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Transcript of ‘The key question is not whether to deploy Internet technology – companies have no choice if...
‘The key question is not whether to deploy Internet technology – companies have no choice if they want to stay competitive – but how to deploy it.’
Porter, M. (2001) Strategy and the Internet, Harvard Business Review, March 2001, 62–78.
A digital marketing strategy is needed
because…
…it provides a consistent direction for online marketing
activities
…the company can achieve its
hierarchy of objectives
…it means analysis of the external environment,
internal resources and capabilities will
take place
…following it will help the company achieve
competitive advantage
Gives a focus to choice of target
markets, positioning and the use of the marketing mix
It helps us to understand
which strategies and tactics
should not be pursued
Tells us how resources will be
deployed and how the
organisation will be structured to
achieve the strategy.
New proposition for customers Getting more customers (acquisition) Converting customers Improving experience Improving delivery of offers Improving the infrastructure to enhance
marketing capabilities
A website is likely to be central to an internet marketing strategy…
Also: Partner with online intermediaries e.g. portals,
social networks and infuencers like bloggers… Use social media marketing on own pages with
user-generated content but also using social networks like Facebook, Google+, LinkedIn, Twitter, Pinterest, etc
Use email, mobile, apps and databases as communications and relationship-building tools.
Link with offline marketing communications. Reduce costs, generate revenue, communicate
and brand.
Achieve 10 per cent online revenue contribution within two years;
Achieve first or second position in category penetration in the countries within
which we operate (this is effectively online market share and can be measured
through visitor rankings such as Hitwise or better by online revenue share;
Cost reduction of 10 per cent in marketing communications within two years;
Increase retention of customers by 10 per cent;
Increase by 20 per cent within one year the number of sales arising from a
certain target market, e.g. 18–25-year-olds;
Create value-added customer services not available currently;
Improve customer service by providing a response to a query within two hours,
24 hours per day, seven days a week;
All other objectives to be achieved profitably giving a return on investment in
a three year period.
E Shop E Procurement E Mall E Auctions Virtual Communities Collaboration Platforms Third Party Marketplaces Value Chain Integrators Value Chain Service Providers Information Broakerage Trust and other Services
•Subscription access to content •Pay Per View content access •CPM Display advertising •CPC advertising on site •Sponsorship of sections, content or
widgets •Affiliate revenue (CPA or CPC) •Subscriber data for e-mail marketing •Access to customers for research
purposes
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
Cheaper to retain customers than recruit new ones
Lifetime value and greater ‘share of wallet’ Customers can become advocates Value can be a source of competitive
advantage Incentives and collectables can encourage
further purchases and return visits to your site Can help you drive thought leader strategy for
B2B e.g. give white papers for free Can lock them in to your brand and stop churn /
switching Customers consolidate number of websites they
use over time so ensure your site is a favourite
Understand expectations: customer research,, site benchmarking, customer scenarios
Set and communicate the service promise: guarantees or promises
Delivering the service promise: on-site support, employee support, physical fulfilment, logistics, delight the customer.
Your USP online… Links to your brand positioning and tells
customers who you are, what you offer, which markets you serve and what makes you different.
It identifies to customers why they should click on the site, return, register, buy and share their experiences. It’s a point of difference from competitors.
Source: Smart Insights 2014
http://www.smartinsights.com/digital-marketing-strategy/online-value-proposition/online-value-proposition-examples/
http://www.impactbnd.com/blog/10-value-propositions-you-wish-you-had
Review effectiveness of communications and web pages. Can your customers progress through each hurdle?1. Exposure – is the information there long
enough for a customer?2. Attention – what grabs the attention?
Movement? Colour?3. Comprehension & perception – how does
the customer interpret the stimulus?4. Yielding & acceptance – is the information
accepted by the customer?5. Retention – how well can the customer
recall their experience?
Awareness Interest Desire Action
Problem Identification Information Search Evaluation of
Alternatives Purchase Post-purchase Evaluation
How does your decision-making differ for the following purchases:
1.Buying some breakfast cereal
2.Buying a car3.Buying a music
album from a brand new band
4.Buying your first home
The IDIC approach provides a framework for using the web effectively to form and build relationships:
1. Customer identification – identify customers on first and subsequent visits through cookies / login
2. Customer differentiation – build a profile to segment customers
3. Customer interaction – on-site interactions such as customer service questions or create a tailored product
4. Customer communications – personalisation or mass-customisation of content or emails according to segmentation.
User-centred design (Bevan, 1999) starts with understanding the nature and variation between user groups:
1. Who are the important users?
2. What is their purpose for accessing the site?
3. How frequently will they visit?
4. What experience and expertise do they have?
5. What nationality are they? Can they read your language?
6. What type of information are they looking for?
7. How will the use the information? Read it online, print it, download it, share it?
8. What type of browser or platform will they use? How fast will their links be?
9. How large a screen will they have and with how many colours?
•‘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
Deise et al (2000) and Chaston (2000) suggest four positioning options:Product performance excellencePrice performanceTransactional ExcellenceRelationship Excellence
These positioning options have much in common with Porter’s generic competitive strategies of cost leadership and differentiation
However unlike Porter’s belief, Kim et al (2004) concluded that for online businesses ‘integrated strategies that combine elements of cost leadership and differentiation will outperform cost leadership or differentiation strategies’