Chapter - Four

Internet marketing Objectives and Strategies

 E-marketing: achieving marketing objectives through use

of electronic communications technology.

 Internet Marketing is the application of the Internet and

related digital technologies to achieve marketing objectives.

 It is Achieving marketing objectives through applying

digital technologies.
 Cont…

 These digital technologies include Internet media such

as web sites and e-mail as well as other digital media
such as wireless or mobile and media for delivering
digital television such as cable and satellite.
 Digital marketing:– Describe both the management and
execution of marketing objectives using electronic media
such as the web, e-mail, interactive TV and wireless
media in conjunction with digital data about customers’
characteristics and behavior.
 Objectives of E-Marketing
• Different businesses may develop different E-
Marketing objectives depending on their
individual circumstances.
• A useful framework for developing effective
E-Marketing objectives is the five S’s
framework, which includes:
1. Sell – using the internet to sell products and
services
2. Serve – using the internet to serve
customers
 Cont…

 The marketing mix tends to lead to a product

orientation rather than customer orientation – a key
concept of market orientation and indeed a key
Internet marketing concept.
 To mitigate this effect, Lautenborn suggested the 4 Cs
frameworks which consider the 4 Ps from a customer
perspective.
 Cont…

 The 4 Cs framework, proposed by Lautenborn in

1990, shifts the focus from the traditional 4 Ps of
marketing (Product, Price, Place, Promotion) to a
more customer-centric approach.
 Here’s a brief overview of the 4 Cs:
 Customer needs and wants (from the product);
 Cost to the customer (price)
 Convenience (relative to place)
 Communication (promotion)
 Cont…

1. Customer Needs and Wants

(Product)
• Focus: Instead of simply offering a
product, businesses should understand
and address the specific needs and
desires of their customers.
• Application: Conduct market research
to identify what customers truly want
 Cont…

2. Cost to the Customer (Price)

• Focus: Pricing should reflect the total cost
to the customer, including not just the
monetary price but also time, effort, and
any additional costs.
• Application: Consider pricing strategies
that provide perceived value and
affordability based on customer
expectations.
 Cont…

3. Convenience (Place)
• Focus: The emphasis is on how easily
customers can access and purchase the
product, rather than just the distribution
channels.
• Application: Optimize online platforms and
physical locations to enhance customer
convenience and reduce barriers to
purchase.
 Cont…

4. Communication (Promotion)
• Focus: Instead of one-way promotion,
communication should foster dialogue
and engagement with customers.
• Application: Use social media, email,
and other channels to create two-way
communication, allowing for feedback
 Cont…
• By adopting the 4 Cs framework,
businesses can better align their
marketing strategies with customer
expectations, leading to improved
satisfaction and loyalty.
• This approach emphasizes understanding
the customer journey and creating value
that resonates with target audiences.
 In online marketing, in addition to 4 ps People, Process,
and Physical Evidence are critical components that
influence customer perceptions and experiences.
 By focusing on these elements, businesses can create a
more effective online presence, foster customer loyalty,
and ultimately drive sales.
 A well-rounded approach that considers these factors can
significantly enhance the overall success of online
marketing efforts.
 Cont…

5. People;- All individuals involved in the marketing

and sales processes, including customer service
representatives, sales teams, and the target audience.
 Importance:
• Customer Engagement: Positive interactions with
knowledgeable and friendly staff can enhance
customer satisfaction and loyalty.
• User Reviews and Testimonials: Customers often
rely on peer reviews and testimonials and share their
experiences to builds trust and influences purchasing
decisions.
• Personalization: Tailoring marketing messages and
offers based on customer preferences creates a more
engaging experience and fosters a stronger
connection between the brand and its audience.
 Cont…
6. Physical Evidence:- The tangible aspects that
support the product and brand presence, including
website design, packaging, and promotional
materials.
 Importance:
• Brand Perception: A professionally designed
website and quality visuals contribute to a positive
brand image, helping to establish credibility and
trust with potential customers.
• Tangible Reassurance: For online purchases,
physical evidence includes aspects like product
descriptions, images, and return policies that
reassure customers of their buying decisions.
• Consistency in Branding: Maintaining consistent
branding across all physical and digital materials
strengthens brand recognition and loyalty.
 Cont…

7. Process:- The systems and procedures that ensure

the delivery of products and services to customers.
 Importance:
• User Experience: A streamlined and efficient
purchasing process enhances user satisfaction.
Complicated or lengthy checkout procedures can
lead to cart abandonment.
• Consistency: Well-defined processes ensure that
customers have a consistent experience across
different touch points, whether browsing products,
making purchases, or seeking support.
• Feedback Loops: Implementing processes for
collecting and analyzing customer feedback helps
businesses continuously improve their offerings and
services.
 The Internet and the Marketing Mix

 Marketing mix-The series of seven key variables – Product,

Price, Place, Promotion, People, Process and Physical
evidence – that are varied by marketers as part of the
customer offering.
 Smith and Chaffey (2005) have defined the 5 Ss of e-
marketing which suggest five broad benefits or reasons for
adopting e-marketing which marketers can use to set
objectives for e- marketing includes
 Cont…

 Sell – Grow sales: Achieve through wider distribution to

customers you can’t readily service offline .
 Serve – Add value: Achieved through giving customers
extra benefits online or inform product development
through online.
 Speak – Get closer to Customers: This is creating a two-
way dialogue through web and e-mail
 Save – Save costs: Achieved through online e-mail
communications, sales and service transactions.
 Cont…
Sizzle–Extend the brand online: Achieved through
providing a new proposition and new
experience online.
Sizzling is all about creating, broadening, and
establishing your brand presence on the digital
platform.
 4.1 Product Strategies on the Web:

•There are many alternatives for varying the

product in the online context when a company is
developing its online strategy.
•Internet-related product decisions can be usefully
divided into decisions affecting the core product
and the extended product.
 Cont…

The 3 levels of a product (Kotler)

1. The core product answers the question
“What do consumers buy?” and consists in
the services or main advantages sought by
consumers.
2. The actual product is built around the
core product and it may have one, several,
or all of the following 5 things : quality,
characteristics, style, brand name,
packaging.
• The strategies at this level should ensure
that the product offers a differential
advantage from the competitors’ products.
 Cont…

3. The augmented product: comes as the

final and most sensitive layer of the total
product.
• It complements the product with additional
services and advantages such as after sales
service, warranty, and delivery terms.
• In a highly competitive market, it’s the
augmented product that makes the difference
and is pushing the buying decision.
 Cont…

The core product refers to the main product

purchased by the consumer to fulfill their needs.
The extended or augmented product refers to
additional services and benefits that are built
around the core of the product. Example:
warranties, awards, customer lists, customer
comments, money-back offer, etc
 Cont…
 The Internet provides many options for learning about
products.
 It can be used as a relatively low-cost method of
collecting marketing research, particularly about
customer perceptions of products and services.
 Typically these will complement rather than replace
offline research.
 Options include:
- Online focus group,
- Online questionnaire survey,
- Customer feedback or support forums and Web logs.
 Cont…
 Information products like video, audio , software's,
books, clothes, electronics etc.
 Companies can use their own panels of consumers to test
opinion more rapidly and often at lower costs than for
traditional market research.
 Another aspect of the velocity of new product
development is that the network effect of the Internet
enables companies to form partnerships more readily
to launch new products.
 Cont…
•In 1998, Ghosh introduced the concept of "digital
value" in the context of evolving product offerings
through the Internet.
•He encouraged companies to consider several critical
questions to enhance their understanding of how to create
and deliver value to customers in the digital age.
•By reflecting on these questions, companies can better
understand how to create and deliver digital value,
leading to improved customer satisfaction and loyalty
 Questions to Assess Digital Value

1. What are the core benefits that customers seek?

• Understand the fundamental needs and desires of
customers to ensure that your offerings align with their
expectations.
2. How can we enhance the customer experience?
• Explore ways to improve the user journey, from
discovery to purchase, ensuring a seamless and
engaging experience.
3. What digital features can differentiate our
products?
• Identify unique digital capabilities or functionalities that
can set your products apart from competitors.
4. How can we leverage data to personalize
offerings?
• Utilize customer data and analytics to tailor products
and services to individual preferences and behaviours.
 Cont…

5.What additional services can we provide to increase

value?
• Consider supplementary services that can enhance
the overall value proposition, such as customer
support, warranties, or educational resources.
6.How can we facilitate customer interaction
and engagement?
• Develop strategies to foster communication and
interaction with customers, encouraging feedback
and building community.
7. In what ways can we ensure security and
trust in our digital transactions?
• Address concerns regarding privacy and security to
build trust with customers in online transactions.
 Online Options for the Core Product

• In the context of online marketing, the core

product represents the fundamental benefit or
value that customers seek.
• Here are some options for enhancing the core
product in online offerings:
1. Digital Content:- Provide valuable content
that meets specific customer needs.
• Examples: E-books, online courses, webinars,
podcasts, and articles.
2. Access to Services:- Offer services that
fulfill customer needs directly.
• Examples: Streaming services (movies,
music), subscription services (software as a
service), or consulting services.
 Cont…

3.Community Engagement:- Foster a

sense of belonging and support among
users.
• Examples: Online forums, social media
groups, and membership communities that
encourage interaction and sharing.
4.Personalization:- Tailor the core product
experience to individual preferences.
• Examples: Customized recommendations
based on user behavior, personalized
learning paths in educational platforms, or
curated content feeds.
 Cont…

5. Convenience Features :- Enhance

the ease of access and usage of the core
product.
• Examples: Mobile apps for on-the-go
access, user-friendly interfaces, and
streamlined checkout processes.
6. Flexibility and Options:- Provide
various choices to cater to different
customer segments.
• Examples: Tiered subscription models,
customizable product options, or
varying service plans.
 Cont…

7. Quality Assurance :- Ensure the core

product meets high standards of quality
and reliability.
• Examples: Offering free trials, satisfaction
guarantees, and responsive customer
support.
8. Integration with Other Products:- Enable
the core product to work seamlessly with
complementary products.
• Examples: Integration of software tools,
compatibility with various devices, or
bundling related services.
 4.2 On-line Pricing Options
 Uniquely among the marketing mix variables, price directly
affects the firm's revenue. Thus, the setting of prices is a critical
issue facing managers.
 Pricing online has to take into account the concept of “differential
Pricing” and “price elasticity “of demand.
 Differential pricing concept: Identical products are priced differently
for different types of customers, markets or buying situations.
 Price elasticity of demand is a Measure of consumer behavior that
indicates the change in demand for a product or service in response
to changes in price.
 Some of pricing options:

 The pricing strategy is based on three components: cost,

customer value, and competitors.

 Market-oriented pricing: There are two approaches.

 Premium pricing (or skimming the market) involves

setting a higher price than the competition to reflect the
positioning of the product as a high-quality item.
 Penetration pricing is when a price is set below the
competitors’ prices to either stimulate demand or increase
penetration.
 Cont…
 Cost-plus pricing. This involves adding on a profit margin based
on production costs.
 Competition-based pricing. This approach is common online.
 The advent of price- comparison engines such as Kelkoo
(www.kelkoo.com) for B2C consumables has increased price
competition and companies need to develop online pricing
strategies that are flexible enough to compete in the marketplace.
 Different types of pricing may be possible on the Internet,
particularly for digital, downloadable products such as mp3’s,
software, e-books.
 Cont…

 The Internet offers new options such as payment per use, rental at a
fixed cost per month.
 Kotler (1997) suggests that in the face of price cuts from
competitors in a market, a company has the following choices
which can be applied to e-commerce:
Reduce the price (to avoid losing market share).
Raise perceived quality or differentiate product further
by adding-value services and
introducing low-priced new product lines etc
 4.4 On-line Distribution
 Traditionally, the place element refers to how an
organization will chose to distribute the product/ service
they are offering to the end user.
 Efficient distribution is highly important in order to
achieve the overall marketing objectives of an
organization.
 Biggest impact of the internet is upon the place element,
for the simple reason that the internet has a global reach.
 Cont…
 New channel structures: some new structures were born,
specific for the internet-based markets.
 This is called disintermediation which refers to the possibility
of performing direct sales without the involvement of middle

men or intermediary.
 Tailoring of web site information for individual countries
or regions which is called localization.
 The strategy of providing a local site, most of the times
using the local language is advisable.
 4.5 Online Promotion
 The promotion as part of the marketing mix refers to how
marketing communications are used to inform the audience about
an organization and its products via internet.
 Whatever we intend to sell, is means nothing as long as the target
market has no information about our offer.
 The site must be promoted just like you promote a product, in
order to make it efficient and support your business.
 Internet technologies provide new ways to improve and sustain
advertising activities, sales promotions, public relations, or to
proceed to direct marketing campaigns using e-mail or websites.
 4.6 The Internet and branding

 Internet branding is defined as a technique in brand management that

uses the internet as a medium to position its brand in the marketplace.

 The first step in building a brand online is found in building brand

identity.

 Brand identity is how a business wants to be perceived by consumers.

The first step is knowing the target customer and the second is in

reaching them.

 To summarize, a brand is dependent on a customer’s psychological

affinity for a product, and is much more than physical name or

symbol elements of brand identity.

•Powerful Brands is defined as: an identifiable
product or service augmented in such a way
that the buyer or user perceives relevant unique
added values which match their needs most
closely.
•Furthermore, its success results from being
able to sustain these added values in the face of
competition.
This definition highlights three essential
characteristics of a successful brand:
 Brand is dependent on customer
perception
 Perception is influenced by the added-
value characteristics of the product.
The added-value characteristics need to
• In the online environment, the customer can
experience or interact with the brand more
frequently and to a greater depth.
• On the World Wide Web, the brand is the
experience and the experience is the brand’.
• To build successful online brands, organizations
should consider how their proposition can build on
the following basic possible brand promises: -
 The promise of convenience – making a purchase experience
more convenient than the real-world one, or that with rivals;
 The promise of achievement – to assist consumers in
achieving their goals, for example supporting online investors
in their decision or supporting business people in their day-
to-day work;
 The promise of fun and adventure – this is clearly more
relevant for B2C services;
 The promise of self-expression and recognition – provided
by personalization services such as Yahoo! Geocities where
consumers can build their own web site;
•Some of the characteristics of successful brand names

suggested by de Chernatony and McDonald are; be simple,

distinctive, meaningful and compatible with the product.

• These principles can be readily applied to web-based brands.

Examples of brands that fulfill most of these characteristics

are CDNow, CarPoint, BUY.COM and e-STEEL.

•Others suggest that distinctiveness is most important:

Amazon, Yahoo!, Expedia, Quokka.com (extreme sports),

E*Trade etc.
The best names will follow most of these eight
principles:
(1) Short,
(2) simple,
(3) suggestive of the category,
(4) unique,
(5) alliterative,
(6) speak able,
(7) shocking and
(8) personalized. Although these are cast as
‘immutable laws’ there will of course be
exceptions!
 Online community
 An online community, also called an internet community or
web community, is a community whose members interact with
each other primarily via the Internet.
 Members of the community usually share common interests.
For many, online communities may feel like home, consisting of
a "family of invisible friends".
 Those who wish to be a part of an online community usually
have to become a member via a specific site and thereby gain
access to specific content or links.
 Cont…

An online community can act as an information

system where members can post, comment on
discussions, give advice or collaborate, and
includes medical advice or specific health care
research as well.

THE END