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Chapter 1


The Internet has become a large market for companies; some of the biggest companies today have grown by taking advantage of the efficient nature of low-cost advertising and commerce through the Internet; also known as e-commerce. It is the fastest way to spread information to a vast amount of people simultaneously. The Internet has also subsequently revolutionizedshopping—for example; a person can order a CD online and receive it in the mail within a couple of days, or download it directly in some cases. The Internet has also greatly facilitated personalized marketing which allows a company to market a product to a specific person or a specific group of people more so than any other advertising medium.

Examples of personalized marketing include onlinecommunities such as MySpace, Friendster, Orkut, and others which thousands of Internet users join to advertise themselves and make friends online. Many of these users are young teens and adolescents ranging from 13 to 25 years old. In turn, when they advertise themselves they advertise interests and hobbies, which online marketing companies can use as information as to what those users will purchaseonline, and advertise their own companies' products to those users.

A very ineffective way of advertising on the Internet is through spamming an email with advertisements. This is ineffective because, now, most email providers offer protection against email spam. Most spam messages are sent automatically to everybody in the email database of the company/person that is spamming. This way ofadvertising is almost like using adware.

Adware is another ineffective way of advertising because most people simply close a popup window when it shows up, not bothering to read it.


1-1 Marketing

1 1-1-1 Definitions

Marketing is one of the terms in academia that does not have one commonly agreed upon definition. Even after a better part of a century the debate continues. In a nutshellit consists of the social and managerial processes by which products, services and value are exchanged in order to fulfill individual's or group's needs and wants. These processes include, but are not limited to, advertising.

In his book, The Practice of Management, Peter Drucker wrote that "Because the purpose of business is to create a customer, the business enterprise has two--and onlytwo--basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business."

If marketing is the distinguishing function of the business, then what is marketing and how is it achieved?

1. " organizational function and a set of processes for creating, communicating, and delivering value tocustomers and for managing customer relationships in ways that benefit the organization and its stakeholders."

2. Human activity directed at satisfying needs and wants through exchange processes".Philip Kotler

3. "...the ongoing process of moving people closer to making a decision to purchase, use, follow, refer, upload, download, obey, reject, conform, become complacent to someone else'sproducts, services or values. Simply, if it doesn't facilitate a "sale" then it's not marketing."

4. "...the management process of anticipating, identifying and satisfying customer requirements profitably" Chartered Institute of Marketing

5. "...war between competitors." Al Ries and Jack Trout

Take these definitions collectively and a comprehensive definition of marketing, applicable toboth business and non-business environments, emerges:

Processes, functions, exchanges or activities -- even if they involve "war" between competitors – that create perceived value by satisfying needs of those involved in the transaction. These processes succeed in moving people closer to making a decision to purchase and facilitate a "sale." Afterwards, these processes anticipate, identify and...