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E Marketing Week05

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The internet in marketing strategy

Week 5 of 13 of the 2007 Internet Marketing Course. Content is based in part on Dann, S and Dann S 2004 Strategic Internet Marketing 2.0, Milton: Wiley. Diagrams taken from the Dann and Dann text are copyright to their respective copyright holders.

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E Marketing Week05

  1. 1. MKTG7037 / MKTG2032 E-marketing Week 5
  2. 2. Course Structure Chapter 15 International marketing 21 May 12 Chapter 14 Relationship marketing 28 May 13 Chapter 13 Services marketing online 14 May 11 Chapter 12 Distribution 7 May 10 Chapter 11 Pricing strategies 30 April 9 Chapter 10 Promotion 2: the internet as a promotional medium 23 April 8 Chapter 9 Promotion: the internet in the promotional mix 2 April 7 Chapter 8 The role of product in internet marketing 26 March 6 Chapter 7 The internet in marketing strategy 19 March* 5 Chapter 6 Applications for business and non-business 12 March 4 Chapter 5 Creating cybercommunities 5 March 3 Chapter 4 Consumer behaviour 26 February 2 Chapter 3 Unique features of internet-based marketing 19 February 1 Topic(s)/Task(s) Week beginning Week No
  3. 3. Assessment Due Dates <ul><li>Task Weighting Due </li></ul><ul><li>Essay Registration 01 March 16 </li></ul><ul><li>Solo Assignment 20 March 26 </li></ul><ul><li>Group-Optional Essay 29 May 21 </li></ul><ul><li>Final Examination 30 June </li></ul><ul><li>Online Forum 20 During semester </li></ul>
  4. 4. Solo Assignment <ul><li>Due: March 26, Monday Week 6, no later than 7pm. </li></ul><ul><ul><li>Electronic Upload via WebCT </li></ul></ul><ul><li>Topic: “Hype or Hope? The value of a new technology for marketing” </li></ul><ul><ul><li>This assessment item is a solo paper where the student examines value of a contemporary technology for marketing practice. The list of contemporary technology includes: </li></ul></ul><ul><ul><ul><li>RFID tags for marketing and marketing research </li></ul></ul></ul><ul><ul><ul><li>m-commerce, including m-gaming, m-gambling and m-shopping </li></ul></ul></ul><ul><ul><ul><li>MMORPG environments such as Second Life </li></ul></ul></ul><ul><ul><ul><li>social media marketing </li></ul></ul></ul><ul><ul><ul><li>online viral marketing </li></ul></ul></ul><ul><li>You are expected to write between 1000 and 1500 words addressing the value of one of the five topic areas for marketing, using references to marketing theory, practice and internet theory. </li></ul><ul><li>Full referencing is expected. Penalties apply for not using references. </li></ul>
  5. 5. Solo Assignment: The Finer Details <ul><li>Referencing </li></ul><ul><ul><li>Any style is acceptable </li></ul></ul><ul><ul><li>Wikipedia is not going to count as a reference (sure, you can still cite it, but you need MORE than wikipedia) </li></ul></ul><ul><li>Things that count </li></ul><ul><ul><li>Blogs </li></ul></ul><ul><ul><li>Websites </li></ul></ul><ul><ul><li>Books </li></ul></ul><ul><ul><li>Other wikis </li></ul></ul><ul><ul><li>Journal articles </li></ul></ul><ul><ul><li>Trade articles </li></ul></ul>
  6. 6. Solo Assignment II: Expectations <ul><li>1000 to 1500 </li></ul><ul><ul><li>Don’t go over, don’t go under </li></ul></ul><ul><li>Addressing the value of the topic areas for marketing using references to </li></ul><ul><ul><li>marketing theory, </li></ul></ul><ul><ul><li>practice and </li></ul></ul><ul><ul><li>internet theory. </li></ul></ul><ul><li>Needs to have a conclusion </li></ul><ul><ul><li>Is your topic area hype or hope? </li></ul></ul><ul><ul><ul><li>Saying maybe won’t cut it this time. BE BIASED. </li></ul></ul></ul>
  7. 7. Stepping back a week or two <ul><li>That's happening because the team at Threadless understands that online communities don't create around the idea of being monetized, they create around a shared interest and passion. Online communities aren't simply waiting for you to find a way to make money off them. (Again if anyone needs a moment, feel free... .) </li></ul><ul><ul><li>http://www.mpdailyfix.com/2007/03/how_threadless_creates_online_1.html </li></ul></ul>
  8. 8. Online Awesomeness . <ul><li>And believe it or not, they have a four-part plan for doing so: </li></ul><ul><ul><li>1 - Allow your content to be created by the community. </li></ul></ul><ul><ul><li>2 - Put your project in the hands of the community. </li></ul></ul><ul><ul><li>3 - Let your community grow itself. </li></ul></ul><ul><ul><ul><li>(This means NO ADVERTISING. I'll pause while those of you that just fainted recollect yourself. Everyone good? Good.) </li></ul></ul></ul><ul><ul><li>4 - Reward the community that makes your project possible. </li></ul></ul>http://www.threadless.com/product/178/Pandamonium
  9. 9. The internet in marketing strategy
  10. 10. Managerial activities associated with marketing <ul><li>Researching the market </li></ul><ul><li>Developing market segmentation strategies </li></ul><ul><li>Targeting key segments </li></ul><ul><li>Creating positioning strategies for the product </li></ul><ul><li>Developing marketing mix </li></ul><ul><li>Conducting all the above to achieve organisational goals </li></ul>
  11. 11. SMART concept <ul><li>Objectives need to address the SMART concept: </li></ul><ul><ul><li>Specific </li></ul></ul><ul><ul><li>Measurable </li></ul></ul><ul><ul><li>Actionable </li></ul></ul><ul><ul><li>Realistic </li></ul></ul><ul><ul><li>Timetabled </li></ul></ul><ul><li>Ask the question: what is the company trying to achieve by going online? </li></ul>
  12. 12. Common Internet objectives <ul><li>Common Internet strategic objectives can include: </li></ul><ul><ul><li>Enhancing communications </li></ul></ul><ul><ul><li>Increasing online sales </li></ul></ul><ul><ul><li>Improving customer service </li></ul></ul><ul><ul><li>Increasing market share </li></ul></ul>
  13. 13. Web site and marketing <ul><li>Valuable for conveying information </li></ul><ul><li>Cost-effective in reaching target markets </li></ul><ul><li>Effective in obtaining consumer action </li></ul><ul><li>Ineffective for long- and short-term promotions </li></ul><ul><li>Not effective in grabbing attention </li></ul><ul><li>Less effective in relation to changing or maintaining attitudes </li></ul>
  14. 14. Online marketing objectives <ul><li>Cost-oriented objectives </li></ul><ul><li>Sales-oriented objectives </li></ul><ul><li>Behavioural change objectives </li></ul><ul><li>Information dissemination objectives </li></ul><ul><li>Promotional objectives </li></ul><ul><li>Entertainment-oriented objectives </li></ul>
  15. 15. Porter’s generic model Source: Viljoen, J. & Dann, S. 2003, Strategic Management: Planning and Implementing Successful Corporate Strategies , 5th edn, Addison-Wesley Longman, Sydney.
  16. 16. Strategic growth options <ul><li>Market penetration </li></ul><ul><li>Market development </li></ul><ul><li>Product development </li></ul><ul><li>Diversification </li></ul>
  17. 17. Strategic growth options (contd) Source: Brassington, F. & Pettitt, S. 1997, Principles of Marketing , Pitman Publishing, Melbourne.
  18. 18. Segmentation <ul><li>Sarabia (1996) suggests that segmentation can be broken into four tasks, namely: </li></ul><ul><ul><li>Describing the segments </li></ul></ul><ul><ul><li>Comparing the segment to the firm’s requirements </li></ul></ul><ul><ul><li>Selecting the most interesting segment </li></ul></ul><ul><ul><li>Making the marketing mix decisions. </li></ul></ul>
  19. 19. Information for online segmentation <ul><li>For online segmentation a marketer needs the following information: </li></ul><ul><ul><li>Online usage patterns </li></ul></ul><ul><ul><li>Internet experience </li></ul></ul><ul><ul><li>Familiarity </li></ul></ul><ul><ul><li>Usefulness of the site </li></ul></ul><ul><ul><li>Technical characteristic </li></ul></ul>
  20. 20. A four-stage analysis <ul><li>A four-stage analysis used to understand segmentation: </li></ul><ul><ul><li>Study the segment. </li></ul></ul><ul><ul><li>Analyse the firm in relation to the segment. </li></ul></ul><ul><ul><li>Analyse the effects of the firm’s decision about the segment. </li></ul></ul><ul><ul><li>Finally evaluate and construct an evaluation matrix. </li></ul></ul>
  21. 21. Positioning <ul><li>Positioning strategies are determined by aligning the company and the product offerings within the marketplace in relation to the other competitors and their products. </li></ul>
  22. 22. Positioning <ul><li>Generic positioning methods through: </li></ul><ul><ul><li>Attributes and benefits </li></ul></ul><ul><ul><li>Price quality </li></ul></ul><ul><ul><li>Use or application </li></ul></ul><ul><ul><li>Product class </li></ul></ul><ul><ul><li>Product user </li></ul></ul><ul><ul><li>Competitor positioning </li></ul></ul><ul><ul><li>Cultural symbol positioning </li></ul></ul>
  23. 23. Online branding <ul><li>Online branding begins with the domain name and the selection of a regional or global orientation. </li></ul><ul><li>For example, Procter & Gamble ( www.pg.com ) owns a range of brand name-specific domain names for its primary products, such as Vicks ( www.vicks.com ) and Pringles ( www.pringles.com ) </li></ul>
  24. 24. Online branding <ul><li>Brands also play a major role in the reduction of perceived risk associated with shopping online. </li></ul><ul><li>Also, branding web pages can be used to create, develop and maintain image associations with known (or soon-to-be-known) brands by careful site design and positioning. </li></ul>
  25. 25. Strategic integration <ul><li>Integration is where the marketing mix, positioning and strategic objectives are integrated into a single coherent outcome to be acted upon in the implementation. </li></ul><ul><li>The role of strategic Internet marketing is to bring the whole package together online and to enable the marketing mix, the web site, and the company’s on- and offline objectives to integrate smoothly for maximum benefits. </li></ul>
  26. 26. Integration for virtual branding <ul><li>The AIPD model </li></ul>Source: Simeon, R. 1999, ‘Evaluating domestic and international web site strategies’, Internet Research Electronic Networking Applications and Policy , vol. 9, no. 4, pp. 297–308.
  27. 27. Blueprinting <ul><li>Blueprint decisions are critical to overall organisational success. </li></ul><ul><li>They may cut across several product lines or divisional boundaries. </li></ul><ul><li>They frequently require the resolution of cross-functional conflict. </li></ul>
  28. 28. Budgeting <ul><li>Determining an Internet budget: </li></ul><ul><ul><li>Last year’s budget + increases </li></ul></ul><ul><ul><li>Based on percentage of company’s sales </li></ul></ul><ul><ul><li>Percentage of overall marketing budget </li></ul></ul><ul><ul><li>Reallocation of existing marketing budget </li></ul></ul><ul><ul><li>Competitors’ budgets and activities </li></ul></ul><ul><ul><li>Needs and creating an effective online presence </li></ul></ul><ul><ul><li>A graduated plan linked to results </li></ul></ul>
  29. 29. Unlocking the Internet’s potential <ul><li>View the Internet as an adjunct. </li></ul><ul><li>Use email strategically. </li></ul><ul><li>Crosspollinate. </li></ul><ul><li>Provide extra value. </li></ul><ul><li>Analyse content and use. </li></ul>
  30. 30. Unlocking the Internet’s potential (contd) <ul><li>Repurpose material. </li></ul><ul><li>Design with online in mind. </li></ul><ul><li>Plan frequent revisions. </li></ul><ul><li>Manage for the long term. </li></ul><ul><li>Set reasonable goals. </li></ul>
  31. 31. Discussion Questions for the Board <ul><li>Explain the importance of integrating the activities of the web site and Internet marketing into the organisation’s overall marketing strategy and business activities </li></ul><ul><li>Read &quot;The Future is Collaborative&quot; . </li></ul><ul><li>Do you agree or disagree with the author's position?  Give reasons and justifications for your position. </li></ul>

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