The E Marketing Mix
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Transcript of The E Marketing Mix
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.1
The e-Marketing Mix
Creating value
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.2
Learning objectives
Apply the elements of the marketing mix in an
online context;
evaluate the opportunities that the Internet
makes available for varying the marketing mix;
define the characteristics of an online brand.
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.4
The marketing mix
In 1963 Bartels said:
a marketer is like a chef in a kitchen a mixer of
ingredients
Variables used to define key elements of marketingstrategy
From the 4Ps of Jerome McCarthy to the 7Ps of
Booms and Bitner sometimes referred to as the
services mix 4Ps Product, Price, Place, Promotion
7Ps add People, Processes and Physical Evidence
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.5
The Offering
OFFERING
Product, packaging, service and brand
What do you have to OFFER the customer?
What does this OFFER to other stakeholders
in the value chain?
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.6
The 4Ps and the 4Cs
Product
Price
Place
Promotion
Customer needs
and wants
Customer
convenience
Communications
with
company
Cost
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Mixing the mix online
Which variables are important for the ideal
customer?
Price and quality?
Where they buy?
You need to decide on target markets first and
do the research on the mix variables
Remember the mix is not generic for allcustomers, but for segments
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The elements of the marketing mix
Figure: The elements of the marketing mix
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Product introduced
The element of the marketing mix thatinvolves researching customers needs anddeveloping appropriate products
Core product The fundamental features of the product that
meet the users needs.
Extended product
Additional features and benefits beyond thecore product.
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Extended product options
Examples:
Add-on services gift wrapping @ Amazon
Endorsements
Awards
Testimonies
Customer lists
Customer comments Warranties
Guarantees
Money back offers
Customer service (see people, process and physicalevidence)
Incorporating tools to help users during their use of theproduct
Information extranets
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Brands
A brand is described by Leslie de Chernatonyand Malcolm McDonald in their classic book1992 book Creating Powerful Brands as
an identifiable product or service augmentedin such a way that the buyer or userperceivesrelevantun ique added values
which match their needs most closely.Furthermore, its success results from beingable to susta inthese added values in the faceof competition.
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Identity
vs.
Image
How we see ourselves... How others see us...
Branding Strategy
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.13
Web sites as BRANDS
What is your company withoutits Website?
Amazon.com = NOTHING
Aftonbladet.se = STILL A NEWSPAPER
BRAND LADDER: Corporate brand/Product/Service/People (CEO)
Brand Image vs. Brand Identity
Websites serve many segments
-Employees (Intranet)
-Partners/Suppliers (Extranet)-Media
-Students/Educators
-Shareholders
-Customers
-Competitors
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.14
Building brand (Website) loyalty
Brands are l ike peopleeach has:A name
A look (packaging)
A demographic description
A personality
A branding auditcan provide a look at your corporate/brand/Website imageCopyright 2000TimFoster
ALL RIGHTSRESERVED
5-point scale:verensstmmer inte alls (1) (2) (3) (4) (5) verensstmmer helt
How the study worked...
5 dimension15 facets
77 adjectives
UPPRIKTIGHET-Jrdnra-rlig-Sund-Munter
SPNNANDE-Djrv-Livfull-Fantasifull-Modern
KOMPETENT-Plitlig-Intelligent-Framgngsrik
SOFISTIKERAD-verklass
-Charmig
ROBUST-Friluftaktig
-Envis/seg
Copyright 2000TimFosterALLRIGHTSRESERVED
1
2
3
4
5
IMAGE: Informationsteknik/IT
Uppriktighet
Spnnande
Kompetent
Slitstark/Robust
Sofistikerad
(3.5)
(3.1)
(2.6)
(3.4)(1.9)
POSITIONERING:Mlgrupper:ITfretag, nya fretag, SMEsFrdelar:Sommar, universitet, sport, havetTillfllen: Mssor, turism, sport, universitetKonkurens:Ume, Stockholm, Sundsvall, UleborgPos./Neg: Stlstad, ITpotential
BASICFACTS:Avg. Employees: 199Avg. Revenue:168.1 MkrAvg. Year established: 1990Typical form:ABAge range:30-44 (5), 45-59(4)
0
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.15
Brands online
Dayal et al. (2000) say, on the world wide web, the brand
is the experience and the experience is the brand.
The promise of convenience making a purchaseexperience more convenient than the real-world (or forrivals).
The promise of achievement to assist consumers inachieving their goals, for example supporting onlineinvestors in their decision or supporting business people
in their day-to-day work.
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.16
Brands -cont.-
The promise of fun and adventure this is clearly morerelevant for B2C services.
Is it???
The promise of self-expression and recognition providedby personalization services such as Yahoo! Geocities
where consumers can build their own web site.
The promise of belonging provided by onlinecommunities (Plus trust and reassurance).
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.17
Online brand options
1. Migrate traditional brand online.
2. Extend traditional brand: variant.
3. Partner with existing digital brand.
4. Create a new digital brand.
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.18
Price implications
View 1 decreased prices inevitable Price transparency
Customer knowledge increases
Price reduction and standardization
View 2 decreased prices unnecessary 89% purchase books from first site
Only 10% are aggressive bargain hunters
For corporate buyers internal changes aremain benefit
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.19
Differential pricing
Options reduce or transfer. Other options Precision
Setting prices more accurately through testing(price indifference band)
Adaptability Rapid changes (dynamic pricing).
e.g. Concert tickets
Segmentation Different charges according to profiling
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.20
MANY WAYS TO PRODUCE REVENUE ONLINE
Purchase
Rental or subscription
Pay per use
Online advertising sales
(banners, pop-ups)
SPAM (junk e-mail)
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.21
Pricing options
Cost-plus
Add profit margin to operational costs
Target profit pricing
Based on breakeven
Competition-based pricing
Market-oriented
Premium-pricing
Penetration pricing
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.22
Evans and Wurster view of place
Reach: This is the potential audience of the e-commerce site. Reach
can be increased by moving from a single site to representation with alarge number of different intermediaries. Allen and Fjermestadsuggest that niche suppliers can readily reach a much wider marketdue to search engine marketing
Richness: This is the depth or detail of information which is bothcollected about the customer and provided to the customer. This isrelated to the product element of the mix.
Affi l iat ion: This refers to whose interest the selling organizationrepresents consumers or suppliers. This particularly applies to
retailers. It suggests that customers will favor retailers who providethem with the richest information on comparing competitive products.
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.23
Place 2 new channel structures
A. Distintermediation
B. Reintermediation
C. Countermediation
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.24
Place 3 channel conflicts
Dependent on:
1.A communication
channel only.
2.A distribution channelto intermediaries.
3. A direct sales channel
to customers.
4.Any combination of theabove.
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.25
Place 4 virtual organizations what are they?
Kraut et al. (1998) suggest the following features of a virtualorganisation:
Processes transcend the boundaries of a single form and are notcontrolled by a single organizational hierarchy.
Production processes are flexible, with different parties involved atdifferent times.
Parties involved in the production of a single product are oftengeographically dispersed.
Given this dispersion, co-ordination is heavily dependent ontelecommunications and data networks.
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.26
Promotion
Promotion unfortunately has a range of meanings. It
can be used to describe the marketing
communications aspect of the marketing mix or, more
narrowly, as in sales promotion. In its very broad
sense it includes the personal methods of
communications, such as face to face or telephone
selling, as well as the impersonal ones such as
advertising. When we use a range of different types
of promotion direct mail, exhibitions, publicity, etc
we describe it as the promotional mix.Wilmshurst (1993)
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.27
Promotion tools
1 Advertising (broadcast, print, outdoor)
2 Sales promotion (prizes, gifts, contests)
3 Personal selling (face-to-face or voice-to-voice)
4 Public relations (relationship & communication
with important publics)
5 Direct marketing (SPAM, pop-ups, offers)
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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.28
Options for replacing people Autoresponders: These automatically generate a response when a company
e-mails an organization, or submits an online form.
E-mail notification: Automatically generated by a companys systems toupdate customers on the status of their order, for example, order received,item now in stock, order dispatched.
Call-back facility: Customers fill in their phone number on a form and specifya convenient time to be contacted. Dialing from a representative in the callcentre occurs automatically at the appointed time and the company payswhich is popular.
Frequently Asked Questions (FAQ): For these, the art is in compiling andcategorizing the questions so customers can easily find (a) the question and(b) a helpful answer.
On-site search engines: These help customers find what theyre looking forquickly and are popular when available. Site maps are a related feature.
Virtual assistants: Come in varying degrees of sophistication and usually helpto guide the customer through a maze of choices.
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Ch ff I t t M k ti 2 d diti P Ed ti Li it d 2003OHT 5 29
Methods of managing inbound contacts
Customer defines
Receipt &acknowledgement
Routeing
Response
Follow-up
Make contact point clear
Use FAQ to reduce enquiries (Measure)
Use drop down lists to categorize query
Use autoresponse with service promise
(number of hours)
Give alternative information source
(phone or web page)
Large organizations use intelligent software tocategorize and prioritize messages and
forward them to relevant staff
Use templates for common responses
Answer ALL of the questionsAdd question to knowledge base
Offer callback or follow up for key enquiries
Use phone if e-mail is not solving problem