E-Active Marketing

Chapter 9

Chapter Overview

• Internet has changed U.S. culture• Global customers, competition• E-active marketing

e-Commerce + Interactive marketing• Consumer e-commerce• Business-to-business e-commerce• Interactive marketing methods

E-Commerce

• Selling of goods/services on the Internet

• >50% of U.S. households use e-commerce

• Online sales is 12% of total U.S. retail sales

•E-commerce sites also used for info gathering

E-Commerce Components

• Catalog• Shopping cart• Payment procedure• Customer service

FAQs• Public relations• Optional elements

Cyber Shopping Categories

•Travel $53B•Office, home, and garden $16B•Computers & accessories $12B•Apparel $12B

Financial Incentives

• Attract first-time purchaser• Effective incentives

Reduced price Free shipping E-coupon

• Incentives must be meaningful and changed periodically

• Reduces costs through Lower shipping costs Lower labor costs Lower personnel costs

Convenience Incentives

• E-commerce available 24/7• Used to obtain product information

• Update and change Web site• Easy to locate merchandise• Convenience services Event registries Popular items Measurement charts

Concerns About E-Commerce

• Seller opportunism

• Security issues

• Information privacy issues

• Brick-and-mortar purchasing habits

Value-Added Incentives

• Change purchasing habits – long term

• Personalized shopping• Examples

Merchandise available only online Free online courses Free information, household tips

Interactive Marketing

• Two-way communications• Customer involvement• Tracking of Internet

activities• Personalize targeted

Banne

r ad

s

Blogs

E-m

ail m

arke

...

E-m

ail n

ewsle.

..

Onl

ine

prom

o...

Podca

sts

Social

net

w...

Sear

ch e

ng...

Viral

cam

pa...

0%

10%

20%

30%

40%

50%

60%

70%

80%

Perc

en

t of

Tota

l

Online Interactive Tactics

Newslet

ters

Online Advertising

• Increase in online budgets• Effective method for reaching

today’s consumers• Becoming “standard”

Click-through response rate – 0.27%

• Traditional integration - Brand spiraling

F ig. 9. 8

Types of Online Advertising

• Display or banner ad• Classified ads • Search advertising • Media/video ads

OnlineAdvertising

Banner Advertising

• First online advertising• Accounts for 32% of online

advertising• Can embed videos and

widgets• Targeted display ads

Auction exchangesMatches audience

Online Advertising - Rates

• CPMs will rise more than 75% over next 5 years

• Overall growth of online advertising will grow more slowly.

• Average CPM will rise from ~$2.66 in 2012 to $4.68 by 2017.

• Largely due to “Visible Impression Standard”

Source: Advertising Age, October 9, 2012, “Forrester Reduces Its Forecast for Online Spending”

Online Advertising - Rates

Visible Impression Standard:• Advertisers pay only for ads that

are visible on the screen.• May mean fewer impressions;

offsetting CPM gains.• Online growth rate overall for

2012 ~17%, down from 20% in 2011.

Classified and Media/Video Advertising

• Online classified ad popular• Media/video ads fastest-growing

format• Mobile phones and hand-held

devices• Dwell time, rate higher for video

ads

Blogs

• Online musings• Power of online buzz• 50% go to social networks

Download coupons Search for information Upcoming sales Discounts

• 22% read or write a product review on a blog

Company-Sponsored Blogs

• Effective? Blog visitors spend more Online 23 hours/week versus 13

• Benefits Communicate! Let customers see who you

are. Reassure shoppers Customers can voice opinion Company controls site

• Must be honest Identify your company if you contribute

significantly to a site.

Online Social Networks

• Facebook, YouTube, etc.• Developing social network presence

Specific product page – Sprite Posting of ads on social networks (Nike) Possible privacy issues

• Consumer-generated advertising “Crowdsourcing”

Consumer-Generated Reviews

• Amazon-com – leader• Retailers – online reviews of

brands• Early adopters• Implications

Negative reviews, Low ratings Consistent quality products Information for

• Marketing plans• Product modifications• Service strategies

E-mail Campaigns

It is essential to:• Integrate with other marketing

channels• Be based on web analytics• Combine with future web analytics

It is beneficial to:• Integrate with Web site’s content

management• Integrate with a customer

relationship program

Newsletters

• E-mail newsletters Build brand awareness Tie-in and drive web traffic Customers newsletters,

subscriptions Provide value

• Advertising on other newsletters Build brand awareness Drive web traffic Pick newsletters that are

relevant

Web Site Design

• Ensure Web site functions properly

• Cost of acquiring a new customer E-commerce company $100 Other companies up to $500

• Design to meet function, match target market

• Front page often skipped• Design every page with complete

information