Demand analysis

A key factor driving e-marketing and e-business strategy objectives is the current level and future projections of customer demand for e-commerce services in different market segments. Demand analysis indicates the scale of opportunity for making or influences sales online and this, in turn, should govern the objectives defined and resources allocated to online channels. In Chapter 2, we saw how companies can model the number of consumers in a particular demographic who use the Internet and even the volume and type of key phrases they type into search engines.

An alternative perspective on e-commerce demand analysis is to review demand from existing customers who migrate online, and those who are new to the company. But, for some companies whose strategy has been to launch an online brand variant, the e-commerce service may have more new customers than those who migrate online from the current user base. For example, 80% of customers of the Co-operative Bank's online bank Smile ( were new customers.

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