Barriers to the Growth of Electronic Marketing - Essay Example

BARRIERS TO THE GROWTH OF ELECTRONIC MARKETING Introduction Since the internet and other ICT tools were developed, there has been a revolution in marketing. Electronic marketing is defined by the use of improved ICT tools especially the internet to make business transactions. Electronic marketing has seen the growth of e-commerce by a large percentage especially towards the end of the last century and it seems to have defined the future of marketing. Electronic marketing is a form of direct marketing where buyers are sellers can conduct their business without actual contact. Email marketing has been one of the most growing forms of direct marketing which uses the electronic mail to communicate commercials transactions. It has been able to exterminate the monopoly in goods an series which has been considered important for the growth of the electronic business. Though it has recorded growth in the recent past, there have been many barriers to the growth of the industry. There have been many issues with the conduction of the business over the internet and other electronic tools especially problems to do with mutual trust and privacy of the deals. Lack of security through the internet and other barriers have been a great block to the growth of the industry. Layout This paper explores the barriers which have prevented the growth of the electronic marketing. In the first section the paper will explore the growth of electronic marking looking at the factors that have enabled the industry to make such great strides. This will give us an insight on how there have been compounding factors that have acted as barriers for the growth of the industry. The second section will look at the actual barriers to the growth of the industry and discuss them in details giving solutions to what could be done in order to minimize the barrier to the growth of the industry. The last section will be a general conclusion which will summarize all the details on the paper. Growth of electronic marketing The future of marketing has been defined. Just click on to the internet and you will get all the information that you need on the products. Few entities have failed to have an impact on modern market like the world wide web which in less than one decade has been able to transform researches on marketing, products and services, and other information to the main street of the world and in a manner that they can be accessed by anyone in any parts of the world and at any time. The internet has been able to revolutionize the market the at the same time we have a luxury of watching events in the world as they unfold which has helped customers to access growth of marketing in all dimensions. There have been many criticism about the internet on the social front citing isolation and connection issues coupled with the political impacts that it has had on many governments but few have talked about the revolution that it has created on the economies of the world except the attention that has been paid on the stock market new that we receive over the internet. (Brown and Duguid 2002, p. 71) Since the 1990s when the internet was developed there has been tremendous growth in e-marking and a general growth of ecommerce. Companies have become open to the scrutiny of the whole world which has made it prerogative for the companies to open their operation and practice more ethics. But it is not only in the practicing of ethics in the corporation but also in the way the process of making business deals with these corporations that has been the main advantage of the internet to the consumers and to the corporations. There has been rising use of the internet as we clock to this decade and it seems to have become the centre of life of many people not only in America but also in the whole word. Recent researches shows that there have been a remarkable drop of about 8 percent on the number of hours that Americans have been spending watching TV and at the same time there have been increased number of house about 8 percent that they have been spending on the internet over the past five years which represent a five fold growth in the use of internet. A large part of this growth has been attributed to the increased use of the credit cards on the internet and the validity that has been attributed to the use of the internet transactions. Initially the growth was segment on the software, books and computer hardware but there has been increased growth of the other products that are purchased over the internet in the recent past. The internet has turned to be a marketing hub in the world and there is expected growth on the future use of the internet. This is because it has enabled the corporations to display their products to the consumers. The aim of any marketing strategy is to reach as many customers as possible and therefore the internet ahs become one of the most important tools that can help corporations to reach as many consumers as possible and also gives the consumers a chance to view as many products as possible. (Baldi and Frasconi 2002, p. 67) Barriers to the growth of electronic marketing There have been many factors that have acted as barriers to the growth of e-marketing. These include blogging, RSS, focus on the social individual, convergence, personalization and M services, Privacy, security and trust, legal and political, trust and credibility, and nature of shopping. Let us look at each in details. Blogging Blogged emerged in the 1990s when there was increased emergent of web logs which gives the consumers a chance to express their own view about a products or something of interest. There are many types of bloggers who give different views in the internet and it is estimated that there is about 11 percent users who access these blogs and post their comments. Blogs have had a positive or negative impact on a particular product or a company although the general trends have concentrated on giving negative information. But it is accepted that blogs have a lot of influence on the consumers especially the new consumers as it shifts their perception. There have been many companies which have been trying to monitor but have not been able to offer alternative channel. Recently it has seen the growth of Twitter - bizarre although it has a strong following. RSS (Really Simple Syndication) This is a new way developed on the internet which supplies the users with constantly update content like new stories. In this regard, one doesn't have to look for the content as it comes direct to you. RSS publish frequently updated content like blog entries, new headlines and pops cast. Simply referred to as web feed, it contain summary of the whole story. RSS may give the wrong information and hence misled the consumers since consumer will have developed the habit of getting the information that they need from the RSS Focus on "social" individuals This has been a new way in with there have been a focus that it turned to a particular individual and all the users are given a chance to express their view on the particular individual. It many have an impact on the consumers in that it can create a perception and a preconceived idea on that particular subject. It may be used by some individual in order for economic purpose and not merely for the purpose of getting an opinion on the subject. Below is an example of such a website. (Adamic 2000, p. 3) The convergence debate There is still a debate on whether convergence should be a strong for a policy to regulate the use of the internet. This has been sparkled by the fact that there has been a trend in which there has been increasing convergent on the use of the internet as the main or the centre of life. It is presumed that the use of the internet may soon transform all other media and in a way may make them irreverence. For example there has been increased provision of all the information through the internet which means all media is converging to the internet alone. (Smith 2007) Personalization Though there are diverse consumers, there has been increased personalization of the use of internet in e-marketing. This has been through the matching process in registration and the creation of database and the use of GSM to provide for internet services on a mobile phone. In this regard increased personalization of services has been one of the barriers due to the inefficiency of the providers of the services. (PaloWirelss, 2008) Privacy and relevance Increase use of internet in the world has made it difficult for companies to maintain some of the privacies that had been previous kept from the consumer. This is because there has been increased openness in these corporations. There is not developed rules regarding privacy that can be use to protect websites. The issue of relevance in this regard refers to the way in which these website provide information that is useful to the consumers. Security The open nature of the internet has intensified the problem of e-marketing as there has been increasing attach on company brands. Most of these attacks are perpetuated by staffs who know the company and the products well. Not many organizations have put in place security policies. Many shoppers just surf the websites but they don't shop. This has been a major barrier to B2C growth for example on the use of credit cards due to interception of details over the internet and increased credit card frauds. There has been increasing problems of hacking and encryption of internet transaction. At the same time there has been developed of firewalls which prevent unauthorized users from accessing the websites. Though there is need for development of clear policies, denial of service attacks and other problem of Trojans have remained a barrier to development of such policies. Fundamental problems - Impersonal nature Here has been a problem of personal experience and the use of the internet in the sense that internet is still not interactive enough fore personal experience. Many people do not like being screened to the computers reading too much and they prefer personal shopping experience to the screen shopping. Therefore they don't get the required gratification as it is very impersonal. The fact that it reduces community interaction acts as a barrier. Legal and political issues Increased frauds in the internet has increased question of how one can get redress. This has been due to lack of legal redress on the issue of e-marketing and many still fear it due to internet frauds. Governments still fear losing sovereignty on the internet. Therefore there is need to build a legal framework that will legalize internet business to reduce the barrier. Other barriers There have been many other barriers to e-marketing not only the ones we have mentioned above. There are barriers that are related to the entry on the web. This has been due to the design of most of these websites which makes it difficult for internet users to access all the information that they require about a certain product. Due to the increasing competition in the e-marketing there have been increased price wars between different companies which has been prompted by some sites which makes actual comparisons between different prices of a particle commodity as offered by a particular company. As a result companies have resulted to selling their products at a low price to beat their competition which in real price is not a credible business model. Website like kelkloo.com compares prices of different products as offered and therefore makes it easy for the consumers to order for the cheapest commodity. (Vibert, 2000, p. 87) There has also an issue of increasing penetration of the technology in the market. In this regard there has been increasing fear of technology by the consumers and the sellers due to the experience they have had with the internet. It is still not known whether digital TV will bring technophobes which have been created by the internet. This has been defined in terms of lower value customers who prefer to use highest cost channel and therefore develop a fear of the technology duet to its complexities. Most of them will prefer to use the old technology which they are used to in favour of the new technology which appears too much complex for them. Due to the convergence debate there are many questions of whether the revolution in the use of digital TV will actually resolve the problem that we are currently experiencing in the use of the technology. What do we have to do to promote the growth of marketing There are several actions that will need to be taken in order to promote the growth of e-marketing. This will involve an array of efforts that will have to be taken in order to resolve the problem but one thing tat will remain to be resolved will be the issue of security. The development of firewalls have so far worked well on the issue of security but there is more that is yet to be done in order to keep away nasty hackers who access information from companies without their authority. But there are still many questions that surround that action that will have to be taken in case the hacker is detected. This is one of the short coming of the current technology as still there has not been development of a strategy that can be used to keep away the hackers and at the same time allow other users to continue detecting the information. If there is the development of an alarm system that will detect hackers, what will need to be done in order to keep away the hackers Should the site be closed down keeping in mind that there are others who are using it There is need at monitor the internal misuse or the websites. In this regard there need to be a good monitoring system that will avoid open internet while exchanging sensitive data. This needs to develop use of virtual private networks which are a bit safe. There is still hope on the future of the internet. This has been due to the changing trends which have shown increased use of the internet. There have been various internet generation which have been emerging everyday which shows that there is a revolution taking place. It has taken the business world 30 years to develop e-marketing and embrace the use of internet in business. As such the field of e-marketing is relatively young and growing and there are more prospects for the future. As consumers evolve and learn new things, there is still need to develop working framework that will help us in building a strong e-commerce generation. (Huberman 2000, p. 8) Conclusion E-marketing has evolved rapidly to be one of the leading business processes. It has enabled business to reach as many customers as possible and at the same time customers have been able to shop widely just on the click of the button. However there are number of barrier which still makes it difficult for the growth of the process of e-marketing. There is need to develop a framework that meets the needs of the business and at the same time meets the demands of the consumer. Most important it to put a legal framework that will protects the process and makes it more valid to the consumers. Building trust and ensuring security over the internet deals remains to be the biggest challenges that the business world is facing currently as it moves to embrace the growing sector. 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