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12-The Internet and Interactive Media.ppt


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12-The Internet and Interactive Media.ppt

  1. 1. The Internet and Interactive Media <ul><li>Adding Two-Way to One-Way Media </li></ul><ul><li>A majority of most companies’ sales and profits come from current customers. </li></ul><ul><li>To motivate repeat purchases, companies need to continually connect and reconnect with customers. </li></ul><ul><li>The media most suited for doing this are addressable, interactive media. </li></ul>
  2. 2. The Internet Picture Senders Internet Receivers Internet Advertisers Sponsors e-Commerce Merchants Users Shoppers Customers
  3. 3. Communication and Technology <ul><li>The information age is shifting people from manufacturing to service industries. </li></ul><ul><li>More complex communication requires more bandwidth . </li></ul><ul><li>The Internet has become the fastest-growing communication technology in history. </li></ul><ul><li>However, it still accounts for only a small portion of all business activities. </li></ul>
  4. 4. Q.: Why Market in the Online Environment? <ul><li>A1: Because it’s where consumers are. </li></ul><ul><ul><li>(Somebody has to provide the goods and services) </li></ul></ul><ul><li>A2: Because it’s where the money is? </li></ul><ul><ul><li>(Perhaps, for some things…) </li></ul></ul><ul><li>A3: Because nobody likes to be left out. </li></ul><ul><ul><li>(The bandwagon moves quickly) </li></ul></ul><ul><li>A4: Because nobody else is there. </li></ul><ul><ul><li>(An empty niche is hard to find.) </li></ul></ul><ul><li>A5: Because it’s not too hard to get in. </li></ul><ul><ul><li>(Low correlation with success !) </li></ul></ul>
  5. 5. Why use the Internet? <ul><li>Three strikes and you’re out! </li></ul><ul><ul><li>Demand risk </li></ul></ul><ul><ul><li>Innovation risk </li></ul></ul><ul><ul><li>Inefficiency risk </li></ul></ul>
  6. 6. Reducing demand risk—fewer customers want to buy a firm’s products/services <ul><li>Market penetration </li></ul><ul><ul><li>Increase market share </li></ul></ul><ul><li>Develop markets </li></ul><ul><ul><li>Existing products into new markets </li></ul></ul><ul><li>Product development </li></ul><ul><ul><li>Create new products for existing customers </li></ul></ul><ul><li>Diversify </li></ul><ul><ul><li>New products into new markets </li></ul></ul>
  7. 7. Reducing innovation risk <ul><li>There is an oversupply of products in most mature markets </li></ul><ul><li>Customers expect something new and different </li></ul><ul><li>Increase access to: </li></ul><ul><ul><li>Ideas for improving present products and services </li></ul></ul><ul><ul><li>Ideas for new products and services </li></ul></ul><ul><ul><li>Ideas for redesigning the delivery of products and services </li></ul></ul><ul><li>Use the Internet to open communication links with customers and other stakeholders </li></ul>
  8. 8. Reducing inefficiency risk <ul><li>Lower the cost of the customer information exchange cycle </li></ul><ul><li>Reduce order handling costs </li></ul><ul><li>Reduce inventory </li></ul><ul><li>Reduce service delivery costs </li></ul>
  9. 9. Transaction costs
  10. 10. Disintermediation <ul><li>The elimination of intermediaries such as brokers and dealers </li></ul>O 1 O 2 O n-1 O n Physical flow Information flow
  11. 11. E-market possibilities Corcoran, E. 1999. On-line: Amazoned. Forbes , Mar 22, 55
  12. 12. The Internet <ul><li>The Internet’s greatest function is as a communication link. </li></ul><ul><li>As a medium, it combines the characteristics of many other media such as newspapers, magazines, catalogs, TV, and directories. </li></ul>
  13. 13. Internet Communications Objectives <ul><li>To Disseminate Information </li></ul><ul><li>To Create Awareness </li></ul><ul><li>To Gather Research Information </li></ul><ul><li>To Create an Image </li></ul><ul><li>To Stimulate Trial </li></ul><ul><li>To Improve Customer Service </li></ul><ul><li>To Increase Distribution </li></ul>
  14. 14. The Internet <ul><li>The Internet’s most important characteristics include: </li></ul><ul><li>Shifts power from companies to customers. </li></ul><ul><li>Is accessible to the majority of the population. </li></ul><ul><li>Provides an extensive range of information. </li></ul><ul><li>Allows for unsurpassed speed and coverage. </li></ul><ul><li>Reduces the cost of selling and acquisition. </li></ul>
  15. 15. Personal Selling on the Internet <ul><li>May replace personal selling </li></ul><ul><ul><li>Reduces high cost of personal calls </li></ul></ul><ul><ul><li>Vastly increases potential reach </li></ul></ul><ul><li>May enhance personal selling efforts </li></ul><ul><ul><li>Provides quick, easy, information to prospects </li></ul></ul><ul><ul><li>May be a source of leads </li></ul></ul><ul><ul><li>May help to enhance customer data bases </li></ul></ul><ul><ul><li>May stimulate trial of the goods or service </li></ul></ul><ul><ul><li>May improve one-on-one communications </li></ul></ul><ul><ul><li>May serve as a sales conference medium </li></ul></ul>
  16. 16. Internet Advertising <ul><li>Sponsorship </li></ul><ul><ul><li>Ownership of an entire site or page </li></ul></ul><ul><li>Banner Ads </li></ul><ul><ul><li>A portion of another owner’s page </li></ul></ul><ul><li>Pop-Ups </li></ul><ul><ul><li>Small windows that appear automatically </li></ul></ul><ul><li>Interstitial </li></ul><ul><ul><li>Ads appearing while waiting for a page to load </li></ul></ul><ul><li>Push Technologies or Webcasting </li></ul><ul><ul><li>Automatic or unsolicited message delivery </li></ul></ul><ul><li>Links </li></ul><ul><ul><li>Hypertext links to other sites, pages or locations </li></ul></ul>
  17. 17. Communication Networks <ul><li>Network technology has helped companies improve communication both internally and externally. </li></ul><ul><li>Intranets and extranets are internet-based networks and proprietary communication systems for corporate communication. </li></ul>
  18. 18. Measures of Effectiveness <ul><li>KEY TERMS </li></ul><ul><ul><li>Hits </li></ul></ul><ul><ul><ul><li>Number of requests for a site component </li></ul></ul></ul><ul><ul><li>Viewers </li></ul></ul><ul><ul><ul><li>Number of visits to a site </li></ul></ul></ul><ul><ul><li>Unique visitors </li></ul></ul><ul><ul><ul><li>Number of different visitors per period </li></ul></ul></ul><ul><ul><li>Clicks (Click-throughs) </li></ul></ul><ul><ul><ul><li>Number of visitors clicking on a banner ad </li></ul></ul></ul><ul><ul><li>Click-through rate </li></ul></ul><ul><ul><ul><li>Ratio of click-throughs from an ad to a page at the advertiser's website </li></ul></ul></ul><ul><ul><li>Impressions per page views </li></ul></ul><ul><ul><ul><li>Number of times viewers view a page </li></ul></ul></ul>
  19. 19. Measures of Effectiveness <ul><li>Online Measuring </li></ul><ul><ul><li>Data on demographics, psychographics, location of access, media used, buying habits, and more. </li></ul></ul><ul><li>Recall and Retention </li></ul><ul><ul><li>Daily user interviews to measure recall and retention of web content viewed </li></ul></ul><ul><li>Nonresponse </li></ul><ul><ul><li>Measures of destination after failure to click-through </li></ul></ul><ul><li>Surveys </li></ul><ul><ul><li>On- and off-line surveys to determine usage factors </li></ul></ul><ul><li>Panels </li></ul><ul><ul><li>Usage and attitude data obtained from a specific group </li></ul></ul><ul><li>Sales </li></ul><ul><ul><li>Sales volume keyed to specific times and sites </li></ul></ul><ul><li>Tracking </li></ul><ul><ul><li>Accumulation of site performance data </li></ul></ul>
  20. 20. Internet Advantages <ul><li>Target Marketing </li></ul><ul><li>Message Tailoring </li></ul><ul><li>Interactive Capabilities </li></ul><ul><li>Information Access </li></ul><ul><li>Sales Potential </li></ul><ul><li>Creativity </li></ul><ul><li>Exposure </li></ul><ul><li>Speed </li></ul>
  21. 21. Internet Disadvantages <ul><li>Measurement problems </li></ul><ul><li>Audience characteristics </li></ul><ul><li>Websnarl </li></ul><ul><li>Clutter </li></ul><ul><li>Potential for deception </li></ul><ul><li>Costs </li></ul><ul><li>Limited production quality </li></ul><ul><li>Poor reach </li></ul>
  22. 22. Mail Formats and Features <ul><li>Mail is the third largest medium. </li></ul><ul><li>It accounts for approximately 20% of all media spending. </li></ul>
  23. 23. Mail <ul><li>Strengths: </li></ul><ul><li>Addressable </li></ul><ul><li>Measurable results </li></ul><ul><li>Highly selective </li></ul><ul><li>Demands attention </li></ul>
  24. 24. Mail <ul><li>Limitations: </li></ul><ul><li>High cost per message </li></ul><ul><li>Long lead time </li></ul><ul><li>Clutter, junk mail perception </li></ul>
  25. 25. Phone Formats and Features <ul><li>In 2000, U.S. companies spent $44.7 billion in telemarketing . </li></ul><ul><li>Outbound calls are those initiated by an organization. </li></ul><ul><li>Inbound calls are those initiated by prospects or customers. </li></ul>
  26. 26. Technical Sophistication of Automated Answering Systems
  27. 27. Telemarketing <ul><li>Strengths: </li></ul><ul><li>Personalized </li></ul><ul><li>Real-time interaction </li></ul><ul><li>Attention-getting </li></ul><ul><li>Measurable results </li></ul>
  28. 28. Telemarketing <ul><li>Limitations: </li></ul><ul><li>Costly </li></ul><ul><li>Ugly image </li></ul><ul><li>Intrusive </li></ul>
  29. 29. E-mail Formats and Features <ul><li>E-mail is the fastest growing interactive medium. </li></ul><ul><li>It can be an effective way to reach customers because it is simple to use and inexpensive. </li></ul><ul><li>Customer permission is an important consideration in e-mail campaigns. </li></ul>
  30. 30. E-mail <ul><li>Strengths: </li></ul><ul><li>Addressable </li></ul><ul><li>Can be personalized </li></ul><ul><li>Extremely low cost </li></ul><ul><li>Can be interactive </li></ul>
  31. 31. E-mail <ul><li>Limitations: </li></ul><ul><li>Clutter (spam) </li></ul><ul><li>Limited creative options </li></ul>
  32. 32. E-Commerce <ul><li>To marketers, the Internet is not only a medium but also a business platform. </li></ul><ul><li>Product categories with the highest volume of online sales are books, CDs, computer software, and toys and games. </li></ul>
  33. 33. E-Commerce <ul><li>E-commerce is used for more than making a transaction. </li></ul><ul><li>Reach broad worldwide audiences </li></ul><ul><li>Cost-effectively communicate with customers and prospects </li></ul><ul><li>Cost-effectively distribute brand information </li></ul><ul><li>Provide alternative channels of distribution </li></ul><ul><li>Provide frequently updated prices and information </li></ul><ul><li>Improve customer service by offering access </li></ul><ul><li>Collect instant feedback and conduct market research </li></ul>
  34. 34. Offline Advertising <ul><li>Companies realize that they need to drive more traffic to their sites than can not be done with online advertising alone. </li></ul>
  35. 35. Online Advertising <ul><li>There are two aspects to online advertising: </li></ul><ul><li>Advertising offline in other media to bring customers to a site </li></ul><ul><li>Advertising online on websites </li></ul>
  36. 36. Online Advertising <ul><li>Advertising online offers a number of advantages: </li></ul><ul><li>Interactivity—engage in dialogue </li></ul><ul><li>Flexibility—change information rapidly </li></ul><ul><li>Precise targeting—interested consumers </li></ul>
  37. 37. Online Public Relations <ul><li>Websites can be designed to be useful to all of a company’s stakeholders. </li></ul><ul><li>For media relations, a site can contain: </li></ul><ul><li>Description of a company’s business operations </li></ul><ul><li>Listing of all its brands and products </li></ul><ul><li>Listing of all executives </li></ul><ul><li>Company contact information </li></ul>
  38. 38. Internet Privacy <ul><li>Internet privacy has become an increasing concern. </li></ul><ul><li>The FTC recommends practices for industry self-regulation: </li></ul><ul><li>Notice. Give clear and conspicuous notice of what information is collected and how it will be used. </li></ul><ul><li>Choice. Let consumers choose whether their information can be used for any purposes besides fulfilling the transaction. </li></ul><ul><li>Reasonable access. Consumers should be able to access the information collected on them and have a reasonable opportunity to correct any errors or delete the data. </li></ul><ul><li>Adequate security. Companies should ensure proper handling of information to prevent unauthorized access. </li></ul>
  39. 39.
  40. 40. Hypercharged Cybermarketing <ul><li>Several challenges for the 21 st century organization: </li></ul><ul><li>The speed with which changes are introduced </li></ul><ul><li>The speed with which business is not being conducted </li></ul><ul><li>To meet these challenges, companies are outsourcing more of their customer management functions. </li></ul><ul><li>The concept of a virtual corporation has increased the need for communication. </li></ul>