Internet and Business Term Paper

Excerpt from Term Paper :

Internet and Marketing

The Internet has become a vibrant and increasingly integral part of individuals' lives over the past few years. It is hard to imagine any business today succeeding without at least some presence on the World Wide Web. Today, the United States boasts a $1.5 trillion market for direct marketers. Without question this is the largest and richest single market in the world and growing at an unprecedented 8.6% per year. With over 10,000 different catalogs alone being mailed in the U.S., there is a niche for every player and every project and service.

This paper examines some of the basic precepts of Internet marketing, suggesting the ways in which companies should treat Internet marketing as the same as any other type of marketing and the ways in which it must be treated on its own terms. Part II discusses the relationship between conventional marketing and Internet marketing. In Part III, the advantages and disadvantages of Internet marketing are outlined. Part IV reviews what type of marketing is more effective, conventional marketing or Internet marketing. Lastly, this paper concludes with an argument that Internet marketing offers more advantages than conventional marketing.


The field of marketing in general and Internet marketing in particular seems so vast and so changeable that it is hard to know exactly where one should begin. While it is useful to analyze Internet marketing as a distinct beast from other forms of marketing, in the real world it will probably be more useful to consider internet marketing as simply another part of the total marketing strategy for a given product and a given company. The main similarity between conventional marketing (i.e., catalogs, commercials, direct mail, free samples, etc.) and Internet marketing (i.e., banner ads, pop up ads, targeted emails, etc.) is the purpose behind such marketing. Both conventional marketing and Internet marketing are designed to increase a company's business by reaching new customers as well as re-connecting with old customers.

Other similarities exist between conventional marketing and Internet marketing as well. In order to succeed over both the short-run and long-term, conventional marketing and Internet marketing must remain fresh and companies must be able to quickly adapt to consumers' ever changing preferences. What is hot today is most likely not going to be hot tomorrow and companies who place too much reliance on one particular method of marketing or a specific product may find themselves left behind when the train leaves for a new, hotter trend. Only those companies who take the time and make the effort to truly learn about their customers and foster long-term relationships will be successful.


There are numerous advantages to Internet marketing. Prospecting via the Internet may be a tough nut to crack, but it is clear that e-mail is well suited for keeping customers active. On the retention side, marketers now have a powerful new vehicle. Unless you were a cataloger or a club, you did not always invest in regular customer communication. A lot of companies are seeing the power of e-mail in particular to drive revenues and customer loyalty and retention.

As e-commerce has found its place on the Internet, the impact on direct mail remains uncertain. In many ways, the Internet complements and supplements direct mail, providing a unique way to generate leads and enhance prospecting efforts. Even today the Internet is an attractive option for new direct marketing advertisers. There is no doubt that the Internet will reduce the need for conventional direct mail, but e-commerce businesses are potential new direct mail advertisers. Email is cheap, sending out a catalog may cost $1 or more, according to a report issued last year by Cambridge, Mass.-based Forrester Research. Companies may send an e-mail for a cost of less than 1 cent to 25 cents, depending on volume and on the content, which can include video and audio as well as personalization.

While conventional broadcast advertising and internet banner ads often reach people who have no interest in a particular product, e-mail marketing, if carefully targeted, reaches only people who have already expressed an interest in the advertised product or related products. Internet and E-commerce companies are now turning to the well-seasoned and measurable way to drive consumers to their site. By sending a direct mail piece, the site becomes more real and credible to them. Catalogs and other direct marketing pieces also help reinforce the brand, and direct mail promises to be an excellent way of reaching prospects and persuading them to visit a web site. Companies may make two to three times more people visit sites via direct mail than through advertising. If a dotcom business sends a piece of direct mail, it adds an extra dimension to the business. People like to hold things in their hands and this offers tangibility and the human touch.

Although Internet marketing offers businesses and consumers numerous advantages in terms of convenience, cost, and effectiveness, disadvantages exist as well. The primary disadvantage of Internet marketing is the fact that consumers cannot fully "test" the products over the Internet before choosing to purchase them as they may with products marketing through conventional channels such as in store displays, direct mailers, etc. Despite the unprecedented technological advances over the past decade, individuals may still not smell perfume or feel clothing over the Internet. For some individuals who enjoy the shopping experience, Internet marketing may not be as effective.

Internet marketing may also be less effective than conventional marketing for consumers who dislike receiving unsolicited email or who disfavor banner or pop up ads. However, these customers are probably not responsive to direct mailings sent through conventional means, so this is not a large disadvantage and is not specific to Internet marketing but to marketing preferences in general. Security may also be a disadvantage of Internet marketing as it is relatively easy for businesses and individuals to cloak their identity on the Internet and "policing" is generally more lax and more difficult to do, both in terms of cost, time, and manpower involved in tracing a business or person on the Internet. Lastly, the lack of "personal service" may be a disadvantage of Internet marketing. Clicking a mouse to order a product deprives individuals of the human touch and face-to-face action of everyday, traditional shopping. While this may not matter as much to younger consumers, it may make a difference to older individuals who appreciate such interaction.


Both conventional marketing and Internet marketing offer unique advantages and disadvantages for businesses and consumers. One of the main advantages of conventional marketing is that it is "tried and true" in some respect and familiar to customers, who in turn respond to certain traditional marketing techniques like strategic product placements in movies, etc. Another advantage of conventional marketing is that it enables customers to "try" the product (to some degree) before deciding to purchase it. Despite the technological advances of the Internet, customers are still not able to "test" products over the Internet in the same manner as they may through conventional marketing. Likewise, certain traditional marketing techniques such as telephone calls from solicitors or door to door prospecting are becoming less lucrative than they used to be, mainly because our society has become increasingly "convenience" oriented and time obsessed.

Like conventional marketing, there are numerous advantages to Internet marketing. One of the main advantages is cost, particularly in terms of email, which costs as little as 1 cent to send. Advertising costs (i.e., preferred links or placements on widely visited sites) are generally less than costs of placing advertisements in magazines and newspapers or on television. Convenience is another advantage of Internet marketing, i.e., consumers may find…

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