Barriers of Internet-Based Marketing Communications: An Empirical Investigation of Saudi Manufacturing Firms

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EXECUTIVE SUMMARY

The objective of this study is to investigate the perceived barriers that limit the use of the Internet in marketing communications by medium and large-sized manufacturing firms in Saudi Arabia. This study focused on two major barriers, which are the lack of technical expertise and maintenance costs as core determinants of use to market Saudi firms' offerings. These two major barriers were identified by factor analysis with a varimax rotation. Results show that managers of medium and large-sized manufacturing firms in Saudi Arabia perceived the Internet to be a costly communication tool; thus, they tend to use it on a limited scale or do not use it at all to market their offerings. Also, managers who stated that their firms lack technical expertise in applying the Internet to market their offerings do not use it at all or they use it on a limited scale. These findings lead to the conclusion that Internet service providers in Saudi Arabia need to understand the importance of lowering the fees of their services. Also, Internet experts who provide maintenance must realize the growth of their businesses when they provide Saudi firms with high quality technical expertise at a reasonable fee. Also, Saudi firms need to use the Internet to market their offerings through their own well established websites in order to overcome the distribution channels challenges around the world.

Keywords: Internet Use; Marketing Communications; Technical Barriers; Cost Barriers; Saudi Medium and Large-Sized Firms.

INTRODUCTION

With the revolutionary advent of the Internet, many marketing communication scholars realized that this new medium would bring many new opportunities for marketing communication processes and strategies (Thao & Swierczek, 2008; Lagrosen, 2005; Heinen, 1996). Some researchers predicted the end of traditional marketing practices (Lagrosen, 2005; Holbrook & Hulbert, 2002). The growth of the Internet as a new medium in marketing communication is continually transforming global distribution channels and the way businesses interact with customers, suppliers, and other stakeholders (Pons, Aljifri, & Fourati, 2004). Therefore, Eid and Trueman (2004) suggest that much of the current literature considers Internet marketing to be a completely new phenomenon that gets the attention and interest of salespeople and organizations. The Internet has become a strategic choice for many companies in order to market their products and services.

Nowadays, the website is considered an important source of information and a medium of communication with the firms' stakeholders, including customers (Pons, Aljifri, & Fourati, 2004). The Internet has had a significant effect on firms that have marketing constraints such as the inability to expand beyond domestic markets through costly traditional distribution channels (Eid, 2005). Thus, marketing communication through the Internet helps companies to overcome geographic boundaries (Freeman, 2001). It also can make information easily and readily available to customers worldwide (Eid, 2005).

The use of the Internet in marketing communications presents an alternative channel for overcoming some strategic challenges that face a large number of Saudi businesses, including the high proportion of medium and large-sized firms within indigenous industry and regional imbalances in the distribution of industry. In short, these businesses lack effective physical distribution in Saudi Arabia and abroad.

The purpose of this study is to gain a better understanding of the determinants of Internet use and how they influence its application in marketing communications. Furthermore, the focus of this study will be on the major barriers that limit the use of the Internet in marketing communications in order to facilitate the implementation of effective marketing strategy that can help Saudi medium and large-sized manufacturing firms to be competitive domestically and internationally. …