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ANALYSING THE INTERNET MARKETING STRATEGY OF AMAZON THROUGH FIVE-STEP POSITIONING PLAN
GROUP 1Monday, 9 August 2010
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GROUP 1:
• Mochammad Larimba Mandrawata• Gaurav• Sukito
• Yen-Heng Kuo• Naif Balabid
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Outline
• General Concept• Problem Definition and
Independent Research• Conclusion• Learning Activities• Questions
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General Concept
• Internet Marketing• Segmentation• Targeting• Positioning: Five-Step Positioning
Plan
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Internet Marketing (e-Marketing)
• It is the process of building and maintaining customer relationships through online activities to facilitate the exchange of ideas, products, and services that satisfy the goals of both parties (Mohammed, R.A. Et al, 2004)
• It is marketing in electronic environments, primarily on the Internet, on one or more of its services, or offline by enterprises that produce and sell Internet-related products.(Siegal, 2006)
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STP of Marketing
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Marketing Strategy Decision
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Pure Plays and BAM
• Pure plays- firms that only have an online business
• BAMs- firms that have offline operations
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Differences between marketing strategy of Pure plays and BAMs
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Segmentation for Pure Plays
• It involves the breaking up of a market of customers into large, identifiable groups, or segments
• It reveals potential marketing opportunities and provides a firm with clearer guidance for product development and marketing strategy
• Bases for segmentation include: Demographic Geographic Psychographic Cognitive and behavourial
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Effective Segmentation
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Meaningful
Actionable
Financially Attractive
Targeting
• The target market is the segment (or segments) of the market most attractive to the firm based on profitability, cost to serve, accessibility and/or growth potential
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Targeting
• Mass Marketing– This strategy markets to all customers, attempting
to fill all their needs and wants of every segment in a market• Differentiated strategy (e.g. P&G)• Undifferentiated strategy (e.g. Coke-Cola)
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Targeting
• Niche Marketing– To serve one or a few segment, and these
segments are not the largest segments, but consist of enough customers to make it worthwhile (e.g. Super luxury car market)
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Targeting
• Growth Marketing– Choosing one or more smaller but fast-growing
segments that will turn into a niche or a larger segment
( e.g.?)
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Positioning
• Positioning is the act of designing the company offer and image so that it occupies a distinct and valued place in the target customers’ minds.
– Philip Kotler(2003)
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Five-Step Positioning
• Norton Paley– has over 25 years of corporate experience– has authored seven books
Manage to WinSuccessful Business PlanningMarketing for the Non-marketing Executive: An Integrated ManagementResource GuideThe Marketing Strategy Desktop GuidePricing Strategies and PracticesMarketing Principles and Tactics Everyone Must KnowThe Manager’s Guide to Competitive Strategies, 2nd Ed.
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Positioning: Five-Step Positioning
Step One : Indentify actual product- Through some customer interviews or questionnaires,
we are able to identify the variables important to consumers and the perceived position of a product
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Positioning: Five-Step Positioning
Step Two : Determine ideal product position- This step determines how to position a product in a
more favorable location on perpetual map
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Positioning: Five-Step Positioning
Step Three : Develop alternative strategies for achieving ideal product position
- In order to achieve an ideal position, a firm must to:
- move your product to a new position- introduce a separate, new product, and
leave current product untouched or withdraw
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Positioning: Five-Step Positioning
Step Four : Select and implement the most promising alternative - This step depends on choosing the plan that is the most
favorable and consistent with a company’s objectives, resources and strengths
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Positioning: Five-Step Positioning
Step Five : Compare new actual position with ideal position- This step must also include measures to track the success of the positioning move
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Problem Definition and Independent Research• Question: Select an online
company and describe how it creates its five-step positioning plan.
• Observed website: Amazon.com
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About Amazon.com
Amazon.com is considered as a “pioneer in online retailing”
Up to his date is Stating that itself “strives to be Earth's most
customer-centric company where people can find and discover virtually anything they want to buy online”
Offers a range of products and services, from books, movie, music, electronics, to web services and selling services
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History of Amazon.com
Summarized Timeline 1994: Founded by Jeff Bezos 1995: Launched on the web, limited to selling books 1997: Went public 1998: Expanded to music store, acquiring international offices 1999: Expanded to toys, hardware, electronics, Opens its auction site 2001: its first fourth-quarter profit 2002: Expanded to web services 2003: its second profit 2004: its first-ever annual profit
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Positioning at Amazon
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Conclusion
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Learning Activities: InterGrating (Interactive & Integrating) CS
• eBay versus Amazon: analysing internet marketing positioning strategies on both companies.
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Learning Activities
• Discussion Points:
– In your opinion, why and how does Amazon position (changing focus) itself in this online purchasing competition?
– In your opinion, why and how does eBay position (reaction) itself in this online purchasing competition?
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Question
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