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Taking Online Marketing To The Customer


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Presentation to the Advertising & Marketing Summit - May 2005

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Taking Online Marketing To The Customer

  1. 1. taking online marketing to the customer getting your customers to interact, and to return to you, again and again Thom Poole Head of Portal Customer Interaction © Thom Poole 2005 Advertising & Marketing Summit 2005
  2. 2. taking online marketing to the customer getting your customers to interact, and to return to you, again and again Thom Poole May 2005 © Thom Poole 2005 Advertising & Marketing Summit 2005
  3. 3. agenda <ul><li>the internet as a business tool </li></ul><ul><li>benefits of entering an online market </li></ul><ul><li>entering a maturing online marketplace </li></ul><ul><li>relationships, trust and repeat business </li></ul><ul><li>recognising the online growth opportunities </li></ul><ul><li>integrated marketing is the way forward </li></ul>
  4. 4. why i’m here <ul><li>web & e-marketing trailblazer since 1992 </li></ul><ul><li>taught e-marketing for 7 years </li></ul><ul><ul><li>e-commerce </li></ul></ul><ul><ul><li>web design for marketers (and the terrified!) </li></ul></ul><ul><ul><li>CRM </li></ul></ul><ul><li>written papers on ‘data privacy’ , ‘the marketing art of the opt-in’ and ‘trust in business and marketing’ </li></ul><ul><li>written a book on ‘ethical e-marketing’ called ‘Play It By Trust’ </li></ul><ul><li>head of portal customer interaction at O 2 – focus on customer centricity and ethics </li></ul>
  5. 5. the internet as a business tool <ul><li>“ the ‘net is a waste of time, and that’s exactly what’s right about it.” </li></ul><ul><li>William Gibson </li></ul>1 © Thom Poole 2005
  6. 6. the internet as a business tool <ul><li>the origins of the internet are as a military and academic tool </li></ul><ul><li>early view: </li></ul><ul><ul><li>“ the internet is a great medium for information, but i don’t know how anyone can make any money from it” (Poole, 1992) </li></ul></ul><ul><li>an ideal source of competitor, supplier and marketing information </li></ul><ul><li>an ideal communications medium, with a healthy mix of push and pull marketing </li></ul><ul><li>has expanded the boundaries of business and trade </li></ul><ul><li>has increased the speed at which we do business </li></ul>
  7. 7. what is it? <ul><li>brochureware </li></ul><ul><li>sales </li></ul><ul><li>support </li></ul><ul><li>administration </li></ul><ul><li>procurement </li></ul><ul><li>education </li></ul><ul><li>training </li></ul><ul><li>tracking </li></ul><ul><li>entertainment </li></ul><ul><li>information/news </li></ul>
  8. 8. benefits of entering an online market <ul><li>“ when i took office, only high-energy physicists had ever heard of what is called the world wide web.... now even my cat has its own page </li></ul><ul><li>Bill Clinton, announcement of next generation internet initiative, 1996 </li></ul>2 © Thom Poole 2005
  9. 9. why go online? <ul><li>you’ve got spare cash </li></ul><ul><li>your customers demand it </li></ul><ul><li>it fits with the marketing communications strategy </li></ul><ul><li>it seems like a good idea </li></ul><ul><li>everyone else is online </li></ul>Except the cat …
  10. 10. online market benefits <ul><li>lower cost – “an average online retailer requires three purchases to break even on the acquisition of each new customer” – Kate Delhagen, 2000 also, servicing/distribution/support costs are considerably lower than any other medium </li></ul><ul><li>loyalty – online customers are promiscuous, but look at Amazon’s or Google’s loyalty ratings? </li></ul><ul><li>communication – interaction offers opportunities to educate your customers and to learn from them </li></ul><ul><li>control – direct selling rather than through 3 rd parities, e.g. airlines </li></ul><ul><li>speed to market – a global market </li></ul>
  11. 11. talking to your customers <ul><li>52% of all UK households have access to the internet (12.9 million) </li></ul><ul><li>61% of UK adults accessed the internet in Q3/4 2004 </li></ul><ul><li>55% of UK adults bought products on the internet in Q3/4 2004 </li></ul><ul><li>77% of UK SME’s are connected to the internet in some way or another </li></ul>( FSB study 2003 )
  12. 12. entering a maturing online marketplace <ul><li>“ advertising may be described as the science of arresting the human intelligence long enough to get money from it “ anon </li></ul><ul><li>… so what does that mean in the online world, where the attention span is comparable to the memory span of a goldfish? </li></ul>3 © Thom Poole 2005
  13. 13. market entry strategies <ul><li>can you be the cheapest online? </li></ul>competitive advantage 1. cost leadership 2. differentiation 3a. cost focus lower cost differentiation broad target narrow target competitive scope Porter, 1985 no? <ul><li>can you differentiate? </li></ul>3b. differentiation focus <ul><li>can you provide the best service? </li></ul><ul><li>can you provide the best quality? </li></ul><ul><li>are you the recognised leaders, offline? </li></ul><ul><li>do you have a substantial ‘network’ offline? </li></ul>
  14. 14. recommendations <ul><li>adhere to the standards set by your competitors / the industry as a minimum </li></ul><ul><li>deliver on your promises </li></ul><ul><li>be accessible, user-friendly and intuitive </li></ul><ul><li>let quality be the main differentiator if you can’t lead in any other way </li></ul><ul><li>look at other online business models, especially the online-only models </li></ul><ul><li>demonstrate a trusted personality on- and offline </li></ul>
  15. 15. relationships, trust and repeat business <ul><li>“ how could we get past the catch 22 at the start of every relationship – i don’t know you, so why should i trust you? </li></ul><ul><li>as well as being involving, dialogue also has a powerful side effect – it builds trust “ anon </li></ul>4 © Thom Poole 2005
  16. 16. CRM in real-time <ul><li>CRM is making a comeback, with emphasis on online and real-time decision making </li></ul><ul><li>predictive sharing of information with customers, and intuitive cross- and up-selling </li></ul><ul><li>‘people buy from their friends’ </li></ul><ul><li>relationships imply trust, and trust will bring your customers back, again and again </li></ul>
  17. 17. friendship = trust <ul><li>‘ people buy from their friends’ </li></ul><ul><li>trust builds loyalty </li></ul><ul><li>trust will drive profit </li></ul>Trust-focused value chain (adapted from Porter, 1998)
  18. 18. trust lifecycle Poole (2005) adapted from Reynolds (2000)
  19. 19. asymmetric information flow Spremann, 2001
  20. 20. recognising the online growth opportunities <ul><li>“ in the modern world of business, it is useless to be a creative original thinker unless you can also sell what you create. </li></ul><ul><li>management cannot be expected to recognise a good idea unless it is presented to them by a good salesman” </li></ul><ul><li>David Ogilvy </li></ul>5 © Thom Poole 2005
  21. 21. growth opportunities existing products new products existing markets new markets market penetration product development market development diversification From Ansoff, 1957 entering the online market building an online market be different
  22. 22. integrated marketing is the way forward <ul><li>“ marketing is about selling dreams ” </li></ul><ul><li>anon </li></ul>6 © Thom Poole 2005
  23. 23. rules for integrated marketing <ul><li>accept that not all customers will see or want to see all channels </li></ul><ul><li>consistency </li></ul><ul><li>multi-channel response mechanisms </li></ul><ul><li>be a trusted partner on- and offline – being trustworthy is profitable </li></ul><ul><li>define the rules, and then bend them as far as they will go where necessary </li></ul><ul><li>make online as simple as possible – accessibility isn’t just for DDA compliance </li></ul>
  24. 24. summary 7 © Thom Poole 2005
  25. 25. summary <ul><li>build trust to engage with customers </li></ul><ul><li>do at least what your competitors are doing </li></ul><ul><li>understand why you are online and for whom </li></ul><ul><li>identify the benefits and measure what you are getting from it </li></ul><ul><li>be consistent on- and offline </li></ul><ul><li>empower the customer – let them think they are in charge </li></ul><ul><li>give your customers a reason to come back, and to spend their money </li></ul><ul><li>don’t let technology dictate your marketing – it’s a tool </li></ul>
  26. 26. Thom Poole Head of Portal Customer Interaction [email_address] taking online marketing to the customer thank you © Thom Poole 2005