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Global competition has improved the need for quality performance
measures and metrics. In the new marketing channel of e-commerce, this
reality is very apparent. Much ground is still uncharted in the arena
of e-commerce, and so companies are scrambling to come up with ways to
track whether e-commerce is working for them, and if so or not so, why
or why not.

The metrics and measurements developing in the
e-commerce field are beginning to revolve around customer behavior. One
reason for this trend is that companies are still in a steep learning
curve about how customers react to e-commerce. However, some quality
metrics and measures have been developed already.

Metrics’ positive effect on the growth and vitality of an organization
- Help Define Business Models
- Help Communicate Strategy
- Help Track Performance
- Help Increase Accountability
- Help Align Objectives

Why some firms have not made an explicit commitment to metrics?
- Companies strategy changes rapidly
- Measurement is resource intensive
- Online system measurement is vulnerable
- Soft metrics are not valued by investment community
- Meaningful metrics change on internet time

The health of new economics firm can be asses by some metrics, such as:
1. Financial Metrics
2. Customer Metrics
3. Internal Business Metrics
4. Learning and Growth Metrics
This
framework may be appropriate for some firms, it is also limited in
three respects: (a) it does not offer additional of strategy, (b) it
does not clearly articulate the capabilities of the firm (instead, the
focus is on internal business processes not linked to customer
benefits), and (c) it does not explicitly include partnerships.

Component of Performance Dashboard
1. Opportunity Metrics
2. Business-Model Metrics
3. Customer-Interface and Customer-Outcome Metrics
4. Branding and Implementation Metrics
5. Financial Metrics

Lifecycle of a company is divided into four stages, which are:
Stage 1 – Startup, develops a platform for rapid growth by building a strong team and creating a flexible site.
Stage
2 – Customer Acquisition, build market share as quickly as possible by
aggressively spending on partnerships and promotion.
Stage 3 – Monetization, increase revenues and customer lock-in by developing new revenue streams.
Stage 4 – Maturity, control costs and optimize marketing expenditure to achieve profitable growth.

Steps to Implement Performance Dashboard
Step One: Articulate Business Strategy
Step Two: Translate Strategy into Desired Outcomes
Step Three: Devise Metrics
Step Four: Link Metrics to Leading and Lagging Indicators
Step Five: Calculate Current and Target Performance

When identifying metrics, it is useful to apply the widely used SMART (Specific, Measurable, Actionable, Relevant, and Timely or time-oriented, a historical analysis).

Market-research
data sources tend to focus on website performance and customers’
perception of websites. Analyst reports often combined primary data
collection with an analyst’ strong point of view on the industry.
Financial sources focus on the investment community and tend to include
in-depth financial information. Each approach has its strengths and
limitations, but each complements the others. Firms often need to
acquire data from all three areas to obtain a complete picture of their
markets.

Five Categories of E-Commerce Metrics
1. Channel Promotion, key to measures:
    - Percentage of all referrals (or visitors)
    - Cost of acquisition
    - Contribution to sales or other out-comes
2. Channel Buyer Behavior, key ratios:
    - Home page interest (home page views/all page views)
    - Stickiness (page views/visitor sessions)
    - Repeats (visitor sessions/visitors)
3.
Channel Satisfaction, evaluation of the customer’s opinion of the
service quality on the site and supporting services such as e-mail.
4. Channel Outcome, records customer actions taken as a consequence to a site.
5. Channel Profitability, the profitability of the web site taking into account revenue and cost and discounted cash flow.

Executives of successful E-commerce companies need to be strategic
thinkers focusing on customers, markets, and competitive positioning,
as well as on internal operations. Determination of a suitable
E-commerce strategy begins with identification of the opportunities and
risks. The task of tracking the changing environments, understanding
customer groups, requires formulating strategies and planning their
implementation.

A successful company needs to correctly manage
seven factors to have a successful resources system: (a) human assets,
(b) process, (c) organizational structure, (d) systems, (e) culture,
(f) leadership, and (g) partnerships.

Increased speed and
intensity of competition in the online environment means implementation
mistakes are punished much more severely and quickly in the offline
world. Online firms face five primary implementation challenges: (a)
higher visibility to errors, (b) lower switching costs, (c) more
dynamic competitive environment, (d) more fluid organizational
boundaries, and (e) more complex linkages.

Single-organization
firms are able to make easier for customers to use different platforms
to interact with the company, and have easier time managing a
consistent brand.
Dual-organization do not have to coordinate their processes, each unit can make decisions based on what is best for it.

E-Commerce
leaders still need to create flexible, fast-moving, adaptive,
results-oriented organizations as well as foster innovations and
develop new intellectual capital. They must also embrace more
traditional responsibilities. Leaders need to listen, respond to
employees and external stakeholders, nurture middle and lower managers,
and employ traditional management tools for planning, budgeting, and
coordination and control.

E-commerce Strategy test
(a) Product characteristics: Does the product need to be physically tried or touched, before it is bought?
(b) Familiarity and confidence: The degree to which consumer recognizes and trusts the product and brand.
(c) Consumer attributes: fits the electronic buyer behavior with the product? (I.e. target group)

Framework for developing web-site for e-commerce
A. How to avoid wasting time fighting over a web site
Web
site must be included: (1) a warranty that all text, design, and
graphics on the Web site is either (i) the independent contractor’s
original work, or (ii) the work of others that have given the
independent contractor permission to use the work and have given the
independent contractor permission to assign any rights in the work to
the business; and (2) a release by the independent contractor granting
the business all the independent contractor’s rights in the Web site’s
design and content.

B. Web sites Fights Involve Direct and Contributory Infringement
Direct
infringement of a copyright means to violate a copyright owner’s
exclusive rights in a copyrighted work: to reproduce the work; to
prepare derivative works; to distribute copies of the work; to display
the work publicly; to perform the work publicly; or to import the work.
Direct infringement of a trademark means to use a trademark identical
or highly similar to the mark of another, in connection with the same
or closely related goods or services in a manner that is likely to
cause confusion, deception or mistake about the source of the goods.

C. Other Web site Pieces and Features and What to Do with Them
A
business should investigate other components or Web site features used
in this Web site since these features may have legal implications or be
protected by someone else’s copyright or trademark rights, including
links, framing, search functions or crawling, and metatags.

D. How to Protect the Web site and the Business Investment
(1) Make sure that all trademarks used on a Web site
(2) Register the business’s trademarks
(3) The Web site should include a legal notice or Terms and Conditions statement
(4) If the Web site provides links to the sites of others, check those links from time to time to make sure they are still good
(5)
Include a clear and conspicuous Privacy Policy, disclosing to users
what personal information is collected and how it is used, and giving
them an opportunity to opt out of any such uses
(6) Get permission
from (or at least notify) any party whose site you link to, frame,
mirror, cache, or otherwise use in connection with the business’ site

Avoiding Consumer Challenges to a Web Site
A. Rights of Privacy
Internet
users are demanding respect for their personal information online.
Privacy issues arise on the Internet in two main ways. (1) by using a
picture of someone, or discussing or disclosing someone’s personal
affairs, without permission. (2) by collecting information on computer
users accessing a web site, including tracking the identity, personal
information, preferences, choices, and online habits of persons who
access Web sites.

B. Rights of Publicity
The
right of publicity is the right of any person (not just a celebrity) to
control the commercial exploitation of that person’s name, likeness,
and personal attributes.

C. Defamation
If a
Web site contains, or invites others to contribute, text commenting on
other people, companies, or their products, the operator of the Web
site risks claims being made that the operator is a publisher of
defamatory material. To be defamatory, the information must be (i)
false, (ii) published and (iii) the publication must harm the
individual who is defamed.

Critical Success Factor for implementation of E-Commerce
- Unique products or services
- Management support
- Project team reflecting various functional areas (integration)
- Technical infrastructure
- Customer acceptance/ User friendly
- Integration with the corporate legacy systems
- Security and control of the EC system
- Competition and market situation
- Pilot project and corporate knowledge
- Promotion and internal communication
- Cost of the project
- Level of trust between buyers and sellers

The markets of the future are destined to be increasingly complex as
economies across the world move very rapidly towards brand
proliferation. In such a scenario, management of marketing
communications and creating brand differentiation and competitive
advantage through implementation of communications strategies become
extremely important.

Marketing communication (or marcom)
consists of the messages and related media used to communicate with a
market. Those who practice advertising, branding, direct marketing,
graphic design, marketing, packaging, promotion, publicity, public
relations, sales, sales promotion and online marketing are termed marketing communicators, marketing communication managers, or more briefly as marcom managers.

The point of marketing communications is persuasion.
Even more to the point – it is about gaining attitude and behavior
change, with the ultimate goal of encouraging habituation. This is
accomplished by altering perceptions through consistent and persistent
communications and then meeting or exceeding expected value delivery.
Both consumer and business-to-business marketers need to realize that
purchase decisions have both an economic component and an emotional
component. Both need to be established and nurtured.

6Is of Market Communication
1.  Interactivity
2.  Intelligence
3.  Individualization
4.  Integration
5.  Industry restructuring
6.  Independence of location

Four categories of communications:
1.  General online communications.
2.  Personalized online communications.
3.  Traditional media communications.
4.  Direct communications.

The Key Role of Marketing Communications:
To communicate the value of products and services offered by firm so as
to differentiate the brand from competition and to grow a strong brand.
At the end of the day, a strong brand builds investor/shareholder
confidence and makes the person (or team) championing the brand a
hero(s).

Marketing communications goal:
1.  Increase brand awareness
2.  Change brand perceptions to better establish desired meaning or to reflect a new position
3.  Introduce new products
4.  Gain new customers
5.  Increase customer retention

Marketing Communications challenges:
1.
Brand developed personality through time, and need to keep the
communications “on message” to keep its unique positions clear.
2.  Customer buys for both functional and emotional reasons, which is needed to “connect” with them on both levels.
3.  Communication is more effective if have specific, measurable, and time bounded goals.
4.  Effective communications begins by understanding the target and knowing how to reach customer with the messages.
5.
Each communication tools has strengths and limitations, by using the
various tools creates efficiencies and improves overall impact to
market.
6.  Customer service and sales staff are crucial for communication effectiveness.
7.  By using and integrating various communication tools will advance relationships, and cost effective.
8.
Price is always an issue, and needed detailed metrics from
communication suppliers and gauging effectiveness in terms of targeted
impacts on served markets.
9.  Understand the challenge of separating good value (high ROI) communication suppliers from poor value suppliers.

A brand is a distinguishing name or symbol designed to:
Identify to origins of a good or service
- Differentiate those goods or services from those of the competition
- Protect the consumer and producer from competitors who would attempt to provide products that appear to be identical

Branding
is an identifiable product or service augmented in such a way that they
buyer or user perceives relevant unique added values which match their
needs most closely. Furthermore, its success results from being able to
sustain these added values in the face of competition.

Three essential characteristics of a successful brand:
- Brand is dependent on customer perception
- Perception is influenced by the added-value characteristics of the product
- the add-value characteristics need to be sustainable

Brand
equity is the brand’s assets (or liabilities) linked to a brand’s name
and symbol that add to (or subtract from) a service.

Four dimension of brand equity:
- Brand awareness
- Perceived quality
- Brand associates
- Brand loyalty

10 step of branding process:
Step 1.   Clearly define the brand audience.
Step 2.   Understand the target customer.
Step 3.   Identify key leverage points in target customer experience.
Step 4.   Continuously monitor competitor.
Step 5.   Design compelling and complete brand intent.
Step 6.   Execute with integrity.
Step 7.   Be consistent over time.
Step 8.   Establish feedback systems.
Step 9.   Be opportunities.
Step 10. Invest and be patient.

Within a technology-mediated customer experience, the user’s
interaction with the company shifts from the "face-to-face" encounter
in a traditional retail environment to a "screen-to-face" interface.
The
7Cs represent the means of presenting and presenting the firm’s value
proposition. As the “face” of the firm, the 7Cs—in the form of the
firm’s interface—must attract, serve, and facilitate the retention of
customers.

The 7Cs Framework for customer interface
· The virtual representation of a firm’s chosen value proposition.
· The virtual website provides significant information to current and prospective target-market   customers.
· If designed correctly, the site quickly answers a number of basic questions that confront such users.
·
Compelling sites communicate the core value proposition of the company
and provide a compelling rationale for buying and/or visiting the site.
· Definitions and simple illustration

The 7Cs Element for customer interface
CONTEXT
“The
context of the website captures its aesthetic and functional
look-and-feel.” The goal in designing the context of a site is to
present an image and experience to the user that is consistent with the
company’s core values and brand image. A site’s context employs
aesthetic and functional features to capture and serve potential
customers. Context is the “virtual” form of the brick-and-mortar factor
of atmospherics.

CONTENT
Content is defined as “all digital subject matter” on a web site.

COMMUNITY
Community
is defined as “the interaction that occurs between site users.” Web
sites encourage interaction by providing chat rooms, multi-user games,
email capability, and other user-to-user communication tools.

CUSTOMIZATION
Customization
is the ability of a site to be modified to display content, or an
assortment of content, that reflects the preferences of the user.
Websites offer the ultimate in customization. While offline stores may
attempt to tailor their offerings, only website can facilitate USER
personalization.   

COMMUNICATION
Communication
is defined as “the dialogue that unfolds between a site and its users.”
The ease of communicating with customers via the Internet is both a
blessing and a curse for a business. It is a blessing because the
Internet is a very quick and low cost way for customers to communicate
directly with a company, and companies are happy to receive a sales
order or a payment online. It is curse because the Internet enables a
large number of people to contact a company easily and often, and a
company can be overwhelmed with the task of responding to a flood of
contacts.

CONNECTION
Connection is defined as “the extent of formal linkages between the site and other sites.”

COMMERCE
Commerce is defined as “the sale of goods, products, or services on the site.”

Obviously,
the selection of “fit and reinforcement” factors required for the
effective presentation of the firm’s value proposition is critical to
success. However, each factor must become part of a coherent,
comprehensive presentation that is mutually reinforcing to provide its
greatest impact.

Traditionally, it was felt that a single site
could not offer BOTH “high” form and “high” function. However,
technological advances are continually enhancing the dynamics of BOTH
components. In the future, the question may be made.

Mature
communities exhibit cohesion, effectiveness, help, relationships,
language, and self-regulation. Websites have the potential to build
huge, borderless communities—IF they can overcome the problems of
diversity that attend this huge potential.

Websites may seek to
tailor their offerings to their perceptions of customer desires. Or,
the site may provide users with the tools to personalize the site to
their own needs.

Consumers may choose from a large, and growing,
number of websites offering similar items. Consumers facing this choice
will tend to emphasize convenience.

The concept of business model is associated with the concept of
internet-based companies. It is said that the Internet technology has
generated new business models for companies based particularly on new
ways of generating revenues through advertising.

Concept of business models
A business model is the way companies define their markets and organise with their business partners to supply them.
The
way companies define their market relates to the issue of their
contribution to the creation of value. What value do they deliver to
their customers? This includes the way they split this contribution
with their business partners like for example the distributors
considering the fact that the internet technology tends to transform
the way the value creation may be split optimally between the different
partners.
The second part of the definition relates to the issue of
organisation. Organisation is about business processes which support
the creation of value.
The final business model is therefore a
search for the optimum market organisation such that the creation of
value of the company is obtained through efficient business processes
either internal or shared with business partners.

Business models of this century will be different from "industrial models" in three key areas: (a) Networked and digital.
The advent of modern telecommunications and a shift to a stronger
service-based economy has required business models to be deployed and
managed in a networked arena, where digital process and documents will
link business applications; (b) Holistic and extended enterprise.
Technology has driven business models that create, as well as support,
the evolution of holistic and extended enterprises, and fully
integrated partner relationships; and (c) Engineered for value creation.
Business models are deployed in real-time and engineered with
strategy—for value creation and the continuous alignment of business
objectives with corporate ideology.

A business models has four parts: (a) a value proposition or cluster of value propositions, (b) an online offering, (c) a unique and defendable resource system, and (d) revenue model.
The value proposition defines the choice of target segment, the choice
of local-customer benefits, and a rationale for why the firm can
deliver the benefit package significantly better than its competitors.
The offering includes a precise articulation of the products, services,
and information provided by the firm. The resources system supports the
specific set of capabilities and resources that will enable the firm to
deliver the offerings. The revenue model details the various ways that
the firm is proposing to generate revenue, enhance value, and grow.

Development of an online requires completion of three sequential tasks: (a) identifying the scope of the offering, (b) identifying the customer decision process, and (c) mapping the offering (products, service, and information) to the customer decision process.
The scope refers to the website’s breadth, or the number of categories
of products and services. The customer decisions process can be divided
into three broad stages: pre-purchase, purchase, and post-purchase. The
process of mapping the offering to the customer decision process
involves the systematic matching of product, service, and information
to each stage of the customer decision process.

A business model for e-commerce companies contain 5 elements, which are: (1) Products and services, offered by the companies are the expression of the contribution of the company to the creation of value; (2) The ways of generating revenues,
companies may get revenues from 3 different sources: (a) revenues from
the sales of the products and services, (b) revenues from subscription,
which is customer pays a subscription fee and gets full access any time
to the product or service, and (c) revenues from advertising, at this
case the access to the product or service is free for the customer. A
third party, the advertiser pays for it; (3) Organisation and cost structure,
express how companies manage to deliver their product and services to
their customers. Information and communication technologies offer new
innovative ways of designing business processes; (4) Alliances, the way companies operate as business partners on the market to better satisfy the needs of their customers; and (5) Position in the supply chain.

Successful
business models are shown to have strategically integrated
network-enabled processes that extend through all participants in the
value Web and provide them value.
Analysis and management of the
model to achieve the best fit for continued value creation is crucial
for success. In analyzing the familiar B2C, B2B, and extended B2B2C
models, the methodology shows that continuity of processes,
transactions, and participants can occur among customers, businesses,
marketplaces, and even applications in peer-to-peer networks. The
thread of value must be engineered by strategy, congruent with new
opportunities of delivery.

In essence, e-commerce is characterized by several attributes: 1) it is
about the exchange of digitized information between parties, 2) it is
technology-enabled, 3) it is technology mediated, and 4) it includes
intra and inter-organizational activities that support the exchanges.

Four
distinct of electronic commerce can be identified: business-to-business
(B2B), business-to-consumer (B2C), peer-to-peer (P2P), and
consumer-to-business (C2B). Business-to-business refers to the full
spectrum of e-commerce that can occur between two organizations. Many
of the same activities that occur in the business-to-business sector
also occur in the business-to-consumer context. Peer-to-peer activities
include auction exchanges, classified ads, games, bulletin boards,
instant-messaging services, and personal services. In a
consumer-to-business relationship, consumers can band together to form
buyers group.

Several new views have emerged, changing the
classical strategic planning process. The sense and respond view offers
an approach that is intuitive, actionable, and easy to implement. It
also makes companies listen in a new manner to customers. The sense and
respond approach makes companies reactive to consumer opinion, though,
instead of proactive in trying to change the market.

E-commerce
does not consist only of the business themselves. Business strategy
such as market opportunity, business models, customer interface, market
communications and branding, implementation, and metrics is the core of
e-commerce and it will be affected by four infrastructures such as
technology, capital, media and public policy.

It is important
for manager to understand e-commerce infrastructure. Understanding of
technology infrastructure is used to leverage the company business for
example which files can be streamline and downloadable. Understanding
of capital infrastructure is used to make decisions company business
plan for example how the music group should be valued. Understanding of
media infrastructure is used to how to figure company business in the
internet. And understanding of public policy issues is used to
understand any regulation that will affect on the company business, for
example: copyrights, patent, trademarks, etc.

The key challenges
of today senior leadership is to understanding customer evolution,
charting changing technology, balancing irrational exuberance and
irrational doom, integrating offline and online activities, and
identifying the key levers of competitive advantage.

The twenty-first century has ushered in an era of business that is
perhaps one of the most challenging in history. Markets for many
products have weakened; major firms face some of their most critical
financial crises; international competition for major product
categories is at an all-time high; and financial markets are in an
upheaval due to interest rate changes, uncertainty over future rates,
and shifting government policies on tax decreases, increases, and
deficit spending.
Although these changes have wreaked havoc in many
industries, they have also caused many managers to reevaluate the basis
of success in their own industries, and in business in general. Many
realized that the key to success is planning—not just on a short-term
basis, but on a time scale that is long-run or strategic in orientation.

WHAT IS OPPORTUNITY ANALYSIS?
Opportunity
analysis is the process of defining the exact nature of the
opportunities available in an organization’s operating environment in
terms of external, financial, and internal considerations.
The
analysis begins with a detailed study of the environment in which the
proposed business would operate. This includes not only the legal,
political, economic, social, cultural, and technological environment
but also market size, growth trends, and consumers’ attitudes and
behavior. It also involves a study of current and potential competitors
who may be going after the same customers you propose to attract. These
factors are external to the organization or person contemplating the
new venture and therefore a great deal of diligence is required for a
thorough analysis of these factors. This usually involves a substantial
commitment of time and money to collect the information used in the
analysis.

Framework for Market Opportunity Analysis:
1. Identify the unmet/or underserved customer need.
2. Identify the specific customers a company will pursue.
3. Assess advantage relative to competition.
4. Assess the company’s resources to deliver the offering.
5. Assess the market readiness of the technology.
6. Specify the opportunity in concrete terms.
7. Assess opportunity attractiveness.

FACTORS INFLUENCING FEASIBILITY ANALYSIS
The
strategic alternatives of an enterprise are influenced by a number of
factors. The factors are of three types: external, financial, and
internal.

External Considerations
External considerations
concsist of marketi size, competition, technology, inflation and the
economy, goverment regulations, political conditions, social changes
and nature.

Financial Considerations
Financial considerations
reflect the financial impact of alternatives in terms of revenue
estimates, cost estimates, and return on investment (ROI). They must
reflect both the size of the investment needed to effectively compete
in a market and the potential returns associated with that investment.

Internal Considerations
Internal considerations include: (1) purpose, (2) corporate objectives, and (3) resources.

If
this analysis indicates that these factors are favorable to the
potential business, then an analysis of the financial implications of
the opportunity should be undertaken. The financial analysis is the key
to determining the potential profitability of the business and the
expected ROI. The results of this analysis provide the information
which can be used to attract investors and/or lenders who may be
approached to obtain capital for the venture.

Why is the media infrastructure an important issue for all ecommerce
managers? The answer is that the Internet is a mass communication
platform. Just as technology evolution sets the context for technology
choices and the capital markets set the context for funding, media
convergence provides both opportunities and constraints for the
practicing manager. Managers who run e-commerce enterprises must learn
to manage a staff responsible for design interface, stylistic choices,
editorial policies, and, most important, content choices associated
with this new communication venue. Thus, in addition to all other
tasks, the e-commerce manager is now a publisher of digital content on
the Web.

The media infrastructure includes all of the various
communication companies, as well as all of the channels of
communication (such as radio, television, newspapers and magazines)
that they use in mass communication with the general public.

Media
convergence is the process by which different types of media content
(news, information and entertainment) found across various types of
media platforms (text, audio and video) are evolving into a single
media platform through the Internet.

The conversion of analog
signals to digital signals has been one of the major steps in making
media convergence possible. Some of the key factors are:
1. Continued advances and decreasing cost of digital technology.
    - The cost of PCs has dropped significantly, as has the cost of peripheral devices used
       in  conjunction with PCs.
2. Low Cost digital network infrastructure.
    - Nonproprietary Internet Protocol (IP), Hypertext Transfer Protocol (HTTP) and
       HyperText Markup Language (HTML) were developed.
    - Standardization of HTTP and HTML led to the development of universal graphical user
       interfaces for Internet browsers.
3. Media Proliferation.
   - New types of media devices (radio, television, VCR, etc.) have developed over the century,
      including portable devices.
4. Media-Usage Fragmentation in American households.
5. Forecasted continued Media proliferation and media usage fragmentation.
6. Advance in New Technologies (Codec process)
    - This is the process by which analog signals are converted into digital signals, and vice-versa.

The
Telecommunications Act of 1996 allowed for both the increased ownership
of television stations by a single entity and direct competition among
telephone companies, cable television companies, and utility companies.
Mergers became part of an overall strategy of media companies to
vertically integrate media content with media distribution. With no
geographic barriers to the distribution of digitized content on the
Internet, many media companies seek to create global markets for their
content through mergers. With increased digitization of content and the
promise of widespread broadband delivery in the near future, the
personal computer will not be the only receiver of information over the
Internet. For today’s media company, the strategy is to collect and,
through media convergence and digital convergence, create a synergistic
combination of what were once disparate media to produce a direct
bottom-line benefit.

The promise of broadband technology gives
media users quick access to a variety of media forms over the Internet
and increasing media fragmentation have sent companies searching for
new ways to capture wider audiences.

Media megamergers have
become more common in recent years. Below are a few reasons why
megamergers are attractive business strategies.
a. They allow the company to pursue multiple revenue streams
    - Opportunity to increase advertising revenue through increased cross-selling, niche media
       buys and advertising sales packages
b. Digital technology advances solidify convergence through the Internet
     - Media companies can put their content on the Internet in various forms
     - Examples include Sony.com and ESPN.com
c. Feasible to enter global markets
     - No geographic boundaries to the distribution of digitized content on the Internet
     - Some examples of expansion into overseas markets include CNN International, MTV
        Overseas, ESPN and The Disney Channel

Media
economics is the business strategy that a company utilizes in creating
media content or distributing the content through various channels.
• The strategy for today’s media company is to collect and, through media convergence and
   digital convergence, create a synergistic combination that produces bottom-line benefits.
• Each form of media has its own economics and therefore a different business model.

Each
form of media has its own economics and hence a different business
model. The most commonly discussed media types are newspapers,
magazines, books, broadcast television, cable television, radio, film,
videos, DVDs, music CDs, video game consoles, and MP3.

While the
internet is an increasingly important source for news, information, and
commerce, the network economy is still dependent on traditional
old-economy new outlets. In fact, online media outlets have attempted
to build their audiences through traditional media channels. Dot-coms
advertised in newspapers and magazines and on broadcast television
during the first stage of attracting early adopters and into the
secondary stage of attracting mainstream users.

Attempts at
organizational convergence have struggled with the difficulty of
executing and business-unit strategies across the breadth of these
newly formed media companies. In addition, the expectations set during
the creation of new-media companies-internally among broad members and
business-unit heads, and externally in the investment community-have
created increased pressure when synergies have not been immediately
realized.