June 13, 2014

Online Marketing - Introduction

Online Marketing - Definitions

Institute of Direct Marketing defines E-marketing as 'the use of internet and related digital information and communications technologies to achieve marketing objectives'.

Strauss et al (2003) make the marketing objectives more explicit. They say e-marketing covers a wide range of IT related applications with three main aims:

Transforming marketing strategies to create more customer value through more effective segmentation, targeting, differentiation, and positioning strategies;

more efficiently planning and executing the conception, distribution, promotion, and pricing of goods, services and ideas;

creating exchanges that satisfy individual consumer and organizational customers' objective.

Internet History.

Internet started in 1969. By 2006 there were more than one billion users worldwide.
In January 2011, two billion internet users were recorded. The mobile users number has reached 5 billion.

Internet users in the world - Continental breakup

Marketing Environment - Conducive to Internet Marketing


1. New supply opportunities: Communication became cheap and structured and many manufacturers and retailers are accessing potential suppliers across national boundaries using internet. Hence, marketers have to implement internet marketing.

2. New distribution channels: Internet made low cost distribution of information products possible. All information sellers are forced to adopt internet marketing or online marketing or e-marketing as this channel is now generating significant amount of sales. For distributing cash through ATM is made possible because of networking and now an ATM can facilitate withdrawal from any bank's account. Credit cards could be used from any shop.

3. Informing stakeholders; Communicating with stakeholders became timely and efficient. Marketers have to access electronic channels for advertising, publicity, informing and interacting.

4. Competition: Entirely new set of people entered various businesses using internet as the channel. Blogging is one example. Newspapers are facing serious competition from bloggers. Textbook authors and publishers are facing serious competition from online authors. This new competition is forcing newspapers and textbook authors to adopt internet marketing.


Social Factors
(i) Busy persons: More senior and successful executives are working 50 to 60 hours per week in pursuit of career success. They are looking for convenience shopping and 24×7 shopping facilities.

(ii) Increased leisure time: There is another category of persons who have more leisure time and they are willing to spend time on internet and use number of new ways of interaction made feasible by internet like blogging, social networking etc.

(iii) Technology adoption: People are adopting internet at a more rapid pace compared to many other technologies.

Technological Factors
Networking technology and communication technology are developing fast to provide more useful features at reduced prices. There are developments that promise computers to children at schools at a price of $100 per terminal. The schools can provide broadband access also at reasonable prices. Internet sites can be accessed through mobiles

Economic Factors
Economic growth has become difficult in advanced economies and hence there is thrust on efficiencies. Internet is in the forefront of technologies offering cost reduction possibilities in number of areas of production, marketing and distribution.

Political Factors
Governments and political parties have realized the benefits of internet based facilities in governing and communicating with the masses. Hence, the political system is in favor of internet penetration even though governments have to simulataneously deal with cyber crime.

Internet Marketing System - Components

1. Customer.
2. Content
3. Communications
4. Competition.

Customer is the focus of any marketing system. An online customer is a more informed and powerful person, with knowledge acquired from various web sites using search engine, price comparison sites, online discussin forums etc.

The web site is the salesman in online marketing systems. Online communication activity and the website have to complete the selling process or at least the order booking process for an internet marketer.

The prospects have to contacted through various channels to make them aware of the web site or the internet sales channel of a organization. Print media, TV channels and internet media are being used for communication purpose. Search engine marketing or use of search engines for attracting the potential customers to the E-commerce or E-business web sites has become the primary communication mode.

Competition is increasing in the internet market place. Traditional brick and mortar companies are starting their internet channels. Some new entrants are coming into the market using internet channels only. Foreign sellers are offering their products through internet channels. Alliance formation has become more easy in internet channels. Certain new competitors are coming into the market through elimination of certain firms in the supply chains. Consumers are able to dispose off their used products through internet channels. Thus competition has increased and also got more varied.

Internet Marketing System - Benefits to the Customer and Marketer

2. Consistency.
3. Creative content.
4. Customization
5. Coordination.
6. Control.

The ability to shop when the customer wants in a 24×7 is a great convenience. Certain repetitive activities can be automated like the monthly shopping list. In a door-delivery set-up, the customer can simply send the shopping list online, billing is done online, payment is done online and the goods package can be delivered at door step. The monthly shopping is now done conveniently at an odd hour that a busy person can find. People can use time like travelling time to browse what is on offer.

The sales message is consistent because it does not vary with the salesman. Any number of times, a customer visits the web sites, he will get the same information or information that is consistent with the earlier messages and he can even check back the earlier messages and information.  A wiki capability, can ensure that all earlier versions of a message related to a product or offer  can be seen by the customer.

Creative Content
The E-commerce site can mimic consent communication. The customers who are satisfied with brief details can complete the buying process with the brief starting message. But customers who want more information can be provided more information at their choice. Total technical information and manufacturing process nuiances can be explained to customers. Quality improvement steps taken by an organization can be shown using video clips.

The site can give an impression of customized site to a repeat customer. It creates shopping lists etc. which are customized to a specific customer. His brand preferences are identified and indicated in the shopping lists.

The E-commerce site can have features of coordination. If the customer for door delivery is not in his residence, the supplier may be informed of this fact through the web site. Such information is available as a written record or formal communication.

Marketers can test their promotion campaigns and measure their impact in an automated fashion in online marketing.

Online Marketing: A Customer-Led Approach, Richard Gay Et.al.
This introductory article will be supplemented by articles focusing on various steps in online marketing.
Now covered in Online (Internet) Marketing and E-Commerce - Knol Book

E-Commerce, Internet, Online, Website Marketing News - SEO,SMM,PPC News

Wharton Professor David Bell on Using Digital Marketing for Building Brands and Customer Assets - 2012




Interesting Web Pages

An Introduction to Internet marketing
By Dave Chaffey, Richard Mayer, Kevin Johnston and Fiona Ellis-Chadwick

Reports on E-Commerce

Second Quarter 2009


What Users are doing on Internet



Migration from Knol
All management knols are being collected in http://nraomtr.blogspot.com/ .
Marketing articles are available under the label http://nraomtr.blogspot.com/search/label/Marketing%20Management
Article on differentiating and positioning http://nraomtr.blogspot.com/2011/11/marketing-strategy-differentiating-and.html
This article is posted under http://nraomtr.blogspot.com/2011/12/online-marketing.html


Original knol - Knol Number 1746


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