Internet Marketing - Response and Database Foundations

8/3/2019 Internet Marketing - Response and Database Foundations

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Page 1Prof. Rushen Chahal

THE DIRECT-RESPONSE ANDDATABASE FOUNDATIONS

OF INTERNET MARKETING

Prof. Rushen Chahal


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In What Ways

Is The Internet A

Direct-Response Medium/

Channel?

And Why Does It Matter?


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THE FOUR Is OF INTERNET MARKETING

GIVE THE ANSWER

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Acquisition

Conversion

Retention

BASIC DIRECT-RESPONSE STRATEGIES


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CRITICAL STRATEGY

ELEMENTSFROM D-R PERSPECTIVE

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The Offer

The (email) List

The Media

The Creative Execution

The Service & Support


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A GOOD OFFER HAS A CALL TO ACTION5-7

B2B Offer


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A GOOD OFFER HAS A CALL TO ACTION5-8

B2C OFFER


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THE OTHER STRATEGY

ELEMENTS The E-Mail ListFor Customer Acquisition

and Retention (Chapters 7 & 8)

The Media The Internet

Any Medium Can Be Direct-Response

The Creative Execution

Always Important; Less So For Direct Response

The Service and Support (Chapter 11)

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PROGRAMMATIC

OBJECTIVES To Make A Sale

To Generate An Inquiry (Sales Lead)

To Convert A Lead Into A Customer

To Remain On The Web Site Longer And

To Visit More Pages

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IMPORTANT DEFINITIONS5-11

THE FRONT ENDAll Pre-Sale Activities

Marketing and Sales

THE BACK ENDAll After-Sale ActivitiesIncludes Order Processing,

Fulfillment, Service, Support


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WHAT IS CLV

AND WHY IS IT SOIMPORTANT?Customer Lifetime Value

Is The Net Present Value

Of The Gross Margin Minus Cost of ServicingAn Individual Or A Cohort Of Customers.

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Reasons For Importance:

The Best Metric For Judging The Success Of

Customer Acquisition & Retention Programs

The Most Powerful Segmentation Criterion


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EXAMPLE OF FIRST YEAR

CLV

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Total Sales $5,280,000

Less: Total Costs $5,148,800

Equals Gross Profit $ 131,200

Times: Discount Rate 1.0

NPV of First Year Revenue $ 131,200

CLV of Customer in Year 1 $ 26.24


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CLV OVER THREE YEARS5-14


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INCREASING CLV WITH

TARGETING

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THE IMPORTANCE OF

TARGETING

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Testing to Determine

Which Program/Offer/Price, etc.

Works Best

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THE DATABASE IMPERATIVE5-18

DATABASE/

DATA WAREHOUSE


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BENEFITS OF A CUSTOMER

DATABASE

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Figure 5.7 goes here


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BENEFITS OF A CUSTOMER

DATABASE

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Using A Customer Database

To Drive Targeted Marketing Programs

Increases Customer Lifetime Value


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WHAT IS DATA

MINING?

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CHAID OUTPUT5-22


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EVENT-DRIVEN MARKETING

An Event In The Customers Life

Birthday, Graduation, etc.

An Event Created By A Marketer

Fashion Show, In-Store Promotion, etc.

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CAPTURE PARTICIPANTS

E-MAIL ADDRESSES!


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HIERARCHY OF INTERACTIVE STRATEGIES5-24


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STRATEGIC SUMMARY Interactivity of Internet = Direct-Response Medium

Learning To Use In Branding Also (Chapter 7)

Use For Customer Acquisition,Conversion,Retentio

Generate Sales, Leads, Site Stickiness

Judge Success By Customer Lifetime Value To Increase Customer Lifetime Value Targeted,Information-Driven Marketing Is Essential Modeling, Data Mining

Non-Traditional Techniques Like Events Build Database Interactive Marketing Strategies Should Increase In

Customer Focus And May Decrease In Cost AsTargeting And Personalization Improve

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Internet Marketing - Response and Database Foundations