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Topic 8

e-Marketing (MAR3880) By Kanghyun Yoon Topic 8 Promotion Strategy Discuss how the Internet technology has changed the way of implementing promotion strategy. Review the nature of promotion. Discuss which types of promotional strategies are suitable for marketing online.

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Topic 8

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  1. e-Marketing (MAR3880) By Kanghyun Yoon Topic 8 Promotion Strategy

  2. Discuss how the Internet technology has changed the way of implementing promotion strategy. Review the nature of promotion. Discuss which types of promotional strategies are suitable for marketing online. Discuss how to maximize the customer value online. Lecture Outline

  3. Consider the following issues when it comes to designing e-product strategy that can be based on the Internet technology. Issue 1: How does the Internet technology change the way of implementing traditional promotion strategy? Issue 2: What is promotion? Issue 3: Which type of promotion strategy is more suitable for marketing over the internet? Issue 4: How to utilize the internet technology to maximize the performances of promotional strategy? Issues Regarding e-Promotion Strategy

  4. Issue 1Impacts of internet technology on traditional promotion strategy

  5. Push-Pull Hybrid Medium Transition of the power from the sellers to the buyers. The Internet as a pull environment as well as a push environment. One-to-One Marketing Communication The Internet as a medium for personal touch or contact. From one-to-many communication to one-to-one communication (using cookies). Buyers (or Viewers) in Control Consumers have the power to control or ignore marketing promotion. However, marketers try to control consumers search effort (e.g., Web page roadblocks, pop-up ads, instant streaming audio for mousetrapping, and so on). New Communication Tools and Promotion Clutter Email is an effective tool for communication. However, there is a situation of promotion clutter, which is caused by email spam, adware, spyware, etc. Impacts of Internet Technology

  6. Issue 2Understanding the essence of promotion

  7. What is the definition of promotion? The company needs to carefully coordinate promotion elements to deliver a clear, consistent, and compelling message about its products. It is about designing and managing Integrated Marketing Communications (IMC). Promotion Goals of the Websites: Build awareness among target audiences (issue: website design and search engine optimization). Increase site traffic (issue: site stickiness) Maximize value-added experience with website and product (issue: satisfaction with website and product). Lead to sales (issue: generation of leads to sales). Generate loyal customers (issue: generation of loyal customers). What is Promotion?

  8. Steps of Integrated Marketing Communication (IMC) Step 1: Identifying the Target Audience Step 2: Determining the Communication Objectives Buyer-Readiness Stage: Awareness, Knowledge, Liking, Preference, Conviction, and Purchase AIDA model: Awareness, Interest, Desire, and Action Hierarchy of Effects model: Think, Feel, and Do Step 3: Designing a Message (using AIDA model) Message content, message structure, and message format. Step 4: Choosing media Personal vs. non-personal communication channels. Step 5: Selecting the Message Source Who delivers the messages? Step 6: Collecting Feedback Measures the recall, attitude, purchase intensions, etc. Traditional Communication Strategy

  9. Issue 3Types of promotion strategies that are suitable for marketing in internet environment

  10. Internet Advertising: Goals: Build awareness, drive traffic, persuade to make sales, (re)position a product, remind the sales, etc. Types: E-mail ads, wireless ads, banners, pop-up windows, sponsorships, interstitials, superstitials, etc. Sales Promotion: Goals: Stimulate instant sales using temporary inducements, increase store traffic, etc. Types: coupons, sampling, contests & sweepstakes Direct Marketing: Goals: Marketers consider all Internet promotion direct marketing since it is interactive and creates personal contact with audience members, and encourage an immediate sales. Types: Click-through advertising, email marketing, viral marketing, opt-In opt-out, interactive web catalogs, direct sales using the website Public Relation: Goals: Create and maintain a favorable image and goodwill, persuade an audience, generate traffic, etc. Types: Effective design of website, community building, online event, etc. Promotion Types on the Internet

  11. Based on the Buyer Decision Process … Goal 1: Building Awareness Website Design: seven Cs of effective website design. Search Engine Optimization (SEO): 47% of web users use search engine (by Jupiter Media Metrix). Top 10 results to a search query get 78% more traffic. How to improve their rankings at search engines: metatags and keywords. Goal 2: Increasing Site Traffic Site Stickiness: An indicator of attractiveness of a website. Total page views/month divided by unique visitors per month. Sticky features: community building by discussion boards, online chat rooms, and online events, etc. Goal 3: Maximizing value-added experience with website Satisfaction with the website: Satisfaction with information contents and navigation flow (website design). Goal 4: Generation of Sales on the Internet Lead to Sales: How to improve conversion rate? Utilize sales promotion offers such as coupons, sampling, sweepstakes, and so on. Promotional Goals on the Internet

  12. Issue 4Maximizing the performances of promotion strategy using the internet technology

  13. AIDABuyer Readiness ModelModel Awareness Awareness Knowledge Interest Liking Desire Preference Conviction Action Purchase Internet Promotion Metrics CPM (Cost Per Impressions) Cost Per Message Opt-Out Rate CTR (Click-Through Rate) Cost Per Click Visitors resulting from click-through CPL (Cost Per Lead) Conversion Rate CAC (Customer Acquisition Cost) Metrics for Internet Promotion

  14. Blackwell, Roger D., Paul W. Miniard, and James F. Engel (2001), Consumer Behavior, 9th ed., Harcourt College Publishers. (see chapter 3 - 6) Hanson, Ward (2000), Principles of Internet Marketing, South-Western College Publishing, Ohio. Kotler, Philip and Gary Armstrong (2004), Principles of Marketing, 10th ed., Prentice Hall. (see chapter 1 and 2) Siegel, Carolyn (2006), Internet Marketing: Foundations & Applications, 2nd ed., Houghton Mifflin, New York. Strauss, Judy, Adel El-Ansary, and Raymond Frost (2006), E-Marketing, 4th ed., Pearson: Prentice-Hall, New Jersey. Reference

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