Transcript Chpt9 - courses.psu.edu

CHAPTER 9
PROMOTIONAL MIX ON THE
INTERNET
Chapter Objectives
 To
introduce the elements of promotional mix as it
is applied to online marketing.
 To understand advantages Vs disadvantages of
promotional mix.
 To develop on line promotional strategy.
Online Awareness
WWW is well suited to marketing mix strategies including
advertising, marketing research, product introduction,
pricing and distribution(shipping).
 Web is matured a great deal within last few years as such
that:

Abilities to personalize user’s site.
 Improving site navigation.
 Partnering with complementary products and services to save
viewer time and effort.

Online Awareness (cont.)
 Value
of online promotion:
 Web
is a support media for most consumer goods and
services accept computer hardware and software.
 Since it is in a print format, it helps awareness and
viewer’s interaction.
 Because of interaction capability of online, marketers
focus on external dialog rather than internal monologue
since Web provides two way communication with
audience.
Online Awareness (cont.)
 Value
of online promotion (Cont.):
 Web
pages must sent information rather than
exaggeration.
 Two-way dialog sets by Web apart from traditional
media which direct their messages through one-way
dialog.
 Web is ideal marketing medium because of its global
reach and its accessibility to both consumer and
business markets.
Online Awareness
 Stages
 The
in online awareness:
site should establish visibility:
 Discussion
 The
groups, usernets.
site should develop believability:
 It
help to turn prospects into customers
 It should be separate from real merchants from scam artists.
 It
should establish longevity:
 Mutual
understanding and long term relationships between
buyers and sellers.
Commerce and Communications
Web marketers should try to balance commerce with
electronic communications.
 Superior service at every point of contact with the
customers.
 Relationship marketing can encompass of influence four
opportunities (www.occ.com):

Customer acquisition-new customers
 Customer retention-satisfied customers
 Customer extension-new product for existing customers
 Customer selection-frequent purchase programs/or 80/20 rule

Pull Strategy of the Web
It is effective when unidentified prospect open the page
worldwide.
 There is a need for a directory that can guide customers to
targeted site.

Yahoo has directory.
 http://advertising.utexas.edu/world

Site may be pure advertisement and it does not have order
entry form.
 It can be the first steps in sales activity on the internet.

Push Strategies of the Web
The Web first use ‘pull’ technology where clients browser
must request a Web page before it is sent.
 Web will evolve into ‘push’ strategy as it delivers
customized news and advertising.
 Web marketers can combine the push interactively and the
promotional program into a push and pull strategy at the
same time.



www.pointcast.com
Send e-mail to relevant customers:

www.doubleclick.com
Formulating the Promotional Strategy
 Promotional
Mix:
 Advertising
 Sales
promotion
 Public relations
 Direct marketing
 Personal selling
Advertising

Paid for of non-personal message about products/services:

Advantages:
Effective way of communicating with large audience.
 It creates image and appeal for products/services.
 Well suited for brand awareness.


Disadvantages:
The cost of national advertising coverage.
 It may not be selective for target market.
 Must be produced in advance, and allows a little flexibility.
 There s much clutter among advertising messages.

Direct Marketing

A promotional media directly communicates with the
target customers to generate response or transaction:

Advantages:
The ability to target customers via data base.
 It contains large amount of product/service information.
 It allows to personalize direct mail and web messages by adding
recipient’s name to envelope and e-mail
 It has ability to send samples to prospects or target users.
 There is opportunity to repeat exposure according to marketing plan.


Disadvantages:
Cost is high if it uses traditional media
 It may be considered junk mail
 As advertising, it may fight with clutter problem.

Sales Promotion

Marketing activities that provides extra value or incentives
to ultimate customers:

Advantages:
Rapid increase in sales activity.
 Attract new buyers for trial purposes.
 Defend an established brand against competition
 Reward loyal customers as they continue product users.
 Provides additional marketing support.

Disadvantages:
 Trains customers to buy only if there is sales promotion.
 Extensive use of it can erode brand perception.
 It may encourage fraudulent coupon redemption.

Personal Selling

Person-to-person communication in which a seller tries to
persuade the buyer:

Advantages:
Its effects may last many years.
 Interactive face-to-face communication between buyers and sellers.
 Yields more immediate and precise marketing results.


Disadvantages:
High cost.
 Reaching to prospective customers is limited.
 Salesmen may not act as same as home office intended.
 Many times purchase and repurchase cycle may be very long.

Developing Unique Advertising
Strategy on the Web

Advertisement should be visually appealing:

It should be effective to grab visitor’s attention and draw
repeated visits.
Advertisement must be targeted to specific groups or
individual consumers.
 The contents should be valuable to consumers:



Web pages should provide valuable information and avoid slow
downloading time.
Advertisement must emphasize brand and firm’s image:

Ads should emphasize how your firm and its products differ
from other competition.
Developing Unique Advertising
Strategy on the Web (cont.)
 Advertisement
must be part of an overall
marketing strategy:
 Firms
should participate other internet activities such as
newsgroups, mailing lists and bulletin boards.
 Advertisement
should be seamlessly linked with
the ordering process:
 When
the internet customer sees the advertisement and
wants to buy it, he/she should be able to order and pay
conveniently.
Designing Internet Advertisements
Web site design is an art as well as science.
 Click-through is higher if the ad is placed one third of way
down than the top:



www.webreference.com/dev/banners
Research results:

Page loading speed:


Graphic and tables should be simple and meaningful.
Business Contents:
Clear and concise.
 Requested information for registration should be minimal.

Designing Internet Advertisements

Navigation Efficiency:
Well-labeled, accurate, meaningful links are a must.
 Sites must be compatible with browser, software, etc.


Security and privacy:


It must be assured.
Marketing Customer focus:
Terms and conditions of purchases including delivery
information, return policy, etc. must be provided.
 Confirmation page after the purchase is needed.

Creativity on the Internet
 The
Web should be able to tell the story about
product, and give answer to the questions of Web
visitors.
 Unique selling proposition:
 Generate
fresh and appropriate ideas.
 Convenience, quality, efficiency, delivery, availability
and performance.
 E-mail addresses in all advertising and activity
materials.
The Services of an Interactive Agency
State-of-the-Art technology to communicate, inform and
sell.
 Dynamic page creation capability of the Web site.
 Enable to perform secure electronic commerce and
personalized technology for user customization.
 Using media expertise to allow Webcasting and high
performance Web serving.



www.cks.com
International expertise reaching global audience.
Attracting Visitors to the Site
 Making
the top List of a search engine:
 URL and
 Improving
search engine spider for establishing links.
company’s ranking on the search engine
list:
 By
adding, removing, or changing a few sentences, the
Web designer may alter he way a search engine’s spider
ranks its findings.
 When the Web designer redesign a page, use search
queries to be responsive.
Economics and Effectiveness of
Advertisement

Exposure models that are based on Cost Per Thousand
Impression(CPMs):

The price charged is different for different search engines and
other popular sites:


Excite charged $68 per CPM and Lycos charged $50-$60 per CPM
Click-Through:

More accountable way of charging for Web advertising

The payment for a banner ad is based on the number of times a visitor
actually clicks on it:

www.pawluk.com/pages.htm
Economics and Effectiveness of
Advertisement

Interactivity:

Instead of click-through, the pricing is based upon the amount
the visitors interacts with the target ad:


Actual Purchase:


Number of repeat visits and duration
Instead of number of visits, the ultimate outcome of the visit is
used as an effect an ad. Exp. Amazon.com pays 8% of the
purchase price as a referral fee to AOL.
Other methods:
Fixed monthly fee
 Market prices-auctions

Components of the Promotional Plan
It should meet corporate objectives.
 Consideration should be given to promotion mix,, the
message and the media.
 Promotional objectives should be extended to online
media.
 Sales promotion should be used for introduction of a new
product.
 If sampling will be used, it should match the right product
with the right prospects in the right place.

The Major Web Ad Players

Advertising agencies and Web site developers:


Market research providers.


Market segmentation and targeting.
These are companies that are tracking the evolution of internet
technology with a focus on its impact on business and certain
industries, including the Web advertising area.
Traffic Measurement and Analysis companies:

Offer software and services to aid publishers in tracking and
executing advertising delivery on their Web sites.
The Major Web Ad Players (cont.)
 Networks/rep
firms:
 They
provide value-added services for Web advertisers
and publishers alike by brokering the distribution of
advertisement and overseeing their delivery.
 Order
processing and support:
 They
are the companies that provide outsourcing
services to Internet publishers and services providers.
Managerial Issues
 Make
Vs. buy:
 Web
advertisement is a complex undertaking; therefore,
outsourcing may be considered.
 Finding
the most visited sites:
 Check
the traffic of most popular Web sites such as
Yahoo or Nestcape.
 www.web21.com
www.pcmag.com/special/Web100/top100f
 www.arbitron.com

Managerial Issues (cont)

Company research:
Companies should research the Web thoroughly before meeting
with an internet marketing/advertising service.
 An Ad network should provide a convenient way for web
publishers to manage a portfolio of Web pages or sites.


Commitment to Web advertising and coordination with
traditional advertisement:
A successful Web program requires top management support.
 Coordination with the traditional media is a must:


Wed address on TV advertisement.
Managerial Issues (cont.)
 Ethical
Issues:
 Selling
of mailing list and customer information.
 Integrating
advertisement with ordering and other
business process:
 Shopping
 Catalog.
 Ordering.
 Paying
cart.