CHAPTER THREE

ONLINE BUSINESS STRATEGIES

Content
3.1. Internet Goals
3.2. Internet Presence
3.3. Direct Selling Model
3.4. Internet Retailing
3.5. Internet Marketplaces
3.1 Internet Goals

3.1 Internet Goals

 There are many kinds of goals or uses of internet in commercial or non-
commercial field. Some of the important current strategic uses of the internet are
listed below:
 - On-line communication
 - Software sharing
 - Exchange of views on topics of common interest
 - Product promotion
 - Feed back about products
 - Customer support service
 - On-line journals and magazines
 - On-line shopping
 - Worldwide Video Conferencing.
 - Compared with face-to-face networking, it’s time-effective
 - Inputs person directly in touch with important decision makers
 - Reach to online universe and build a reputation.
Basic Services of Internet
Basic Services of Internet
 There are basically three types of services provided by the internet network to the users.
These services are explained below:
 1. Usenet News:
 This service gives a chance to the groups to exchange their ideas, information, and views
about subject of common interest. There are several groups in the internet, which are
called news groups. This service includes main services like, e-mail and news.

 2. File transfer protocol (FTP):
 This service helps internet users to exchange and move the files from one computer to others.
These files may contain digital information – text document, image, artwork, movie, sound, and
software.

 3. The World Wide Web (WWW):
 The World Wide Web is a developing technicality and it is the most popular
and promising method of accessing the internet network. Its popularity has
come from using the hypertext concept which allows us to see the picture,
image, text and sound.
 Each service has its own features and special address so that the computers
using FTP system have a special address different from the computers using
3.2. Internet Presence

3.2. Internet Presence

 In the modern age, we are witnessing amazing development in the
computer and networks fields, particularly in the last decade. The word
internet was not as popular as it is today; because internet users were
limited to those who had the ability to communicate and exchange
information via computer networks. Now a day's communication
through computer has become part of our life and we can’t do without
it. Fast development in the computer and networking has changed the
life and its methods around the world, and we can see that clearly in the
U.S.A. and European countries, every thing there is being done through
the internet .for example shopping, making reservations at hotels and
restaurant, booking airplanes, and train tickets through internet and
also pursuing education as well as certain banking activities.

Definition:

 Definition:
 There are several definitions for internet, but the popular one is
that “Internet is a huge network of computers, which links many
different types of computers all over the world; it is a network of
networks, which share a common mechanism for addressing
(identifying) computers, and a common set of communication
protocols for communications between two computers on the
network.” Internet is asset of computers talking over fiber optics,
phone lines, satellite links and others links. It is a global collection
of high powered computers that are connected to each other with
network cables, telephone lines, microwave dishes, and satellites.
 The internet is the world's largest computer net work. It is a global
information infrastructure comprised of millions computers
organized into hundreds of thousands of smaller, local networks.
Who are actually available on internet?
 Who are actually available on internet?
 The wide meaning of internet includes people, groups, organizations, schools,
universities, commercial services activities, formal orientations and free networks
that use the protocols of TCP / IP and always remain connected with the
network the whole day. There are various opinions about the meaning of
(availability on internet). Does it mean communication with the net only? or
ability to communicate with the system and internet services like FTP, Goper,
Telnet, E-mail and World Wide Web? or does it mean producing and selling
goods, services and information to others? The view of the researcher is that
“this concept means two ideas coming together, having wide availability.
 Anyone having a personal computer connected to the internet network is
considered available on internet network, whether he is a producer, a consumer
or supplier. It is necessary to mention that the English language is still the main
language used on the internet and has the biggest share. Some web sites offer
documents in other languages and are also supported by English.
 Several researches indicate that, the internet network will constitute new
economies and plan the movement of international Electronic commerce
through the next few years and the number of local subscribers will increase
enabling the getting of information much easier for commercial organization
and will develop the internet network at great speed”. Internet network has
3.3. Direct Selling Model

3.3. Direct Selling Model

Direct sales represent the largest and most important revenue
stream for e-commerce sites. The simple and straight-forward
mission of an e-commerce site is to sell as many products to as
many online shoppers as possible. Products can be tangible,
such as shampoo, sneakers, and groceries, or intangible, such as
digital music or the purchase of a reserved seat on a flight.
Typically, the direct sale of products is made in numbers of
units, with each unit multiplied by the advertised price (three
bottles of shampoo at $5 each is a grand total of $15, plus any
shipping, taxes, and other charges that may apply). Typically,
consumers who purchase products do so for one of three
reasons:
Conti….
 In the presentation of the product, marketers generally rely
on three elements:
 Copy, which can be used to describe the product, its attributes, its value,
and any other important information that the marketer feels will be
appropriate to boost sales. Copy also includes information such as the
price of the product, size, weight, and other such vital info.
 Pictures, which are used to provide a visual reference so that shoppers
can see what they are buying. In the case of products that might be less
familiar, or whose appeal might be in the way they look (picture frames
or decorative candle holders, for example), marketers may decide to
show the product from a number of different angles. As with copy,
smaller images, called thumbnails, are shown initially, and larger images
are often provided upon further consumer investigation. Other times,
application shots are provided to show how the product might look in its
final environment or when being used by a representative consumer.
 Video of the product is sometimes used to demonstrate how the product
works, market its benefits, or generally build excitement for the product.
As we discussed in Chapter 5, online videos can increase audience
retention time—a big benefit to e-commerce marketers who want to
3.4. Internet Retailing

3.4. Internet Retailing

3.4.1. E-Retailing: The Virtual Channel
Internet is being used as a channel to market, examining the
activities retailers are engaging with online with customers.
Retail channel is a term introduced by Doherty et al. (1999) to
describe companies’ multi-purpose adoption of the Internet,
using it as both a communication and transactional channel
concurrently in business-to-consumer markets. Traditionally
the term channel -describes the flow of a product from source
to end-user. This definition implies a passive unidirectional
system whereby the manufacturer or producer markets
through a wholesaler or retailer to the consumer.
Conti…….
3.4.2 E-retail activities
 These will primarily fall into one of two categories: Information Functions or
Interactive Functions.
 Information functions
 Web sites provide retailers with an important opportunity to give customers information.
Many companies see the web as a means of expanding customer services through offering
their customers wider ranges of information than is possible in-store. One of the greatest
advantages of the web according to UK retailers is its ability to facilitate the dispersion of
low-cost information. Retailers have been proactive about providing information on their
web sites, and offer a wider range of different types of information:
 Product information includes product descriptions and prices, promotional information
and web advertisements, colour swatches and graphical images.
 Financial information includes company reports, annual statements and investor
information.
 The depth of coverage can vary considerably, as can the extent of accessibility.
 Company information includes such items as history of the company, store location
information, details of employees and company incentive schemes.
 Press releases appear in various forms. Some companies use press releases as part of their
consumer promotions whereas others include such information in their corporate web
sites aimed at enhancing the overall profile of the brand(s).
 Recruitment information – companies have recruitment features providing potential
applicants with job details
Conti….
Interactive functions
 Interactive use of the Internet involves more than simply the provision of promotional
information. It includes activities such as ordering of catalogues, promotional literature
and ‘free gifts’ and encouraging customers to provide market research data as well as sales
ordering and payment transactions. Interactive ways of using the Internet and the web
include:
 MARKETING COMMUNICATIONS TOOL – the Internet is frequently used
as an advertising channel. Traditional advertising channels such as broadcasting and print
media enable a one-to many dialogue based on communications theory (Schramm, 1955)
between senders and receivers. The communication process is normally constrained by
time, namely the speed of response of participants, but communication can become
‘conversations at electronic speeds’ if conducted via interactive services such as the
Internet (Fill, 1999).
 DIRECT COMMUNICATION – as an interactive channel for direct
communication and data exchange the Internet enables focused targeting and
segmentation opportunities for more closely monitoring consumer behaviour. E-mail
provides a direct non-intrusive means of communication between firm and customer.
 ONLINE COMMUNITIES – are also developing on the web and facilitating
interaction between individuals and companies. Car manufactures such as Citroen and
Volkswagen support many enthusiasts’ sites in order to reinforce the emotional bonds
between the product and the consumer via the web.
 MARKETING RESEARCH TOOL – the Internet’s interactivity facilitates the collection of
consumer data, providing the opportunity to gather personal information from online
Cont….
SALES CHANNEL – the selling of goods and services
online can take several different forms: the order is
placed online while the delivery and payment are
made through real-world channels; online ordering
where the delivery of goods is required in the real
world and the payment facility has options online or
offline; the total process, namely the order, payment
and delivery of the product occurs via the Internet.
3.5. Internet Marketplaces
3.5. Internet Marketplaces
Internet marketplace connects Sellers and Buyers through
the Internet and thereby fosters efficiency in an otherwise
inefficient market. An internet Marketplace is an
ecommerce platform that enables Individuals as well as
Business to either list their items for sale or set up online
stores on the online platform and leverage this platform and
its services for example search, viewing product
information, buying, payment, order management etc
What sets an internet Marketplace apart from B2B
eCommerce sites is that fact that a marketplace is an
aggregation of sellers and their inventory. Examples of some
online marketplaces are Amazon.com, Alibaba, eBay, etsy,
Flipkart, Rakuten, Snapdeal.
END OF CHAPTER-3