Chapter 6Chapter 6E-MarketingE-Marketing

By: Marya Sholevar

Fall 2014

Department of Banking and Finance

What is E-Marketing?

Marketing:– Use of 4 “P’s” to meet customer’s needs

E-Marketing:– Use of technology to increase efficiency of

marketing– Increases company profitability and adds

customer value

Ten Rules of E-Marketing

1. Power Shift from sellers to buyers

1. Increasing Velocity

1. Death of Distance

1. Global reach

1. Time compression

6. Knowledge management is key

6. Market deconstruction

6. Interoperability

6. Interdisciplinary focus

6. Intellectual capital rules (Digital City)

E-Marketing Challenges and Opportunities

Markets

Revenge of the Consumer

Businesses

Technology

Five Markets Business-to-Consumer (B2C)

– Example: www.iGo.com

Business-to-Business (B2B)– Example: www.amazon.com

Consumer-to-Consumer (C2C)– Example: www.eBay.com

Business-to-Government (B2G)

Government-to-Consumer (G2C)

Methods for online marketing:

E-mail marketing Blogging Pay per click marketing(ppc) Social media marketing Digital marketing Viral marketing

E-mail marketing

Email marketing is promoting products through the use of email

There are 2 main ingredients to an effective email marketing campaign

They are to build a large list of people you can email and to write great emails

The emails should be packed with free value and they should move people to buy what you’re trying to sell

Blogging

Yet another but important and crucial marketing trend that has brought a huge aberration in our society

Blogger was launched in 1999 by three friends. Blogging as an ardent marketing tool has really blossomed in the last some years

Businesses, companies and even superstar now use blogging system for huge promotion

Pay per click marketing

You have to pay for PPC ads.

You target certain words and then when those words are searched for on a search engine such as Google your ad will appear.But you do have to pay every time your ad is clicked on.You need to make sure you do your homework and find out how to effectively use PPC.Otherwise you can easily lose a lot of money in a short amount of time.But if you do learn how to use PPC effectively then you can make a lot of money just as fast

Social media marketing

Social media is very popular right now and it’s only getting more popular You can tap into that popularity by using social media to sell your productsJust make sure you don’t SPAM people. In fact, you shouldn’t use any social media to directly sell anything Just use social media to direct people to other sites where you can then hit them with a sales pitch

Digital marketing

With regards to the Internet, this is the promoting of brands using all forms of online digital advertising channels to reach consumers

This includes video channels, Internet Radio, mobile phones, display or banner ads, digital outdoors, and any other form of digital media.

Viral marketing

Marketing techniques that use social networks to produce an increase in brand awareness or achieve other marketing objectives (such as product sales) through self-replicating viral processes.

It can be word-of-mouth delivered or enhanced by the network effects of the Internet.

Viral promotions may take the form of video clips, interactive Flash games, ebooks, images, or even text messages.

Revenge of the Consumer

1930s:– Caveat emptor (“let the buyer beware”)

2000s:– Consumers have control

What consumers want:– Privacy– To safeguard their children– Permission before being sent commercial email

Businesses

Challenges:– Quality customer service– Information overload

Opportunities:– Ways of generating revenue– Greater interdependence in their value chain

Exhibit 1 - 5 Amazon.com Uses Mass Customization to Personalize Web Pages

Source: www.amazon.com Amazon.com is a registered trademark or trademark of Amazon.com, Inc. in the United States and/or other countries. © 2000 by Amazon.com. All rights reserved.

Technology

Can lower costs on staff and paperwork

Can be a costly investment

Security issues

New payment instruments

Low bandwidth

E-Marketing DeliversValue = Benefits – Costs

Value - customer perceptions of the product’s benefits

Benefits - attributes, brand name, etc…– Add benefits through mass customization and

personalization

Costs - time, money, energy, and psychic– Lower costs through 24/7 convenience and one-stop

shopping

Marketing Mix Components

Product

Price

Distribution

Marketing Communication

Relationship Marketing

Product

Through E-Marketing numerous new products emerged

Breakthrough software, hardware, and services that created digital value

Price

Efficiencies have been manifested through E-Marketing

No need for a sales force with all order processing, billing and payments are transacted between customer and Website– Cost savings return a larger profit margin and

lower prices

Distribution A primary E-Marketing application that creates

customer value

New ways for selling and distributing products

Affects all manufacturers, service providers and intermediaries

Models: – Content Sponsorship Model– Direct Selling Model– Infomediary Model– Intermediaries Model

Content Sponsorship Model

Companies create valuable content or services on their Websites

Self-advertising– Examples:

• Yahoo!

• gURL.com

Direct-Selling Model

Manufacturers eliminating channel intermediaries and sell directly to consumers

Known as “Disintermediation”

Dell Computers

Infomediary Model

An organization that collects and sells information about consumers or businesses

Similar to a Market Research firm

Hoover’s

Intermediary Model

Brokers and agents bring buyers and sellers together but neither purchase nor take possession of the actual products– Brokerage firms

• E-Trade, E-Bay, Metalsite– Agent firms

• Travelocity

E-tailers are firms that buy products and resell them online– “Click and mortar” stores– Example: E-Toys

E-Marketing Communication

Accomplished through promotion mix elements:– Advertising– Sales Promotion– Direct Marketing– Public Relations

Models:– Online Advertising Model– Online Sales Promotion Model– Content Publishing Model– Email Model

Online Advertising Model

Firms purchase advertising space on Websites owned by other firms

Does not include a firm’s own Website

Dogpile

Online Sales andPromotion Model

Sampling digital products

Allows consumer to view products before purchasing

E-Music

Content Publishing Model A company’s Website

The displaying of a firm’s information about their product offerings on the Website to Internet users

Brochureware

Does not involve transactions

Directed towards stakeholders

Pure Fishing

E-Mail Model Three types:

– Target Promotions• Companies target users through research and data mining to

send e-mail• Bulk Email Software Marketing

– Reverse Channel• User to firm• Customer service• Bass Pro Shops

– Consumer-to-Consumer• Word of mouth

Relationship Marketing Customer Relationship Marketing (CRM)

E-Marketing is able to build long-term relationships due to:– Online FAQs– Automatic e-mail responders– Customized Websites– Fax-on-demand– Supply chains integrated with the firm’s functions

Model:– Community Building Model

Community Building Model Website developed to create a special interest

community

Users may provide information for products or services

Bring consumer to concise location, making them more available for communication by a firm

Creates social bonds and enhances customer relationships

Ivillage

Marketing Plan Tasks

Situation Analysis– Environmental Factors – Marketers collect and

analyze external elements that include economic analysis, social and demographic trends, and more

– Market opportunity analysis – This entails a supply and demand analysis along with a SWOT analysis. The SWOT analysis determines the strengths, weaknesses, opportunities, and threats.

Selecting Target Market – marketers select the type of customer they are looking to attract.

Marketing Plan Tasks continued Setting objectives – marketers set the objectives

according to the firm’s mission and resources.

Designing marketing mix strategies – Develop product, pricing, distribution, and promotion strategies

Action Plan – Plan the actual marketing plan implementation

Budget – Set a budget for the marketing plan

Evaluation Plan – Continuously evaluate the plan to make sure objectives are met.

The End.The End.