E-commerce Market
The firm’s objectives can be met and a go–ahead is suggested subject to
addressing the recommendations. Macrosegmentation of the market identified
machinery, wood, base metals and plastics as target markets for the firm.

Revenue expectation based on a 0.4% market share is $329,000. Break even is
$259,000 and requires contributions from 17 customer projects at an average
billing of $15,000. The budget set for implementing the promotional mix is
$100,000. Target ROI = 15%. The following recommendations must be considered
before start-up: 1. Protect service names and marks. 2. Conduct a
microsegmentation analysis to refine market segment intelligence. 3. Develop
multisegment targeting strategies for the chosen markets. 4. Ensure that funds
are in place for first year’s operation. 5. Develop a decision support system
including customer details, candidates for networking and reciprocity. 6.

Complete 3 – 4 assignments at cost to establish a credible portfolio. Use as a
source of referrals. 7. Obtain ISO 9000 certification – "walk the talk".

Apply benchmarking standards. 8. Develop assessment and promotional tools using
the firm’s service. If the service is to work for the client it should work
for the firm. 9. Finalize details of the promotional plan. 10. Develop influence
as a trade mission co-ordinator. Organizational Mission The firm’s mission is
to provide innovative and effective global marketing services to British

Columbia industries. They focus on E-business as a primary means of achieving
client objectives and measure their effectiveness in terms of customer
satisfaction and referral business. Market Opportunity Analysis Analysis of the
size and sustainability of various market segments. The segmentation basis used
is demographic. Primary descriptors are geography, customer type, growth rate
and size. Demographics – (BC Statistics)  There are 13,700 small and
medium exporters in BC – 4.6% of all businesses in British Columbia. They
account for $3.7 billion or 13% of British Columbia’s total export value. The
average small and medium exporter typically exports $269,500 annually. 

Rising trend – small and medium exporters  1000 per annum and export
 $200+ million per annum.  British Columbia’s small and medium
exporters typically ship "value added" products – less susceptible to
economic slowdowns. During a recent slowdown they actually increased their
exports by $12 million.  79% of small and medium exporters are dependent
on the United States as their primary export market. Environmental Scan
(Purchasing On-line) Social Forces  Increasing competition is forcing
higher standards in the global marketplace – TQM, ISO 9000. 

Globalization of trade increasing competitive pressure on domestic producers due
to foreign competition – simultaneously offering new opportunities for export.
 Small and mid-sized businesses often lack vision and resources to
develop world class enterprises – need help. Political/Legal Forces 

Various Governments are attempting to stimulate business on the Internet –
taxation moratorium, privacy protection, copyright protection and fewer
regulations. Technology  Dramatic increase in Internet use for business
– 73% of corporate buyers use the Internet.  Opinion leaders such as

IBM are shifting their entire purchasing systems onto the Internet. 

Vendor analysis is more efficient – faster and more comprehensive comparison
of supplier alternatives.  Distribution improvement – intermediaries
become redundant as suppliers and buyers connect directly.  Purchasing
cycle time reduced – RFQ’s that used to take 20 days to process now take 20
minutes.  Shipping/Logistics – tracking, price brokering,
inventory/shipping integration are streamlined.  Real-time

Supplier/Purchaser dialogue and co-operative design over the Internet eliminates
waste, reduces costs and speeds up new product development.  Internet
not expected to be significantly affected by Y2K problems in either North

America or Europe.  Perceptions of transaction security remain a
concern. (This perception is rapidly diminishing)  Suppliers are ill
equipped to provide E-commerce – (Actually a plus for Global Reach Inc.)
 Heterogeneity of service is a concern as buyers are confronted with
numerous unfamiliar suppliers and engage in extensive, high-involvement
decision-making. – (Actually a plus for Global Reach Inc.) Competitive

Analysis (Business in Vancouver, The AD Pages, telephone survey) There are 51

Marketing Consultants operating in the Lower Mainland. Average market share of

1.9% is inferred – no data available. Web page development and media promotion
are standard. Larger firms have the capacity to develop E-commerce solutions but
are focusing on expensive EDP and Intranet strategies – suitable for only the
larger exporting firms. Some are involved in E-commerce on the Internet – no
significant impact on the market. Methods of charging for services are fixed
price quotations, cost plus arrangements, often with performance bonuses. Assume
average annual billing per client is $15,000. Fee range = $25 – $200+ per
hour. Target Market Profile and Analysis  16% Machinery  11%

Wood  7% Base Metals 