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E-Marketing

Basics Web Retailing 1-1 Marketing. E-Marketing. On-line Retailing Issues Product – what products are suitable? Software interface – ease of use, search time, help Process – how can the process be re-engineered? Pricing – willingness-to-pay Payment – which methods?

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E-Marketing

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  1. Basics Web Retailing 1-1 Marketing E-Marketing

  2. On-line Retailing Issues • Product – what products are suitable? • Software interface – ease of use, search time, help • Process – how can the process be re-engineered? • Pricing – willingness-to-pay • Payment – which methods? • Market penetration – build a loyal customer base

  3. Determinants of Customer Delivered Value Productvalue Services value Total customer value Personnel value Image value Customer delivered value Monetary cost Time cost Total customer cost Effort cost Psychic cost

  4. Individual Characteristics … … Environmental Characteristics … … Stimuli Marketing Others … … … … Buyer’s Decision … … Consumer’s Decision Making Process Vendor’s System Logistics Technical Customer Service … … … … … …

  5. Consumer Evaluation of Products Clothing Jewelry Furniture Houses Automobiles Restaurants Vacation Haircut Child care TV Repair Legal services Root canal Auto repair Medical Diagnostics Hard to evaluate Easy to evaluate Most goods Most services High in search quality High in experience High in credence

  6. What sells on the Internet?

  7. Consumer Adoption Process Adoption probability Early adopters 13.5% Early majority 34% Late majority 34% Innovators 2.5% Laggards 16% Time of adoption

  8. Deterrents to B2C

  9. Basics Web Retailing 1-1 Marketing E-Marketing

  10. Product/service search and discovery in the information space Comparison shopping and product selection based on various attributes Pre-purchase interaction Negotiation of terms, e.g., price, delivery times Placement of order Purchase consummation Authorization of payment Receipt of product Customer service and support (if not satisfied in X days, return product) Post-purchase interaction Consumer Mercantile Model

  11. Marketing Communication Objectives Effectiveness Low High Web? Mass ads Personal selling

  12. Conversion Process on the Web Surfers Include web address in broadcast ads; on product packaging, etc. Aware Surfers Active Info Seekers Passive Info Seekers Passives: Hot links, sponsored sites Actives: Multiple sites, speed, bandwidth Web Site Hits Make it an interesting visit; visual appeal - graphics, sound, video, ease of use Active Investigators Simplicity of establishing a dialogue, quality and speed of response More Dialogue Respond to dialogue; simplicity and security of ordering; order status. Purchase Exploit transaction database; purchase satisfaction and feedback. Re-purchase

  13. Measuring Effectiveness Awareness efficiency =People aware of site / People with Web access Attractability efficiency =Hits on site / People with Web access Contact efficiency = Active visitors / Hits on site Conversion efficiency = Purchases / Active visitors Retention efficiency = Repurchases / Purchases Web site efficiency Caching and undercounting

  14. 3rd Party Seal of Approval Vendor Reputation After-Sales Trust in Web-shopping Sales Activity Product Repeat Web Purchase (Brand Loyalty) Web-site Store Front Security System Reliability Speed of Operation Ease of Use Content, Quality Privacy Transaction Safety Format Timeliness Reliability Authentication Integrity Non-repudiation Completeness Model of Internet Consumer Satisfaction Customer Satisfaction

  15. Web Storefronts: Pros & Cons

  16. Focus of competition away from quality, features and service to price Dubious measures of sales (lower price inflates sales volume, some revenue in form of stocks of partner dot-coms) Wrong metrics (number of customers or site visitors) Lower estimation of costs (infrastructure needs, customer acquisition, employee compensation schemes) Business model not sustainable Some E-Tailing Fallacies

  17. Basics Web Retailing 1-1 Marketing E-Marketing

  18. Evolution of 1-1 Marketing • Mass Marketing: One price for all • Direct Marketing: Target market segments • Micro Marketing: Variable pricing for micro-segments • One-to-one Marketing: Unique pricing for individuals

  19. MASS MARKETING Average customer Customer anonymity Standard product Mass production Mass distribution Mass advertising Mass promotion One-way message Economies of scale Share of market All Customer Customer attraction ONE-TO-ONE MARKETING Individual customer Customer profile Customized market offering Customized production Individualized distribution Individualized message Individualized incentives Two-way messages Economies of scope Share of customer Profitable customers Customer retention

  20. Customer Relationship ManagementIntegrated sales, service and marketing intelligence

  21. Identify customers Collect more customer names Collect more customer information Verify and update customer data Differentiate customers Who are the top customers? Who’s unhappy? Who’s buying less? Who’s missing in the list? Which customers drain your resources? Rank customers into A, B and Ccategories One-to-one Marketing: Steps

  22. Interact meaningfully Just call top 2-3 people at 5% customers Call your company / competitor posing as a customer Evaluate paper / voice / email communication Customize your behavior Customize / personalize communication Find what / how often customers want to hear from you Ask top ten customers what they want One-to-one Marketing: Steps (continued)

  23. 1. Search: Help customer find your product 2. Selection: Assist customers choosing your products Customer Resources Life Cycle 3. Acquisition: Help buy 6. Repurchase / Disposal 5. Stewardship: Inform about offerings 4. Use: Making best use

  24. Online Market Research for EC

  25. Internet only approach may be limited Web can cut costs, enhance customer satisfaction, may produce new revenue On-line market research is one alternative Key Points

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