Australian Businesses and Web Marketing; Using Information Technology and the Internet

By Devon Andersen, CEO of AT.DEV.AT, Andersen Technology Development

http://at.dev.at/

31st October, 2003

Perth, Western Australia

Copyright 2003, Andersen Technology Development

Executive Summary

Australian Businesses need to transform their thinking. They need to focus on orientating towards the next-generation of consumers; information-rich , internet-savvy shoppers with global reach. This report shows that there has been a strong up-take of computers and internet access, and Australia is ready for e-business. There has also been significant contributions to the Australian ICT economy. Australia needs to capitalise on these opportunities, and the best way is to ramp up web marketing efforts. The recent uptake of broadband by businesses and consumers is highly likely to spark a new growth phase of e-commerce and web-marketing opportunities in Australia.

A holistic approach in the use of the technology and marketing departments, and the development of integrated marketing strategies will undoubtedly be an important issue in the success of web marketing efforts. Businesses must ensure that the front-end is marketing-oriented, easy-to-use, and constantly tested for usability. The backend must provide connection to the business resources, without complicating or driving the front-end. The marketing strategies should also be changing (in real-time) depending on the one-to-one customer feedback. A Business with integrated marketing and technology departments is more likely to succeed in doing this.

We must also realise that customers are extremely sensitive to technology changes in the marketplace. Customers don’t like the rules to be changed, new processes are sometimes rejected outright (eg Woodhead and Connors 2003) hence the need for focus-group testing.

Finally, there is strong evidence to suggest that Small Business can compete on an almost equal footing with larger businesses in the web-marketing arena. By providing an integrated experience (website, online interactive tools, marketing) a Small Business is able to significantly improve it’s efficiency, improve and provide service customers 24x7, and increase the coverage of their business while retaining a local focus.

Table of Contents

Australian Businesses and Web Marketing; Using Information Technology and the Internet 1

Table of Contents. 1

Introduction. 3

Value of ICT and the Internet to Australian businesses. 3

Value of E-commerce to Australia. 5

Insufficient use of web marketing technologies. 6

Fundamentally, things have to improve. 6

Where are the market leaders?. 6

Prevalence of E-commerce. 6

E-commerce and Small Business. 7

How ready is the small business for web marketing?. 7

How do they get started?. 7

A holistic approach; integration. 8

The one-to-one future for web marketing?. 9

Insufficient market orientation towards web-based customers. 10

Is web-marketing new or just an extension of existing marketing techniques?. 10

The bricks and mortar marketplace is changing too. 10

But we don’t trust new technology. 11

Things to fear 11

Future of Australian businesses and web marketing. 12

Conclusions. 13

About The Author 13

References. 15

Appendix. 17

 


Introduction

Even though the dot-bomb explosion is still ringing in people’s ears, the internet market has remained strong. Rather than a death, we have seen a culling. The ridiculous business ideas have come and gone, and those still remaining have provided good examples of what to do to ensure your e-business isn’t the next e-victim. Few businesses have survived as pure online businesses (such as Ebay.com), yet many have successfully augmented their business with an internet presence (such as Ford.com).

Even since the 2001-2002 bust, web-site banner advertisements and bulk-email advertising (that is, spam) have remained strong, but they are probably fading stars in a galaxy full of web-marketing promise.  The point here is that being successful in marketing is about being dynamic and remaining oriented towards your customers (Kotler et al). In many ways, web marketing is very similar to traditional marketing. However, Internet-related technologies have evolved the theories, providing additional capabilities and opportunities for businesses wanting to augment their business marketing processes. There have also been several paradigm shifts in methodologies of marketers interacting with customers.

This is increasingly important with a growing proportion of the population that is net-aware. Web marketing requires diligence at the outset, with the same degree of thought and consideration being made to the online marketing channels as with the bricks-and-mortar marketing channels (Shaklett 2001).

Value of ICT and the Internet to Australian businesses

Computers, Information & Communication Technology (ICT) and the resulting Information Economy have undeniably made a major contribution to the GDP growth within Australia. The Australian National Office for the Information Economy (NOIE) predicts that the Information Economy will increase GDP by up to 2.6 percent over levels that we would otherwise obtain by 2004-05 (NOIE 2003 Allen Report). The contribution appears to be stable over the next decade. The improvement is undoubtedly related to improved process automation, and supply-chain efficiencies, and improved customer relations. IT and the e-commerce technologies have proven their worth and attention, despite the downturn!

The NOIE report provides some useful reminders as to why web marketing is so important to Australian businesses, given that the foundations for success are in place right now. Unfortunately, as we will see, web marketing is dramatically underutilised in Australia (later discussion).

Firstly, a measure of the E-business readiness puts Australia 5th in the OECD (NOIE 2003 Index).  According to NOIE, “E-business readiness includes factors that range from telephone line penetration to online security, to intellectual property protection. 60 countries are ranked on the basis of a composite score based on 100 quantitative and qualitative indicators measuring performance across six broad categories including: connectivity and technology infrastructure; business environment; consumer and business adoption; social and cultural infrastructure; legal and policy environment, and supporting e-services”. This is commendable:

Source: NOIE 2003, Graph courtesy of www.ebusinessforum.com.

Even with the % of businesses online ranking for Australia being 9th in the OECD, 89% Internet adoption rate for Australian businesses is very positive:

Source: NOIE 2003

The % of businesses purchasing online is commendable, with Australia being 3rd in the OECD. However, at a mere 31%, Australia (and most other countries) still has a long way to go. This shortfall represents an untapped, undeveloped market.

Source: NOIE 2003

Essentially we are e-business ready, and we have the capacity to grow our online business substantially. This will require Australian businesses to focus on web-based marketing plans with the same vigor that they focus on their traditional marketing plans.

Value of E-commerce to Australia

E-commerce is the buying or selling of a product or a service online, via the Internet. Theoretically, e-commerce should be driven by web-marketing. But can we really measure the impact of the Internet and e-commerce on traditional markets? There is more to the contribution than just dollar values transacted via the internet. The ABS valued Australian E-commerce at $Billion 11.3 in 2002, with no slowing in sight. However, what about the portion of sales that resulted from an initial internet-based information gathering, and the order placed via the telephone or fax? More research will be required to encourage business to think about the synergies of an online presence. NOIE (2003) shows the growth of e-commerce (as calculated):


Source: NOIE 2003


This is good! However, what is not shown in these results is how poorly Australian businesses are performing this e-business. Unfortunately, this E-commerce value is dominated by unsophisticated methods of marketing, and we have to go to ABS data in order to magnify this point.

Insufficient use of web marketing technologies

Fundamentally, things have to improve

The ABS Special Article (2002) highlights some items that are of specific concern. Given that the data is now approximately 2 years old (albeit it is the latest available, from 2001), additional government research on the subject would be prudent. Perhaps, hopefully, Australian business has moved ahead since this article was written.

Essentially, Australian businesses are using very simple technology for performing e-commerce activities. Australian websites, according to the Special Article:

-         39% have on-line ordering

-         14% have on-line payment capabilities

-         11% offer secure access or transactions (eg secure socket layers)

-         10% have shopping cart facilities.

Over half of the businesses did not have any of the above features, indicating that they must have used low-level technology such as e-mail.

The report also characterizes that only 8% of online businesses generating income from online business have the ability to integrate the processes with their back-end systems:

“This appears very low and would presumably be an area where businesses stand to gain efficiencies by automating and integrating post order functions and processes.”

On an even more discouraging note, one can assume that if their online ordering systems are not linked to backend systems, that online customer-relationship management and tracking is probably not linked to backend systems either. And, given that these aren’t being performed, what chances are there that web-marketing is occurring?

Where are the market leaders?

If US estimates are anything to judge by, we will see almost 10% of all retail sales performed via the Internet by 2008. Forrestor Research (2003) shows that while offline retail sales have slowed considerably, online retail sales have grown a steady 19% year-on-year. It is predicted to rise from $95.7 billion in 2003 to $229.9 billion in 2008. They also find that a growing online consumer base, increases in new product categories, and efforts by online retailers to optimise online shopping experiences will be the catalysts for significant growth over the next five years. According to Forrestor Research, food and beverage, sporting goods, and home goods will grow the fastest, outpacing more traditional online categories like books and travel.

The ABS special article provides some solstice in the closing comments, in that the longer a business has had a website and has been receiving orders “the more sophisticated their web sites are in relation to Internet commerce functionality”. Given that 2 years have passed another special report is probably overdue.

Prevalence of E-commerce

You cannot just put your business “online” and expect to gain customers and reduce your costs. Traditionally, the rules of marketing are the same; you cannot just place an advertisement in a newspaper and expect to gain customers. You need to look at the whole marketing cycle. ABS Report (2002), Prevalence of Electronic Commerce, shows business perceptions of the benefit for the business of receiving orders via the Internet :

“Of businesses reporting that they earned income via the Internet/web during 2000–01, 63% reported that the ability to receive orders via the Internet or web had increased trading outside their local area. Other important effects were increased trading outside normal business hours (61%) and increased efficiency of business procedures (57%). An estimated 68% of businesses reported either an increase or no change to business costs while only 26% reported a decrease in business costs.”

There was an overwhelming net increase in quality of customer service, efficiency of business process, sales, competitiveness, and trading outside of local business area and outside of local business hours. The only category showing no net increase was the business costs; presumably going online to service the customer directly does have a substantial cost, and the kinds of savings make in the B2B e-commerce world that have so heavily contributed to our GDP have not materialized here.

E-commerce and Small Business

A small business doesn’t necessarily have the resources to be able to engage in the kind of marketing that larger business do. However, small businesses can compete with larger businesses when using the web. For example, Luneborg & Nielsen (2003) ask the question of how does the link between technological resources and performance depend on organizational size? They show that positive effects of using customer-focused technology are strongest in small businesses, despite the larger business having more sophisticated e-commerce applications and reporting utilities.

How ready is the small business for web marketing?

Small business operators work long hours (Characteristics of Small Business, ABS 2002): 71% being fulltime and 25% working more than 51 hrs per week. There were approximately 1,162,000 small businesses operating in Australia in June 2001. This was an average annual increase of 11% over the 19 month period since November 1999. 55% were non-employing, 34% employed 1-4 people, 11% employed 5-19 people. This points to individuals working long hours. I would contend that there is already a saturation of the hours worked, and that the businesses need to become more efficient. Web-based marketing and customer relationship management may provide solutions.

graph-use of computers and the internet-june 2001

Source: ABS (Characteristics of Small Business, ABS 2002)

How do they get started?

The business owner will probably go through various stages of website development. For example, they may start with a free website (perhaps hosted with Yahoo or Geocities), that simply provides their contact details and some information about their company. The website is  probably created by someone without much training in websites, using easy authoring tools or pre-made website templates (such as Frontpage).

The business owner could then possibly purchase a domain name, such that they can also be contacted via email in relation to the domain name, and can print the domain name on the company correspondence. Perhaps, over time, and with some extra cash to invest, they may outsource the website to be professionally authored, and provide more product details. They may even setup an e-commerce system whereby users can purchase products online, and the order usually routed to the sales team.

Many would see this as a natural process of “getting the business online”. However, I am of the opinion that this is a band-aid solution and far from something that will generate vast quantities of sales; the web site needs to be integrated with the other marketing channels, not just created as an add-on to the existing business.

Also, some things cannot be bought and sold over the internet; for example some items are too costly for shipping, have specific handling requirements, or require salesmanship in order to complete. However, that doesn’t mean that customers wont window-shop. Businesses can gain improvements by allowing customers to window-shop via the internet, and encourage them to come to the store to complete the purchase. There is an opportunity to a) get the customer interested by providing information, b) do this cost-effectively 24x7 c) manage the customer (cross-selling, provide details of other related specials).

Businesses that do not have the personnel to be running 24x7 can improve their competitiveness and online customer support by more thoroughly relying on automation and self-service tools. How to provide automation and self-service tools? This could be achieved by having an internet presence linked to an information and customer-service system.  These capabilities will depend upon the customer’s preferred orientation. For example, Coke’s website provides images of fun, it does not provide methods for purchasing Coke.

Perhaps one reason Australian businesses are slow to get on the Web-Wagon is the lack of internet takeup, until now, of broadband services. Dialup services are not only slow in terms of bandwidth (amount of data transferable per unit time), but they suffer from much higher latency (the time required to send the data from your computer to the Internet Service Provider). These factors, coupled with disconnections, can lead to poor user satisfaction in using the web for anything serious. The current boost in broadband uptake (currently up around 208,000 businesses, not the ACCC’s previously estimated 70,000 -- Pearce 2003) could be the new catalyst for an e-commerce explosion in Australia. Marketing Managers need to take into account the demographic profile of broadband users (eg, younger, more affluent, technology savvy) when orientating towards this group!

A holistic approach; integration

Kurian (2002) argues that today’s effective web marketing “requires a cohesive, holistic approach that integrates every point of customer contact, be it print, online or direct interaction”. This is a good point! Kurian’s view is that the IT and Marketing departments should unite, providing the marketing the freedom to implement sophisticated and integrated marketing campaigns quickly and cost effectively, while simultaneously receiving  timely feedback as to the success of the campaign.

I would further add to this, and say that in e-commerce, the web-application product developers (and not just the infrastructure components) should be firmly united with the marketing department. A functional web-based application will be much more successful if it, too, is integrated with the marketing campaigns and allows a one-to-one customer centric approach.

Wang et al (2002) discuss marketing integration issues in regards to e-tailing (e-commerce retailing). They present two perspectives for business response strategies:

-         The web is either a new marketing tool which is integrated into existing business strategies; or

-         The web is a new marketplace that demands new business design.

Two tables characterizing a comparison of the strategic and implementation aspects are included in the Appendix of this report.

Wang et al also propose that on the Internet, the traditional market participation has evolved into Web Market participation model:


 



Source: Wang et al, 2002


This highlights that the web is now an integrated channel, which greatly facilitates information access, collection and analysis for all market participants, whereby all market participants can be active in the market.  They state that the market channels are not communications buffers, they act as a interaction carriers; allowing both marketer and consumer to be in direct contact with each-other.

The one-to-one future for web marketing?

In 1993 Don Peppers and Martha Rogers published their book “The One-To-One Future” which is reported to have been the “mantra of web-marketing” in the late 90’s (Bhatia 2001). The authors described the importance of knowing and marketing individual customers and creating lasting relationships with them. They state that web marketing has now changed, and that it is no longer sufficient just to focus on building consumer profiles and market (and remarket) to them, it’s increasingly important to:

-         Understand the basics of the product offerings,

-         Learn through each and every sale what drives consumer response,

-         Evolve the marketing in real-time to take advantage of the new understandings.

This is an important issue that has been overlooked by Australian businesses seeking to market online. After all, if they cannot transact their business online, how are they going to be able to perform these steps with their online customers?

The following figure helps to illustrate the types of sites in operation on the internet:

Source: Bhatia (2001)

Australian websites would tend to be dominant in the “static” area. By using dynamic web-serving tied to realtime feedback and analysis, Bhatia has been able to improve conversion rates by up to 800%, obviously preferable strategies for the new e-business.

Mussi (2003) states that Expert Systems can be used in order to facilitate one-to-one marketing capabilities. This is quite an interesting topic, and destined to come to the attention of many web-marketers. The technique integrates user preferences with user goals using causal knowledge. The model allows the system to know (and possibly explain – useful information to a marketer) why the user acts the way they do, and also remove the burden of personalization from the user; the user does not need to declare their needs or goals as this is automatically inferred from their profile data.

Insufficient market orientation towards web-based customers

In order to better orient towards the customer, you need to understand the mechanisms and underlying features of the customer behavior. Given the above discussion, it is inferred that Australian businesses are probably not doing this sufficiently.

A simple example related to traditional techniques is that of age groups. The Australian Bureau of Statistics provides population ages, and there are slight population bulges around the 20yr and 30yr age groups. Of these, the 20-year age group offers the most opportunity. These younger people with disposable incomes are technology-aware and not reluctant to use the internet for information and shopping.

Is web-marketing new or just an extension of existing marketing techniques?

One-to-one marketing aspects were certainly new in the 1990’s, but they were in use before becoming popular on the web. Yet, the web has evolved the capability.

Technology-based differences are apparent; such as bulk mailing, email, and banner advertisements (all of which have been very successful to-date; Bialik 2003).  However, remove the technology and we are left with similar marketing models. These technologies can be used as bulk-marketing tools or selected to be specific one-to-one tools.

There are other striking differences, however. Web-based marketing offers some serious advantages over traditional marketing in terms of control, targeting and efficiency. For example, different strategies (such as background colors, presentation style, pricing) can be trialed and modified on a continuous basis (Bhatia 2001). Websites can also be extremely customized to become extremely one-to-one focused, advertisements can be customized on a real-time basis. In order to orient your products and services around the customers who will buy the most, you need to be able to understand them and provide them what they want.

The bricks and mortar marketplace is changing too

Take for example, the marketing you are exposed to every day as a consumer. You see advertisements on TV, radio, as advertisers attempt to find target markets by identifying with the type of media content you like. If you look closely, you will see advertisers using families, spouses, children and even pets to sell their products. They attempt to influence the buying process by influencing all decision makers and influencers (Kotler et al).

Supermarket chains already data-mine customer preferences; for example by creating “club” cards they can track your purchases over time and make better guesses as to what you purchase regularly (what you need), irregularly (what you are trying out), and what you purchase in combinations. Credit-card merchants can do similar data mining. Exactly what is protected by privacy agreements is open to debate. Businesses and Supermarkets all over the world are trying new technologies to gain more information about customers, and also provide more values for the customers. As you walk around the supermarket, cameras and investigators may be watching to see how long you look at certain products, if you touch the products; what gets purchased. This isn’t so far away from the Mum-and-Dad convenience store, in these smaller one-on-one style stores, the proprieters can see what you do, and consciously change their store and contents to reflect customers demands. However, they can only do it on a small scale.

The Boston Globe (Bray 2003) reports on a supermarket “Stop & Shop” that is using technology to lure customers. They provide a “Shopping Buddy” so customers can track all of their purchases as they shop, allowing the cost-concious to carefully note expenditure. The Shopping Buddy (using infrared sensors) will also alert the customer to where they are in the store, what they previously purchased in the isle they are in, and what specials are here today. They use hand-held laser scanners and checkout is done as you shop. Customer reation is mixed – some loving the concept, others wary and uncomfortable that their habits are being tracked.

But we don’t trust new technology

The biggest reason that technology lags the marketplace is that customers are cautious. For example, telephones are much less secure than Internet standard 128bit encryption, yet many still pay bills by phone and avoid the internet, claiming it as insecure. The theft of credit card details makes consumers wary, but they still use this very insecure technology, thanks in part to Credit merchants willing to absorb the risk and marketing the convenience aspects.

RFID (Radio Frequency Identification) is set to revolutionise marketing, the question is one of timing. So far, it has only been successful outside of the Business-to-Customer marketing influence, being used in situations such as tracking pallets of goods. RFID can provide a multitude of advantages to the business and customer, such as complete product tracking; know exactly when stocks run low on shelves, keeping inventories tight. RFID also offers marketing opportunities, such as complete product and customer tracking. Lessons being learnt today about RFID graphically illustrate the difficulties that exist in online retail marketing and e-commerce. To put this in context, take for example Prada, who installed RFID and wireless readers for salespeople to be able to access online product databases, and, interestingly, customer buying habits. The salesperson can orient themselves as required. If someone was to buy a certain color skirt, there may also be a high probability that they will also buy a certain colour pair of shoes; and the salesperson could suggest to them, with a high chance of another sale.

"It turns out the ladies who shopped at Prada objected to the data collected," said Terry Retter, a technology forecaster at PricewaterhouseCoopers. "They didn't mind Prada keeping track of what they bought and when, but they did mind the store knowing what size they wore." - Australian Financial Review 2003.

The RFID technology was promptly removed from the store. RFID will certainly become a technology revolution for the world, but cases like this illustrate the issues with new technology and marketing management. In the case of the Internet and E-commerce, the technology experience is vastly different, and more complex, in many more ways than this simple example of RFID.

Perhaps it should be obvious, but it seems that we never learn from the same lessons; consumers are always wary of new technology and processes appearing in the marketplace. Marketers would like customer’s to embrace the technology and cast fears away, but this won’t happen without assistance. The marketing organization has the responsibility to ensure that fears are dispelled and the public educated.

Things to fear

Of course, technology in the wrong hands can cause harm. I have noticed some seriously disturbing marketing technology emerging on the Internet.

Some of the above examples demonstrate businesses trying to sell the technology as “product tracking”, where in fact it is undoubtedly being used for “customer tracking”. After all, it’s far more efficient than paying staff to perform manual observations, and with more data, statistical analysis and data mining becomes better. The customer may feel that their habits are been recorded, and their purchases tracked, and not like this.

Now if we extend this notion to the Internet and e-commerce, the customer doesn’t necessarily see other purchasers or visitors, and doesn’t see cameras following them around the store. Yet, in many ways the web-marketer can track and profile a website visitor much more accurately, and interact with the customer much more directly. For example, in a bricks-and-mortar shopping centre, prices and advertisements do not change (yet) depending on who walks past them. However, with the Internet, and customer profiling, it is quite easy to provide different customer profiles with different prices and advertisements. Is that discriminatory or just good marketing?

On the Internet, information is ubiquitous. Analysis can be performed on which pages the customer observes, what he reads, what he buys, what he has bought in the past, where the customer comes from, what subjects they like, etc. A classic example is Amazon.com (http://www.amazon.com) . If you find a book, Amazon will also provide you with a list of related books, and others books that other customers bought when they purchased the book. They are only able to do this using customer profiling. They are trying to orient their products closer towards your needs. This is good marketing strategy.

However, the Internet makes it easier for unscrupulous companies to buy and sell your purchasing habits, without you ever knowing. There are no inefficient manual processes, and huge quantities of data abound. Usually the privacy agreements contains clauses that allows them to operate with their affiliates or other third-parties. This breeds even more distrust amongst service users, and attitudes towards the online seller can be negative. Much work needs to be done in convincing the customer that your e-commerce or online retail store respects and values them, minimally, these privacy issues should find their way into codes-of-practice.

Some companies have made a living selling this type of information. So-called spy-ware or ad-ware allows companies to track every single movement of customers. For example, the Gator Corporation (Gator.com) state that they are the online behavioral marketing leaders. They provide what they say is “free” software to benefit the Internet community. They operate in a grey area of legality, as the user will agree to install the software as a very small point in a user license agreement. In reality, consumers are often misled into agreeing that the software is installed, which then displays targeted advertisement pop-ups (Pop-ups are often designed as sign banners, and follow traditional marketing practices), and modifies website content in-situ, depending on such things as websites visited, search results requested , etc. Of course, once installed, all of the user’s online web activity is continuously (and closely) monitored until it is removed. For more information on these nasties, see http://www.google.com/search?q=spyware  .

E-mail “spam” is another area that creates fear in consumers. It is the equivalent to mass-marketing at your letterbox, but delivered to your email. However there are subtle differences. Costs are much lower, and response rates are much lower, meaning that literally millions and millions of emails are sent out continuously. Spammers often work with others who “harvest” and sell your email address details, and personal habits. It is also confirmed as one of the top problems for Australian businesses – they rate it as a major problem (Pearce 2003).

A legitimate version of spamming is to provide a mailing-list capability to your business, one on which you would provide useful articles and information to clients. In the email, you could also describe products and services that you wish to showcase at the time. Customers should be able to opt-out, and their customer contact information never given to others. This also offers a low-cost method of testing marketing methods and techniques, without the high costs or difficulties often associated with cold-calling or standard mass mailouts.

Future of Australian businesses and web marketing

As appliances and products become integrated with the Internet (such as phones, even toilets, gas pumps, kiosks) the PC and Browser may not be the dominant form of interaction with the Internet forever. M-commerce (mobile phones) will become more prevalent, and business will need to determine how they can interact with these new emerging platforms. Virtual shop-fronts: the line will become blurred between the physical and virtual shop-fronts. Even in physical stores, interactive billboard style advertising may allow customers to shop for virtual products, and even order them directly to the physical store.

I argue that businesses need to transform their thinking. They need to focus on orientating towards the next-generation of consumers; information-rich , internet-savvy shoppers with global reach. As already shown, there has been a strong up-take of computers and internet access, and Australia is ready for e-business. There has also been significant contributions to the Australian ICT economy, and direct contributions to Australia’s GDP, all due to IT. Australia needs to capitalise on these opportunities, and the best way is to ramp up web marketing efforts. It would be beneficial if Australian businesses adopted integrated, holistic and one-to-one approaches to their web-marketing efforts in the future.

Current improvements in efficiencies have largely been within the business (B2B), allowing inventories to be reduced, products-lines able to be managed, with eventual cost-savings passed on to consumers.

Substantial improvements to e-commerce/internet businesses in Australia is yet to occur, yet the market is ripe for exploitation! Customers have the attitude and tools to interact with business online, but businesses are not orientating themselves properly to the customer.

The Australian climate is very favorable for a near-term and long-term expansion of the information economy. This means that Australian companies embarking on online presence and marketing efforts really need to:

  1. Assess their business and the viability of their product or service to be marketed electronically, via the Internet. Some typical Australian industry areas such as resources/commodities will not necessarily perform better with increased market orientation (Narver & Slater 1990)
  2. Provide information and gain credibility with Customers (use of “Power of Legitimacy”), for example using mailing lists.
  3. Provide a professional website, that has been highly user-tested and product focused. Outsourcing is recommended. Remain dynamic, adopt frequent changes to the website and the functionality in line with customer orientation.
  4. Use Business-Intelligence tools, one-to-one profiling, adjusting strategies in real-time .
  5. Integrate the traditional and web marketing strategies into a single, holistic marketing strategy.

 

Conclusions

A business using the internet will need to remain dynamic and market oriented towards unique information-savvy customer groups. These market-oriented busineses will need to have a comprehensive understanding of the moderating processes, and continue to develop new market-sensing techniques in order to maintain a comparative advantage (Slater 2001).

We have also seen that the simple process of shopping is extremely sensitive to technology changes. Customers don’t like the rules to be changed, new processes are sometimes rejected outright (eg Woodhead and Connors 2003) hence the need for focus-group testing. Another wildcard is that the recent uptake of broadband by businesses and consumers could spark a new growth phase of e-commerce and web-marketing opportunities.

The holistic approach in the use of the technology and marketing departments, and the development of integrated marketing strategies will undoubtedly be an important issue in the success of web marketing efforts. Businesses must ensure that the front-end is marketing-oriented, easy-to-use, and constantly tested for usability. The backend must provide connection to the business resources, without complicating or driving the front-end. The marketing strategies should also be changing (in real-time) depending on the one-to-one customer feedback.

 

About The Author

Andersen Technology Development Chief Executive Officer is Mr Devon Andersen, who manages, outsources and develops software and research projects.

Mr Devon Andersen holds a 1st Class Honours Bachelors degree in Applied Physics, and also a Multidisciplinary Science Bachelors degree in Computer Science and Physics from Curtin University of Technology, Western Australia. Devon is currently completing his Masters in Business Administration at the Graduate School of Business, Curtin University.

Devon can be contacted via the http://at.dev.at website.

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Appendix

Source: Wang et al, 2002

Source: Wang et al, 2002