectivity

and the opportunities it creates to transform relationships with suppliers, customers, and others is crucial to its success

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Developing a deep, lasting relationship with customers takes on even greater importance on the Web

Creating a meaningful presence on the Web requires an ongoing investment of resources – time, money, energy, and talent

Measuring the success of a Web-based sales effort is essential to remaining relevant to customers whose tastes, needs, and preferences constantly change

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The following are essential to e-commerce success:Acquiring customersOptimizing customersMaximizing Web site performanceEnsuring a positive user experienceRetaining customersUse Web analytics as part of a cycle of continuous

improvement

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Myth 1: If I launch a site, customers will flock to it

Myth 2: Online customers are easy to please

Myth 3: Making money on the Web is easy

Myth 4: Privacy is not an important issue on the Web

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Privacy on the Web does matter!The TRUSTe Privacy Index reports that 90% of adults

in the U.S. worry about privacy onlineTips:

Post a privacy policy and stick to itSafeguard information your company collects from

customers

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Myth 1: If I launch a site, customers will flock to it

Myth 2: Online customers are easy to please

Myth 3: Making money on the Web is easy

Myth 4: Privacy is not an important issue on the Web

Myth 5: Strategy? I don’t need a strategy to sell on the Web!

Just give me a Web site and the rest will take care of itself

Myth 6: The most important part of any e-commerce effort is

Technology

Myth 7: On the Web, customer service is not as important as

it is in a traditional retail store

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Average conversion rate for e-commerce sites is 2.1%The most common reasons for not purchasing

include:Unexpected shipping and handling charges (70%)Insufficient product information (56%)Lack of trust or security concerns about the site

(50%)Difficulty navigating the Web site to find the right

product (46%)Companies can win back sales by sending a prompt

follow-up e-mail

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Myth 8: Flash makes a Web site betterA site that performs efficiently and loads quickly is a far better

selling tool than one that is filled with “cornea gumbo,” slow to download, and confusing to shoppersAkamai study: 47% of shoppers expect a Web page to load

within 2 seconds and 40% of shoppers will abandon a site that takes more than 3 seconds to load

Myth 9: It’s what’s up front that countsVirtual order fulfillmentMyth 10: My business doesn’t need a Web site

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Average Time Americans Spend Online and Shopping Online Per Month


Focus on a Niche in the Market Develop a CommunityAttract Visitors by Giving Away “Freebies” Make Creative Use of E-mail, but Avoid Becoming a “Spammer”

Open rateClick-through rateTriggered e-mails

Sell the ExperienceMake Sure Your Web Site Says “Credibility”Make the Most of the Internet’s Global Reach

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Markets with the Highest Online Sales Potential


Focus on a Niche in the Market Develop a CommunityAttract Visitors by Giving Away “Freebies” Make Creative Use of E-mail, but Avoid Becoming a “Spammer”

Open rateClick-through rateTriggered e-mails

Sell the ExperienceMake Sure Your Web Site Says “Credibility”Make the Most of the Internet’s Global ReachGo Mobile

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U.S. Mobile Commerce Sales


Go MobilePromote Your Web Site Online and OfflineUse Social Media Tools to Attract and Retain Customers

MashupReally Simple Syndication (RSS)Social MediaWikisWidgets

Capture Local TrafficDevelop an Effective Search Optimization Strategy

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Search engine optimization (SEO) strategies: essential to online companies’ successThe most common tool that people use to find the products

and services they want 89% of shoppers say they use search engines to find

information about products and services Search engines drive more traffic to e-commerce sites (32.0

percent) than either e-mail (4.3 percent) or social media (1.9 percent) and generate higher average order values ($90.40) than either e-mail ($82.72) or social media ($64.19)

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Natural (organic) listings: the result of “spiders,” powerful programs that crawl the Web, looking at key words, links, and other data

Paid (sponsored) listings: short text ads with links to the sponsoring company’s Web site that appear on the results page of a search engine

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Use paid listings to accomplish what natural listings cannotGoogle, Microsoft Bing, Yahoo!, and AOL – account for 98% of all

searches in the U.S.Average cost of a keyword has risen from 39¢ in 2004 to 53¢ today Beware of click fraud!

Estimate: Pay-per-click fraud rate is 19%

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Go MobilePromote Your Web Site Online and OfflineUse Social Media Tools to Attract and Retain Customers

MashupReally Simple Syndication (RSS)Social MediaWikisWidgets

Capture Local TrafficDevelop an Effective Search Optimization StrategyDesigning a Killer Web Site

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Designing a Killer Web SiteDecide How to Bring Your Site to LifeStart With Your Target Customer

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Online Activities by Generation


Designing a Killer Web SiteDecide How to Bring Your Site to LifeStart With Your Target CustomerGive Customers What They Want

Boston Consulting Group: improvements to customers’ online shopping experience that would motivate them to shop more online are:Free shipping (74 percent), lower prices (56 percent), free returns

(35 percent), more secure Web sites (25 percent), and better views of virtual products (25 percent

Select an Intuitive Domain Name

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Select an Intuitive Domain NameSelect a domain name that is consistent with the image

you want to create for your company and register itShortMemorableIndicative of a company’s businessEasy to spell

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Designing a Killer Web SiteDecide How to Bring Your Site to LifeStart With Your Target CustomerGive Customers What They WantSelect an Intuitive Domain NameMake Your Web Site Easy To Navigate

Landing pagesBounce rate

Provide Customer Ratings and ReviewsOffer Suggestions for Related ProductsAdd Wish List CapabilityCreate a Gift Idea Center

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Establish the Appropriate Call to Action on Each PageBuild Loyalty By Giving Online Customers A Reason To ReturnEstablish Hyperlinks With Other Businesses, Preferably Those Selling

Products or Services That Complement Yours Include An E-mail Option and a Telephone # On Your Site Offer Shoppers Online TrackingOffer Web SpecialsUse the Power of Social MediaUse Customer TestimonialsFollow a Simple Design

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Follow a Simple DesignAvoid clutterUse less text on the home pageAvoid huge graphicsInclude a menu bar at the top of the pageInclude navigation buttonsMinimize the number of clicks required to a pageIncorporate meaningful content into the siteInclude an “FAQ” sectionInclude privacy and return policiesAvoid fancy typefaces and small fontsWatch for “typos” and misspelled wordsAvoid small fonts on “busy” backgrounds

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Use contrasting colors for text and graphicsBe careful with framesTest the site on different browsers and different size monitorsCollect information from visitors, but don’t put them through a tedious

registration processInclude a search function and company contact informationAvoid automated music Make sure the page looks appealingRemember: Simpler is better

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Follow a Simple DesignAssure Customers That Their Online Transactions Are SecurePost Shipping and Handling Charges Up Front Create a Fast, Simple Checkout Process Confirm TransactionsKeep Your Site FreshRely on Analytics to Improve Your siteTest Your Site Often Consider Hiring A Professional To Designer

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Software SolutionsWeb analytics: tools that measure a Web site’s ability to attract customers,

generate sales, and keep customers coming back Commerce metricsVisitor segmentation measurementsContent reportsProcess measurements

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Other measures of Web site performance include:Click-through rate (CTR): the proportion of people who see a company’s online ad and

actually click on it to reach the company’s Web site Conversion to browse-to-buy rate: the proportion of visitors to a site who actually make a

purchaseCost per acquisition (CPA): the cost a company incurs to generate each purchase (or

customer registration)

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PrivacyTake an inventory of the customer data collectedDevelop a company policy for the information you collect

Privacy policyPost your company’s privacy policy prominently on your Web site and follow it

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SecurityCybercrime affects 1.5 million victims each day

Most cybercriminals target customer recordsTo minimize cybercrime, use tools including:

Virus detection softwareIntrusion detection softwareFirewallSecure sockets layer (SSL) technology

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Losses to Online Fraud

copyright © 2015 pearson education, inc. publishing as prentice hall 13-1

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