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Online Marketing

           John Hale
Center for Information Security
      University of Tulsa

    john-hale@utulsa.edu...
Overview

1.   Consumer behavior
2.   Basic marketing
3.   Internet marketing
4.   Customer relationships




            ...
Consumer Behavior Models

• Attempt to predict/explain what consumers
  purchase and where, when, how much and why
  they ...
A General Model of Consumer
          Behavior




    University of Tulsa - Center for Information Security   4
Background Demographic Factors

• Culture: Shapes basic human values, wants perceptions and
  behaviors
• Subculture: Subs...
Consumer Decision Process




  University of Tulsa - Center for Information Security   6
A Model of Online Consumer
                     Behavior
• Adds two new factors:
    Web site capabilities – the content, ...
A Model of Online Consumer
         Behavior




  University of Tulsa - Center for Information Security   8
Basic Marketing Concepts

• Marketing: The strategies and actions firms take to
  establish a relationship with a consumer...
Basic Marketing Concepts

• Firms within an industry compete with one another on
  four dimensions:
     Differentiation
 ...
Feature Sets
Defined as the bundle of capabilities and
services offered by the product or service




                  Un...
Products, Brands and the Branding
                          Process
• Brand: A set of expectations that consumers have whe...
Marketing Activities: From
   Products to Brands




  University of Tulsa - Center for Information Security   13
Internet Marketing Technologies

•   Web transaction logs
•   Cookies and Web bugs
•   Databases, data warehouses, and dat...
Web Transaction Logs

•   Built into Web server software
•   Records user activity at a Web site
•   WebTrends a leading l...
Cookies

• Cookies: small text file that Web sites place on
  a visitor’s client computer every time they visit,
  and dur...
Web Bugs

• Tiny (1 pixel) graphic files embedded in e-mail
  messages and on Web sites
• Used to automatically transmit i...
Databases and Data Warehouses
• Database: Software that stores records and attributes
• Database management system (DBMS):...
Data Mining
• Set of analytical techniques that look for patterns in
  data of a database or data warehouse, or seek to
  ...
Data Mining and Personalization




     University of Tulsa - Center for Information Security   20
Advertising Networks

• Best known for ability to present users with
  banner advertisements based on a database of
  user...
How Advertising
           Networks Work




University of Tulsa - Center for Information Security   22
Customer Relationship
                  Management (CRM) Systems

• Repository of customer information that records all of...
Customer Relationship
Management Systems




University of Tulsa - Center for Information Security   24
Customer Retention
                Marketing Techniques
• Customization: Changing the product (not just the
  marketing me...
Other Customer Retention
             Marketing Techniques (cont’d)
Customer service tools include:
• Frequently asked que...
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Secom%20 Online%20 Marketing

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Secom%20 Online%20 Marketing

  1. 1. Online Marketing John Hale Center for Information Security University of Tulsa john-hale@utulsa.edu *Slides adapted from E-Commerce: Business, Technology, Society – 2/e by K. Laudon and C. Traver, Pearson/Addison-Wesley University of Tulsa - Center for Information Security
  2. 2. Overview 1. Consumer behavior 2. Basic marketing 3. Internet marketing 4. Customer relationships University of Tulsa - Center for Information Security
  3. 3. Consumer Behavior Models • Attempt to predict/explain what consumers purchase and where, when, how much and why they buy. • Consumer behavior models based on background demographic factors and other intervening, more immediate variables University of Tulsa - Center for Information Security
  4. 4. A General Model of Consumer Behavior University of Tulsa - Center for Information Security 4
  5. 5. Background Demographic Factors • Culture: Shapes basic human values, wants perceptions and behaviors • Subculture: Subset of culture; forms around major social differences such as ethnicity, age, lifestyle, geography • Direct reference group: Include one’s family, profession/occupation, religion, neighborhood, schools • Indirect reference group: Includes one’s life-cycle state, social class and lifestyle group • Opinion leaders (viral influencers): Influence the behavior of others through their personality, skills or other factors University of Tulsa - Center for Information Security
  6. 6. Consumer Decision Process University of Tulsa - Center for Information Security 6
  7. 7. A Model of Online Consumer Behavior • Adds two new factors: Web site capabilities – the content, design and functionality of a site Consumer clickstream behavior – the transaction log that consumers establish as they move about the Web University of Tulsa - Center for Information Security
  8. 8. A Model of Online Consumer Behavior University of Tulsa - Center for Information Security 8
  9. 9. Basic Marketing Concepts • Marketing: The strategies and actions firms take to establish a relationship with a consumer and encourage purchases of products and services • Internet marketing: Using the Web, as well as traditional channels, to develop a positive, long-term relationship with customers, thereby creating competitive advantage for the firm by allowing it to charge a higher price for products or services than its competitors can charge University of Tulsa - Center for Information Security
  10. 10. Basic Marketing Concepts • Firms within an industry compete with one another on four dimensions: Differentiation Cost Focus Scope • Marketing seeks to create unique, highly differentiated products or services that are produced or supplied by one trusted firm (“little monopolies”) University of Tulsa - Center for Information Security
  11. 11. Feature Sets Defined as the bundle of capabilities and services offered by the product or service University of Tulsa - Center for Information Security 11
  12. 12. Products, Brands and the Branding Process • Brand: A set of expectations that consumers have when consuming, or thinking about consuming, a product or service from a specific company • Branding: The process of brand creation • Closed loop marketing: When marketers are able to directly influence the design of the core product based on market research and feedback. E-commerce enhances the ability to achieve • Brand strategy: Set of plans for differentiating a product from its competitor, and communicating these differences to the marketplace • Brand equity: estimated value of the premium customers are willing to pay for a branded product versus unbranded competitor University of Tulsa - Center for Information Security
  13. 13. Marketing Activities: From Products to Brands University of Tulsa - Center for Information Security 13
  14. 14. Internet Marketing Technologies • Web transaction logs • Cookies and Web bugs • Databases, data warehouses, and data mining • Advertising networks • Customer relationship management (CRM) systems University of Tulsa - Center for Information Security
  15. 15. Web Transaction Logs • Built into Web server software • Records user activity at a Web site • WebTrends a leading log analysis tool • Can provide treasure trove of marketing information, particularly when combined with: Registration forms – used to gather personal data Shopping cart database – captures all item selection, purchase and payment data University of Tulsa - Center for Information Security
  16. 16. Cookies • Cookies: small text file that Web sites place on a visitor’s client computer every time they visit, and during the visit as specific pages are accessed. • Cookies provide Web marketers with a very quick means of identifying the customer and understanding his or her prior behavior • Location of cookie files on computer depends on browser version University of Tulsa - Center for Information Security
  17. 17. Web Bugs • Tiny (1 pixel) graphic files embedded in e-mail messages and on Web sites • Used to automatically transmit information about the user and the page being viewed to a monitoring server University of Tulsa - Center for Information Security
  18. 18. Databases and Data Warehouses • Database: Software that stores records and attributes • Database management system (DBMS): Software used to create, maintain and access databases • SQL (Structured Query Language): Industry-standard database query and manipulation language used in a relational databases • Relational database: Represents data as two-dimensional tables with records organized in rows and attributes in columns; data within different tables can be flexibly related as long as the tables share a common data element • Data warehouse: Database that collects a firm’s transactional and customer data in a single location for offline analysis by marketers and site managers University of Tulsa - Center for Information Security
  19. 19. Data Mining • Set of analytical techniques that look for patterns in data of a database or data warehouse, or seek to model the behavior of customers • Types include: – Query-driven – based on specific queries – Model-driven – involves use of a model that analyzes key variables of interest to decision makers – Rule-based – examines demographic and transactional data of groups and individuals at a Web site and attempts to derive general rules of behavior for visitors – Collaborative filtering – behavioral approach; site visitors classify themselves into affinity groups based on common interests; products are then recommended based on what other people in the group have recently purchased University of Tulsa - Center for Information Security
  20. 20. Data Mining and Personalization University of Tulsa - Center for Information Security 20
  21. 21. Advertising Networks • Best known for ability to present users with banner advertisements based on a database of user behavioral data • DoubleClick best-known example • Ad server selects appropriate banner ad based on cookies, Web bugs, backend user profile databases University of Tulsa - Center for Information Security
  22. 22. How Advertising Networks Work University of Tulsa - Center for Information Security 22
  23. 23. Customer Relationship Management (CRM) Systems • Repository of customer information that records all of the contacts that a customer has with a firm and generates a customer profile available to everyone in the firm with a need to “know the customer” • Customer profiles can contain: – Map of the customer’s relationship with the firm – Product and usage summary data – Demographic and psychographic data – Profitability measures – Contact history – Marketing and sales information University of Tulsa - Center for Information Security
  24. 24. Customer Relationship Management Systems University of Tulsa - Center for Information Security 24
  25. 25. Customer Retention Marketing Techniques • Customization: Changing the product (not just the marketing message) according to user preferences • Customer co-production: Allows the customer to interactively create the product (Nike) • Transactive content: Results from the combination of traditional content with dynamic information tailored to each user’s profile University of Tulsa - Center for Information Security
  26. 26. Other Customer Retention Marketing Techniques (cont’d) Customer service tools include: • Frequently asked questions (FAQs) – text-based listing of common questions and answers • Real-time customer service chat systems – company’s service representatives interactively exchange text messages with one or more customers on a real-time basis • Intelligent agent technology – bots • Automated response systems – send e-mail confirmations and acknowledgments • VReps University of Tulsa - Center for Information Security

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