Germany, the UK and other countries in Europe 1997 to SI.64 billion ­ or 7.5 per cent of global

Germany, the UK and other countries in Europe 1997 to SI.64 billion ­ or 7.5 per cent of global

by the end of 1998. To compete in the interna­ record sales ­ by 2002 as Internet access

tional online music market, a global network of increases, according to research consultancy

Internet record subsidiaries is essential. At pre­ Jupiter. Traditional record labels and retailers

sent it supplies consumers outside the United were initially sceptical about the Internet, but the

States by airmail or courier. Local operations success of upstarts like CDnow and N2K has

would help it tailor product ranges to suit local changed the industry's af­titudcs towards the Net.

needs, and to increase sales by offering faster, Now the race is on. Both CDnow and N2K are

cheaper delivery. Then there are the challenges trying hard to ward off online competition from

presented by software advances. Newcomers such as Virgin Net are offering secure shopping

WORLDWIDE SAJ,ES, ESTIMATED guarantees built around ;i secure electronic trans­ action (SET) standard to ensure that transactions

47 over the Internet are secure and tamper free.

They are also marketing low­cost set­top boxes

which would cost about £200 and provide users

with Internet access via their television sets.

Others are making substantial investments in

software to deliver albums and singles directly to consumers' computers as digital signals, rather

SOURCE: Jupiter Communications, USA

than sending compact discs by the post.

Forms of Direct Marketing • 969

The upbeat tempo may not be music to all ears. The cost of Internet placement deals, expansion and software advances is proving loo much for smaller companies. Meanwhile, N2K

and CDnow are intent on battling it out, making substantial investments from their flotation pro­ ceeds to keep the business rolling in cyberspace.

and behaviours of online service and Internet users. SRJ's Web site (www.future.sri.eoni) allows visitors to take the VALS 2 questionnaire and get immediate feedback on their VALS 2 type. Fully 50 per cent of those who have visited this site so far are Actualizers, the stereotypical up­scale, technically oriented academies and professionals. Only 10 per cent of the general population belongs to this segment. 2S

Finally, Internet consumers differ in their approaches to buying and in their responses to marketing. They are empowered consumers who have greater

control over the marketing process. 2 ''People who use the Net place greater value

on information and tend to respond negatively to messages aimed only at selling. Whereas traditional marketing targets a somewhat passive audience, online

marketing targets people who actively select which Web sites they will visit and which ad banners they will click on. They decide which marketing informa­ tion they will receive about which products and services and under what condi­ tions. Thus, in online marketing, the consumer, not the marketer, controls the interaction.

Internet 'search engines', such as Yahoo!, Infoseek and Excite ­ with huge databases containing searchable details about most Internet sites and the pages within those sites ­ give consumers access to varied information sources. This

helps to make them better informed and more discerning shoppers. In fact, online buyers are increasingly creators of product information, not just consumers of it. As greater numbers of consumers join Internet interest groups that share product­related information, 'word of Web' is joining'word of mouth' as an import­ ant buying influence. Thus, the new world of elcetronic commerce will require

new marketing approaches.