I.
Internet Trends
Ø
Demographics
·
Key drivers of internet usage, most are correlated
o
income -- internet usage rises sharply with household
income
o
education -- the more educated someone is, the more likely
they are online
o
residence -- internet usage varies dramatically from
country and region of the world
o
age -- middle aged heads of household, followed by younger
households, followed by seniors
Ø
Online costs
·
labor and organizational changes
·
skilled Web employees in high demand, therefore cost more
·
support material more powerful, making internal
programming less an option
Ø
Overall internet usage
·
U.S. adult usage 41% in 1998
·
lower use in other countries, except Canada &
Scandinavia
·
usage variables
o
income -- affordability of computer and internet access,
related to education
o
education -- college grads 3 times more likely to use the
internet
o
location -- income and educational attainment related,
also rural areas use more often, areas with dark winters use the net
more often (Finland is the most wired country in the world)
o
gender -- men now are only slightly more likely to be
internet users than women; this is a change from the early years
o
family type -- largest users are married couples with
children under 18, the lowest users are female householders with
children under 18
Ø
Projecting an Online Customer Base
·
match demographics to available products & services
II.
ECommerce Statistics
Ø
Key to certain industries such as travel, e-tailers, and
financial services
Ø
Be aware they are constantly changing
III.
Web Site Costs
Ø
Hosting -- many times outsourced
Ø
Building & Improving a Web site
·
costs by Web stage & complexity
o
simple site -- 20 pages, email, training, approximately
$78,000
o
medium site -- 100 pages, stock ticker, search engine,
password protection, simple database services, approximately $150,000
o
large site -- all above plus Java applets, sophisticated
database dynamic Web pages, chat software, sound/video, simple Web
banners, secure transactions, approximately $440,000
·
cost features
o
large range of costs
o
time to market may be lengthy
o
outsourcing common
o
labor intensive, and cost of labor high
Ø
Managing a Site
·
industry standards -- see thestandard.com
·
routine maintenance and updating
IV.
Internet Marketing Plan Overview
Ø
The Stand-Alone Approach
·
online fit -- demographics, trends, growth
·
Web site analysis -- performance, communication model, and
visibility
·
brand building activities -- awareness, identity, and
advertising
·
collaboration building activities -- content trees,
community building, feedback impacts
·
business model impacts -- alliances, pricing,
cannibalization
·
financials -- ROI, customer equity, brand equity
·
DNI analysis -- digital, network, individual
·
traffic building activities -- customer acquisition,
reach, frequency, duration, links
·
information impacts -- information policies, data needed,
data generated, analysis tools
·
supply chain impacts -- logistics, needed capabilities
·
critical path -- timeliness, uncertainties
Ø
The Embedded Approach as related to typical marketing plan
·
key Web contributions and requirements
·
internet fit
·
unique benefits or challenges of online material
·
competitor Web use
·
Web based service components
·
relevant keys to success
·
critical issues
·
Web site purpose
·
specific business objectives
·
net based ROI
·
communication target/model used by net activities
·
brand positioning support or conflict with Web content
·
net activities
·
information requirements and information outputs
V.
Price Sensitivity & the Internet
Ø
The Standard Pricing Answer
·
balancing marginal revenue and marginal cost
·
price elasticity
Ø
Price Sensitivity & Online Information -- 1994 study
by Nagle
·
the unique value effect -- unique features and value lower
price sensitivity
·
the substitute awareness effect -- impact of substitutes
on price elasticity
·
total expenditure effect -- customers pay more attention
to big budget items
·
price-quality effect -- price may be equated with quality
·
inventory effect -- price elasticity is much higher on
nonperishables
VI.
Real-Time Pricing
Ø
When Simple Pricing Approaches Fail
·
a company does not know its demand curve
·
different customers pay different prices
·
customers buy multiple products
Ø
Lessons From Other High-Speed Markets
Ø
Auctions
·
auctions as real-time pricing
·
online art auctions
·
online auction types
Ø
Online Rental Markets -- Cryptolope (see
Hanson figure 11.12)
Ø
Yield Management -- fixed & perishable capacity
(see Hanson table 11.1)
VII.
Bundling -- combining products into larger packages
Ø
Guidelines for profitable bundling
Ø
margin spread bundling -- based on contribution margin
Ø
aggregation bundling -- targeted toward the average
customer, stimulates volume
Ø
setup cost bundling -- especially important in
manufacturing with high setup costs
Ø
registration cost bundling-costs to generate sufficient
information for setup
Ø
customer contact expenses such as with online stockbrokers
Ø
joint performance bundling -- example personal locator
sites such as 411, Yellow Pages
VIII.
Traffic Building
Ø
Key methods
·
available time -- Web marketers are competing for
consumers available time
o
time spent per week online is similar to time per day
spent watching TV
o
pages that consumers spend more time at are more popular
·
traffic driving tools-popularity does not correlate with
effectiveness
o
affiliate programs, email, PR, and TV ads effective
o
banners, email, buttons, PR popular
·
advertising media selection drivers
o
mainstream net use means mainstream promotion methods
o
email shows higher conversion rates than online banners
o
bandwidth still prevents more “TV like” ads online
·
banner formats
Ø
Search Engines
·
how do they work?
·
buying your way up the list
IX.
Net Marketing Tutorials
Ø
Initial efforts
·
getting a domain name
·
protecting your domain name
·
creating community content
Ø
Launch
·
analysis
o
Web chains to measure
§
lifetime customer value
§
click through rates
§
conversion rates to buyers
·
improving capabilities
o
traffic building
§
using log files
§
advertising
§
tracking things
o
your way around auctions -- buyers & sellers
o
building a store
·
revenue techniques
o
required hardware & software
o
targeting
o
specs
o
reporting
Ø
Web Site Audit & Improvement
·
making site accessible
·
building your private policy
·
visualizing content trees
·
using XML
X.
The Battle for Web Traffic
Ø
Value and Scarcity
·
the diamond-water paradox
·
the rising supply of Web content -- 300 million Web pages
by March 1998
·
slowing growth in online time per user
(see table 9.1)
·
novelty no longer guarantees traffic -- first movers
benefited from free publicity
Ø
Elements Of A Web Traffic Plan
·
acquiring traffic is expensive
·
retaining traffic is profitable
(see table 9.2)
·
developing traffic requires value -- time online equates
to value
Ø
Traffic Builders
·
domain names -- choices have long-term consequences
·
portal presence -- classifying your site with proper
keywords
·
creating a wave -- publicity and word of mouth
·
buying traffic through paid advertising
XI.
Domain Names
Ø
Domain Name Goals
·
a good domain name should accomplish 3 goals
o
reinforce branding
o
build traffic
o
anticipate customer behavior & mistakes
Ø
Defining Domain Names
·
the Internic registration service
·
one number, many names (see figure 9.6)
·
hierarchical structure (see table 9.3)
o
primary -- identified by .org, .com, .edu
o
secondary -- identifies company, such as “Coke”
Ø
The Brand-Domain Connection
·
domain design guidelines -- Bruner et al., 1998 (see table
9.4)
·
brand hierarchies & domain design – example: GM (see table 9.5)
·
brand extensions using domain names -- strategy should be
flexible, consistent, innovative
XII.
Portal Presence
Ø
Portal Problems
Ø
The Importance of Gateways -- can’t guess a Web address
·
too many “hits”
·
poor indexing -- less than 1% of Web pages show up in all
4 most popular search engines
Ø
Managing Portal Problems
·
make sure Web pages are listed with all major search
engines
·
use Web page content to place important Web pages high on
the return list in keyword searches
·
getting registered -- usually 1-2 week lag minimum
·
getting a top ranking -- difficult to place in the top 20
·
portal presence importance and Web site size -- engines
more important for small sites
Ø
The Emergence of Specialized Portals for example: PikeNet
for the Real Estate Industry
XIII.
Publicity & Word of Mouth
Ø
Electronic Word of Mouth & Diffusion
(see figure 9.9)
·
net word of mouth technologies
o
email among friends and business acquaintances
o
usenet groups
o
email listservs
o
AOL and other online forums
o
industry portal discussion areas
o
online and traditional media coverage of the Internet
·
bad news travels fast -- negative Web sites and the Intel
chip problem
·
leveraging word of mouth -- similar to Metcalfe’s Law
Ø
Opinion Leaders Online
·
not all users are equal -- industry leaders, journalists,
etc.
·
reaching opinion leaders -- referral chaining & The
Six Degrees of Kevin Bacon
Ø
URL Placement
·
bills, machines, and subroutes -- list your Web site
everywhere!
XIV.
Banners & Buttons
Ø
The Rise of Interactive Advertising
·
the growth of banner ads -- most dominant form (see figure
9.12)
·
part newspaper ad, part bingo card -- tends to follow
traditional advertising
Ø
Online Advertising Effectiveness
·
a simple media -- online banners are simple
·
behavior-based online advertising
o
the goal of traffic steering
o
click-through rates associated with bold colors,
animation, and top of page placement, call to action, limited frequency
of exposure
o
the importance of commerce to behavior-based advertising
-- easy to evaluate
·
brand building
o
paid advertising improves visibility efforts
·
98% wasted, or building brands -- most banners have little
effect
Ø
Online Advertising May Not fit All Companies
·
lack of local online advertising (see figure 9.15)
·
better-developed traditional advertising media
XV.
Evaluating Traffic Sources
Ø
Measuring The Effectiveness of Traffic Sources
·
trading off traffic sources -- measurement &
comparisons
Ø
Online Traffic Tracking Capabilities
·
vitanet.net (see figure 9.17)
·
tracking search terms -- ranking of keywords
·
connecting profits to banner ads (see
table 9.7)
XVI.
Marketing Plan Structure
Ø
What is an Internet Marketing Plan?
Ø
General Internet Marketing Plan Implementation Strategies
·
Strategy 1: View the Internet as an Adjunct
o
Off-line and online media go together
·
Strategy 2: Use Email Strategically
·
Strategy 3: Cross Pollinate
·
Strategy 4: Provide Extra Value
·
Strategy 5: Analyze Content and Use
·
Strategy 6: Repurpose Materials
·
Strategy 7: Design with Online in Mind
·
Strategy 8: Plan Frequent Revisions
·
Strategy 9: Manage for Long Term
·
Strategy 10: Set Reasonable Goals
Ø
Preparing the Business Plan Executive Summary: Section One
& Two
·
Section One: Business Overview
o
Company Overview—who are you
o
Company Name—why it is so important
o
Company History—where have you been
o
What is the Company business?
o
Product and Market Definition
·
Section Two: Analyzing Internet Marketing Statistics
o
What statistics are for?
o
Active versus passive marketing
o
What information you need
Ø
Formulating Marketing Communications Strategies: Section
Three
·
Defining strategic alliances
·
Managing and nurturing business relationships
·
Best Practices of companies with alliances
·
Understanding Objectives, Strategies, and Tactics
·
Traditional Marketing Principles Revised
·
Tackling Trends, Risks, and Opportunities in E-Commerce
o
Web pricing and payoff structures
o
Adjusting to sales challenges
·
Establishing an Internet Marketing Vision
Ø
The Internet Marketing Team: Section Four
·
Outsourcing
o
Self Evaluation
o
Staff Evaluation
o
Policy Review
o
Information Technology Review
·
Evaluating Internet Service and Hosting Providers
·
Selecting an Internet Marketing Agency
·
Web Boutiques
·
Graphics Artist
XVII.
Marketing Plan Implementation
Ø
Marketing Plan Implementation: Section Five
·
Advertising & Mail
o
Media Planning
o
Traditional Advertising and the Internet
o
Ad Banners
o
Hyperlinked Banners
o
Clickthrough Rations
o
Clickstreams
o
Headers
o
The Reality of Internet Advertising
o
Using Email and the problems of Spam
·
Collateral & Sales Materials
o
Integrate the Internet into Your Collateral Materials
o
Integrate Your Collateral Materials into the Internet
o
What Should You Publish on the Web?
o
How Should You Publish on the Web?
o
Document File Formats
o
Annual Reports and Financial Data
o
Equipment and Software Needs
o
Password Access and Security Issues
·
Corporate Identity
o
Developing a Corporate Identity
o
Online Corporate Identity Guidelines
o
Take Advantage of Your Identity
o
Domain Name Ownership and Trademark Issues
o
Creating and Internet Style Manual
o
Designing Browser Specific Pages
XVIII.
Marketing Plan Launch, Support, and Results
Ø
Incorporating Sales Support Functions
·
Applying the Internet to Sales Support
·
Infobots, Autoresponders, and Mailbots
·
Taking Orders Online
·
Sales Lead Management
Ø
Measuring Internet marketing results
·
Defining marketing measurement
·
Editorial coverage and slant
·
What to measure
·
How accurate are web traffic statistics?
·
Measurement tracking firms
·
Off-line tracking methods
Ø
Budgeting and Launching the Internet Marketing Program
·
Budgeting Methods
·
Determining Costs
·
Plan of Action: The Schedule
·
Online Promotional Plan
XIX.
Summarizing the Plan
