MGS 523 

At the time of  this course (Sept - Dec 2001) many significant changes continue to take place in the further development of the internet (eg. mobile and wireless internet) 

So, the purpose in giving you information and links to learn about the origins of the Internet and WWW is to equip you with an understanding which will help you personally judge the immediate future events and activities so that you may be better able, as a student and later as a business person, to evaluate particular situations and judge whether to use, or not use, learn or not learn, spend money or save money, as these develop.
WTGR

Chapter 1
 
 
 
 
 
 
 
 
 

Chapter 1
 
 
 
 
 
 
 

Chapter 1
 
 
 
 
 
 
 
 

Chapter 1

Key Points for discussion from Chapter One

Interdisciplinary nature of e-Commerce (e-Business) p. 13, 14

• Marketing
• Computer Sciences
• Consumer behaviour and psychology
• Finance
• Economics
• MIS - Management Information Systems 
• Accounting and Auditing
• Management
• Business Law and Ethics
• Linguistics

• Expands the size of the market from regional to national or national to international
• decreases costs

• costs of creating the product
• costs of distribution
• costs of processing (orders from the customers)
• costs of storing information
• reduces inventories
• enables customization of products
• reduces the time exposure
• increases productivity
• lowers telecommunication costs
• improves customer service (in some cases)

• can buy when you want, from more locations (internet connected terminals)
• more choices
• sometimes products are less expensive
• can receive more information about the product, make a more informed decision
• greater information leads to enhanced customer satisfaction
• quicker delivery (for online products)

• cocooning - more individuals can work offsite
• less affluent people can buy more and increase standard of living (questionable says WTGR)
• facilitates delivery of public services (Toronto water bills online now)

• Technical Limitations
• some protocols are not standardized around the world
• reliability for certain processes
• insufficient telecommunications bandwidth
• software tools are not fixed but constantly evolving (ie. Netscape 3,4,4.7,4.75 etc.)
• access limitations of dial-up, cable, ISDN, wireless
• some vendors require certain software to show features on their pages, which is not common in the standard browser used by the majority
• Nontechnical Limitations
• costs
• security and privacy
• lack of trust and user resistance
• tactile limitations
• legal issues outstanding
• limitations of support services
• lack of critical mass in certain market areas for sellers and buyers
• accessibility outside of urban/suburband areas effects universality

 
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 

Chpt Eleven - Infrastructure for e-commerce

Basics of a web site

• graphics
• texts
• navigation
• catalog of products
• payment method

• authenticity
• privacy
• integrity
• nonrepudiation

Rob's story was based on a new study by Deloitte and Touche that shows that while roughly one third of retailers with a Web presence consider their online store to be  "strategic," a majority have set up  Web operations with no clearly articulated strategy and are merely "testing the waters  to gauge Internet demand." 
 http://www.ecommercetimes.com/news/articles2000/000126-1.shtml
 

Components of a good strategy
First, understand how Strategy fits into the overall corporate planning framework

• Goal
• Objective(s)
• Plan(s)
• Strategy(ies)
• Tactics

Goals-- Goals are the ultimate thing you want to achieve. They are the statements that a company uses to motivate employees and statements used to judge and measure challenges that you face. Excellently worded goals should include measurable statements.
WTGR

Examples: 

• To be the largest on-line cosmetics retail site on the planet

.

Examples: 

• To have the largest on-line product offering of cosmetics

(theoretically if you have the largest product offering, you have the potential to make the largest sales, which helps fulfill the goal)
• To have the most competitive prices for cosmetics sold on-line
• To carry  the largest brand selection of cosmetics sold on-line

• generating leads, 
• increasing sales, 
• increasing store traffic, 
• reducing customer service costs or 
• improving brand awareness.

Examples: 

• Develop online giveaways to drive consumers to our product.
• By having on-line contests with prizes given away by other companies, you associate your brand with other circumstances, thereby increasing your brand depth
• Build links from the web sites of famous cosmetics brands and have reciprocal links.

• Strengths
• Weaknesses
• Opportunities
• Threats. 

(SWOT is explained in the text in Chpt 7, page 188-189)

Examples: 

• Establish ongoing monthly contests giving away sample product to 10 lucky winners. 
• To enter, consumers must complete a data sheet, providing demographic information.
• Winners will be announced in the product category of the Web site to ensure consumers see our product line.

It was explained that Industry Associations contain membership lists of companies which is information you could use to screen which companies you consider for your project.
 
 

	Automotive Parts Manufacturers' Association APMA Membership Directory  http://www.capma.com/lin_mems.html
	Automotive Recyclers' Association  http://www.oara.com/members.html
	Canadian Cosmetic, Toiletry and Fragrance Association  http://www.cctfa.ca/members.html
	Ontario Propane Association  www.propane.ca/members/members.html
	Canadian Plastics Industry Association  http://www.cpia.ca/scriptcontent/index.cfm

The purpose of this material is to focus on the customer
- who is the customer
- how do they think
- what are things to make sure you do, do not do
- how to be convincing
 

There are a couple of suggestions as to why that may be the case.
1. The largest number of sites from which to buy are U.S. based, which is a disincentive to Canadian shoppers who have to consider the exchange rate disadvantage and additional chsipping costs
2. Sociocultural considerations might be brought in to explain why Canadians are a bit more hesitant to try buying on the Internet - eg. culturally we don't like auctions as much in Canada as they do in the U.S., therefore in online considerations, it is not surprising to see 51% of U.S. shoppers have bought at an auction whereas only 32% of Canadians did.

as used by Substance Consulting 
 http://www.gdsourcing.com/substance/datac.htm
on their web site

this article was online at
 http://www.theglobeandmail.com/gam/ROB/20001117/RNETT.html

"Nearly half of all Canadian homes are now hooked up to the Internet, more than in either the United States or leading European countries" Dixon quotes from the Pricewaterhouse Coopers study

The study says "more than 48 per cent of Canadian households now have Internet access, up from 43 per cent last year [1999]"
"This compares with 43 per cent of homes in the United States, 38 per cent in Australia and 26 per cent of households in Britain, France and Germany combined"

Dixon explains that "Most of the growth in Canadian home Internet use this year has been due to a rapid expansion in Quebec. About 42 per cent of households in that province are now wired to the Web, up from only 29 per cent last year, as more and more French-language Web sites are created..."

However, the fast pace of the trend may be ebbing. Dixon notes that ".. for the rest of Canada, the rate at which Internet use has grown has slowed. Fifty per cent of Canadian homes outside of Quebec now have Internet access, up from 48 per cent last year." A rise of 2% over 12 months is quite a drop from the fast pace of increase between 1998 and 1999.
 

Dixon says "...Americans are spending less time on-line, down to four hours a week from five hours last year. This decline in the United States "may be a sign of the medium's maturity and that people are becoming more economical and efficient in their use of the Internet," the study said."

.

.

Pricewaterhouse Coopers is another one of the big accounting/management consulting firms that are trying to secure their reputation among their existing clients as well as get some publicity for attracting new clients. Whenever you read a newspaper article which has 75% of the content based on somebody else's material, eg. in this case a study by an accounting firm, the best thing to do is go to the web page for that company and see if you can find a link to the original study, and, in most cases you can..  www.pwcglobal.com/ca/eng/main/home/index.html in Nov 2000, the study was noted on the PWC site at  www.pwcglobal.com/extweb/ncsurvres.nsf/docid/0AD8B61796C17A148525699700708245 By going to the PWC site you can learn that the survey was compiled from interviews with 802 Canadians. Sometimes this information (the number in the sample) is helpful to know in order to guage the validity of the conclusions. WTGR

The question of to what degree Canadian business is serving the e-business community compared to American companies

Susan Pigg writing in the Toronto Star June 17th, 2000 writes
"More online shoppers buying Canadian"

Pigg reports in June 2000 that "In just a year, the number of Canadian online shoppers buying from Canadian sites has more than doubled from 28% to 58%." In the same article, Chris Ferneyhough of polling giant Angus Reid Group says Canadians do indeed want to be able to buy from Canadians so this will help boost Canadian retailers. Pigg concludes her article by saying that one of the reasons why there are more Canadians buying Canadian sites is simply, duh, because there are more Canadian sites offering products and services.
 
 

Business-To-Consumer Online Sales Expected To Reach  $4.1 Billion In 2000 -- More Than Double 1999’s Spending   http://www.Angusreid.com/MEDIA/CONTENT/displaypr.cfm?id_to_view=1043 Subtitle: More dollars than ever being spent at Canadian e-retailers: Angus Reid/J.C. Williams Group Survey

"J.C. Williams Group and Angus Reid asked Canadians where their e-retail purchases are being made, and found that Canadian retailers have made  exceptional gains in a relatively short period of time. Back in Q1 of 1999, 62% of online purchases were  made at U.S. sites, and 28% at Canadian sites. By Q4 of 1999, this had reversed, and 52% of purchases were at Canadian sites compared to 44% at U.S. sites. The most recent wave of the survey, conducted in the first quarter of 2000, has shown that the momentum that Canadian retailers  gained over the Christmas shopping season of 1999 has carried over into 2000. The joint study found that 58% of Canadian online shoppers in Q1 of 2000 made their most recent purchase at a Canadian site (and only 37% at a U.S. site)"

How much do Canadians buy on the internet compared to Americans
Forrester Research Inc. of Cambridge, Mass. says by the end of 1999
9% of Canadian households had made a purchase over the Internet
23% of American households had made a purchase over the Internet

"If a well-researched study reveals that there are now more female Internet users than ever before, this information can be used to support a reassessment of the marketing mix and a reallocation of advertising dollars [read promotional mix]."
 

Marketing Mix product price promotion place

Promotional Mix Mass Selling Advertising Publicity Sales Promotion Personal Selling

"... as a result, companies who have traditionally courted the female market through television and magazines, are now courting the female market through the addition of online services and the Internet".

"Women" Customers

In June 2000, Ms. Zena Olijnyk wrote and interesting article for the National Post (which was also included in the online version) titled
"More Women Using Internet to Shop"

The original article was still on the National Post's web site in August 2000
check
 http://www.nationalpost.com/search/story.html?f=/stories/000614/316546.html

Olijnyk wrote that
"...study of more than 2,000 Canadian women ...indicates 46% have used the Internet to make an online purchase in the last six months... That's up from October, [1999] when a survey said 38% of women had bought online. "

"...  there are differences in the types of transactions men and women make on the Net; women tend to buy more books, gifts and toys, while men tend to buy more computer software". 

"Women" 
Customers
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

"WHO" 
is using the
Internet

"Women" 
Customers

Source: Ernst & Young (January, 2000 )

The chart to the immediate left was found Sept 27th, 2000 and we have added it in here because it serves to show that Canadian women have, in a short period of time, moved from 22% to 38% of Canadian online shoppers.

• "7 in 10 female Canadian Internet users use the Internet during the shopping process"
• "46% of female Canadian Internet users have made a purchase online, and 26% use the Internet to browse or shop for products before purchasing offline"
• "The percentage of female Canadian Internet users who have made an online purchase has grown by 21% since October 1999"

Here is some more current information on Canadian women shoppers and you can see that it is now roughly 50/50 This information was gathered by Ernst & Young in December 2000 and shws that the percentage of women shoppers has grown from 21 % in 1999 38 % in Sept 2000 49 % in Dec 2000 so we can conclude that the % of women online in Canada is growing very fast

a great
interest
to
companies
marketing
products
to women
 
 
 
 

Women
Online

a great
interest
to
companies
marketing
products
to women
 

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

Leaving us to question is business doing well, or poorly in dealing with the potential of the Internet. Different reporters and columnists can't seem to agree.
 

"CFIB’s chief economist and director of research, Ted Mallett said: "The small business sector has been adopting general Internet technology very rapidly during the past few years. Now we are seeing small firms increasingly embracing more complex and sophisticated e-business models. The most basic application is
 of course e-mail, and it is used by virtually every business that is  on-line. So for the purposes of this study, e-businesses were defined as firms using the Internet to market their services or make transactions on-line -- meaning they are maintaining a web  site, purchasing for their business on-line or are selling their     products over the Internet." In total, Mallett said that 35 per cent of Canada’s small- and medium-sized firms can be considered e-businesses."

The reason we feature the CFIB is in respect of the fact that the fastest growing area of business (offline and online) in the late 1990's and early millenium, is small business.
WTGR

MGTD06's
own list of
Do's and Don'ts

"Things you have to
be convincing about"

Source: Ernst & Young (January, 2000 )as used by Substance Consulting 
 http://www.gdsourcing.com/substance/datac.htm
on their web site
http://www.gdsourcing.com/substance/dcey3.htm#indexf

Source: Ernst & Young (January, 2000 ) as used by Substance Consulting 
 http://www.gdsourcing.com/substance/datac.htm
on their web site
http://www.gdsourcing.com/substance/dcey3.htm#indexf
 

E-tailing
Considerations

"Things you 
have to be 
convincing 
about"
 
 
 
 

"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 

1. Preliminary requirement determination
(translation: "looking for stuff 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)

1. computer
2. modem in the computer
3. an account with an ISP Internet Service Provider company
- the account has to include web page hosting
4. browser - to see web pages
5. images to put on the pages on the web site
6.  text to put on the pages on the web site
7. software to make and edit web pages (HTML editors)
- Netscape Composer
- HoTMetaL 6.0
8. software to send the pages to the hosting server
- eg. WS FTP
 

1. a product or service to sell
2. a domain name that is registered and hosted
3. web page describing the product/service
4. marketing
5. a payment system 
6. shipping methods (for physical products)
7. a mechanism to deal with customer service inquiries and returns
8. people to carry out the tasks of 1-7
9. money to pay for the people, domain registration, hosting

discussed in MGS523
class
19 Sept
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

FTP Basics

discussed in MGS523
class
19 Sept

8. software to send the pages to the hosting server  - eg. WS FTP

FTP is similar to using Windows Explorer to move files around.
Basically you need to take the ".htm" files , and images, you have made, and transfer them from your computer to the computer acting as the server for the web site. Its called a server because when the viewer calls up the page, the host "serves it" so it can be viewed.

One of the most popular reason why you cannot see something on a web page is because the file you are looking for, has not been properly FTP's to the server.

Where to go to get FTP software