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Question
Subject: Consumer Behaviour with Information Technology Posted: 05 Feb 2005 02:52 PST
Category: Business and Money Expires: 07 Mar 2005 02:52
Asked by: rich80-ga PST
List Price: $100.00 Question ID: 469313
Hi,
Answer
Rated:
-----------------------------------Historical
Background----------------------------
"First we must confront the question of what happened during the late
1990s. Viewed from 2003, such an exercise is undoubtedly premature,
and must be regarded as somewhat speculative. No doubt a clearer view
will emerge as we gain more perspective on the period. But at least I
will offer one approach to understanding what went on.
"The Internet for us was like air. It was there all the time - you
wouldn't notice it existed unless it was missing. But the Internet as
a major social phenomenon didn't enter our radar until the advent of
the World Wide Web, which was developed in Europe at CERN, beginning
in 1989, by a team of physicists that included an alumnus of the Media
Lab. That was what provoked the big change in the Internet. "
http://archives.obs-us.com/obs/english/books/nn/bd1101bn.htm
Some innovations, such as the cell phone have clearer economic return.
The cell phone had measurable impact on the productivity of the
American worker in the late 1990s that was far greater than most other
technological improvements."
http://en.wikipedia.org/wiki/Digital_Revolution
"The Net and other online systems - not to mention the growing
presence of personal computers. Andy Grove, CEO of Intel, is fond of
pointing out that every two years more computing is manufactured than
existed on the planet previously. By 2000, Grove estimates, the PC
industry will be shipping 100 million Pentium-style microprocessors a
year. I think he's wrong: he'll be shipping 500 million."
http://archives.obs-us.com/obs/english/books/nn/bd1101bn.htm
Negroponte: For the past five years, people who build TV sets have
been putting more and more computation into their TVs, and people who
build personal computers have been putting more and more video into
their personal computers. When these two industrial trends converge,
there will be no distinction between the two. Don't worry about the
difference between the TV set and the PC. That's not fundamental,
because basically a TV set is a personal computer you look at from the
sofa. Focus on the broadcasting side of it. In the future, we won't be
pushing bits at people like we're doing today. It doesn't matter
whether you call the receiver a TV or a PC. What's going to change is
how those bits are delivered. "
http://archives.obs-us.com/obs/english/books/nn/bd1101bn.htm
Future Predictions:
1. Failure to understand customers, why they buy and how they buy.
Even a product with a sound value proposition can fail if producers
and retailers do not understand customer habits, expectations, and
motivations. E-commerce could potentially mitigate this potential
problem with proactive and focused marketing research, just as
traditional retailers may do.
2. Failure to consider the competitive situation. One may have the
capability to construct a viable book e-tailing business model, but
lack the will to compete with Amazon.com.
3. Inability to predict environmental reaction. What will competitors
do? Will they introduce competitive brands or competitive web sites.
Will they supplement their service offerings? Will they try to
sabotage a competitor's site? Will price wars break out? What will the
government do? Research into competitors, industries and markets may
mitigate some consequences here, just as in non-electronic commerce.
4. Over-estimation of resource competence. Can staff, hardware,
software, and processes handle the proposed strategy? Have e-tailers
failed to develop employee and management skills? These issues may
call for thorough resource planning and employee training.
5. Failure to coordinate. If existing reporting and control
relationships do not suffice, one can move towards a flat,
accountable, and flexible organizational structure, which may or may
not aid coordination.
6. Failure to obtain senior management commitment. This often results
in a failure to gain sufficient corporate resources to accomplish a
task. It may help to get top management involved right from the start.
7. Failure to obtain employee commitment. If planners do not explain
their strategy well to employees, or fail to give employees the whole
picture, then training and setting up incentives for workers to
embrace the strategy may assist.
8. Under-estimation of time requirements. Setting up an e-commerce
venture can take considerable time and money, and failure to
understand the timing and sequencing of tasks can lead to significant
cost overruns. Basic project planning, critical path, critical chain,
or PERT analysis may mitigate such failings. Profitability may have to
wait for the achievement of market share.
9. Failure to follow a plan. Poor follow-through after the initial
planning, and insufficient tracking of progress against a plan can
result in problems. One may mitigate such problems with standard
tools: benchmarking, milestones, variance tracking, and penalties and
rewards for variances.
10. Becoming the victim of organized crime. Many syndicates have
caught on to the potential of the Internet as a new revenue stream.
Two main methods are as follows: (1) Using identity theft techniques
like phishing to order expensive goods and bill them to some innocent
person, then liquidating the goods for quick cash; (2) Extortion by
using a network of compromised "zombie" computers to engage in
distributed denial of service attacks against the target Web site
until it starts paying protection money.
http://en.wikipedia.org/wiki/E-commerce
--------------------------------Product
Overview-----------------------------------
"Wired: Printed books have been around for 500 years. Obviously,
they're an enduring medium.
Negroponte: The thing that's been around for thousands of years and is
so powerful is the word. The power of the word is extraordinary, and
if the word is embodied as text, that, too, is powerful, regardless of
whether the text lives as ink on pulp or signal on fiat-panel display.
Words aren't going away, and I think the book/no-book argument is dumb
once you realize that all we're talking about are variations in
display technology. I'm not anti-book or anti-print; it's just that
soon we're going to be doing our "printing" in a different medium. "
http://archives.obs-us.com/obs/english/books/nn/bd1101bn.htm
* Concerns about security. Many people will not use credit cards over
the Internet due to concerns about theft and fraud.
* Lack of instant gratification with most e-purchases (non-digital
purchases). Much of a consumer's reward for purchasing a product lies
in the instant gratification of using and displaying that product.
This reward does not exist when one's purchase does not arrive for
days or weeks.
* The problem of access to web commerce, particularly for poor
households and for developing countries. Low penetration rates of
Internet access in some sectors greatly reduces the potential for
e-commerce.
* The social aspect of shopping. Some people enjoy talking to sales
staff, to other shoppers, or to their cohorts: this social reward side
of retail therapy does not exist to the same extent in online
shopping."
http://en.wikipedia.org/wiki/E-commerce
------------------------Important
Studies----------------------------------------
http://www.ascusc.org/jcmc/vol5/issue2/hairong.html
This study proposed and tested a model of consumer online buying
behavior. The model posits that consumer online buying behavior is
affected by demographics, channel knowledge, perceived channel
utilities, and shopping orientations. Data were collected by a
research company using an online survey of 999 U.S. Internet users,
and were cross-validated with other similar national surveys before
being used to test the model. Findings of the study indicated that
education, convenience orientation, experience orientation, channel
knowledge, perceived distribution utility, and perceived accessibility
are robust predictors of online buying status (frequent online buyer,
occasional online buyer, or non-online buyer) of Internet users.
Implications of the findings and directions for future research were
discussed."
*Nicholas Negroponte
From Wikipedia, the free encyclopedia.
http://en.wikipedia.org/wiki/Nicholas_Negroponte
Being Digital sold well and was translated into some twenty languages.
However, critics faulted his techno-utopian ideas for failing to
consider the historical, political, cultural realities with which new
technologies should be viewed. In the years following dot-com bust,
the book dated quickly. Yet one can still appreciate the unique
quality of the author's vision, and draw inspiration from the sense of
speculative possibility that washes over the reader."
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* David Weinberger
"What is the Web for? And why do we care so much? Why has this simple
technology sent a lightning bolt through our culture? It goes far
beyond the Web's over-hyped economic impact: 500 million of us aren't
there because we want a better "shopping experience." The Web, a world
of pure connection, free of the arbitrary constraints of matter,
distance and time, is showing us who we are - and is undoing some of
our deepest misunderstandings about what it means to be human in the
real world."
Harvard Page
http://cyber.law.harvard.edu/home/david_weinberger
---------------------------------------------------------------------------
---------
* Patricia Seybold
On E-valiablility Theory:
If you go to a website and it's not available, you won't go back. It?s
that simple. Customer expectations have changed. They expect your site
to be available at all times.
Home Page
http://seybold.com/patricia.htm
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* Schumpeter's Theory
---------------------------------------------------------------------------
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*Gordon's Theory
<<But the Internet revolution took only a few years. Why was it so
rapid compared to the others? One hypothesis is that the Internet
revolution was minor compared to the great technological developments
of the past. (See, for example, Gordon [2000].) This may yet prove to
be true-it's hard to tell at this point.
"There are those that claim that we need a new economics to understand
the new economy of bits. I am skeptical. The old economics-or at least
the old principles-work remarkably well. Many of the effects that
drive the new information economy were there in the old industrial
economy-you just have to know where to look.
----------------------------Primary References/
Sources-----------------------
Electronic commerce
From Wikipedia, the free encyclopedia.
http://en.wikipedia.org/wiki/E-commerce
----------------------------Additional
Information--------------------------------------
Charles Babcock. Will open source get snagged in .NET? ZDNet News,
August 6 2001.
http://www.zdnet.com/zdnn/stories/news/0,4586,2801560,00.html.
Ward Hanson. The original WWW: Web lessons from the early days of
radio. Journal of Interactive Marketing, 12 (3): 46-56, 1998.
http://www3.interscience.wiley.com/cgi-bin/issuetoc?ID=79208.
Monica Roman. Black ink all over Hewlett-Packard. Business Week, 2001.
http://www.businessweek.com/@@8zC3j2QQgISnLgEA/premium/content/01_22/
Pamela Samuelson and Hal R. Varian. The 'New Economy' and information
technology policy. In Jeffrey Frankle, editor, Economic Policy During
the Clinton Administration. MIT Press, Cambridge, MA, 2002.
http://www.sims.berkeley.edu/~hal.
Good luck!
-Anthony
(adiloren-ga)
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Cross-cultural marketing is defined as “the effort to determine to what extent the consumers of two or more
nations are similar or different. This will facilitate marketers to understand the psychological, social and
cultural aspects of foreign consumers they wish to target, so as to design effective marketing strategies for
each of the specific national markets involved.”
A company can enter a foreign market as a
??Domestic exporter
??Foreign importer
??Foreign government-solicit the firm to sell abroad
The firm’s objectives could be:
??To determine how consumers in two or more societies are Similar / different and devise suitable,
appropriate strategies
??Devise individualized marketing strategy if cultural beliefs, values and customs of a specific country are
different
Characteristic features of a firm going global:
1. High market share in the domestic market
2. Advantageous economies of scale
3. Access to marketing/manufacturing bases across global borders
4. Availability of resources and capability to absorb huge losses
5. Product/technology clout
6. Cost and differentiation advantages
Problems in Cross Cultural marketing
1. Problems related to product selection: The marketer going for cross cultural marketing has to select the
customers/ market not on the basis of the superficial similarities of age or income, but by using the real
motivating factors that prompt them to accept or reject products.
2. Problems related to promotion/marketing communication: e.g. Ariel in the middle east and also Pepsi
3. Problems related to pricing: the marketer has to adjust his pricing policies according to the local economic
conditions and customs.
4. Problems related to selection of distribution channels: in Japan, P & G
used this to sell soap
Cross-Cultural Consumer Analysis
To determine whether and how to enter a foreign market, we need to conduct some form of cross-cultural
consumer analysis. Cross-cultural consumer analysis can be defined as the effort to determine to what
extent the consumers of two or more nations are similar or different. Such analysis can provide marketers
with an understanding of the psychological, social, and cultural characteristics of the foreign consumers they
wish to target, so that they can design effective marketing strategies for the specific national
markets involved.
Similarities and differences among people
A major objective of cross-cultural consumer analysis is to determine how consumers in two or more
societies are similar and how they are different.
• Fight for one’s
beliefs/positions
• Individualistic
• Clear-cut
• Specific
• Display emotions in public
• Result oriented
• Make a short story long
• Verbal communication important
• Interested in what is spoken