Chapter 3 - Internet macro-environment

Learning Objectives

How does a macro-environment impact the execution of an organization's Internet marketing strategy?

There are several key macro-environment elements that can impact the Internet marketing strategy of a business. Each element can impact a strategy in their own unique way, which is why a business needs to plan for each one carefully.


The first type of element that can impact a business Internet marketing strategy is society in which they sell their product or service. Society influences how a person will use the Internet and if they will buy a product or service online. There are some societies that do not have access to high-speed Internet, which can lead to them not buying online. In some societies, people do not have the trust in buying products or service online, because they paying cash when making purchases. All of these factors can shape the way a business creates and executes their Internet marketing strategy.

The second type of element that can impact Internet marketing strategy is legal and ethical factors. These include how a product or service can be promoted. There are many different laws around the world and many governments try to safe guard their citizens from getting hurt or being taken by a business. Laws may also dictate how a product can be made or what types of materials can be used to create the product. 

Another factor that can impact an Internet marketing strategy is economic factors of the country where the business is selling their product or service. If the country is a poor country or going through tough economic times, then this will impact how the people will buy. People only buy when they have the excess monies to make purchases other than their basic needs.


Political factors can also impact the Internet marketing strategy of a business. An example might be the election of a new President and how they proceed with political policies effecting job growth, economic policies, and even laws. 


The last factor impacting an Internet marketing strategy is technology. Technology is an ever evolving industry, which changes rapidly. For instance, if a business does not get in on the ground floor of a particular type of technology, they might miss opportunities that could have allowed them growth. It is also said if a business gets in too early on a particular technology, they might fail if the technology fails. Businesses must be diligent in their use of the technologies.

How does legal, moral, and ethical constraints impact the opportunities of an organization?

There are many legal factors that can impact the opportunities of a business. One important legal factor includes the data and privacy laws, which can impact the collection, storage, usage, and deletion of personal information that is retained through websites. This law can limit the way in which the business can collect and use the data on individuals. Without this law businesses might sell the information they collect to people or companies that might use the information for unethical purposes such as identity theft, or spamming individuals, or much worse. These laws are put into place not only protect the individual, but also the business from making immoral and unethical decisions.

Branding and trademark protection is another law can impact the opportunities of an organization. These laws were created to keep businesses from harming other businesses. If not for these types of laws, businesses could go around intentionally try and damage the reputation of its competitors. Damaging other competitors brands for the purpose of gaining more customers would be both immoral and unethical, so these laws make it harder for the business to do this kind of act.

What are some other kinds of macro-environment constraints that can impact an organization? 

There are other factors that can impact the way a business can be run online. One of these factors might be economics, which can defiantly effect how people buy. Another factor might include the type of access to the Internet a person has. If a person only has access to dial-up, then the person will not be able to go online to a website that has a lot of rich media, because it would be so slow to access.  Another impact could be that of taxation. This can effect how they sell in a country, because if the taxes were too high they might not profit from being in the country. When being online in an international space, a business must plan for the unexpected and be ready for constraints that can effect their business.

Questions For Marketers

How do I complete a situation analysis as part of planning digital marketing?

In order for a business to complete a situation analysis, they must go through a series of analysis. These include looking at the following, in order to create a whole picture of the consumers they are servicing.

• Social factors
• Legal and ethical factors
• Economic factors 
• Political factors
• Technical factors

Each of these factors are the pieces to the bigger puzzle and by analyzing these pieces a business will have the competitive edge they need to thrive online.

Which factors affect the environment for online trading in a country?

There a several factors that can affect a business from doing online trading in a country.  On huge factor includes the social factor. This includes things such as religion, gender, and the perceptions a society has about the Internet. Another factor include the legal and ethical factors, which includes privacy laws, patient laws, and even the governments roll in Internet trade. Economic factors can affect the online trading in a country due to the wealth of the people. If the people don't have the excess monies to buy things other than necessities, then they might not buy the products or services being presented to them. Another factor can be politics, which can be important when doing online trading. A government might not allow a certain product or service to be sold in the country, which will definitely affect where the online trading can take place. The last factor is technology, which is very important. If a country is very poor, the people may not even have access to the very essential types of technologies to get on the Internet and make trades.

  

How do I make sure my online marketing is consistent with evolving online culture and ethics?

Re-evaluation is the key to making sure that the Internet marketing strategy is consistent with culture and ethics of the locations which they serve their products or services online. Without a consistent re-evaluation of the strategies set by the business, a business might miss on new opportunities or even create a situation where they can not do business in a particular location. It is recommended that a business re-evaluate their Internet marketing strategy at least once a year at minimal. Many business have formed a committee that meets once a quarter or even on a monthly basis. This insures that a business is meeting the needs of the people they are serving and meeting the goals they have set in their strategies.

How do I assess new technological innovations?

Every manager has their own way of assessing new technological innovations.  One manager might decide to take the necessary risks of being on the "bleeding edge".  Other managers, might wait until a technological innovation has been around for a while and make sure it is a worth while investment to pursue.  There is no correct answer for a manager to make the decisions on whether to invest time and money into technical innovations, but there are steps that most managers will follow when making the decision. 

1. Evaluate the technology to make sure it is the right fit for the business.
2. Create a list of goals and objectives for the new technology.
3. Determine when the new technology is to be implemented.
4. Determine the ROI of implementing the new technology. 
5. Implement the new technology into the business.
6. Re-evaluate the new technology to see if it has meet the goals and objectives.  

These steps can help guide the manager in figuring out whether the new technology they want to implement will help or harm their business.

Which laws am I subject to when trading online?

Businesses that are conducted online immediately become international businesses due to the nature of the Internet. There are international laws, which most business must adhere to and abide by. In most cases, though, a business must adhere to the local laws and regulations in which they service their products or services to. Taxation on products or services is an example of one law, which when the business makes a transaction, the business must pay a part of the tax to the country where the transaction took place and the other part of a tax to the country where the business resides. As of right now, because Internet is in its infancy, there is a fuzzy line that has not been clarified and as the Internet becomes more widely used, the precedence of the laws will start to materialize and create a clearer boundary for doing business online.