Info

Improve branding metrics such as: brand awareness, reach, brand favourability and purchase intent

Source: Smith and Chaffey, 2005

2 Services-oriented relationship-building web site

Provides information to stimulate purchase and build relationships. Products are not typically available for purchase online. Information is provided through the web site and e-newsletters to inform purchase decisions. The main business contribution is through encouraging offline sales and generating enquires or leads from potential customers. Such sites also add value to existing customers by providing them with detailed information to help them support them in their lives at work or at home.

Visit these examples: B2B management consultants such as PricewaterhouseCooper (www.pwcalobal.com) and Accenture (www.accenture.com), B2C portal for energy supplier British Gas (www.house.co.uk).

3 Brand-building site

Provide an experience to support the brand. Products are not typically available for online purchase. Their main focus is to support the brand by developing an online experience of the brand. They are typical for low-value, high-volume fast-moving consumer goods (FMCG) brands for consumers.

Visit these examples: Tango (www.tanao.com), Guinness (www.auinness.com).

Brochureware site

A simple site with limited interaction with the user that replicates offline marketing literature.

Stage models

Models for the development of different levels of Internet marketing

Transactional sites

Sites that support online sales.

4 Portal or media site

Provide information or news about a range of topics. 'Portal' refers to a gateway of information. This is information both on the site and through links to other sites. Portals have a diversity of options for generating revenue including advertising, commission-based sales, sale of customer data (lists).

Visit these examples: Yahoo! (www.yahoo.com) (B2C) and Silicon (www.silicon.com) (B2B).

Each of these different types of sites tend to increase in sophistication as organisations develop their Internet marketing. Many organisations began the process of Internet marketing with the development of web sites in the form of brochureware sites or electronic brochures introducing their products and services, but are now enhancing them to add value to the full range of marketing functions. In Chapters 2 and 4 we look at stage models of the development of Internet marketing services, from static brochure-ware sites to dynamic transactional sites that support interactions with customers.

A powerful method of evaluating the strategic marketing opportunities of using the Internet is to apply the strategic marketing grid of Ansoff (1957) as discussed in the strategy formulation section of Chapter 4 (Figure 4.10). This shows how the Internet can potentially be used to achieve four strategic directions:

1 Market penetration. The Internet can be used to sell more existing products into existing markets.

2 Market development. Here the Internet is used to sell into new geographical markets, taking advantage of the low cost of advertising internationally without the necessity for a supporting sales infrastructure in the customers' countries.

3 Product development. New products or services are developed which can be delivered by the Internet. These are typically digital products.

4 Diversification. In this sector, the Internet supports selling new products which are developed and sold into new markets.

As well as assisting large corporate organisations develop their markets, perhaps the most exciting potential of the Internet is to help small and medium enterprises (SMEs) expand. Read Mini Case Study 1.1 'North West Supplies extends its reach online' which also illustrates some of the challenges of managing an online business and highlights the need for continual investment.

Mini Case Study 1.1

North West Supplies extends its reach online

NWS commenced operations in March 1999 when Andrew Camwell, a member of the RAF Volunteer Reserve at the time, spotted a gap in the UK market for mail-order supplies of military garments to people active in the Volunteer Reserve and the Air Cadet Force. Andrew, his wife Carys, and her sister Elaine Hughes, started running a mail-order business out of shop premises in the village of Cemaes Bay.

The web store at www.northwestsupplies.co.uk has been on-line since November 2002. As it can take several months for a web site to be indexed by search engines, NWS used pay-per-click advertising (PPC - see Chapter 8) as a method of very quickly increasing the web site's presence in the major search engines. This marketing method proved successful. The directors were pleasantly surprised as they had previously been somewhat dubious about the prospect of the Internet generating sales in their sector. Within six months of running the web site, the company had increased turnover by £20,000, but further advances would incur a high advertising cost. Following an eCommerce Review by Opportunity Wales, the company decided to tackle the issues by implementing search engine optimisation (SEO - see

Chapter 8) and a site re-design which included:

• Improved graphic design - this was to be changed to a more professional and up-to-date look.

• Best, featured and latest products - the introduction of a dynamic front page to entice customers to re-visit the site on a regular basis. The contents of this page would feature the best sellers, and latest or featured products.

• Reviews and ratings - to provide confidence to consumers and allow some kind of interaction with them, which would allow users to review products they have purchased and give them a star rating.

• Cross-selling - when customers view a product there may be other products or categories that may be of interest or complementary, hence there was a proposal to allow staff to link products and categories so that these would be displayed.

• Segmentation - the site would be split into two sections emphasising the segmentation of product lines into military wear and outdoor wear sectors, thus being less confusing, and easier to use for the respective users (see Figure 1.8 under 'Best, featured and latest products').

• Navigation by sub-categories - as the product range had expanded, the additional pages created in each category made it harder for customers to find specific items or have to browse many pages before finding a suitable product. The introduction of sub-categories would provide a clear link to the areas of interest and contain fewer pages to browse thus helping the customer to make a choice more easily and more quickly. A new search tool and order tracking were also seen as important parts of the online customer experience (Chapter 8).

Figure 1.8 North West Supplies Ltd site (www.northwestsupplies.co.uk)

Source: Opportunity Wales

Figure 1.8 North West Supplies Ltd site (www.northwestsupplies.co.uk)

Source: Opportunity Wales

Benefits

The owners describe the benefits of the improvements to the site as follows:

• Increased Direct Sales - 'The new launch increased sales and appealed to a broader audience -young and old'. The annual turnover of the business has increased from £250,000 to £350,000 and this is mainly attributable to the new web site. The high profile launch aimed at existing customers, the greater visibility in search engines, and the greater usability of the site have all contributed to this.

• Improved Promotion of the Whole Range of Stock - 'We started selling stuff that we hadn't sold before'. The changes in navigation, particularly division into two market segments (military and outdoors) and greater use of sub-categories, meant that products were easier to find and hence easier to buy, leading to increased sales of products that had previously been slow sellers.

• New Customers - 'We now send more items abroad'. The better performance of the site in search engines has led to an increase in orders from new customers and from abroad. The company now has regular sales to Canada, Australia, New Zealand and various European states. 60% of orders are from new customers - not bad for a business that initially set up on the premise of a niche market for UK based cadet forces.

• Adding Value to the Brand - 'New corporate clients could look at our Web site and see we weren't fly-by-night and that we meant business'. Improvements to the design have raised confidence levels in visitors and this has led to increased sales. But perhaps more significantly, the professional image of the site was a good boost to confidence for potential business partners in the emerging business-to-business division that started to trade as North Star Contracts.

A strategic approach to Internet marketing

To realise the benefits of Internet marketing that we have described, an organisation needs to develop a planned, structured approach. As we will see in Chapter 4, which covers Internet marketing strategy, there are many risks if an ad-hoc rather than strategic approach to managing online channels is used. Some of the problems that we have commonly seen in organisations are:

• Unclear responsibilities for the many different Internet marketing activities shown in Figure 1;

• No specific objectives are set for Internet marketing;

• Insufficient budget is allocated for Internet marketing as customer demand for online services is underestimated and competitors potentially gain market share through superior online activities;

• Budget is wasted as different parts of an organisation experiment with using different tools or suppliers without achieving economies of scale;

• New online value propositions for customers are not developed since the Internet is treated as 'just another channel to market' without review of opportunities to offer improved, differentiated online services;

• Results from digital marketing are not measured or reviewed adequately, so actions cannot be taken to improve effectiveness;

• An experimental rather than planned approach is taken to using e-communications with poor integration between online and offline marketing communications.

Consequently, this book defines a strategic approach to Internet marketing which is intended to manage these risks and deliver the opportunities available from online channels. In Figure 1.9 we suggest a process for developing and implementing an Internet marketing which is based on our experience of strategy definition in a wide range of companies. This diagram highlights the key activities and their dependencies which are involved for creation of a typical Internet marketing. The purpose of strategic Internet marketing activities and the main point at which these topics are covered in this book are as follows:

A Defining the online opportunity

Setting objectives to define the potential is the core of this phase of strategy development. Key activities are:

• 1. Set e-marketing objectives (Chapter 4): Companies need to set specific numerical objectives for their online channels and then resource to deliver these objectives. These objectives should be informed by and influence the business objectives and also the following activities:

• 1.a. Evaluate e-marketing performance (Chapters 4 and 9): Applying web analytics tools to measure the contribution of leads, sales and brand involvement currently delivered by online communications such as search engine marketing, online advertising and email marketing in conjunction with the web site.

• 1.b. Assess online marketplace (Chapters 2, 3 and 4): Situation analysis reviewing the micro-environment (customers, competitors, intermediaries, suppliers and internal capabilities and resources) and the broader macro-environment which influences strategy such as legal requirements and technology innovation.

B Selecting the strategic approach

• 2. Define e-marketing strategy (Chapter 4): Select appropriate strategies to achieve the objectives set at stage A1.

• 2a. Define customer value proposition (Chapters 4 to 7): Define the value proposition available through the online channel and how it relates to the core proposition delivered by the company. Reviewing the marketing mix and brand values to evaluate how they can be improved online.

• 2b. Define e-communications mix (Chapters 4 and 8): Selecting the offline and online communications tools to encourage usage of an organisation's online services and to generate leads and sales. Developing new outbound communications and event-triggered touch strategies to support customers through their relationship with the company.

C Delivering results online

• 3. Implement e-marketing plan (Part 3): This details the implementation of the strategy.

• 3a. Implement customer experience (Chapter 7): Build the web site and create the e-mail marketing communications' which form the online interactions customers make with a company. Create online customer relationship management capabilities to understand customers' characteristics, needs and behaviours and to deliver targeted, personalised value (Chapter 6).

• 3b. Execute e-communications (Chapter 8): Managing the continuous online marketing communications such as search engine marketing, partnerships, sponsorships and affiliate arrangements and campaign-based e-marketing communications such as online advertising, e-mail marketing and microsites to encourage usage of the online service and to support customer acquisition and retention campaigns. • 4. Customer profiling (Chapter 6), monitoring and improving online activities and maintaining the online activities (Chapter 9): Capturing profile and behavioural data on customer interactions with the company and summarising and disseminating reports and alerts about performance compared with objectives in order to drive performance improvement.

You will see that in the process diagram, Figure 1.9, many double-headed arrows are used, since the activities are often not sequential, but rather inform each other, so activity 1, set e-marketing objectives, is informed by the activities around it, but may also influence them. Similarly, activity 4, profile, measure and improve, is informed by the execution of online activities, but there should be a feedback loop to update the tactics and strategies used.

A. Defining the online opportunity

B. Selecting the strategic approach

C. Delivering results online

Business objectives

) k > r a. Evaluate e-marketing performance

1. Set e-marketing objectives

SEO Guide for Top Rankings

SEO Guide for Top Rankings

Search engines are special sites on the web that are designed to help people find information stored on other sites. There are differences in the ways various search engines work. Learn more about this topic within this guide.

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