A study on internet marketing channel in e-business

Abstract

Marketing channels based on the Internet have become a reality in the late 1990s and some observers predict that they will become a major marketing channel after the turn into the twenty-first century. To qualify as Internet marketing channels, the customer and seller must be able to use the Internet to interact with each other and complete the transaction. Although many experts have predicted that Internet marketing channels would eliminate most middlemen from the channel structure - disintermediation - because the need for intermediaries becomes superfluous given the capabilities of the Internet. So far this has happened in some areas like the Dell story, but not happened in others, such as Amazon.com, Autobytel and the like. In fact, there are numerous examples of Internet marketing channels actually adding intermediaries to the channel structure - reintermediation - because the middlemen added are able to perform the distribution tasks more efficiently than producers and consumers, even though they are linked via the technology of the Internet. These phenomenons explain the nature of channel strategies different from the other variables of marketing mix. With regard to product strategy, rapid technology transfer from one company to another and global competition have made it much easier for competitors to achieve equivalents in product design, features, and quality. The ability to compete over the long run by relying on products has become exceedingly difficult to sustain in E-Business. Gaining a sustainable competitive advantage via pricing strategy in today``s Internet and global economy is even less feasible than through product strategy. The ability to operate production facilities all over the world has created fierce price competition in many different product categories and in services as well. Internet market will increase competitive pressures on on-line sellers as buyers are increasingly able to compare Websites through kinds of mySimon.com. ...