5/03/2012

MMK737 Online Marketing

Seminar 1 Introduction to Online Marketing

Stewart Adam, PhD. Associate Professor in Electronic Marketing
1

Stewart Adam, Unit Chair Karen Lurati, Lecturer

Well HELLO and Welcome to Online Marketing! What knowledge do I have to teach you?

Expectations
What do you want to learn about? What do you think this unit is about? My expectations That you will keep up with the content and ask questions when you dont understand Participate online and/or in class discussions Have fun too!

5/03/2012

What is Online Marketing about?

ItisnotabouttheIT(software,technical etc)aspectsoftheInternetandrelated technology ItisaMARKETINGunitandisabouthowto usetheInternet(andrelatedapplications i.e.,mobile)tobepartoftheoverallIMC andimproveyourbusinessfroma customerandprofitperspective
5

5/03/2012

Demonstration of D2L
(so you know where everything is!) https://d2l.deakin.edu.au/d2l/lms/content/previe w.d2l?tId=1407443&ou=25144

Assessment
Assignment 1: Proposal (1000 words) 10% See Navigator. No longer groups. Each person is to develop a research proposal concerning use of Social Media in Marketing (see DSO for fuller details) See Navigator for due date: 2 April Assignment 2: Research paper (3000 words) 40% See Navigator on DSO for submission dates. Each person is to complete a paper. See Navigator for due date: 14 May. Examination - Two hour. - Three questions of equal value. 50%

Need to do now for your Assignments!

Formstudygroups Exchangecontactdetails Byallmeansstudytogetherifneedsbe,butdo notcopyfromeachother. Yourassignmentsareautomaticallyscannedby Turnitin .Butyoumaycheckyourownwork priortosubmission.
9

5/03/2012

Lets look at D2L and consider the marking template and rubric via a Vodcast

10

Any ASSESSMENT questions?

11

Week 1 (chapter 1) Introduction to Online Marketing

12

5/03/2012

Learning objectives
Evaluate the relevance of the Internet to the customer-centric, multi-channel marketing concept Distinguish between Internet marketing, e-marketing, digital marketing, e-commerce and e-business Evaluate the advantages and challenges of digital media Identify the key differences between Internet marketing and traditional marketing Assess how the Internet can be used in different marketing functions
13

Internet and Marketing

Since 1991 (now 20 years ago or 140 in Net/Web time!) the internet has changed everything about the way we find information, consumer behaviour, and the way businesses communicate Constant change in this space has rewritten all the traditional rules (or has it????) Consumers still want to engage/participate. And businesses still need to make money whichever way they find a way to do this
14

Introducing the scope of Internet Marketing

Achieving marketing objectives through applying digital technologies
How?

Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably.
Chartered Institute of Marketing
How?

Marketing is an activity, a set of institutions and processes for creating, communicating, delivering and exchanging offerings that have value for customers, clients, partners and society at large.
AMA, AMI from 2012, Principles of Marketing, 5th edn, Pearson Australia. 15

5/03/2012

Internet and Marketing

Innovation Survival Competition Identify and meet customer needs Sound business model What things will work for my organisation and customers?
16

Quotes to consider?!?!?
Marketing is everything (Regis McKenna) eBusiness should be judged as any business (Jeffrey Rayport) If it cant be measured it isnt marketing (Stewart Adam) Most of what is spoken about as eBusiness is marketing science the stolen discipline but ... e-commerce as described by the media is solely transaction based there is more to business and marketing (Stewart Adam)

17

Extended marketing mix

PRODUCT, SERVICES & EXPERIENCES Variety Quality Design Features Brand name Packaging Sizes Add-ons Warranties Returns PRICE List price Discounts Allowances Settlement and credit terms PEOPLE People interacting with people is how many service experiences might be described. Relationships are important in marketing PHYSICAL EVIDENCE Services are mostly intangible. The meaning of other tools and techniques used in measures of satisfaction are important

TARGET CUSTOMERS INTENDED POSITIONING

PROMOTION Advertising Personal selling

Armstong, Adam, Denize and Kotler, 2012, Principles of Marketing, p.18.

PROCESS In the case of high-contact PLACEMENT services, customers are often LOGISTICS involved in the process of Demand chain creating and enjoying management experiences. Increasingly, so Logistics management too is technology Channel management Direct and online marketing 18

5/03/2012

Questions for marketers

How significant is the Internet as a marketing tool? How does Internet marketing relate to e-marketing, ecommerce and e-business? What are the key benefits of Internet marketing? What differences does the Internet introduce in relation to existing marketing communications models?
19

Online Opportunities

20

More recent opportunities

21

5/03/2012

22

A more in-depth definition

Customercentricdigitalmarketinginvolves: Applying Digitaltechnologieswhichformonlinechannels (Web,email,databases,mobile,iDTV) to Contributetomarketingactivitiesaimedatachieving profitableacquisitionandretentionofcustomers (withinamultichannelbuyingprocess andcustomerlifecycle) through Improvingcustomerknowledge (oftheirprofiles, behaviour,value andloyaltydrivers),thendeliveringintegratedtargeted communicationsandonline servicesthatmatchtheirindividual needs
23

How the Internet supports marketing

Identifying the Internet can be used for marketing research to find out customers needs and wants (Chapters 7 and 10). Anticipating the Internet provides an additional channel by which customers can access information and make purchases evaluating this demand is key to governing resource allocation to e-marketing as explained in Chapters 2, 3 and 4. Satisfying a key success factor in e-marketing is achieving customer satisfaction through the electronic channel, which raises issues such as: is the site easy to use, does it perform adequately, what is the standard of associated customer service and how are physical products dispatched? These issues of customer relationship management are discussed further in Chapters 6 and 7.
24

5/03/2012

1.4

25

1.5

26

Why is a digital strategy needed?

To set clear goals for digital channels To align with business strategy (avoid ad-hoc approaches) Create a specific online value proposition (OVP) Specify communications tools to drive visitors Integrate digital and traditional channels Manage customer lifecycle (e.g. through DOL marketing)

27

5/03/2012

Applications of digital marketing

An advertising medium A direct-response medium A platform for sales transactions A lead-generation method A distribution channel A customer service mechanism A relationship-building medium

28

29

30

10

5/03/2012

Figure 1.7 Summary and examples of transaction alternatives between businesses, consumers and governmental organisations

31

Different forms of web presence

1. Transactional e-commerce site:
Examples Amazon, Dell, Skorptec.com.au

2. Services-oriented/relationship building
Accenture; realestate.com.au; privacy.gov.au

3. Brand Building site

Qantas, Virgin, Coles, etc

4. Portal or media site

Yahoo!, Ninemsn,

5. Social network or media site many, many Note that these types overlap

32

33

11

5/03/2012

34

35

Figure 1.9 Six categories of e-communications tools or media channels (Chaffey and Smith, 2008)

36

12

5/03/2012

Explanation of tools

37

Figure 1.11 Summary of communication models for (a) traditional media, (b) new media

38

Figure 1.12 Summary of degree of individualisation for: (a) traditional media (same message), (b) new media (unique messages and more information exchange between customers

39

13

5/03/2012

Figure 1.13 Channels requiring integration as part of integrated e-marketing strategy

40

Figure 1.14 The role of mixed-mode buying in Internet marketing

41

Figure 1.15 Travel Republic (www.travelrepublic.co.uk)

42

14

5/03/2012

43

Can e-commerce provide a sustainable competitive advantage?

Issues: * Security; * Lack of value; * Lack of ROI; * Perceived hype ahead of reality. * Difficult to implement logistically
Source: AIDC & KPMG study

44

Top Benefits of e-Business

1. 2. 3. 4. 5. 6. 7. eBusinesses are gaining a competitive advantage. eBusiness in Australia is widespread and delivering benefits to the economy. Emerging Applications are Boosting eBusiness Gains. eBusiness facilitates cost reductions. eBusiness provides new ways to generate revenue. Additional benefits for eBusinesses are improved relationships with suppliers and
improved service to clients.

Collaborative online exchanges can generate eBusiness benefits for buyers and sellers. 8. eMarketplaces have the capacity to deliver the benefits of better business practices to participants. 9. eBusiness is facilitating major transformations in industry structures and business processes. 10. eProcurement by Government is acting as a driver to get businesses online. 11. Top benefits of e-Business
Source: NOIE, The Benefits of Doing Business Electronically eBusiness,

45

15

5/03/2012

eBusiness defined

ecommerce crm supplychainmanagement businessintelligence knowledgemanagement collaborationtechnologies

Gartner Group (1999), Enterprise Management Alert: Five e-Business Myths that can destroy a Business

46

internet issue

newbusinessmodels
notallarepuredot.coms ....manyareSMEs...Some arehybrids.

47

eMarketing website spectrum

eBay.com.au Amazon.com COLESONLINE NSWTAB.com.au MOST

PURE DOT COM

ALMOST PURE DOT COM

CLICKS N BRICKS

ALMOST PURE BRICKS AND MORTAR

PURE BRICKS AND MORTAR

Stewart Adam & Kenneth R Deans (2000), Online Business in Australia and New Zealand: Crossing a Chasm, AUSWEB2K,SCU, 12-17 June, Cairns, Queensland.

48

16

5/03/2012

Metrics

siteobjectives budgetallocation siteevaluation measuresofsuccess culturaldifferences

49

internet roles in eMarketing markcommsnewmedia transactionsmarketingchannel CRMknowledgemedia

50

porters five forces

New entrants
Threat of new entrants

Industry Competitors Suppliers Intensity of rivalry

Threat of substitutes

Buyers

Industry profitability is determined by these forces

Substitutes

After Porter, M.E., (1985) Competitive Advantage: Creating and Sustaining Superior Performance. The Free Press.

51

17

5/03/2012

five forces + Downes & Mui

New entrants
Threat of new entrants

Industry Competitors Suppliers Intensity of rivalry

Threat of substitutes

Buyers

Industry profitability is determined by these forces

Substitutes

After: After Porter, M.E., (1985) Competitive Advantage: Creating and Sustaining Superior Performance. The Free Press, and Downes, L. and Mui, C. (1998), Unleashing the Killer App. Digital Strategies for Market Dominance, Harvard Business School Press, Boston.

52

Unbundling the value proposition

Traditional value proposition components are pooled . but online, they can be disaggregated:
Content (company offering) Context (how the offer is made) Infrastructure (what enables transactions to occur)

Yakhlef, A. 1998, The Internet as a new locus for value creation, Management Decision, Vol. 36, No.9, pp. 610-14.

53

Unbundling the organisation and adding value

Customer Relationship Management
identify, attract, and build relationships with customers

Product Innovation
conceive of attractive new products and services and commercialise them

Infrastructure Management
build and manage facilities for high-volume, repetitive operational tasks

Source: John Hagel III & Marc Singer (1999), Unbundling the corporation, HBR, (March-April):133-141.

54

18

5/03/2012

internet roles

markcomms (newmedia) marketingchannel

(transactions)

CRM(knowledgemedia) businessmodels(issues)
55

new media
Online Marketing Focus Twowaycomms. Brandpersonalitydevpmt &attitudemovement ProductawarenessAmazon spent68%ofrev.about US$25perproductorderto establishbrand Experientialaugmentation Creatingasenseof community Online Marketing Activities Contextadaptivebanner ads.push Digitaldisplaypages(pull) Digitalclassifieds(pull) Thematicchangeagents Thirdgenerationonline marketingeg.P.As;M Commerce;Groove NetworksP2P

56

internet roles

markcomms (newmedia) marketingchannel

(transactions)

CRM(knowledgemedia) businessmodels(issues)
57

19

5/03/2012

But what gets cut away online?

AGENTS & BROKERS

Marketing logistics networks

DISTRIBUTOR

RETAILER

Raw Assembly Final materials packing

Batch, Line Continuous Process

MANUFACTURER
EDI LINK JIT SYSTEM QRT EDI LINK EFTPOS & POS SCAN DATA

FLOWS: Information ~ Materials ~ Title ~ Payment / Credit

Marketing 5/e .

58

internet roles

markcomms (newmedia) marketingchannel

(transactions)

CRM(knowledgemedia) businessmodels(issues)
59

But what gets cut away online?

AGENTS & BROKERS

Marketing logistics networks

DISTRIBUTOR

RETAILER

Raw Assembly Final materials packing

Batch, Line Continuous Process

MANUFACTURER
EDI LINK JIT SYSTEM QRT EDI LINK EFTPOS & POS SCAN DATA

FLOWS: Information ~ Materials ~ Title ~ Payment / Credit

Marketing 5/e .

60

20

5/03/2012

e-marketing channel ...with online FMCG ... re-intermediation

Shopping: drudgery complex experiential electronic / networked media: the internet

Once the consumer a certain context, the potential for related transactions is limited only by the imagination. ...and relationships, Adam
Source: Rayport & Svoilka, 1994 Harvard Business Review, December

home / office: telephony gaming shopping pay-tv video-onis loyal to demand

61

e-marketing channel
electronic / networked media: ATMs home / office banking

high street banks

super ATMs Kiosks etc

... with online financial services ... costs change

62

e-marketing channel
Online Marketing Focus Online Marketing Activities

Onlinesales Channelstructure developments(e.g.

associates,clickthrough commissionsetc)

Drudgery/Complex/ Experientialproduct mix Commoditisationissues

Contextadaptiveads. push&pullwith thematicchange Transactionengines Strategicnetwork alliances Marginimprovement Thirdgenerationonline marketingeg.Intelligent agents;P2P
63

21

5/03/2012

TUTORIAL QUESTIONS
Any content questions about week 1? ACTIVITIES advised based on time left!

64

22