1. CHAPTER 8Slide 8.1E-MARKETING Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007

2. Slide 8.2Learning outcomes Assess the need for separate e-business and e-marketing strategies Create an outline e-marketing plan intended toimplement the e-marketing strategy Distinguish between marketing communicationcharacteristics of traditional and new media.Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 3. Slide 8.3Management issues How do we integrate traditional marketingapproaches with e-marketing? How can we use electronic communications todifferentiate our products and services? How do we redefine our marketing andcommunications mixes to incorporate newmedia?Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 4. Slide 8.4Marketing The definition of marketing by the Chartered Institute ofMarketing (http://www.cim.co.uk/) is:M rke ting is the m a na g e m e nt p ro c e s s re s p o ns ible fo raid e ntify ing , a ntic ip a ting a nd s a tis fy ing c us to m e rre q uire m e nts p ro fita bly Whic h e -m a rke ting to o ls c a n a s s is t? We b, e -m a il, d a ta ba s e s , wire le s s a nd d ig ita l te le v is io n. Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 5. Slide 8.5How do e-tools supportmarketing?I e ntify ing ho w c a n the I rne t be us e d fo r m a rke tingd ntere s e a rc h to find o ut c us to m e rs ne e d s a nd wa nts A ip a ting a ntic ip a ting the d e m a nd fo r d ig ita l s e rvic e s nticSa tis fy ing ho w to a c hie ve c us to m e r s a tis fa c tio n thro ug hthe e le c tro nic c ha nne l Pro fita blyDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 6. Figure 8.1 The e-marketing plan in the context of other plans 7. Slide 8.7E-marketing defined Achieving marketing objectives through use ofelectronic communications technology Another similar term is digital marketing Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 8. Slide 8.8E-marketing planning A e-marketing plan is needed to detail thespecific objectives of the e-business strategythrough marketing activitiesDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 9. Figure 8.2 SOSTAC a generic framework for e-marketing planning 10. Slide 8.10 SOSTAC Developed by Paul Smith (1999) Summarizes the different stages that should be involved in a marketing strategy from strategy development to implementationDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 11. Is a separate e-marketing planSlide 8.11 required? Customer demand will be underestimated Existing and start-up competitors will gain market share Duplication of resources Insufficient resources will be devoted to planning Insufficient customer data are collected Efficiencies available through online marketing will be missedDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 12. Figure 8.3Usage of detailed e-marketing plans in UK e-commerce organizationsSource: E-consultancy (2005) 13. Figure 8.4 Inputs to the e-marketing plan from situation analysis 14. Slide 8.14 Situation Analysis To understand the current and future environment in which the company operates Involves consideration of all of these factors and will form the basis for defining objectives, strategies and tactics Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 15. Slide 8.15Demand analysisWhat percentage of customer businesses have access to the Internet?What percentage of members of the buying unit in these businesses have access to the Internet?What percentage of customers are prepared to purchase your particular product online?What percentage of customers with access to the Internet are not prepared to purchase online, but are influenced by web-based information to buy products offline?What are the barriers to adoption amongst customers and how can we encourage adoption? Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 16. Figure 8.5 Customer demand analysis for the car market 17. Slide 8.17 Competitor Analysis The monitoring of competitor use of e- commerce to acquire and retain customer Companies should review: Well-known competitors Well-known international competitors New Internet companies locally and worldwide Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 18. Slide 8.18Benchmarking solutionsFina nc ia l p e rfo rm a nc eM rke tp la c e p e rfo rm a nc e market share and sales trends and significantly a the proportion of sales achieved through the Internet.Bus ine s s a nd re ve nue m o d e ls do these differ from other marketplace players?M rke ting c o m m unic a tio ns te c hniq ue s is the customer value proposition of a the site clear? Does the site support all stages of the buying decision from customers who are unfamiliar with the company through to existing customers, are special promotions used on a monthly or periodic basic? Beyond the competitors site, how do they make use of intermediary sites to promote and deliver their services?Se rvic e s o ffe re d what is offered beyond brochureware? Is online purchase possible, what is the level of online customer support and how much technical information is available?I p le m e nta tio n o f s e rvic e s these are the practical features of site designm such as aesthetics, ease of use, personalization, navigation and speed.The 7Ps. Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 19. Slide 8.19 Intermediary analysis Identifying relevant intermediaries for a particular marketplace Identify strategic partners when executing an online advertising campaigns To consider the way the marketplace is operatingDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 20. Slide 8.20Internal marketing auditBus ine s s e ffe c tive ne s s : Contribution of site to revenue (see objective setting), profitability and any indications of the corporate mission for the site. The costs of producing and updating the site will also be reviewed, i.e. cost-benefit analysis.M rke ting e ffe c tive ne s s . These measures may include: a leads; sales; retention; market share; brand enhancement and loyalty;Customer service. These measures will be assessed for each of the different product lines delivered through the web site. The way in which the elements of the marketing mix are utilized will also be reviewed.I rne t e ffe c tive ne s s : These are specific measures that are used tonte assess the way in which the web site is used, and the characteristics of the audience. Such measures include specialist terms such as hits and page impressions that are collected from the log file, and also more typical techniques such as focus groups and questionnaires to existing customers. From a marketing point of view, how clear the value proposition of the site for the customer, is should be noted.Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 21. Slide 8.21 OBJECTIVE SETTINGDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 22. SMART e-marketing objectivesSlide 8.22 Specific Measurable Achievable Realistic Time-constrainedDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 23. Slide 8.23Examples of SMART e-marketing objectivesStart-ups acquiring a specific number of new customers or to sell advertising space to generate a specified revenue that will hopefully exceed investment in site creation and promotion!Established mobile-phone operator increase customer retention by reducing churn from 25 per cent to 20 per cent.Established media company increase online revenue, target of 20 per cent online contribution to revenue by offering new online services and media sales.Established business-to-business engineering company increase overall revenue by 5 per cent, through targeting sales in new international markets.Reduce costs of routine customer service by 10 per cent to enable focus on delivery of specialized customer service.Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 24. Assessment of the future online promotion contribution and online revenueFigure 8.6for The B2B Company, for Product A, Europe 25. The Online RevenueSlide 8.25 Contribution A measure of extent to which a companys online presence directly impacts on the sales revenue of the organizationDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 26. Slide 8.26 STRATEGY Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 27. Slide 8.27De Kare Silvers ES test1. Pro d uc t c ha ra c te ris tic s . Does the product need to be physically tried or touched before it is bought?2. Fa m ilia rity a nd c o nfid e nc e . Considers the degree the consumer recognizes and trusts the product and brand.3. Co ns um e r a ttribute s . These shape the buyers behaviour are they amenable to online purchases in terms of access to the technology skills available and do they no longer wish to shop for a product in a traditional retail environment? Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 28. Slide 8.28ES Test resultsProduct1. Product2.3. Consumer Total characteristics Familiarity attributes (30) (10)and confidence (10)1.Groceries 48 15272.Mortgages 101 4153.Travel106 15314.Books 87 2338 Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 29. Figure 8.8 Stages in target marketing strategy development 30. Slide 8.30 Target market strategiesEvaluation and selection of appropriate segments and the development of appropriate offers5 questions when developing strategy: Who are our customers? How are their needs changing? Which do we target? How can we add value? How do we become first choice?Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 31. Slide 8.31 Characteristics of new-media marketing communications Interactivity Intelligence Individualization Integration Industry restructuring Independence of location Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 32. Summary of communication models for (a) traditional media,Figure 8.9(b) new media 33. Slide 8.33 IntelligenceDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 34. Summary of degree of individualization for (a) traditional media (sameFigure 8.10message), (b) new media (unique messages and more information exchangebetween customers) 35. Slide 8.35 IndividualizationDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 36. Figure 8.11 Channels requiring integration as part of integrated e-marketing strategy 37. Slide 8.37 Integration Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 38. Slide 8.38 www.dell.com.my Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 39. Examples of integratedSlide 8.39 communication tools The internet can be used as a direct-response tool enabling customers to respond to offers and promotions publicized in other media The web site can have a direct response or callback facility built into it. The Internet can be used to support the buying decision even if the purchase does not occur via web site.Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 40. Figure 8.12 Channel integration required for e-marketing and mixed-mode buying 41. Slide 8.41 TACTICSDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 42. Slide 8.42Online value propositionA clear differentiation of the proposition from competitors based on product features or service quality.Target market segment(s) that the proposition will appeal to.How the proposition will be communicated to site visitors and in all marketing communications. Developing a tag line can help this.How the proposition is delivered across different parts of the buying processHow the proposition will be delivered and supported by resources is the proposition genuine? Will resources be internal or external?Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 43. Slide 8.43Example OVPsCo m p a re . Buy . Sa ve . Kelkoo (www.kelkoo.com)Ea rths big g e s t s e le c tio n. Amazon (www.amazon.com)Se a rc h the la rg e s t inve nto ry o f c a rs a nd truc ks o n the I rne t. M re tha n 1 . 5 m illio n lis ting s , up d a te d d a ily (nte o www.autotrader.com)The Citibank site design (www.citibank.com) uses a range of techniques to illustrate its core proposition and OVP. The main messages are: We lc o m e to Citiba nk: The o ne -s to p s o lutio n fo r a ll y o ur fina nc ia l ne e d s . Lo o k fo r a p ro d uc t o r s e rv ic e ; Le a rn a bo ut a fina nc ia l p ro d uc t; Find a lo c a tio n.Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 44. Slide 8.44Issues with varying the mix onlineDo we vary the mix online or replicate offline?Is the offer clear brand proposition, online offerIs online differentiation defined?Is online differentiation communicated?Key online mix variables Product Price Place Promotion Service: People, Process, Physical evidence Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 45. The Marketing MixFigure 8.13 The elements of the marketing mix 46. Slide 8.46Product Extend range (Tesco) Narrow range (WH Smith iDTV) Online-only products (banks) Develop new brand (Egg) Migrate existing brand (HSBC) Partner with online brand (Waterstones and Amazon). Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 47. Slide 8.47 Product Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 48. Slide 8.48PriceDifferential pricing: Reduce online prices due to price transparency and competition (easyJet) Maintain price to avoid cannibalisation of offline sales (Dixon)New pricing options (software, music): Rental Pay per use Reverse auctions (B2B) Dynamic pricing (Concert tickets). Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 49. Slide 8.49 Implications for price Increased price transparency Downward pressure on price New pricing approaches Alternative pricing structure or policiesDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 50. Slide 8.50PlacePlace = avoiding channel conflicts Disintermediation sell direct Reintermediation partner with new intermediaries Countermediation:Form new intermediaries Partnerwith existing intermediaries Distance from intermediaries. (Abbey National) Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 51. Slide 8.51 Implications on place Place of purchase New channel structures Channel conflicts Virtual organizations Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 52. Slide 8.52Promotion Selective use of new online tools for different stages of the buying process and customer lifecycle Online only campaigns Integrated campaigns incorporating online tools into communications mix. Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 53. Options for the online vs offline communications mix (a) online > offline,Figure 8.14(b) similar online and offline, (c) offline > online 54. Slide 8.54ServicePeople Automate use web self-service, offer customer choiceProcess Change process for service contact strategiesPhysical evidence Site design differentiate or support brand Fulfillment quality. Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 55. Slide 8.55Branding Malcolm McDonald in their classic 1992 book,Cre a ting Po we rful Bra nd s as a n id e ntifia blep ro d uc t o r s e rvic e a ug m e nte d in s uc h a wa ytha t the buy e r o r us e r p e rc e ive s re le va nt uniq uea d d e d va lue s whic h m a tc h the ir ne e d s m o s tc lo s e ly . Furthe rm o re , its s uc c e s s re s ults fro mbe ing a ble to s us ta in the s e a d d e d va lue s in thefa c e o f c o m p e titio n. Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 56. Options for changing brandSlide 8.56 identity online Transfer traditional brand online Extend traditional brand Partner with existing digital brand Create a new digital brand Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 57. Figure 8.15 Percent of marketing communications budget spent on e-communications(n = 76)Source: E-consultancy (2005) 58. Changes to brand perception and behaviour as a result of using theFigure 8.16Internet for researchSource: BrandNewWorld: AOL UK/Anne Molen (Cranfield School of Management)/Henley Centre, 2004 59. The influence of brand knowledge on purchase. Matrix for question I willFigure 8.17buy a product if Source: BrandNewWorld: AOL UK/Anne Molen (Cranfield School of Management)/Henley Centre, 2004 60. Slide 8.60 Actions What level of investment in the Internet channel is sufficient to deliver services? What training of staff is required? What new responsibilities are required for effective Internet marketing? Are changes in organizational restructuring required? What activities are involved in creating and maintaining the web site? Dave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007 61. Slide 8.61 Control Conduct marketing research Analysis of web-server log files Intranets can be used to share informationDave Chaffey, E-Business and E-Commerce Management, 3rd Edition Marketing Insights Ltd 2007