Focus on characteristics of new-media marketing communications

In this section, we explore the main differences between marketing communications in the traditional media such as TV, print and radio and new digital media such as web sites, inter­active TV and mobile commerce. This section is based on the summary presented in Chaffey (2000). Recognizing the differences between the Internet and other media is important to achieving success in channel promotion and channel satisfaction, and will lead in turn to positive channel outcomes and profitability.

A useful summary of the differences between the new media and traditional media has been developed by McDonald and Wilson (1999) as the ‘6 Is’ of e-marketing. The ‘6 Is’ are useful since they highlight factors that apply to practical aspects of Internet marketing such as personalization, direct response and marketing research, but also strategic issues of indus­try restructuring and integrated channel communications. By considering each of these facets of the new media, marketing managers can develop marketing plans that accommo­date the characteristics of the new media. This presentation of the ‘6 Is’ is a new interpretation of these factors using new examples and diagrams to illustrate these concepts.

1. Interactivity

Deighton (1996) was one of the first authors to explain that a key characteristic of the Inter­net was the opportunities that the Internet provided for interactivity. Figure 8.14(a) shows how traditional media are predominantly push media where the marketing message is broadcast from company to customer and other stakeholders. During this process, there is limited interaction with the customer, although interaction is encouraged in some cases such as the direct-response advert or mail-order campaign. On the Internet, it is usually a customer who initiates contact and is seeking information on a web site. In other words it is a ‘pull mechanism unless e-mail is used (this can be considered as a push technique). Figure 8.14(b) shows how the Internet should be used to encourage two-way communication; these may be extensions of the direct-response approach. For example, FMCG (fast-moving con­sumer goods) suppliers such as Nestle (www.nescafe.co.uk) use their web site as a method of generating interaction by providing incentives such as competitions and sales promotions to encourage the customer to respond with their names, addresses and profile information such as age and sex.

Hoffman and Novak (1997) realized relatively early in the development of the web that this change which is now a core part of the Web 2.0 concept is significant enough to repre­sent a new model for marketing or a new marketing paradigm. They suggest that the facilities of the Internet including the web represent a computer-mediated environment in which the interactions are not between the sender and receiver of information, but with the medium itself. They say:

consumers can interact with the medium, firms can provide content to the medium, and in the most radical departure from traditional marketing environments, consumers can provide commercially-oriented content to the media.

The content customers can provide may be directly commercial such as auctioning of their possessions such as via eBay (www.ebay.com) or could include comments on products or suppliers on a neutral site (e.g. www.bizrate.com) or a destination site (www.firebox.com).

2. Intelligence

The Internet can be used as a relatively low-cost method of collecting marketing research, particularly about customer perceptions of products and services. In the competitions referred to above Nestle is able to profile its customers on the basis of the information received in questionnaires. The Internet can be used to create two-way feedback which does not usually occur in other media. Financial services provider Egg (www.egg.com) collects information about their online service levels through a questionnaire that is continuously available in the customer-service part of their site. What is significant is that the company responds via the web site to the main concerns of the customer; if the length of time it takes to reply to customer-service e-mails is seen as a problem it will explain what the organiz­ation is trying to do to resolve this problem.

A wealth of marketing research information is also available from the web site itself, since every time a user clicks on a link this is recorded and can be analysed with the web analytics tools described in Chapter 12. Potentially companies can respond in real time to buyer behaviour. For example, banks such as HSBC (www.hsbc.co.uk) and Lloyds TSB (www.lloydstsb.co.uk) use a service from Omniture Test and Target (www.omniture.com) to serve messages according to an evaluation of which offers they are most likely to respond to.

3. Individualization

Another important feature of the interactive marketing communications referred to above is that they can be tailored to the individual (Figure 8.15(b)), unlike traditional media where the same message tends to be broadcast to everyone (Figure 8.15(a)). The process of tailor­ing is also referred to as personalization and is an important aspect of achieving customer relationship management online. Personalization is often achieved through extranets which are set up with key accounts to manage the buying and after-sales processes. Dell (www.dell.com/premier) set up ‘Dell Premier’ for key accounts such as the Abbey where special offers and bespoke customer support are delivered. Another example of personaliza­tion is that achieved by business-to-business e-tailer RS Components (www.rswww.com). Every customer who accesses their system is profiled according to their area of product interest and information describing their role in the buying unit. When they next visit the site information will be displayed relevant to their product interest, for example office prod­ucts and promotions if this is what was selected. This is an example of what is known as mass customization where generic customer information is supplied for particular segments, i.e. the information is not unique to individuals, but to those with a common interest. Amazon (www.amazon.com) is well known for using a collaborative filtering approach or Amazon’s ‘Customers Who bought X … also bought … Y. Amazon also has two other per­sonalization features, ‘Customers who shopped for X also SHOPPED for … ’ and ‘Customers who searched for X also BOUGHT … ’. You can read about the approach that they use to achieve this in IEE (2003).

4. Integration

The Internet provides further scope for integrated marketing communications. Figure 8.16 shows how it is just one of many different media channels (these channels are also offered by intermediaries). When assessing the success of a web site, the role of the Internet in communi­cating with customers and other partners can best be considered from two perspectives. First, organization-to-customer direction: how does the Internet complement other channels in com­munication of proposition for the company’s products and services to new and existing customers with a view to generating new leads and retaining existing customers? Second, cus- tomer-to-organization: how can the Internet complement other channels to deliver customer service to these customers? Many companies are now considering how they integrate e-mail response and web-site callback into their existing call-centre or customer-service operation. This may require a substantial investment in training and new software.

Some practical examples of how the Internet can be used as an integrated communica­tions tool are as shown by Figure 8.17 and Activity 8.3.

  • The Internet can be used as a direct-response tool enabling customers to respond to offers and promotions publicized in other media. Dell uses ‘e-value codes’ which it publishes in magazines and offline material to direct people to specific pages (via a search) when they visit the web site. CapitalOne uses a similar approach. These codes include a media code to assess which offline communications were most effective in driving sales on the web site.
  • The web site can have a direct-response or callback facility built into it. The Automobile Association has a feature where a customer service representative will contact a customer by phone when the customer fills in their name, phone number and a suitable time to ring.
  • The Internet can be used to support the buying decision even if the purchase does not occur via the web site. For example, Dell has a prominent web-specific phone number on their web site that encourages customers to ring a representative in the call centre to place their order. This has the benefits that Dell are less likely to lose the business of customers who are anxious about the security of online ordering and Dell can track sales that result partly from the web site according to the number of callers on this line. This is alternative 3 in Figure 8.17. Considering how a customer changes from one channel to another during the buying process is referred to as mixed-mode buying or channel switching. It is a key aspect of devising online marketing communications since the customer should be supported in changing from one channel to another. Bazett et al. (2005) give the example of a high-street chain that estimated (through credit card tracking) that for every £1 of revenue it takes on the web, £3 are spent in-store after browsing online – so it has objectives for this and works equally hard to help these customers through facilities such as store
    locators and information on stock availability for that store.
  • Customer information delivered on the web site must be integrated with other databases of customer and order information such as those accessed via staff in the call centre to provide what Seybold (1999) calls a ‘360 degree view of the customer’.
  • The Internet can be used to support customer service. For example, easyJet (www.easyjet.com), who receive over half their orders electronically, encourage users to check a list of frequently asked questions (FAQs) compiled from previous customer enquiries before contacting customer support via phone.

5. Industry restructuring

Disintermediation, reintermediation and countermediation are key concepts of industry restructuring that should be considered by any company developing an e-marketing strategy and were introduced in Chapters 2 and 4. For the marketer defining their company’s com­munications strategy it becomes very important to consider the company’s representation on these intermediary sites by answering questions such as ‘Which intermediaries should we be represented on?’ and ‘How do our offerings compare to those of competitors in terms of features, benefits and price?’.

6. Independence of location

Electronic media also introduce the possibility of increasing the reach of company com­munications to the global market. This gives opportunities to sell into international markets that may not have been previously accessible. Scott Bader (www.scottbader.com), a busi- ness-to-business supplier of polymers and chemicals for the paints and coatings industry, can now target countries beyond the forty or so it has traditionally sold to via a network of local agents and franchises. The Internet makes it possible to sell to a country without a local sales or customer service force (although this may still be necessary for some products). In such situations and with the restructuring in conjunction with disintermediation and rein­termediation, strategists also need to carefully consider channel conflicts that may arise. If a customer is buying direct from a company in another country rather than via the agent, this will marginalize the business of the local agent who may want some recompense for sales efforts or may look to partner with competitors.

A further appraisal of using the characteristics of new media for effective communications is presented in Chapter 9.

Source: Dave Chaffey (2010), E-Business and E-Commerce Management: Strategy, Implementation and Practice, Prentice Hall (4th Edition).

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