Innovations In Behavioral Marketing And Essay, Research Paper

MARKETING MANAGEMENT

TERM PROJECT

?Innovations in Behavioral Marketing and

Electronic Commerce?

Date: June 15, 2000

Table of Contents

Preface??????????????????????????????1

? . Introduction

? . Benefits of Electronic Marketing

? . Effectiveness of E-Commerce

I. Ways for Promoting your Website

II. Learning about your Visitors

III. Segmenting your Internet Market

? . E-Commerce in Lebanon

I. Lebanese Companies on the Net

II. Customer Adaptation to E-Commerce Websites

? . Conclusion

I. Introduction

An online marketing channel is one that a person can reach via computer and modem. A modem connects a computer to a telephone line so that the computer user can reach various online information services. There are two types of online channels:

Commercial Online Channels:

Various companies have set up online information and marketing services that can be accessed by those who have signed up for the service and pay a monthly fee. The best-known online services are: CompuServe, America Online, and Prodigy, with more than 3,200,000, 3,000,000, and 1,600,000 subscribers respectively. These online channels provide subscribers with five main services: information (news, libraries, education, travel, sports, reference), entertainment (fun and games), shopping services, dialogue opportunities (bulletin boards, forums, chat boxes), and E-mail.

The Internet:

The Internet is a global web of some 45,000-computer networks that has made instantaneous and decentralized global communication possible. Originally established to facilitate research and scholarly exchanges, the Internet is now available to a much broad audience, some 25,000,000 people. Users can send e-mail, exchange views, shop for products, and access news, food recipes, art and business information. The Internet itself is free, though individual users may need to pay a commercial service to be hooked up to it.

II. Benefits of Electronic Marketing

Why have online services become so popular? First, they provide three major benefits to potential buyers:

 Convenience: Customers can order products 24 hours a day wherever they are. They do not have to sit in traffic, find a parking space, and walk through countless aisles to find and examine goods. And they do not have to drive all the way to a store, only to find out that the desired product is out of stock.

 Information: Customers can find reams of comparative information about companies products, and competitors without leaving their office or home. They can focus on objective criteria such as prices, quality, performance, and availability.

 Fewer hassles: With online services, customers do not have to face salespeople or open themselves up to persuasion and emotional factors.

Second, online services also provide a number of benefits to marketers:

 Quick adjustments to market conditions: companies can quickly add products to their offering and change prices and descriptions.

 Lower costs: Online marketers avoid the expense of maintaining a store and the accompanying costs of rent, insurance, and utilities. They can produce digital catalogs for much less than the cost of printing and mailing paper catalogs.

 Relationship building: Online marketers can talk with consumers and learn much from them. Marketers can also upload useful reports, or a free demo of their software, or a free sample of their newsletter, onto the system Consumers can then download these items into their electronic mailboxes.

 Audience sizing: Marketers can learn how many people visited their online site and how many stopped at particular places on the site. This information can help the marketers improve their offers and ads.

Clearly, marketers will want to consider using online services to find, reach communicate, and sell. Online marketing has at least four great advantages. First, both small and large firms can afford it. Second, there is no real limit on advertising space, in contrast to print and broadcast media. Third, information access and retrieval are fast, compared to overnight mail and even fax. Fourth, shopping can be done privately and swiftly. However, online marketing is not for every company or for every product; thought has to be given to if, when, and how it should be done.

III. Effectiveness of E-Commerce

In order for your company to be effective in its electronic commerce, some conditions must be satisfied. For example, your company should promote its web site properly in order to attract visitors who are the company?s potential customers. Thus the more the visitors, the higher the probability of having more customers. Another point of concern is the size of the Internet, which constitutes a humongous market. Therefore, attacking it as a whole would be a difficult task for the company. That is why companies usually tend to segment the market into small niches to give each of them an equivalent portion of the company?s attention. In addition, the company must keep in mind that there are millions of surfers with different wants and needs, different age groups, sexes, ethnicity, social lifestyles, educational levels, and so on. This issue pushes almost every company with a web site running online to start knowing its online customers in order to serve them best, knowing that online competition is increasing vastly each and every day.

A. Ways for Promoting your Website

The most important first step is to register your site with the main Web search engines, so we begin with steps to prepare your Web pages for optimal indexing.

1. Write a Page Title. Write a descriptive title for each page of 5 to 8 words. Remove as many “filler” words from the title, such as “the,” “and,” etc. This page title appears on the Web search engines when your page is found. Entice surfers to click on the title by making it a bit provocative. Use some descriptive keywords along with your business name on your home page. For example, instead of “LAU” use “LAU ? Leading University in Middle East “. The more people see in the blue highlighted portion of the search engine that interests them, the more likely they are to click on the link.

2. List Keywords. To get your juices flowing, sit down with some associates and brainstorm a list of 50 to 100 keywords or key phrases – the kind of words or phrases someone might search on to find a business or site like yours. Then refine the list to the most important 20 or so. Those words are placed at the top of the Web page internally – not visible on the page – in a META tag1. Search engines use them in order to locate the site. Note however, that some research on search engine algorithms indicates that a fewer number of keywords may help you better target the most important search if you are working to increase your page’s ranking on the search engines. Consider using both lowercase and capitalized forms of your very most important words, since some search engines are case-sensitive.

3. Write a Page Description. Select the most important 20 keywords, and write a sentence or two. You do not need to repeat any words used in the page title. Keep this readable but tight. Those words are placed at the top of the Web page internally in a META tag1 too. They will appear in the search result of search engines when a user requests a search for one of the specified keywords.

4. Submit Page to Search Engines. Next, submit your page to the important Web search engines and directories. The most important search engines that robotically “spider” or index your site are: Yahoo, AltaVista, Excite, HotBot, Lycos, Infoseek, WebCrawler, and Northern Light.

5. Request Links on Industry Sites. You probably belong to various trade associations that feature member sites. Ask for a link. Even if you have to pay something for a link, it may bring you the kind of targeted traffic you crave.

6. Include URL on Stationery, Cards, and Literature. Make sure that all reprints of cards, stationery, brochures, and literature contain your company’s URL. And see that your printer gets the URL syntax correct. In print, it is recommended leaving off the http:// part and including only the www.domain.com portion. This way it is easier to memorize.

7. Promote using traditional media. Do not stop print advertising you have found effective. However, be sure to include your URL in any display or classified ads you purchase in trade journals, newspapers, etc. View your website as an information adjunct to the ad. Catch readers’ attention with the ad, and then refer them to a Web page where they can obtain more information or perhaps place an order. Sometimes these ads are more targeted, more effective, and less expensive than online advertising. Consider other traditional media to drive people to your site, such as direct mail, classifieds, post cards, etc.

8. Develop a Free Service. It is one thing to say, “Come to our site and learn about our business.” It is quite another to say “Use the free kitchen remodeling calculator available exclusively on our site.”

Make sure that your free service is closely related to what you are selling so the visitors you attract will be good prospects for your business. Give visitors multiple opportunities and links to cross over to the sales part of your site.

9. Request Reciprocal Links. Find complementary websites and request a reciprocal link to your site (especially to your free service, if you offer one). Develop an out-of-the way page where you put links to other sites — so you don’t send people out the back door as fast as you bring them in the front door.

10. Issue News Releases. Find newsworthy events (such as launching your free service), and send news releases to print and Web periodicals in your industry.

11. Request Links from Business Link Sites. Especially if you offer a free service, you can request links from many of the small business linking pages on the Web. When you have something free to offer, many doors open to you. Surf the Net looking for places that might link to your site. Then e-mail the site owner or Webmaster with your site name, URL, and a brief 200-word description of what you offer there.

12. Capture Visitor E-mail Addresses and Request Permission to Send Updates. On your website’s response form, include a checkbox where the visitor can give you permission to e-mail updates about products or services. Now your e-mails to visitors are not “Spam.” You are responding to their request for more information. It is recommended capturing first and last name in separate fields so you can market personally to them. But only ask for the information you need or they won’t fill it out.

13. Publish an E-Mail Newsletter. While it’s a big commitment in time, publishing a weekly, monthly, or quarterly newsletter is one of the very best ways to keep in touch with your prospects, generate trust, develop brand awareness, and build future business. You can distribute your newsletter using your e-mail program, or have people subscribe on your website directly to a listserver program offered by your Internet Service Provider.

14. Install a “Signature” in your E-Mail Program. Most e-mail programs such as Eudora, Netscape, or Outlook allow you to designate a “signature” to appear at the end of each message you send. Limit it to 6 to 8 lines: Company name, address, phone number, URL, e-mail address, and a one-phrase description of your unique business offerings. Look for examples on e-mail messages sent to you.

15. Promote Your Site in Mailing Lists and News Groups. The Internet offers thousands of very targeted mailing lists and news groups made up of people with very specialized interests. Do not use aggressive marketing and overtly plug your product or service. Rather, add to the discussion in a helpful way and let the “signature” at the end of your e-mail message do your marketing for you. People will gradually get to know and trust you, visit your site, and do business with you.

16. Announce a Contest. People like getting something free. If you publicize a contest or drawing available on your site, you will generate more traffic than normal.

17. Join a Banner Exchange Program. Essentially, you agree to show a rotating banner on your site for other Link Exchange members, and they do the same for you, and there is a possibility you’ll earn something through paid banner ads, too.

18. Purchase Banner Ads on Appropriate Sites. You may need to spend money to boost traffic by purchasing banner advertising. Choose sites that seem to attract the kinds of people who would be good prospects for your business or product. You can find media brokers who can help you find appropriate and cost-effective places to advertise, especially if you have a significant advertising budget for branding purposes.

19. Buy a Text Ad in an E-Mail Newsletter. Businesses are finding that some of the best advertising buys are for small 4 to 12 line ads in established e-mail newsletters. Ads can both inform and motivate readers to click on the URL, and tend to bring much more targeted visitors.

20. Rent targeted e-mail lists. Bulk untargeted, unsolicited e-mail lists are despised, and you’ll pay a very stiff price in reputation and cancelled services if you yield to temptation here. But the direct marketing industry has developed targeted e-mail lists you can rent consisting of people who have agreed to receive commercial e-mail messages. Do a smaller test first to determine the quality of the list.

21. Begin an Affiliate Program. Essentially, a retailer’s affiliate program pays a commission to other sites whose links to the retailer result in an actual sale. The goal is to build a network of affiliates who have a financial stake in promoting your site. If you are a merchant2 you need to (1) determine the commission you are willing to pay (consider it your advertising cost), (2) select a company to set up the technical details of your program, and (3) promote your program to get the right kind of affiliates who will link to your site.

22. Ask Visitors to Bookmark Your Site. It seems so simple, but make sure you ask visitors to bookmark your site.

23. Devise Viral Marketing Promotion Techniques. So-called viral marketing uses the communication networks (and preferably the resources) of your site visitors or customers to spread the word about your site exponentially. Word-of-mouth, and network marketing are offline models. The classic example is the free e-mail service hotmail.com that includes a tagline about their service at the end of every message sent out, so friends tell friends, who tell friends. Another example is the Recommend-It.com service to tell friends. ?Why don’t you recommend this site right now to see how it works, and enter to win a prize??

Certainly, ways to promote your site will never end. To effectively market your site you need to spend some time adapting these strategies to your own market and capacity. (Wilson. June 99)

B. Learning about your Visitors

As part of developing your Internet Marketing Plan, you need to carefully define your visitors. Everything flows from who your customers are: your website design, your product or service offerings, and your modes of advertising. If you are to succeed offline or online, you need to have an excellent understanding of your customers. Here is the kind of information you ought to be looking at to build your profile.

Here are some elements of a customer profile to consider. For business-to-consumer businesses, these customers are individuals. Of course, business-to-business customers are companies, they usually have a human face that may well have some specific characteristics as owner, purchasing agent, engineer, webmaster, VP of marketing, etc.

Let us begin to define your customers with some of these parameters:

 Geographic. Are they grouped regionally, nationally, or globally?

 Cultural and Ethnic. What languages do they prefer to do business in? Does ethnicity affect their tastes or buying behaviors?

 Economic conditions, income and/or purchasing power. What is the average household income or purchasing power of your customers? What are the economic conditions they face as individuals? As an industry?

 Power. What is the level of decision-making level and title of your typical B2B customer?

 Size of company. What company size are you best able to serve? Do you determine this best by annual revenue or number of employees?

 Age. What is the age of the companies you do business with? Dot-com start-ups or several decades old. What is the predominant age group of your target buyers? How many children and of what ages the family is of?

 Values, attitudes, beliefs. What are the predominant values that your customers have in common? What is their attitude toward your kind of product or service?

 Knowledge and awareness. How much knowledge do your customers have about your product or service, about your industry? How much education is needed? How much brand building advertising do you need to make your pool of customers aware of what you offer?

 Lifestyle. How many lifestyle characteristics can you name about your purchasers? CACI (http://www.caci.com/Products/MSG/Databases.html) has developed the fascinating ACORN system of 43 closely targeted lifestyle profiles that can be tied to specific ZIP codes. If you were to geo-code your existing customer database using their ACORN system, you would be able to determine patterns for your best customers that would guide future marketing.

 Buying patterns. There is a growing body of information on how consumers of different ages and demographic groups shop on the Web. This is vital information for your marketing plan, even if you have to pay to get it.

 Media Used. How do your targeted customers learn? What do they read? What magazines do they subscribe to? What are their favorite websites? These are all pretty obvious to developing a marketing campaign.

(Web Marketing Today. April 1999)

We have just touched the surface here, but we hope it gives you an idea of the process. After you have collected this kind of information from a wide variety of sources, you are ready to write a description of your best customers. Distill all you have learned into a maximum of three or four paragraphs, even though you may have spent days or weeks researching.

Once for good measure, all repeat together: “The core of our Internet Marketing Plan is understanding our customers.” Get this right and you can carve out a successful business on the Web. Be careless in defining your customers, and you will doom your online marketing, no matter how much money you throw at it.

You can learn about your site visitors in a number of ways. But before we look at any of them, we need to talk about privacy. One of your visitor’s chief concerns is the steady erosion of his privacy. If you want to gather information, you will need to show integrity about the way you use the information. It is strongly recommended that you develop a site privacy policy, link to it from every form (and preferably from every page in your site), and abide by it rigorously.

Here are eight ways you can learn about your site visitors:

1. Monitor E-Mail Inquiries and Complaints

It is vital that you find a way to monitor e-mail inquiries and complaints from your site visitors. Even if you have an employee handle this e-mail for you, have them print out an extract of key questions and complaints so you can keep your finger on the pulse. We have found that my blind sides are quickly spotted by visitors, who’ll fire off an e-mail. Do not look at these e-mails as enemy fire; these are your friends who will help you improve your site. When you spot a question occurring repeatedly, it is a sign that you need to deal with it more fully or more visibly on your site. And, it tells you what is important to your visitors.

2. Provide Online Questionnaires

You might want to create an online questionnaire with which you can gather information from your site visitors. What kinds of questions are important? ?Internet World subscription form? is an example questions asked by a Business-to-Business magazine (http://www.iw.com/subs/subs.html).

3. Send Out E-Mail Questionnaires

The strength of online forms is the ease with which the data can be collected for analysis. The downside is that online forms are essentially passive; they wait until someone comes to them. E-mail questionnaires, on the other hand, are active; the recipient can fill it out and reply without having to open a web browser.

E-mail questionnaires, however, may be the survey of choice because of their immediacy and ease in sending.

4. Use Cookies Strategically

Another information gathering strategy is to use cookies. Cookies are tiny pieces of information that can be placed on your site visitor’s web browser for retrieval later. These are widely used to display banners, keep track of shopping carts, remember passwords, track affiliate referrals, etc. Let is say you want to learn how many of the people who responded to a certain ad actually made a purchase. One way to do this is to create a special web page URL for the ad. When someone clicks on the ad URL, they come to the special page where JavaScript code places a cookie on their web browser indicating that they came from a certain ad. When a purchase is made in the site ordering system the cookie (if any) is retrieved and a record is made of the source of the sale.

5. Examine Order Files

Another way to learn about visitor shopping patterns is to analyze individual order files as well as summaries. Once a visitor places an order or provides an e-mail address, any information collected about that individual can be used to develop a personal profile. Amazon.com uses such information to offer recommendations of other books or purchases based on your previous purchases.

6. Provide Site Personalization

Larger company sites are employing database tools that harvest information about visitors by what products they look at or purchase, which banners they click on, etc. Then this data is merged with other databases providing demographic information by ZIP code, etc. to give a customer profile.

7. Study Your Traffic Logs

Considerable data about your customers and their surfing habits can be gained from studying the traffic logs for your website. These can tell you how the visitor came to your site, browser used, route used to surf through your website, most popular pages, domain name of visitors, and much more.

8. Employ JavaScript on Your Site

In addition to placing cookies, JavaScript can be programmed to harvest information contained in the visitor’s web browser, such as plug-ins available, the resolution of his computer monitor, operating system used, and version of browser.

The information you learn from each of these methods can help you gain a clearer picture of those visiting your site. Use the data with integrity; adhere to your privacy policy. But use what you learn about your visitors to fine-tune your website sales and revenues, and you’ll come out ahead. Careful attention to customer data is a major factor in distinguishing successful from unsuccessful sites. Neglect it at your peril.

(Web Marketing Today. Nov. 1999)

II. Segmenting your Internet Market

Once you have studied the customers who are likely to purchase your products or services, you may find that there are several kinds of customers, each with different interests and needs. When you segment your market in this way, you increase your chances of success.

One of the most profitable exercises you can conduct is to segment your site visitors into specific categories. This takes market research on your customers and then careful analysis, but it will enable you to be much more successful in your website marketing efforts. Then include in your Internet Marketing Plan a paragraph or two explaining how you segment your potential customers. Later in the plan, you will indicate which products or services are most suitable for each segment, and a marketing strategy to reach each segment of your market.

From a web-marketing standpoint, one of the difficulties you face when you offer a number of products aimed at different groups is to segment visitors quickly and move them to their own section. Imagine the problems with a company as diverse as Microsoft (http://microsoft.com), for example. Their website uses these kinds of categories:

Product Family Sites

BackOffice

Developer Tools

Office

Windows

Web Services

bCentral

MSNCustomer Sites

Home & Personal

Business

Developer

Education

IT Professional

Partner/Reseller

Notice the redundant way they segment by both product/service family as well as by customer type. We think Microsoft does a pretty good job at this.

(Wilson, ?Web Marketing Today?)

IV. E-Commerce in Lebanon

The Internet invaded the Lebanese market in 1995, where at that time few companies (ISPs) monopolized the market. However, in less than five years, companies working in this sector rose to more than twenty companies competing to have a higher market share and attracting more customers, which led to many price wars recently. At the beginning, Internet was only sought for the fun and entertainment part of it, not knowing how important this technology is for trade, economy, knowledge, etc. But with time, companies got to understand the importance of business on the Internet, leading to the existence of a new sector in the national economy, that of information and communication. This evolution paved the way for e-commerce to flourish the Lebanese ?E-Market?.

A. Lebanese Companies on the Net

Roula Mousa, managing director of Netways, could hardly control her excitement while speaking on the global implications the World Wide Web will have on the world?s future.

Speaking at a workshop hosted by the ministry of economy?s trade information center she pointed to the range of benefits that being plugged into the Net could bestow.

If a company needs to know how their stocks are doing on the Beirut Bourse, it can always just punch in *www.bse.com.lb* and get the day?s closing prices.

Want to check out new real-estate investment opportunities in the country? Check out *www.homesandland.com* and you can get a listing of land and property for sale according to your specifications.

The possibilities are endless, but ?it?s a war here,? she said. If a company wants to compete in today?s global village, it needs to learn how to market and sell its products, recruit employees and search out clients, all over the Net. For this reason, the ministry of economy will be hosting free Internet workshops for Lebanese companies on a monthly basis.

There are more than 100m Internet subscribers across the world, of which 60 per cent are in the US.

Of that number, 100,000 are from Lebanon, half of them university students.

There are more than 8m websites on the World Wide Web and, according to the estimates, more than 5,000 Lebanese companies are represented on the Net.

Some have made it into a valuable tool.

Exotica is an example. Through its website at *www.exotica.com.lb* a client can order, pay by credit card and have delivered an order of flowers or a potted plants, without having to do more than click a mouse button.

The typical Internet E-Commerce includes catalog-shopping merchandise, distribution, wholesaling and other commercial activities. The success of these solutions will be driven by consumer confidence in the security and confidentiality of their transactions.

The basic way to handle commerce via the internet is to setup an HTML form where users can enter the items they wish to buy, shipping address and credit card information. By using a secure socket layer (SSL), server and browser will ensure that third parties cannot discover the credit card information.

Alternative way to increase the security of credit card transaction is to use a trusty transaction company between the merchant and customer, so the merchant does not see the customer’s credit card number.

II. Customer Adaptation to E-Commerce Websites

Reaching the world, and more specifically lucrative Arab markets, does not need grandiose planning. Computers are spreading and making Arab citizens potential consumers to an electronic form of commerce dominated by multinational firms with huge financial and technological resources. Despite foreign competition, the Internet can fuel economic growth in our country.

E-commerce is practiced differently between the two powers that dominate virtual business in the world, Europe and the United States. European e-commerce is mostly comprised of retail selling, such as buying flowers, cameras and computers on the Internet using credit cards, or other ?secure? payment methods designed not to let financial accounts fall into the wrong hands.

In the U.S., there is a large and increasing consumer appetite to buy goods and financial services on the Internet, but firms also rely on the Web for their supplies and to keep stocks at a minimum through what is known as ?business to business? transactions.

In Lebanon, the volume of both types of virtual trading is negligible. Businesses tend to think of the Internet as a method of displaying their goods and services on-line, not as a tool to increase sales and cut costs.

At the global level, forecasts for e-commerce growth are quite daring: From $59 billion last year, international consultants Deloitte says that virtual trade would cross the $1 trillion barrier by 2002, mainly from business-to-business deals.

Asia, it seems, is destined to continue lagging behind with a less than $50-million share compared to more than $800 million for U.S. businesses. Such calculations cast of grim shadow over the Arab East, which is already being left behind the rest of the world economy in the traditional fields of industry and services.

The vast majority of Asia?s e-commerce is conducted in advanced nations such as Singapore and Japan. What can we expect then from Arab businesses? How can we avoid being confined to another footnote in the globalization story?

The Arab virtual market is small. The U.A.E. is the most virtual with more than 200,000 Internet surfers up to April. Lebanon is in good shape with respect to its Arab neighbors and is not very far from 100,000 subscribers. The Syrian government limits the spread of the Internet to its citizens who dial-up using Lebanese providers.

Saudi Arabia is finally booming after the government allowed a highly censored Internet to reach the population. In terms of personal computers, we notice that Saudi Arabia has formidable infrastructure (almost 1 million PCs), which justifies the Internet explosion there. The Levant enjoys much less purchasing power, but hopefully economic liberalization will finally hit the whole region, raise the standard of living and spread computers more rapidly to an eager, multi-lingual and educated population.

One of the very few studies I managed to come across showed that 9 percent of Arab Internet surfers make on-line purchases. But the market for credit cards, the main settlement mechanism on the Internet, is also growing. Lebanon?s 30,000 credit cards two years ago are have exceeded to 100,000 in 1999, and is expected to rise to 300,000 in 2001 with banks such as Credit Libanais working to introduce state of the art chip-based plastic.

Lebanon defines itself on the virtual map by a set of encouraging numbers and some innovative approaches to e-commerce. A liberal business code has allowed the spread of tens of Internet firms that are competing primarily by undercutting each other?s prices and making the costs of accessing the Web among the lowest in emerging markets.

Lacking huge R&D budgets, Lebanese firms are devising low cost, yet effective, ways to wipe consumer fear of the Internet. Fransabank began by introducing a credit card with a monthly limit of $100-$200 to be used when making on-line purchases. If a credit card number is stolen, the resulting losses would be minimal.

Other banks among them Lebanon & Gulf Bank, Credit Libanais, Blom, Audi, Inaash have followed with even lower limit Internet pre-paid cards. Local service providers are teaming up with international firms to market the secure payment methods adopted internationally, such as Data Management, which linked with Kleline, and Inconet with Global Sign.

While a major credit card issuer, CSC has teamed with Moscanet for providing a new way of secure payments in Lebanon.

Another positive development has occurred on the Web itself. Some firms managed to break from the monotony and dullness that characterized Arab sites and carved a niche of selling goods to a large base of Lebanese expatriates, such as sweets manufacturer Hallab. In the financial industry, customers of the Arab Finance Corporation trade on-line.

Despite these bright spots, the market is stagnant and has not reached an international level of maturity. Most sites are dull, slow and difficult to manipulate. I tried to buy a book on-line from a local site. I only had a choice of the latest available publications (about six books) and waited for what felt like a decade for the necessary page to open. It was much easier to go to the bookshop, buy the book and come back before the page finished downloading.

So there is huge room for technological improvements to make the Internet faster and the connection more efficient.

But a fair bit of investment is needed to upgrade system speed, create sophisticated sites and conduct large-scale marketing campaigns to familiarize the consumer and merchant with the new medium, especially the business-to-business side.

The probability that such investments can be made through the small firms that form the market is tiny. Their small sizes limit their access to finance and the amount of salaries they can pay specialists capable of taking the e-business a step up. (Majzoub R., downloaded from http://www.dailystar.com.lb)

V. Conclusion

Individuals will be able to process documents and pay their bills using the government?s network.

Mohammed Amin of the Ministry of Economy and Trade made the announcement and several conceded that at present there are obstacles in the path to the future – incomplete telecommunications infrastructure, non-existent e-commerce legislation and a lack of consumer awareness. ?Electronic commerce and its various services represent an easy and inexpensive opportunity for Lebanese businesses to compete on the regional and global markets,? said al Amin, director-general at the ministry.

?The public and private sectors are both responsible for the development of e-commerce in Lebanon,? said Amin. ?The Lebanese government intends to play an active role in this area.?

The government strategy includes the creation of a flexible legislative framework for electronic commerce and its adoption as the model in government transactions.

The government also hopes to encourage small and medium sized businesses to adopt new technology and increase investment in information technology education and infrastructure.

Louis Hobeika, chairman of Sodetel, stressed the importance of IT development in all companies. ?Speeding transactions and minimizing costs is the key to doing business,? he said. ?Electronic-commerce helps businesses reach this target.?

According to Hobeika, certain drawbacks limit the propagation of electronic-commerce in Lebanon, including slow network speed, consumer awareness and secure transactions.

?Fraud on the Internet is a major concern for an e-commerce company,? he said. ?But the fact is that less money is lost to Internet fraud than mobile phone fraud.?

According to Forrester Research, only $1 is lost to Internet fraud per $1,000 revenue transactions, compared to $19.63 for the cellular phone industry.

Electronic-commerce turnover reached $59 billion in 1998, mainly in business-to-business deals.

?In the future, technology will allow people to bypass local authorities such as Customs,? said Salah Rustom, president of CIE Lebanon.

?Governments that show flexibility in their legislature will benefit more than those who don?t,? he added.

?The Beirut Chamber of Commerce is working on a proposal to facilitate the movement of information, goods and services,? said Hobeika.

?Few Lebanese companies make use of their website for business,? said Rami Majzoub, sales executive at Reuters. ?They use it mainly for promotional purposes.?

Majzoub suggested that e-commerce could help Lebanon regain its global muscle, but that the market was still in its infancy and needed incentives to grow.

?Lebanon has the competitive advantage in certain areas including low dial-up costs, a growing number of credit card holders, and businesses that recognize the potential of the web,? said Majzoub. ?But the industry is still at a crossroads and needs to consolidate and attract joint venture capital to grow to its full potential.?

Majzoub invited businesses to recognize the electronic market, and to act now because tomorrow is too late.

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Foot Notes:

1) Meta tag: is a programming script tag used in HTML (Hyper Text Markup Language), which is used for developing web sites. This tag includes a description of the web site and some keywords that describe the web site. The purpose of it is to allow search engines to index the web site for users to easily locate it. Example:

*META NAME=”KEYWORDS” CONTENT=”university, education, Lebanese American University, etc …*

*META NAME=”DESCRIPTION” CONTENT=”LAU is the leading university in the Middle East etc …”*

2) Merchant: is a company that links between the web surfer and the company of the web site. It ensures that the credit card of the surfer is valid, that he has the amount of money to be paid in the bank, and transfers the needed amount from his account to the company?s bank account.

Bibliography

1. Majzoub, Rami. Seminar on e-commerce at the Bristol Hotel. September 1999 (http://www.dailystar.com.lb)

2. Al-Ittihad Al-Iktissadi. 30th Edition, February 2000. (pp. 29).

3. Haraky, Aly. ?Future of Commerce is Digital: Point and Click?. August 1999. (pp. 1). http://www.dailystar.com.lb

4. Wilson, Ralph F. ?The Web Marketing Checklist?. Web Marketing Today. Issue 57, June 1, 1999.

5. ?Preparing a Customer Profile for Your Internet Marketing Plan?. Web Marketing Today. Issue 76, April 1, 2000.