CHAPTER 4E-ENVIRONMENT

SLEPT Factors Macro-environment

Social Legal Economic Political Technological

SLEPT: Social

Include the influence of consumer perceptions in determining usage of the Internet for different activities

SLEPT: Legal and Ethical Determine the method by which

products can be promoted and sold online

Governments, on behalf of society, seek to safeguard individuals right to privacy

SLEPT: Economic

Variations in the economic performance in different countries and region affects spending patterns and international trade

SLEPT: Political National governments and transnational

organizations have an important role in determining the future adoption and control of the Internet and the rules by which it is governed

SLEPT: Technological

Changes in technology offer new opportunities to the ways products can be marketed

Factors Governing Internet Adoption Cost of access Value proposition Ease of use Security Fear of the unknown

Internet Access

Consumers and businesses who uses Internet vary according to countries

Within each country, adoption of the Internet vary significantly according to individual demographic characteristics

Broadband adoption

Why Personal Data are Valuable?1. Contact information2. Profile information3. Behavioral information (on a single

site)4. Behavioral information (on multiple

site)

Ethical Issues and Data Protection

Ethical issues concerned with personal information ownership have been usefully summarized by Mason (1986) into four areas:

1. Privacy – what information is held about the individual?

2. Accuracy – is it correct?3. Property – who owns it and how can ownership be

transferred?4. Accessibility – who is allowed to access this

information, and under which conditions?

Ethics – Fletcher’s View Fletcher (2001) provides an alternative

perspective, raising these issues of concern for both the individual and the marketer:

1. Transparency – who is collecting what information?

2. Security – how is information protected once collected by a company?

3. Liability – who is responsible if data is abused?

The Eight Principles for Data Protection Fairly and lawfully processed; Processed for limited purposes; Adequate, relevant and not excessive; Accurate; Not kept longer than necessary; Processed in accordance with the data subject's

rights; Secure; Not transferred to countries without adequate

protection.

Regulations on Privacy and Electronic communications Privacy and Electronic Communications

Regulations (PECR) Act1. Applies to consumer marketing using

email or SMS text messages2. Is an ‘opt-in’ regime3. Requires an opt-out option4. Does not apply to existing customers

when marketing similar products5. Contact details must be provided

Regulations on Privacy and Electronic Communications

6. The ‘From’ identification of the sender must be clear

7. Applies to direct marketing communications

8. Restricts the use of cookies

Viral e-mail Marketing

To reassure web users about threats to their personal information

TRUSTe ISIS – a UK accreditation initiative

Checklist of Compliance

Follow privacy and consumer protection Inform the user Ask for consent for collecting sensitive personal

data Reassure customers by providing clear privacy

statements Let individual know when cookies are used Never collect or retain personal data Amend incorrect data Only use data for marketing Provide the option to stop receive information Use appropriate security technology

Legal – Sparrows Eight Areas1. Marketing your e-commerce business Domain name registration Using competitor names and trademarks

in meta tags Using competitor names and trademarks

in pay-per-click advertising Accessibility law

Legal – Sparrows Eight Areas2. Forming an electronic contract 3. Making and accepting payment4. Authenticating contracts concluded over

the Internet5. E-mail risks 6. Protecting Intellectual Property 7. Advertising on the Internet 8. Data protection.

Economic/Political, Competitive Factors

Ensuring companies competitive Funding for education and technology Promoting new technology e.g. broadband 12% in UK, 70%

Taiwan, South Korea Achieving government efficiencies

E-government – all UK services online by 2005 Singapore ‘Intelligent Island’

Taxation regimes Legislation for offshore trading.

A framework describing the e-economy

Source: Booz Allen Hamilton (2002).

E-commerce and Globalization The increase of international trading and

shared social and cultural values Language and cultural understanding English becoming the lingua franca of

commerce Tailoring e-commerce services for

individual countries or regions

Political Factors

Promoting the benefits of adopting the Internet

Enacting legislation to protect privacy or control taxation

Providing guidelines and assistance for compliance with legislation

Setting up international bodies to coordinate the Internet

Technological Issues Need to be able to assess new innovation Rate of change

Which new technologies should we adopt? Monitoring for new techniques Evaluation – are we early adopter Re-skilling and training

Are our systems secure?