The E Marketing Mix

7/28/2019 The E Marketing Mix

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Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.1

The e-Marketing Mix

Creating value


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Learning objectives

Apply the elements of the marketing mix in an

online context;

evaluate the opportunities that the Internet

makes available for varying the marketing mix;

define the characteristics of an online brand.


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The marketing mix

In 1963 Bartels said:

a marketer is like a chef in a kitchen a mixer of

ingredients

Variables used to define key elements of marketingstrategy

From the 4Ps of Jerome McCarthy to the 7Ps of

Booms and Bitner sometimes referred to as the

services mix 4Ps Product, Price, Place, Promotion

7Ps add People, Processes and Physical Evidence


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The Offering

OFFERING

Product, packaging, service and brand

What do you have to OFFER the customer?

What does this OFFER to other stakeholders

in the value chain?


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The 4Ps and the 4Cs

Product

Price

Place

Promotion

Customer needs

and wants

Customer

convenience

Communications

with

company

Cost


7/29Chaffey: Internet Marketing, 2nd edition Pearson Education Limited 2003OHT 5.7

Mixing the mix online

Which variables are important for the ideal

customer?

Price and quality?

Where they buy?

You need to decide on target markets first and

do the research on the mix variables

Remember the mix is not generic for allcustomers, but for segments



The elements of the marketing mix

Figure: The elements of the marketing mix



Product introduced

The element of the marketing mix thatinvolves researching customers needs anddeveloping appropriate products

Core product The fundamental features of the product that

meet the users needs.

Extended product

Additional features and benefits beyond thecore product.



Extended product options

Examples:

Add-on services gift wrapping @ Amazon

Endorsements

Awards

Testimonies

Customer lists

Customer comments Warranties

Guarantees

Money back offers

Customer service (see people, process and physicalevidence)

Incorporating tools to help users during their use of theproduct

Information extranets



Brands

A brand is described by Leslie de Chernatonyand Malcolm McDonald in their classic book1992 book Creating Powerful Brands as

an identifiable product or service augmentedin such a way that the buyer or userperceivesrelevantun ique added values

which match their needs most closely.Furthermore, its success results from beingable to susta inthese added values in the faceof competition.



Identity

vs.

Image

How we see ourselves... How others see us...

Branding Strategy


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Web sites as BRANDS

What is your company withoutits Website?

Amazon.com = NOTHING

Aftonbladet.se = STILL A NEWSPAPER

BRAND LADDER: Corporate brand/Product/Service/People (CEO)

Brand Image vs. Brand Identity

Websites serve many segments

-Employees (Intranet)

-Partners/Suppliers (Extranet)-Media

-Students/Educators

-Shareholders

-Customers

-Competitors


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Building brand (Website) loyalty

Brands are l ike peopleeach has:A name

A look (packaging)

A demographic description

A personality

A branding auditcan provide a look at your corporate/brand/Website imageCopyright 2000TimFoster

ALL RIGHTSRESERVED

5-point scale:verensstmmer inte alls (1) (2) (3) (4) (5) verensstmmer helt

How the study worked...

5 dimension15 facets

77 adjectives

UPPRIKTIGHET-Jrdnra-rlig-Sund-Munter

SPNNANDE-Djrv-Livfull-Fantasifull-Modern

KOMPETENT-Plitlig-Intelligent-Framgngsrik

SOFISTIKERAD-verklass

-Charmig

ROBUST-Friluftaktig

-Envis/seg

Copyright 2000TimFosterALLRIGHTSRESERVED

1

2

3

4

5

IMAGE: Informationsteknik/IT

Uppriktighet

Spnnande

Kompetent

Slitstark/Robust

Sofistikerad

(3.5)

(3.1)

(2.6)

(3.4)(1.9)

POSITIONERING:Mlgrupper:ITfretag, nya fretag, SMEsFrdelar:Sommar, universitet, sport, havetTillfllen: Mssor, turism, sport, universitetKonkurens:Ume, Stockholm, Sundsvall, UleborgPos./Neg: Stlstad, ITpotential

BASICFACTS:Avg. Employees: 199Avg. Revenue:168.1 MkrAvg. Year established: 1990Typical form:ABAge range:30-44 (5), 45-59(4)

0


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Brands online

Dayal et al. (2000) say, on the world wide web, the brand

is the experience and the experience is the brand.

The promise of convenience making a purchaseexperience more convenient than the real-world (or forrivals).

The promise of achievement to assist consumers inachieving their goals, for example supporting onlineinvestors in their decision or supporting business people

in their day-to-day work.


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Brands -cont.-

The promise of fun and adventure this is clearly morerelevant for B2C services.

Is it???

The promise of self-expression and recognition providedby personalization services such as Yahoo! Geocities

where consumers can build their own web site.

The promise of belonging provided by onlinecommunities (Plus trust and reassurance).


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Online brand options

1. Migrate traditional brand online.

2. Extend traditional brand: variant.

3. Partner with existing digital brand.

4. Create a new digital brand.


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Price implications

View 1 decreased prices inevitable Price transparency

Customer knowledge increases

Price reduction and standardization

View 2 decreased prices unnecessary 89% purchase books from first site

Only 10% are aggressive bargain hunters

For corporate buyers internal changes aremain benefit


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Differential pricing

Options reduce or transfer. Other options Precision

Setting prices more accurately through testing(price indifference band)

Adaptability Rapid changes (dynamic pricing).

e.g. Concert tickets

Segmentation Different charges according to profiling


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MANY WAYS TO PRODUCE REVENUE ONLINE

Purchase

Rental or subscription

Pay per use

Online advertising sales

(banners, pop-ups)

SPAM (junk e-mail)


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Pricing options

Cost-plus

Add profit margin to operational costs

Target profit pricing

Based on breakeven

Competition-based pricing

Market-oriented

Premium-pricing

Penetration pricing


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Evans and Wurster view of place

Reach: This is the potential audience of the e-commerce site. Reach

can be increased by moving from a single site to representation with alarge number of different intermediaries. Allen and Fjermestadsuggest that niche suppliers can readily reach a much wider marketdue to search engine marketing

Richness: This is the depth or detail of information which is bothcollected about the customer and provided to the customer. This isrelated to the product element of the mix.

Affi l iat ion: This refers to whose interest the selling organizationrepresents consumers or suppliers. This particularly applies to

retailers. It suggests that customers will favor retailers who providethem with the richest information on comparing competitive products.


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Place 2 new channel structures

A. Distintermediation

B. Reintermediation

C. Countermediation


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Place 3 channel conflicts

Dependent on:

1.A communication

channel only.

2.A distribution channelto intermediaries.

3. A direct sales channel

to customers.

4.Any combination of theabove.


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Place 4 virtual organizations what are they?

Kraut et al. (1998) suggest the following features of a virtualorganisation:

Processes transcend the boundaries of a single form and are notcontrolled by a single organizational hierarchy.

Production processes are flexible, with different parties involved atdifferent times.

Parties involved in the production of a single product are oftengeographically dispersed.

Given this dispersion, co-ordination is heavily dependent ontelecommunications and data networks.


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Promotion

Promotion unfortunately has a range of meanings. It

can be used to describe the marketing

communications aspect of the marketing mix or, more

narrowly, as in sales promotion. In its very broad

sense it includes the personal methods of

communications, such as face to face or telephone

selling, as well as the impersonal ones such as

advertising. When we use a range of different types

of promotion direct mail, exhibitions, publicity, etc

we describe it as the promotional mix.Wilmshurst (1993)


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Promotion tools

1 Advertising (broadcast, print, outdoor)

2 Sales promotion (prizes, gifts, contests)

3 Personal selling (face-to-face or voice-to-voice)

4 Public relations (relationship & communication

with important publics)

5 Direct marketing (SPAM, pop-ups, offers)


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Options for replacing people Autoresponders: These automatically generate a response when a company

e-mails an organization, or submits an online form.

E-mail notification: Automatically generated by a companys systems toupdate customers on the status of their order, for example, order received,item now in stock, order dispatched.

Call-back facility: Customers fill in their phone number on a form and specifya convenient time to be contacted. Dialing from a representative in the callcentre occurs automatically at the appointed time and the company payswhich is popular.

Frequently Asked Questions (FAQ): For these, the art is in compiling andcategorizing the questions so customers can easily find (a) the question and(b) a helpful answer.

On-site search engines: These help customers find what theyre looking forquickly and are popular when available. Site maps are a related feature.

Virtual assistants: Come in varying degrees of sophistication and usually helpto guide the customer through a maze of choices.


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Ch ff I t t M k ti 2 d diti P Ed ti Li it d 2003OHT 5 29

Methods of managing inbound contacts

Customer defines

Receipt &acknowledgement

Routeing

Response

Follow-up

Make contact point clear

Use FAQ to reduce enquiries (Measure)

Use drop down lists to categorize query

Use autoresponse with service promise

(number of hours)

Give alternative information source

(phone or web page)

Large organizations use intelligent software tocategorize and prioritize messages and

forward them to relevant staff

Use templates for common responses

Answer ALL of the questionsAdd question to knowledge base

Offer callback or follow up for key enquiries

Use phone if e-mail is not solving problem

The E Marketing Mix

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