marketing on the web – part 1 mgmt 230 week 8. this class will cover… the impact of the internet...
TRANSCRIPT
Marketing on the Web – Part 1
MGMT 230WEEK 8
This class will cover…
• The impact of the Internet on the marketing mix
• The internet marketing toolbox– Pay-per-click advertising on search engines– Social media marketing overview
General aims of Web marketing: Acquisition, Conversion, and Retention of Customers
• The first step in doing business on the Web is to ACQUIRE or draw visitors to the site itself – driving traffic
• The second step is CONVERTING those first time visitors into customers by persuading them to make a purchase or register with the site, etc.
• Customers who return to the site one or more times after making their first purchases are RETAINED customers (site stickiness is important).
The 4Ps of the marketing mix in transition
The impact of the Internet on the traditional marketing mix framework
• Product – new products, the rise of the “prosumer”
• Price – dynamic pricing, comparison pricing, bidding……..FREE!
• Place – direct distribution of digital products, supply chain management, channel integration
• Promotion – new social and communications media, measurable advertising
• Strong trend towards personalization and away from the mass (undifferentiated) market affecting all the elements of this framework
• The Six “I”s Framework– Interactivity– Intelligence (market)– Individualization– Integration– Industry restructuring– Independence of
location
MacDonald and Wilson. The New Marketing, 2002
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Interactivity• The internet is not TV
• Conversation, not broadcast
• Pull, not push
• Active rather than passive (lean-forward medium)
• Social Networking / User Generated Content / Web 2.0
Source: eMarketing eXcellence. 2012. Smith &Chaffey
[Market] Intelligence
• By the very act of using the internet, we are “telling” marketers what we want:• Passively
• Clickstream data• Web analytics
• Actively• Social network updates, photos, videos, reviews, forum
postings etc
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Individualization
• The market of one: based on the information about customers that we provide, and that is collected automatically and monitored constantly
• Amazon for example
Traditional media
Same message to all customers or segments
New
media
Message tailored to each customer or micro-segment
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Integration
• Online marketing is very readily integrated into a marketing communications strategy
• Web channels complement and integrate with offline marketing channels– EXAMPLES?
• Call a customer service rep for assistance• Movie trailers on YouTube
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Industry restructuring and Independence of location
INDUSTRY RESTRUCTURING• Disintermediation –
traditional intermediaries used by marketers disappearing
• Re-intermediation new intermediaries (eg. PayPal)
• Business models challenged
LOCATION INDEPENDENCE
• Increased reach to global markets
• Increased exposure
• Increased competition
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Product trends online
• Digital value – adding value to products through online means
• Digitization – product or place?
• Personalization – individualized products and the “prosumer”
Product
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Digital goods distribution
• Any product that can be digitized can be delivered over the Internet
• Online distribution costs are significantly lower– No inventory problems– No product depletion
• Completely new business models based on digital distribution methods
• Internet becomes a direct substitute for an offline distribution channel eg. online banking
Place
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Some industries that are undergoing rapid change due to Internet forces affecting
product and place
• Recorded Music industry• Video/DVD rental industry• Newspaper and magazine publishing• Banking• Book publishing / Textbook publishing
• Forces for change:– Digitizable product– Self service – Direct to consumer shift– Personalization
Place
Product
Pricing
• Internet influences – buyer and seller perspectives of price
• Moving from free to fee (and freemium)• Price comparisons / transparency• Choice!• Dynamic pricing
Price
Source: eMarketing eXcellence. 2012. Smith &Chaffey
Online promotion
• There are many new techniques available to marketers to promote goods and services online
• Permission marketing• The big value of internet marketing for
promotion – ability to measure results and therefore performance based
Promotion
Source: eMarketing eXcellence. 2012. Smith &Chaffey
THE INTERNET MARKETING TOOLBOX – OWNED, EARNED, AND PAID MEDIA
Own Website
Analytics, Datamanagement
Law, Regulation,ethics
Planning and management
Demographics Market research
Being found
Domains, usernames,
hashtags
Content & technologiesText, video,
images, AR, VR
Social media
(owned &
earned)
Advertising
Email / messaging
The big picture of internet marketing
The internet marketing
toolbox
Blogging
Mobile
General social
networks
Niche social networks
Search engine optimization
AR, VReMail
Search advertising
Interactive display
advertising
Video
The internet marketing toolbox
Owned, earned, and paid media
• Owned media: “media owned by the brand. Online this includes a company’s own websites, blogs, mobile apps or their social presence on Facebook, LinkedIn or Twitter [etc]” Dave Chaffey
• Earned media: “Earned media also includes word-of-mouth that can be stimulated through viral and social media marketing and includes conversations in social networks, blogs and other communities.” Dave Chaffey
• Paid media: “media where there is investment to pay for visitors, reach or conversions” Dave Chaffey
Owned, earned and paid media: role, benefits & challenges
http://www.smartinsights.com/digital-marketing-strategy/customer-acquisition-strategy/new-media-options/
SEARCH ENGINE ADVERTISING (PAY PER CLICK) – “PAID MEDIA”
Search engine marketing – 2 major methods
Search engine marketing is the umbrella conceptOBJECTIVE IS TO BE IN THE TOP FEW SEARCH RESULTS
1. Search engine optimization (SEO) – relies on the content of web pages plus inbound link quality – called organic positioning (we looked at this in Week 4)
2. Search engine advertising: Pay-Per-Click (Today’s class)
BOTH RELY ON THE CONCEPT OF KEYWORDS / PHRASES
Paid listings (advertisements)
Organic listings
Internet advertising formats (IAB report for 2014)
Search engine advertising – why is it so popular with marketers?
• Search engines allow marketers to bid on specific key words - ie. buy their way to the top
• Performance model is attractive (no clicks on the ad, no payment for the ad)
• Less consumer resistance that other forms of advertising (but remember that the click-through-rate is still quite low – around 2%)
• Print directory versus search advertising for SME?– Effectiveness can be directly measured– Speed of execution and “tweaking” of advertising copy– Speed of consumer response– Usually more cost-effective
The importance of keywords / key phrases in PPC advertising
• Keywords are the search terms people type into search engines
– in search engine advertising the keywords / key phrases are the terms that “trigger” the advertising when someone types them into the search box (the page must be relevant to the keywords or Google will regard it as deceptive advertising)
• The concept of the “landing page”
Bidding on keywords: how search engine advertising works
• The position of the ad on the page is not just related to the bid price, and is not decided in advance
• At the moment a person types in a search query and presses enter a real-time auction takes place to decide the position of the ad– Google uses a combination of the bid price or cost
per click (CPC) and the ad relevancy or click-through rate (CTR) - the “Quality Score”• CPC x CTR = Google AdRank
Understanding Ad Rank • Geo-targeting (language and location)• Setting a daily budget
Not just search results pages
• PPC advertisements purchased from search engines also appear across their advertising networks – These ads are triggered in a different way
• Google Adsense is for publishers
One of the problems with PPC advertising? Click fraud
• Two main types of click fraud:– Search engine click fraud: artificially raising a competitor’s marketing
costs or exhausting their budget to remove them from their position in the listings (usually on very high cost or competitive key terms)
– Publisher click fraud: artificially raising a publisher’s income from AdSense
• Estimated 10% to 15% of ad clicks are fake, representing roughly $1 billion in annual billings (Business Week, 2006).
• Search firms have put tools in place to detect and prevent click fraud (but have still been sued by advertisers)
• Where are we now with click fraud? • Mobile clicks in error are now an increasing problem• Display advertising is now the target of massive ad fraud (we will talk about this
next week)
Paid search versus SEO
Paid search• Results can be seen immediately
through increased traffic.
• But : no spending = no results
• Greater control over which keywords are most associated with their company, brands, products or services.
• Additional metrics are available, which means more detailed Web analytics that yield sophisticated knowledge from the data.
SEO• Results are gradual – can take months• But the results can persist –
maintaining position over time• Searchers find it more acceptable
than advertising• Can be complex and may require
external expertise• One process – many results (tends to
bring results across many search engines, not just one)
http://www.iab.net/insights_research/947883/1675/708987
DO BOTH!
Google local business listings (not SEO)
• Very important for local businesses to keep their information updated with Google via Google My Business
• This impacts the business listings that appear when someone does a local search– Relate to reviews and distance from searcher
(especially important on mobile)
SOCIAL MEDIA MARKETING “OWNED AND EARNED MEDIA”
The growth of the participative web• The First Generation Web (1989 – 2003-ish)
– Publishing medium; predominantly one-way / asymmetrical
• The Next Generation: Web 2.0 – What is Web 2.0? (Tim O’Reilly). • The Machine is Us/ing Us - the classic viral video by Mike Wesch from
2007 – The participative web– Publishing tools in the hands of users – communication now 2-way. The web is “us”– User-generated content– Focus on the user/participant
• Media becomes gradually more “social” in the early to mid 2000s– 2002: Friendster – 2003: MySpace– 2004: Facebook– 2005: YouTube, Reddit– 2006: Twitter
Social media
• "a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of user-generated content.“ Andreas Kaplan and Michael Haenlein
• Also sometimes called “consumer-generated media”
“Social” media includes…
• “The online tools and platforms that people use to share opinions, insights, experiences and perspectives with each other.”
Catherine Seda
• Includes– Social networking sites (many types)– Blogs and microblogs– Wikis– Podcasts and vodcasts– Forums– User Generated Content of all kinds
Type of social network Some examples
Business/professional networking LinkedIn
Social Q&A Quora, Yahoo Answers
General social communities Facebook, Google+, My Space, Pinterest, Reddit
Blogs & microblogs WordPress, Twitter, Plurk, Tumblr, LiveJournal
News sharing / creation NewsVine, NowPublic, Slashdot
Social bookmarking / curation Delicious, Pinboard, StumbleUpon, Flipboard
Video / photo sharing YouTube, Vine, Vimeo, UStream, Livestream, Flickr, Instagram, SnapChat, Twitch
Virtual / social gaming worlds SecondLife, WoW, Minecraft, LBP
Subject specialist / niche communities Nature Network, Goodreads, Jamendo, Flixter, Soundcloud,
Document sharing / collaboration Slideshare, Google Docs, Prezi
Product-based communities Amazon, eBay, Dell
Location-based (check-in) services Foursquare, Gowalla
Reviews and ratings Yelp, TripAdvisor, Amazon reviews
Messaging WhatsApp, Skype, Viber, WeChat, SnapChat
Frequency of social media site use
• Facebook, Instagram, and Twitter have highest engagement levels, with multiple daily usage.
Pew Research Internet Project. Social Media Update 2013
Demographics
• Facebook popular across a diverse mix of demographic groups
• Pinterest - women are four times as likely as men to be Pinterest users
• LinkedIn - especially popular among college graduates and higher income households.
• Twitter and Instagram - younger adults, urban dwellers, and non-whites.
• Substantial overlap between Twitter and Instagram user bases
• Demographics of key social networking platformsPew Research Internet Project. Social Media Update 2013
Marketing using social networking sites: still experimenting
• We are in an “attention economy”– People’s attention is the scarce resource today
• Marketers should go where the people are, not expect the people to come to them– Behavioural and contextual advertising– Brand presence eg. Facebook, Twitter, Google + Viral
marketing – spreading memes– Earning trust – by using an “authentic voice”– Generating traffic / interest– Enhancing reputation– Customer support
Owned and earned in social media
• Owned media– An organization’s own Facebook page, Twitter
account, Pinterest account etc• Earned media
• Likes, comments, shares on Facebook• Retweets, mentions, favourites on Twitter• Repins, favourites, comments on Pinterest
• Big problems for marketers with decreasing “organic” reach – especially on Facebook
The Edgerank algorithm tweaked to reduce organic reach
• Analysis of more than 100 brand pages - organic reach was around 6 percent, a decline of 49 percent from October 2013
• For large pages with more than 500,000 Likes, organic reach hit 2 percent in February 2014
• “Organic reach of the content brands publish in Facebook is destined to hit zero. It’s only a matter of time.”
• Marketers being pushed to paid media
http://social.ogilvy.com/facebook-zero-considering-life-after-the-demise-of-organic-reach/