Transcript Online mix options

Slide 8.1
Chapter 8
Digital marketing
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.2
Learning outcomes
• Assess the need for separate digital business
and digital marketing strategies
• Create an outline digital marketing plan intended
to implement the digital marketing strategy
• Distinguish between marketing communication
characteristics of traditional and new media
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.3
Management issues
• How do we integrate traditional marketing
approaches with digital marketing?
• How can we use electronic communications to
differentiate our products and services?
• How do we redefine our marketing and
communications mixes to incorporate new
media?
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.4
Digital marketing
• The definition of marketing by the Chartered
Institute of Marketing (http://www.cim.co.uk/) is:
Marketing is the management process
responsible for identifying, anticipating and
satisfying customer requirements profitability.
• Which e-marketing tools can assist?
– Web, e-mail, databases, wireless and digital
television
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.5
Operational processes of digital marketing
Figure 8.1
The operational and management processes of digital marketing
Source: E-consultancy (2008).
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.6
Management processes of digital marketing
The operational and management processes of digital marketing
(Continued)
Figure 8.1
Source: E-consultancy (2008).
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.7
Hierarchy of plans
Figure 8.2
The digital marketing plan in the context of other plans
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.8
Content Marketing
Figure 8.6
Content Marketing Chaffey,
Matrix
Digital Business and E-commerce Management Powerpoints on the Web, 6
Source: Smart Insights (2012).
th
edition © Marketing Insights Limited 2015
Slide 8.9
Digital Marketing Plan
Figure 8.7
®
SOSTAC
– a generic framework for digital marketing planning
®
Source: PR Smith’s SOSTAC
Planning Model (1990).
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.10
Situation Analysis
Figure 8.8
Inputs to the digitalChaffey,
marketing
plan from situation analysis
Digital Business and E-commerce Management Powerpoints on the Web, 6 edition © Marketing Insights Limited 2015
th
Slide 8.11
SWOT analysis
Figure 8.9
Example SWOT analysis
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.12
Figure 8.9
SWOT analysis – con't
Example SWOT analysis (Continued)
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.13
Demand analysis
•
•
•
•
•
•
What percentage of customer businesses have access to the
Internet?
What percentage of members of the buying decision 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 webbased information to buy products offline?
What is the popularity of different online customer
engagement devices such as Web 2.0 features such as blogs,
online communities and RSS feeds?
What are the barriers to adoption amongst customers of
different channels and services and how can we encourage
adoption?
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.14
Demand analysis – con't
Figure 8.10
Customer demand analysis for the car market
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.15
Competitor analysis
Review of digital business services offered by
existing and new competitors and adoption by
customers.
Benchmarking of competitors' online services and
strategy is a key part of planning activity.
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.16
Perspectives of competitor benchmarking
•
•
•
•
•
•
•
Review of internal capabilities
From core proposition through branding to online value
proposition
Different aspects of the customer life cycle
Qualitative to quantitative
In-sector and out-of-sector
Financial to non-financial measures
From user experience to expert evaluation
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.17
Benchmark comparison: an example
Figure 8.11
Benchmark comparison of corporate websites
Source: Bowen Craggs & Co (www.bowencraggs.com).
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.18
Objective setting
The relationship objectives, strategies and performance indicators for a
B2B company (in order of priority)
Table 8.3
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.19
Objective setting
The relationship objectives, strategies and performance indicators for a
B2B company (in order of priority) (Continued)
Table 8.3
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.20
Objective setting - ORC
Assessment of the future online promotion contribution and online
revenue for a B2B company, for Product A, Europe
Figure 8.12
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.21
Objective setting - Metrics
Example Internet marketing objectives within the balanced scorecard
framework for a transactional e-commerce site
Table 8.4
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.22
Goal setting
• Business effectiveness. 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, that is cost-benefit analysis.
• Marketing effectiveness. These measures may
include:
– 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 utilised will also be reviewed.
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.23
Goal setting – con't
• Internet effectiveness. These are specific
measures that are used to 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 is for the
customer should be noted.
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.24
Strategy
Summary of typical focus for main types of e-commerce-related strategic
initiatives
Table 8.5
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.25
Strategy – con't
Summary of typical focus for main types of e-commerce-related strategic
initiatives (Continued)
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 edition © Marketing Insights Limited 2015
Table 8.5
th
Slide 8.26
Strategy – con't
Summary of typical focus for main types of e-commerce-related strategic
initiatives (Continued)
Table 8.5
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.27
de Kare-Silver ES Test
1. Product characteristics. Does the product need to
be physically tried, or touched before it is bought?
2. Familiarity and confidence. Considers the degree
the consumer recognises and trusts the product and
brand.
3. Consumer attributes. These shape the buyer’s
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?
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.28
de Kare-Silver ES Test – con't
Table 8.6
Product scores in de Kare-Silver (2000), Electronic Shopping Potential Test
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.29
Target market strategies
Figure 8.14
Stages in target marketing
strategy development
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6
th
edition © Marketing Insights Limited 2015
Slide 8.30
Options for targeting customers
Table 8.7
A range of targeting and segmentation approaches for a digital campaign
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.31
Online value proposition
• A 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 process.
• How the proposition will be delivered and supported by
resources – is the proposition genuine? Will resources
be internal or external?
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.32
Example OVPs
• ‘Compare. Buy. Save’. Kelkoo (www.kelkoo.com)
• ‘Earth’s biggest selection’. Amazon (www.amazon.com)
• ‘Search the largest inventory of cars and trucks on the
Internet. More than 1.5 million listings, updated daily’
(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
– Welcome to Citibank: The one-stop solution for all your
financial needs
– Look for a product or service; Learn about a financial
product; Find a location.
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.33
Characteristics of digital media
communications
•
•
•
•
•
•
Interactivity
Intelligence
Individualisation
Integration
Industry restructuring
Independence of location
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.34
Characteristics (con’t) - Interactivity
Figure 8.16
Summary of communication models for (a) traditional media, (b) new
media
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.35
Characteristics (con’t) - Individualisation
Summary of degree of individualisation for (a) traditional media (same
message), (b) new media (unique messages and more information exchange
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 edition © Marketing Insights Limited 2015
between customers)
Figure 8.17
th
Slide 8.36
Characteristics (con’t) - Integration
Figure 8.18
strategy
Channels requiring integration as part of integrated digital marketing
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.37
Characteristics (con’t) - Integration
Figure 8.19
buying
Channel integration required for digital marketing and mixed-mode
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.38
Tactics – marketing mix
Figure 8.20
The elements of the marketing mix
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.39
Issues with varying the mix online
• Do we vary the mix online or replicate offline?
• Is the offer clear – brand proposition, online
offer?
• Is online differentiation defined?
• Is online differentiation communicated?
• Key online mix variables
–
–
–
–
–
Product
Price
Place
Promotion
Service: People, Process, Physical evidence.
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.40
Marketing mix – long-tail concept
Zipf’s law, showing decrease in popularity of items within an ordered
sequence
Figure 8.21
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.41
Online mix options - Product
Options for product variability
• Core product
• Extended product
• Mass customisation
• Bundling
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.42
Online mix options - Price
Implications of the Internet
–Increased price transparency and its implication on
differantial pricing
•
•
Offering different prices
Price elasticity
Examples:
• Reduce online prices (easyJet)
• Maintain price to avoid cannibalisation of
offline sales (Dixon)
–Downward pressure on price
• Commodisation (e.g. Automotive DaimlerChrysler)
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.43
Online mix options – Price (con’t)
Implications of the Internet
–New pricing options (software, music):
•
•
Dynamic pricing (Concert tickets)
Aggregated buying
–Alternative pricing structure or policies
•
•
•
•
•
•
Payment per use
Rental as a fixed cost
Add-ons and extra services
Guarantees
Refund policies
Order cancellation terms
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.44
Online mix options – Price - Elasticity
Figure 8.22
Price elasticity of demand for a relatively elastic product
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.45
Online mix options – Price - Elasticity
Figure 8.23
Price elasticity of demand for a relatively inelastic product
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.46
Online mix options - Place
Implications of the Internet
–Place of purchase
–New channel structures
–Channel conflicts
–Virtual Organisations
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.47
Online mix options - Promotion
Main elements of the promotional mix
– Advertising
– Direct mail
– Selling
– Exhibitions
– Sales promotion
– Merchandising
– Public relations
– Packaging
– Sponsorship
– Word-of-mouth
Investment decisions for the promotions
– Investment in promotion compared to site creation and
maintenance
– Investment in online promotion techniques in comparison
to offline promotion
– Investment in different online promotion techniques
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.48
Online mix options
People, Process, Physical Evidence
• Service
– People
•
Automate – use web self-service,
offer customer choice
– Process
•
Change process for service – contact strategies
– Physical evidence
•
•
Site design – differentiate or support brand
Fulfilment quality.
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.49
Branding
Leslie de Chernatony and Malcolm McDonald
described ‘brand’ in their classic 1992 book, Creating
Powerful Brands, as:
‘An identifiable product or service augmented
in such a way that the buyer or user perceives relevant
unique added values which match their needs most
closely. Furthermore, its success results from being
able to sustain these added values in the face of
competition.’
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015
Slide 8.50
Branding from an alternative perspective
Brand equity:
The assets linked to a brand's name and symbol that add to service.
Table 8.9
Traditional measures of brand equity and online measures of brand equity
Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015