Internet on business_print

Internet Technology and your Business-
Understanding the Aspects of e-Business.
An Introduction and Guide

Francis Stevens George
Kizuki Group-

Information Technology.FSG www.kizukigroup.com 1

Telecommunications & Internet


Business Value of Telecommunications
Strategic Capabilities Example Business Value

Overcome geographic Use the internet and Reduce delay in order
barriers extranet to transmit filling, improve cashflow
customer orders for order by speeding billing.
processing.

Provide information to
Overcome time barriers remote locations upon Speed sales, less lost
request. Credit sales due to lack of
authorization. information.

Reduce costs of more
Overcome cost barriers traditional means of Reduce expensive
communication- business trips
Videoconferencing
Overcome structural
barriers Support linkages for Fast. Convinient services
competitive advantage- locked in customers and
B2B EC suppliers.

Information Technology.FSG
www.kizukigroup.com 3

Strategic Business Value of Internet based
applications

Internet Marketing & Product Sales & Support & customer
Capability Research Distribution feedback

Data for Market Reach new Access to customer
Research customers Comments online

Benefits Consumer response Low cost distri Immediate response
To new products bution to customer
To company problems
Environmental Multiple contact
scanning points at no incre
mental costs

Opportunities Enhanced customer
For Increase Market Share Lower cost margins
satisfaction
Advantage
Adapted from Mary Cronin-Doing MoreBusiness on the Internet .

eBusiness & eCommerce


The Difference between e-Business & eCommerce

• E-Business is about interaction. It represents a more focused
and comprehensive involvement of the organisation. The
platform is attitude shift.

• E-commerce is about transaction. It represents one aspect of
E-Business. The platform is hardware and software.


eComerce/eBusiness-Strategic
Considerations

Business Strategy Technology Strategy
Consideration

What is our value proposition? Is e-business an element?

Where are we going, and how long Can the internet accelerate the
before we get there? effort?

Where do we gain strategic Can the internet provide additional
advantage? leverage?

Who are our customers? Are they computer literate? Can the
internet improve their buying
experience?
Who are our suppliers? Do they have technology interface
with our system?

What are the demands of our Will web enabled commerce improve
stakeholders? our valuation?


Investment Approach to eCommerce & eBusiness

High
Short-Term Strategies Long-Term Strategies
E-Business
Self-services
Web Sales
CRM SCM
Intergrated
Web Store
Collaborative
Extranets
Business Interactive Extranets and
Value Marketing Exchanges

Web Storefront Procurement
Automation
& e-catalog
Community
Extranets
B2C Customer Self
WebBbrochures B2B Service

Short-Term Projects Operations Automation
Time to Implement High
Low


How your company can use the Internet for
Business

Inventory
Management
System

Suppliers
Extranet for EC, access
Head Office: Inventory, replenish stock,
Marketing,Electornic THE INTERNET Send documents, specs.
Commerce,
Collaboration with
customers,Prospects .

Remote office-
Business Partners- Customers- Intranet links,virtual teams,
Email,document transfer, Order, shop, get service Interactive communications,
Discussion, extranent /support. Collaboration, computing


Example:Intranets-Enterprise Information Portal
Communication and
Collaboration

Existing Communicate and
Collaborate with e.mail, Everyone
E-mail, Voice Discussion forums, chat
And conferencing
Mail Systems
Intranent F Internet
Business Operations
Enterprise
And Management
Portal
I
Existing database
R
And Enterprise Secure, universal
Applications access to view E
and use corporate
external data W
A
Web Publishing Employees
L
HTML, MS Office, Author, publish, L Extranet
XML, Java and Other and share documents
Document types Customers,
Intranet Portal Management Suppliers,
Centrally administer Partners
Existing Hardware Clients, servers,
And Networks Security, directory,
And traffic


Deriving Business Value from E-commerce
Applications

Generate
New Revenue
Sources

Reduce costs of doing Business

Develop New Markets & Channels

Attract New Customers

Increase customer loyalty & Retention

Develop New Web based Products


The Process of Discovering e-Opportunities

E-Operations
•Automation
•Supply chain recon & Int
•Re-eng of primary infa
•Procurement
•Increase Parenting Value

E-Services
•Understanding customer needs
•Provide excellent customer service
•Knowledge
•Construct customer options

E-Marketing
•Improved and enhanced selling process
•Improved customer experience


Possible Benefits of E-Commerce System-
Intangibles

Intangible Benefits
Intangible Benefits Example
Example
•Improved information availability
•Improved information availability More timely and accurate
More timely and accurate
•Improved abilities in analysis
•Improved abilities in analysis OLAP and Data Mining
OLAP and Data Mining
•Improve customer service
•Improve customer service More timely CRS
More timely CRS
•Improve management decision making
•Improve management decision making MIS/ESS
MIS/ESS
•Impoved competitive position
•Impoved competitive position System to lock in customers.
System to lock in customers.


Possible Benefits of E-Commerce System-
Tangibles

Tangible Benefits
Tangible Benefits Example
Example
•Increase in sales or profit
•Increase in sales or profit EC based Products
EC based Products
•Decrease in information
•Decrease in information
processing costs
processing costs Eliminate unnecessay
Eliminate unnecessay
document
document
•Decrease in operating Costs
•Decrease in operating Costs Reduction in inventory
Reduction in inventory
carrying costs
carrying costs
•Decrease in required investment
•Decrease in required investment Decrease in inventory
Decrease in inventory
investment required
investment required
•Increase operational efficiency
•Increase operational efficiency Less spoilage, waste, idle tume.
Less spoilage, waste, idle tume.


Overview of E-Business Applications
E-Business
Applications
The Internet
Intranets
Telecommunications Extranets
Networks Other Networks

Enterprise Communication Electronic Commerce Internal Business
and Collaboration Systems

-Electronic Mail -POS -Transaction Processing
-Voice Mail -Web retailing -Intranent Ent. Info. Portal
-Discussion Forum -Online Auctions -CRM
-Data conferencing -Interactive Marketing -Workflow Systems
-Videoconferencing -SCM -Activity Monitoring
-Electronic Meeting -Electronic Fund Transfer -Process Control
-Online Banking -Management Support Systems


Business Model


Business Model

What is a Business Model?
A system which defines how a firm will build and use its resources to offer its
customers superior value profitably.

Business model
Customer Value
Scope
Revenue sources
Connected Activities
Implementation
Capabilities
Internet
Performance

Environment
Five Forces
Industry Drivers
Industry Dynamics
Macro


Key Questions for your Business Model.

• Under what business model does my company operate?
• How do we develop a model to ensure success?
• Which business models are taking hold in my industry and why?
• Is my organisation capable of adapting to the required business
model /business model changes?


Business Models-Topography
Self Organizing

Agora Alliance
Controlling

Distributive
Network

Value Chain
Aggregation

Hierarchical
Low Value Integration High


Business Model-Questions
Component Questions for all models Questions specific to
Internet business models

Customer value Is the company offering What unique features of the
something distinctive? internet allows you to offer
something distinctive? Can we
solve a specific problem
Scope To which customers are we What is the scope of customers
offering our value? that the internet enables us to
reach? Does the net alter my
product/service mix.
Pricing How do we determine price? Does the internet make pricing
different?

Revenue Source Where do the mullah come Are revenue sources different?
from? What are the margins?

Connected Activities What set of activities do we How many new activities must
have to perform to deliver be perform? Can we perform
value? existing activities better?
Implementation Organizational structure, What does the internet do?
systems, people and
environment.
Capabilities Capabilities and capabilities What new capabilities?
gaps.

Sustainability How difficult for others to copy Sustainability- easier or more
us? How do we keep making difficult?
money?

Practical Business Question,
Why you cannot wait,
What you must do and know.


Practical Business Questions: We can work with
you to answer some of them.

 How do I Imove my traditional business to e-business?
How do move my traditional business to e-business?

 We have lot of information coming from various
We have lot of information coming from various
sources. How can we collect, analyse and use it to
sources. How can we collect, analyse and use it to
support our business?
support our business?

 We are small company and do not have the resources to
We are small company and do not have the resources to
invest in e-commerce. what can we do?
invest in e-commerce. what can we do?
 We want to see the big picture. How?
We want to see the big picture. How?
 My business needs to get easy-to-use, analytical tools to
My business needs to get easy-to-use, analytical tools to
create good customers profiles. How can we do this?
create good customers profiles. How can we do this?
 We do not know the use of order Management?
We do not know the use of order Management?
 We sell and deliver tangible goods. What can the
We sell and deliver tangible goods. What can the
internet do for us?
internet do for us?


Why you cannot wait?

 Lower costs today to develop and implement.
 Early investment for better pay back in the future.
 Leadership role rather than follower.
 Certain cost savings are immediate-so called ”hard costs”.
 Early starters create electronic structural barriers for followers.
 Companies implementing technology are more likely to meet
customer needs than those who do not.
 Unprecedented market reach at home and abroad.
 Possible elimination of costly intermediaries.


The New Paradigm

Agri/Commodities

Services
Industrial Goods

Logistics Banking Sofware Systems

Telecommunications


A ”must” for Managers

 Conceptual understanding of the
technologies.
 Application Integration.
 Listen, learn, understand and respond.
 Appreciate that e-business is a long term
proposition.
 Understand that e-business is evolving.


Key Advice

 Its not the technology but its applications that counts!
 Technology in itself will not create value.
 Focus on the big picture.
 Build a little, use it, build a little more.
 Your people MATTER


The Stakeholders-eBusiness
 Strategic Partners:
Strategic Partners:
Partners who are planning for the future of your business.
Partners who are planning for the future of your business.
 Operational Partners:
Operational Partners:
Partners helping you run your business today.
Partners helping you run your business today.
 Governance:
Governance:
The individual applying the rules and regulations that are
The individual applying the rules and regulations that are
relevant to your business stakeholders.
relevant to your business stakeholders.
 Customers:
Customers:
The end purchasers.
The end purchasers.
 Community:
Community:
The people who are interested in your products and services,
The people who are interested in your products and services,
people who may or may not include your business customers.
people who may or may not include your business customers.
 Shareholders:
Shareholders:
 Employees:
Employees:


Management Information Systems


Why Management Information Systems

Competition in World Markets
Global Work Groups
Knowledge and information
Knowledge-now a key asset
Productivity
New Product and Services
Flat organisations
Virtual Companies
Increasing decentralization
Lower transaction and coordination costs
Collaborative work and Team work


Management Information Systems-Types

Operational Transaction
Processing
Level Systems

Knowledge Office Automation,
Knowledge work
Level Systems

Management Decision Support,(DSS)
Level Systems Management Infor (MIS)

Strategic Executive
Level Systems Support (ESS)

Link between information Systems

Executive
Support
System

Management Management
Systems Systems
(MIS) (DSS)

Knowledge Transaction
Systems Process


Management Information Systems-Uses

Mapping Structured,
Semi-Structured and Un structured Decisions
Better linkage between activities in the value chain
Promote Quality (TQM)
Manage Strategic Transitions
Improve product and services
Reduce Cycle Time


Systems Development & Organisational Change
Information Technology Organisational Change

Global Networks No longer constrain by location;
transaction costs decline. Everyone
linked through intranets.
Enterprise networks Collaboration, cross functional teams;
customer focus increases, business
process reengineering.
Distributed Computing Decentralization, empowerment

Mobile Computing Anywhere, anytime, work is portable,
increases flexibility.

Digital Work Processes Accessibility, work flows automated,
shared documents,conference calls


Who we are and what we do


What we do?
 Calculate ROI and related financial ratios/analysis on
 Calculate ROI and related financial ratios/analysis on
eCommerce & eBusiness venture
eCommerce & eBusiness venture
 Analyse your customers' expectations related to
 Analyse your customers' expectations related to
eBusiness/ecommerce
eBusiness/ecommerce
 Track the impact of technical innovations on your industry
 Track the impact of technical innovations on your industry
 Determine the best eCommerce strategy for your specific
 Determine the best eCommerce strategy for your specific
industry
industry
 Determine your back end logistics/supply chain management
 Determine your back end logistics/supply chain management
 Define the steps you can take to Webify your business
 Define the steps you can take to Webify your business


E-Business/IT Strategic Planning Process

Key Insights Key Objectives Priorities

Customer and E-Business E-Business/IT E-Business
Business Value Strategies and Strategies and Application
Visioning Models Architecture Development and
Deployment

More Questions Feedback Feedback


Applications Development

Identify an end users
E-Business
Requirements
Investigate/Analysis

Develop E-Business
Systems Prototypes Analyses/Design
Prototyping
Cycle
Revise the Prototypes
to better meet End user
requirements Design/Implementation

Maintenance
Cycle Use and Maintian the
Accepted E-business
Systems
Implementation/Maintenance


Feasibility of E-Commerce/E-Business Systems

Organizational
Feasibility
Economic
•How well a proposed Feasibility
E-commerce systems Technical
fits the company •Savings in labour costs
plans •Increase sales revenue
Feasibility
•Decreased investment in
•Capability, reliability Operational
inventory
and availability of Feasibility
•Increased profits
hardware, software and
applications management
•Acceptance of employees
•Management support
•Customer and Supplier
acceptance


Who are we?
 Young Consulting company with a team that has 25
 Young Consulting company with a team that has 25
years of combined experience in technology, Business
years of combined experience in technology, Business
Management and Development issues in Africa.
Management and Development issues in Africa.
 A diverse team in age, educational, professional
 A diverse team in age, educational, professional
experience and nationalities.
experience and nationalities.
 A company that has key strategic partners leveraging
 A company that has key strategic partners leveraging
knowledge in all aspect of business, development and
knowledge in all aspect of business, development and
technology.
technology.
 A company that has as much to learn as it has to
 A company that has as much to learn as it has to
share.
share.


Transform Ideas to Reality
An idea, perhaps a thought

The path from Idea to a service,
product or project is like a plane flight.
Everything has to be planned for, including
the unknown….

The rest is history…..


Our Information

 Kizuki Group. Kongens Gate 24. 0153 Oslo. Norway.
Kizuki Group. Kongens Gate 24. 0153 Oslo. Norway.
Tel: 47 24 14 99 53/ 47 916 88 270. Fax: 47 24 14 99 98.
Tel: 47 24 14 99 53/ 47 916 88 270. Fax: 47 24 14 99 98.
ePost: office@kizukigroup.com
www.kizukigroup.com
www.kizukigroup.com

 Represented in
Represented in
South Africa
South Africa
Nigeria,
Nigeria,
Cameroon,
Cameroon,
Ghana,
Ghana,
Sierra Leone
Sierra Leone


Sources Consulted
 Our Research
 Our Research
 Cyberstrategy-Pauline
 Cyberstrategy-PaulineBickerton, Mattew Bickerton,Kate Simpson-
Bickerton, Mattew Bickerton,Kate Simpson-
Holley. Published in Association with the Chartered Institute of
Holley. Published in Association with the Chartered Institute of
Marketing.
Marketing.
 Business Data Communications and Networking. 6th thEdition. Jerry
 Business Data Communications and Networking. 6 Edition. Jerry
FitzGerald & Alan Dennis.
FitzGerald & Alan Dennis.
 Essentials of Information Management Systems. 3rd rdEdition. Kenneth C.
 Essentials of Information Management Systems. 3 Edition. Kenneth C.
Laudon & Jane P. Laudon.
Laudon & Jane P. Laudon.
 E-Business Readiness-A customer –focused framework. James Craig &
 E-Business Readiness-A customer –focused framework. James Craig &
Dawn Jutla.
Dawn Jutla.
 E-Commerce: Formulating Strategy, Robert Plant
 E-Commerce: Formulating Strategy, Robert Plant
 Introduction to Information Systems-Essentials for the Internet worked e-
 Introduction to Information Systems-Essentials for the Internet worked e-
Business Enterprise. James A. O’Brien
Business Enterprise. James A. O’Brien


Selected Industry
The Internet effect
on these Industries


The Pharmeuctical Industry


Pharmaceuticals-The Reality
• The internet is already changing the way
pharmaceuticals companies deal with each other and
their customers.
• Internet related R&D is already having far reaching
implications in the industry according to 50 R&D
executives from large pharmaceuticals.
• Companies will have to move quickly and decisively if
they are to stay ahead of the technology driven
changes in the industry.


Pharmaceuticals-Action

• Design web-enabled strategies for owing
and trading in three key assets:
• Capability Assets-operational excellence
• Science assets-insight & knowledge management
• Consumer value assets-feedback from consumers in
creating new drugs.
xxxxxx have a choice in investing in these assets now, while the healthcare
sector on the internet is still forming (particularly in Africa) OR being
caught by those who have already done so.


Pharmaceuticals-A New
Concept (e-detailing)

• E-detailing is using internet-based communications
to provide a value added marketing channel to
reach prescribers and complement the activities of
sales reps.
• The key goal is to maximise the effectiveness of
marketing and detailing efforts and offer physicians
a range of convenient interactive channels.
• Aventis is one of the well known companies that is
pioneer with this new concept.


The Banking Sector


M-Commerce Value Content Aggregation
Design and Operation of Service
Chain Portals, search facilities, etc.

User Applications

Banking, Purchasing, SMS, News,
Entertainment/Games, etc.
Personalization Support

End-User information mgmt.,
profiling and more effective targeted
sales
Presentation Services

Content conversion, Suitability
for small & low resolution screens in
mobile phones

Transaction Support
Increasing Value Proposition
Payments, Billing, Alerts, 2-sided
payments flow, Security, & Profitability
Basic Services

Server hosting, Data Backup,
System Integration
Transport www.kizukigroup.com 49

Key Players….Banking

Content Tele-
Providers Operators

Banking Device
Vendors

The Educational Sector


IT in Education-The Case
• In a world that is increasingly knowledge based, new information
technologies provide and economical way of providing the
continuous education that is needed.
• IT enables a shift toward learning experiences that are
asynchronous rather than synchronous.
• Modern technology makes it cost effective to reach new students
cost effectively. IT offers economies of scale. After a(sometimes
large) front-end investment, the cost of usage per incremental
student is apt to be low. Moreover, access to very large amounts of
information can be obtained at low incremental costs.
• It eases the limits of time and space for education activities. Access
to lecturers and courses through IT is particularly important for the
increasing number of non-traditional students in higher education,
with often jobs and family to attend to.


IT in Education-Current Situation
• Due to rapid changes in business and industry, re-skilling is
becoming an important requirement.
• Life long learning is becoming a necessity.
• External vocational training is provided by private sector
companies. Business and others are turning to these institutions
to meet their needs.
• Development issues are increasingly becoming a partnership
between the private sector.
• Residential costs are an inhibiting factor for many. IT makes it
possible to address this factor.
• Increasing demand for learning from non-traditional sector.
• Collaboration is now a must as no one person can have all the
skills and competencies needed in today's high performance
workplace.


IT in Education-What should Institutions
do?

• Make a concerted effort to reach the ”new” consumers-life long
learners, knowledge workers, etc.
• Enable flexibility in terms of what, where and how.
• Increase productivity-faculty and student alike.
• Respond to a new definition of quality.
• Redefine traditional structures and approaches to serve society
in the information age and capitalise on the opportunities
present.
• Manage and control the shift from campus-centric to a
consumer-centric model.
• Create and develop well defined market niches which are
profitable and sustainable.


IT in Education-Development of Value Proposition

Served
markets
Content- Systems
adaptation Design/Technology
Functionality and specification
integration

Customer-perceived Efficiency /
Relative quality functionality relative
(Functionality) to customer demand

Relative value Relative
Market share Reduced cost
Penet
ration
Relative price
(Higher)
Relative cost
(Lower)

Results


IT in Education-What we offer

• Systems Analyses-development of the project, identify
the stakeholders and project perspective.
• Provide the Learning Management System and the
delivery mechanism for the courses.
• Assist with the design/pedagogic aspect of the system.
• Assist and provide training for the learners.


The Hotel Sector


Travel Industry
• Between 1998-2003, revenue forecast to grow by 800%.
i.e. $2,2b-16b (Jupiter)
• Air Segment is responsible for 80%.
• Hotel Booking is 25%.
• 2003 Hotel Booking will reach 35%
• This is some $11 billion in monetary terms.
• Visits to travel related sites has grown from 150 million in
1998 to reach 400 million in 2002


Travel Sites Visited by Online Consumers

Cruise

Car Rental Supplier

Hotel Supplier

Online Agency

Airline Supplier

0 20 40 60 80

%

Source Juipter Communication May 2000


Services used at Travel Related Sites

Researching Cruise Package

Deciding w here to go

Researching Hotel Rates & Info

Researching Airline Ticket

0 10 20 30 40 50 60 70 80
%

Source Juipter Communication May 2001


Implications-Strategic

• Internet Reservations through own branded websites
• Reservations from Intermediary travel sites will continue
to grow until 2003 (Why?)
• Reducing the cost of distribution is the key driving hotels
to the internet
• Not unusual for 15-20% of Total Value Booking
• “Look-to-book” ratio is very important to assessing the
real impact of e-commerce.


“Look- to- Book”

• 6,7 million Americans actually made a booking online.
• 33,8 millions made travel planning on the internet.
• What is the ratio?
• Does it suggest the impact of e-commerce greater or less
on the lodging industry?


Why Does a Hotel Need a Website?
• Competition
• Advertising and Publicity
• 24 hour exposure
• Exclusiveness
• Specialized Marketing
• Highly Desirable Markets
• Easy update
• Added value Service
• The Smart Money


Hotel Distribution Channels
• Internet impact both existing channels and via entirely new ones

GDS Environment Hotel Travel
CRO Switch GDS Consumer
Agent

Hotel Travel
Switch GDS Consumer
CRO Agent
Int Environment
Hotel
Switch GDS Consumer
CRO

Hotel
CRO Switch Consumer

Hotel
Consumer
CRO


Deductions

• Internet users invited to visit travel sites containing hotel information
and booking capability created or service by a variety of hotel,
intermediary and destination companies
• Internet reservations come via traditional GDS and Internet only
channels, flowing through the CRS
• Internet reservations are delivered direct-to-property via internet
connections, email or even Telex
• Voice centres are processing bookings for which the research and
buying decisions were made on travel websites
• Some percentage of walk ins learned about the property via the
internet.


The Present Situation
Internet Users

WebSites with Hotels

Commercial Reps Chains
TI GDS
Sites

Commercial
Switch
Sites
Chains

Independent
Independent Chain Chain
Chain


Explanations

• Hotel chains sponsor their own branded internet sites, and also provide
their properties status to other sites via intermediary. Mainly Pegasus
and Wizcom (Switch companies)
• GDS company Sabre sponsors and provides data and looking
capability to its own Travelocity.com site
• HotelBook.com is both a representation and a reservation-systems
solution company.
• Switch and ADS companies also operate their own sites (www.
placestostay.com)


What makes a Good Website

 The site must cater to the audience
 Website does not exists in isolation
 Not an online brochure
 24/7 Sales and Marketing Tool
 MUST have a Booking Engine
 Think bandwidth


What makes a Good Website-Things not do

 Frames, or heavy JPEGs
 Hide the Booking Engine
 No bookable hotel packages
 No customer e-mail capture
 Not easy to find on the web
 Incomplete key words


What makes a Good Website-

Good Planning
Customer focused
User Friendly
Easy to navigate


Promoting your Site

 Meta tags
 Key Words
 Search Engine Submission
 Sign up for key words-Realnames.com
 Affiliate Marketing
 Collateral Promotion
 Track


E-Commerce for Competitive
Advantage


Introduction

• Determine your current position
• Born on the internet?
• Move to the internet?
• Virtual Organisation?


Pillars of Success-I –Moving to the Net

• Technology: • Market
• Internet • Branding (implications)
• Intranet • Relationship
• Extranet Management(implications)
• ERP • Same Target market
• Datawarehouse • Has core marketspace moved?
• Market Growth and
Segmentation


Pillars of Success-II-Moving on to the Net

• Service: • Brand
• Expectations of new service • Strong Brand dot com
level • Basis of dot.com brand
• New value proposition • Same Target market
• Reasses your service value • Challenges
chain • Amenendment or complete
new service provision
• Will existing brand change


Pillars of Success-Above All

• Leadership
• Infrastructure
• Organisational Learning


Internet Marketing


Introduction-Internet Marketing

What is Internet Marketing:
…process of building and maintaining customer relationships
through online activities.


The Process

Unlocking Value
Identifying Unment and underserved Needs
Identify Target Market
Company Resources
Assess Competitive and Technology Opportunites
Make go/ No-go Assessment


Unlocking Value

….means creating value, unlocking value
Trapped value-more efficient value systems-easy
information, efficient booking systems
New Value-customise offering, build community,
introduce new functionality


Identifying Unmet and /or Underserved
Needs

Customer Decision Process
What steps does a typical customer go through?
Who gets involved and what roles do they play?
Customer Decision Process
Experience of the customer in each stage


Determing Target Market

Demographic

Geographic

Behavioural


Determing Target Market -cont

Occassional (situational)

Psychographics

Benefits

Beliefs and attitudes


Actionable and Meaningful Segments

Actionable Segmentation
Easy to identify
Easily reached
Can be described in terms of growth,
size profile attractiveness


Meaningful Segments

Meaningful Segmentation

Behave similarly, while customers across segments
behave in different ways
Provides insights into motivation
Corresponds to a set of barriers customers face when
they buy or use the product or service
Differences is large enough to warrant a different set of
actions by your company.


Company Resources

Resource System
….discrete collection of individuals and organizational
activities and assets that, when taken together, create
orgainsational capabilities

Customer-Facing-brand name, well trained sales force,
and multiple distribution channels
Internal-technology, product development, economies of
scale.
Upstream-relationships, partnerships


The Impact of the Internet on Porter’s Five Forces
Risk of Entry by Potential Competitors

•Enabling technology, barriers to entry go down
•New Market entrants can acquire technology easily
•High technology costs and expertise increases barriers to entry

Bargaining Power Rivalry Among Bargaining Power
of suppliers Established Competitors of Buyers

•Direct connection to customers;
minimizes supplie’s bargaining •Internet minimizes ability to •Reduces bargaining power of
power. product differentiate. Less channels
•Suppliers can access en-users
differentiation means more •Consumers have information
through the internet, minimizing
competition over price. and ability to search for better
the need for middlepersons.
•Differentiation becomes more •Low barriers to entry open deals
difficult as access to suppliers is markets to heavier •Decrease switching costs
equalized. competition.
•Fewer barriers to entry result in •Variable costs decrease as
increased buyer competition thus percentage of fixed costs,
boosting supplier bargaining leaving price discounting as
power. primary method of
competition.

Threat of Substitute Products
Especially for internet related
products
Internet has introduced new
business methodologies-adding
www.kizukigroup.com additional products 87

Creating Competitive Advantages

E-Marketing Strategy
Positioning and target market selection
Marketing Tactics(4Ps)

Performance Outcomes
Distinctive Competencies Competitive Advantages Satisfaction
Superior skills Superior customer value Loyalty
Superior resources Low cost producer Market Share
Profitability

Investment to Create
and Sustain Advantage


Our Information

 Kizuki Group. Kongens Gate 24. 0153 Oslo. Norway.
Kizuki Group. Kongens Gate 24. 0153 Oslo. Norway.
Tel: 47 24 14 99 53/ 47 916 88 270. Fax: 47 24 14 99 98.
Tel: 47 24 14 99 53/ 47 916 88 270. Fax: 47 24 14 99 98.
www.kizukigroup.com
www.kizukigroup.com

 Represented in
Represented in
South Africa
South Africa
Nigeria,
Nigeria,
Cameroon,
Cameroon,
Ghana,
Ghana,
Sierra Leone
Sierra Leone


Internet on business_print

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