The eMarketing Textbook Blog

If you're a follower of our GottaQuirk blog, you'll know that we now have the second edition of the Quirk eMarketing Textbook in our hands, which means that we can send them to you as well! We kept the writing of the first textbook quietly under wraps, but decided to open up the process with the second edition.

We've had some good feedback, both through comments on the blog and emails sent directly to the team, that have really helped us to shape the new content. It has been invaluable to hear from both industry heavyweights and those in education in order to make sure that we have produced a book that is relevant and useful. Thank you to all those who have participated in this process.

We've had a fantastic response to the textbook so far, and all your feedback is always welcome, whether it's a pat on the back or (constructive!) criticism. We've always said that we're committed to regular updates, so there will be plenty of occasions for you to make your voice heard.

So, if you've not done so already, get yourself a copy (and let us know what you think).

 

At last! The final chapter. Feel free to send us your comments and suggestions.

Introduction 

The mobile phone is a small gadget that has made a huge impact in our daily lives. It has already had a profound impact on the way we communicate and conduct ourselves daily. This impact continues to be felt as the mobile phone enables new ways to market and markets in which to transact. 

The Internet transformed our world in two fundamental ways: it has given anyone with access to the Internet the opportunity to interact easily with others (and with companies and brands), and through search, it has made information easily available. Media content has become freely available, and importantly, available for free on the Internet. Developed as a platform for academics to share information, the Web has a strong ethos of free content.  

Mobile phones, particularly as developing technology means that new and better features are being packed into every smaller devices, add to the interactivity and search-ability of the Internet with several fundamental features native to the mobile phone and the way we use it. These unique benefits are explored further in this chapter. 

While the Internet and the personal computer have had a profound impact on the world we transact in, it is the mobile phone that presents an exciting opportunity for even more of the world to access the benefits of these inventions. 

Consider that there are 1.3 billion people worldwide with access to the Internet. Of those, 1.2 billion are active users of email. With the world’s population at 6.6 billion, that’s almost a fifth of the population who can be reached on email. That needs to be compared to 3.2 billion mobile phone subscribers – almost half of the world’s population. And of that 3.2 billion, 2.5 billion were active users of SMS text messaging in 2007 (Ahonen, 2008). 

Looking at figures like that, it’s obvious why so many organisations are investigating the mobile phone as a marketing platform. 

Why the mobile 

The mobile phone is a sophisticated device. Today’s phones can act as alarm clocks, cameras, video recorders, MP3 players, calendars, notebooks, messaging devices, and they can even make voice calls. However, it is not the aforementioned plethora of features that makes the mobile phone such an attractive device. The following seven features (Ahonen, 2008) are what turn mobile phones into something truly remarkable for marketers: 

1. The mobile phone is personal.
2. The mobile phone is always carried.
3. The mobile phone is always-on.
4. The mobile phone has a built-in payment system.
5. The mobile phone is available at the point of creative inspiration.
6. The mobile phone presents accurate audience measurement.
7. The mobile phone captures the social context of media consumption. 

If you consider your relationship with your mobile phone, the above features should make sense. However, a few facts and figures never hurt anyone, so here goes: 

1). The mobile phone is personal

The implication for marketers: Respect for privacy and permission is exceptionally important in all aspects of marketing, and particularly so when it comes to mobile phones. 

2). The mobile phone is always carried 

What do you take with you when you leave your house? Wallet, keys and mobile phone. What do you keep always near you when you are in your house? Mobile phone. According to 2007 research by Morgan Stanley, 91% of mobile phone owners keep their phone within one metre, 24 hours a day. People have their phones with them at all times of the day, even in the bathroom. 

The implication for marketers: Messages sent to recipients can be read and acted on immediately. Unlike, for example, email which requires that the recipient be in front of their computer and connected to the Internet, messages sent to mobile phones will most likely be accessed within minutes of being received. 

3). The mobile phone is always on 

In order to fulfil its primary function – as a telephone – the mobile phone is always on. Messages and services can be sent and acted on at all times of the day. 

The implication for marketers: Similar to the previous feature of the phone, the fact that the phone is always on changes the services and messages that can be developed for the phone. It also means that marketers need to be perhaps even more sensitive with their marketing communications. Not many people would appreciate an SMS at 4am informing them of a special offer. 

4). The mobile phone has a built-in payment system 

This is perhaps the key feature of the mobile phone, and one reason why content for mobile phones in many areas generates as much or more revenue than content for the Internet. Every mobile phone has a built in payment mechanism – the SIM card. Billing is easily handled through the user’s mobile network. Not only do mobile phones have this built-in payment mechanism, paying for content and downloads has been built into the way that consumers use their phones. There is less of an expectation that goods and services will be free. 

There are also a number of services that turn the mobile into a virtual wallet or bankcard, bringing banking and payment services to people all around the world. 

iChannel, a mobile news ticker feed in Japan, generates US$ 192 million per year in subscriptions for its US$ 2 a month service. It has more paying subscribers on this single service that all online newspapers in the world combined (Moore, 2008). Similar cases can be made for games, music and other mobile content. 

The implication for marketers: Consumers are willing to pay for services and content on their mobile. Advertising is not the only way to generate revenue for content. 

5). The mobile phone is available at the point of creative inspiration 

As the mobile phone is always carried and always on, it is always available as a creative tool. Phones today feature a number of tools that let users act on creative impulse, from taking photos and video, to becoming a scribbling pad on which to jot down ideas. 

The implication for marketers: The feature can be used to encourage interactivity with campaigns created for mobile. It presents the mobile as a useful tool in viral campaigns based on consumer generated content. 

6). The mobile phone presents accurate audience measurement 

While the Internet is vastly superior to other media in its ability to track and measure advertising and marketing campaigns, it is eclipsed by the mobile phone. Every transaction made on a mobile phone can be uniquely tracked to that mobile phone number, whether the transaction be a voice call, an SMS message or accessing the Internet. 

The implication for marketers: Aggregated data provides extensive profiling and segmenting opportunities for the target audience. Campaigns can also be accurately measured and tracked for ROI. Bear in mind as well that this accurate measurement means that mobile phone users have far less anonymity than Internet users. Even though at least 50% of mobile phones worldwide are on a prepaid or pay-as-you-go type of contract (which means that the network operators do not have the phone user’s name and demographic details to go with the mobile number), each transaction made by the phone user can still be measured.  

7). The mobile phone captures the social context of media consumption 

This represents emerging thinking on the benefits of the mobile. Because of the nature of the mobile phone to be able to accurately track transactions to any particular phone number (user), it can track transactions between mobile numbers (users). This means that sophisticated data mining can identify patterns that indicate information about and preferences of mobile phone users. Not only can alpha users be identified, but they may be identified within their social context. 

The implication for marketers: This information will represent rich data that can be used to both create and market products, content and services online. 

[note: The Mobile Marketing Association has an in-depth glossary of mobile marketing terminology available as a free download from their website: www.mmaglobal.com] 

Limitations of the mobile phone 

The mobile phone is a feature packed gadget used all around the world by almost half the world’s population. However, as much as the mobile phone has a number of unique benefits, it does come with its own challenges. 

The mobile phone is small. This means that it has a small screen and a small keypad. While some phones have a full QWERTY keypad, many have the standard numeric keypad. When it comes to the mobile web, consider that phones do not have a mouse. There are a few models that have touchscreens, but for the most part, navigation of the mobile web is through the keypad or scroll buttons on the phone. 

Mobile phones are also even less standard than PCs. Not only do phone models present a myriad of screen sizes, there are also several operating systems and browsers that are used by mobile phones. 

Use of more advanced features of phones can require an extensive education process. While mobile phones have a host of features, these devices are for the most part under-used. 

Mobile Phones: more than phone calls 

Basic phones can make voice calls, send and receive SMS messages and make use of USSD services.  

Featurephones offer features additional to a basic phone, including cameras and increased storage, as well as the ability to access the Internet. Featurephones usually have a standard numeric keypad. 

Smartphones offers advanced capabilities and features over featurephones, notably allowing users to add applications to their phones. These phones run a complete operating system, usually have 3G as well as WiFi capabilitities and usually have a QWERTY keypad. 

Note that there is not yet an industry standard definition of a smartphone, and many featurephones are now being developed with technology similar to smartphones. Smartphones tend to have bigger screens than featurephones. 

[note: QWERTY refers to a full keypad, similar to the keyboard of a computer.] 

How to reach your audience 

Just as the Web is used in a myriad ways as a marketing, advertising and distribution channel, so is the mobile phone. There are a number of technologies available to reach a mobile audience. Some of the most prevalent are detailed further. 

Mobile phones started as literally phones that are mobile (thank you again, Captain Obvious). Before we look at mobile phones as device used to access the World Wide Web, to take photographs or as a device to make payments, we need to address its primary function: communication. The primary use of a mobile phone is to enable communication, either through voice calls, or through messages. Messaging services on a mobile phone use either Short Message Service (SMS), to send text messages, or Multimedia Message Service (MMS), which supports graphics, audio, photos and video as well as text. 

SMS supports messages of about 160 characters in length, though it is possible to string several messages together to send longer messages. Messages can be sent from one phone to another, or from a PC to a phone and vice versa.  

[Note: Do u find it tricky to transl8 txt msgs? www.transl8it.com translates from text speak into every day English and back again.] 

SMS also supports a service known as common short codes (CSC). Short codes are phone numbers (short ones, as the name implies) to which users can send a text message from a mobile phone, usually to get something return. Short codes can be used to sign up for services, to enter competitions or to indicate permission (or to end permission) to receive marketing messages. Messages sent to short codes can also be used to make a payment or a donation, with a set amount being deducted from a user’s prepaid airtime or monthly airtime bill.  

SMS and Marketing

With twice as many SMS users worldwide than email, SMS should be a no-brainer for marketers. However, mobile phone users have proved reluctant to hand over their phone number for marketing messages, perhaps fearing a similar deluge of spam for which email has such a poor reputation.  

This is changing to some extent, with the prevalence of short codes being used in marketing and advertising campaigns. As consumers are so comfortable with using text messages for their communication, no extensive education process is required to have consumers access marketing campaigns based on short codes. 

[Mini case study: short codes raise $40,000 for charity. Source: http://www.mobilemarketingwatch.com/text-to-donate-alive-and-well-in-us/] 

Short codes can be used to receive messages from consumers, and to send messages to consumers. Short codes can be either dedicated (used by one company and presumably for one campaign) or shared. When short codes are shared, keywords in the text message are used to separate the messages. There are two standard keywords that should always elicit a standard response:

STOP: unsubscribe the sender’s number from the service

HELP: a support request from the sender’s number 

[Note: Another standard number is the international emergency number which is in use in most countries in the world – 112.] 

Sending messages

Once prospects have given you permission to communicate with them and their mobile number, timely messages can be sent to their mobile phone. These can be promotional or sales messages, such as special offers in stores or information about upcoming events. Unlike email messages, prospects need to at least open an SMS messages in order to delete. As well as this, mobile phones are generally kept with a prospect at all times, meaning that messages are more likely to be read very soon after they have been broadcast. 

There are several ways that SMS messages can be utilised to complement existing marketing strategy. 

SMS updates can be an exceptionally useful tool for CRM (customer relationship management). In the travel industry, hotel and airplane reservations can be sent by mobile phone, with updates being sent close to the time of travel. These short messages can include directions, or details of a flight’s status. 

When it comes to insurance claims or order processing, SMS updates as to the progress of a claim or order can reduce call centre volume, and go a long way to ensuring that a client feels valued and cared for. 

Promotions

SMS messages present a way to send timely sales promotion information to a large database for a relatively low cost. These can be targeted to a particular time of day when prospects are most likely to be out shopping. SMS messages can also be used when promoting events.  

Despite their pithy nature – these messages have a limit of 160 characters – they can carry a strong call to action. 

Receiving Messages

Short codes are often used to receive messages from prospects or customers. They provide a fast, instant and trackable means for the public to enter competitions, voice opinions or make requests. And even better for a company, the costs can often be passed on to the consumer, meaning that it can be a cost effective way to receive marketing messages. 

As short codes can be shared, keywords can be used to separate communications and campaigns. For example, a user might be asked to text the word LUXURY to a number in order to enter a competition. 

Entering competitions

Requiring less data entry time than entries by postcard, SMSes to a short code are a hassle free to run competitions. Entries can be almost immediately entered into a database, with fast automatic responses to ensure that the consumer knows her entry has been received. In addition, costs can be passed on to the consumer by charging entry SMSes at premium rates. 

Text to Donate

A concept that is being taken up by the fundraising community, text messages can be sent by donors to donate a fixed amount to a campaign. The fixed amount is deducted from the user’s airtime, or added to their monthly bill. 

Text to Participate

Text messages provide an almost instantaneous way to elicit response from an audience, whether it be to a radio programme, TV show, newspaper or magazine advertising or billboards. Some newspapers allow readers to send SMS messages instead of lengthy letters to the editor. 

Combining the two

Once users have indicated their interest by sending a text message, a company can then send messages back to them. In the UK, the mobile phone network Orange ran a successful campaign around movies. All Orange customers could go the movies for half price on a Wednesday. All they had to do was text the word MOVIE to a particular number, and in return they would receive a unique code with which to claim their discounted tickets. 

In return, Orange then sent the list of prospects who requested discounts information about the movies being shown at their local cinema. How did Orange know which was the local cinema? Simple: all they had to do was match the unique code to the number it was sent to and the cinema it was used at. 

MMS messages are messages that contain graphics, audio, video or images as well as text. These messages do allow for richer information to be sent to prospects, but the costs are considerably higher. They use WAP (Wireless Access Protocol) to download rich content onto mobile phones. 

MMS messages are particularly useful in viral campaigns, whether encouraging participants to use their phones to create content (photographic, audio or video) or encouraging users to pass on content.  

Because there is no standard screen size across all mobile devices, MMS messages may display differently on different phone models. 

Bluetooth and Infrared 

Most modern mobile phones present an array of means for connecting. As well as using the cellular network, phones have 3G and Wifi capabilities, as well as the ability to connect via Bluetooth or infrared. 

If a user sets their Bluetooth enabled mobile phone to “discoverable”, Bluetooth devices within range of the phone can request to connect to the phone and exchange messages and data. This can be used to send location specific marketing messages, such discount codes in a shopping mall.  

Outdoor display advertising can be fitted to send Bluetooth messages to people within range of the advertising. The messages can contain further information to offer a richer, longer lasting, experience. 

[note: Smart phones are susceptible to receiving viruses via Bluetooth, so this is not necessarily the ideal channel to reach smart phone users.] 

USSD (Unstructured Supplementary Service Data) is an alternative messaging system to SMS and is available on most GSM networks. Unlike SMS, USSD is a protocol that allows for a query and response type of action between the customer and a service centre, where these transactions can be seen to be similar to a session on a website. USSD services are usually initiated by the user who enters a code on his phone and then sends that as a request to the network. The code differs from the number an SMS is sent to because it includes the symbols # and *. For example, *100# can be used to check the balance of a prepaid service on some networks. These services are often used by networks to provide a service to a customer, such as balance requests, adding credit to a prepaid contract or to pass on credit to another mobile phone user. A popular service is a “call back” functionality, where a mobile phone user sends a request by USSD for another user to phone him. The requested number receives an SMS informing her of the request. Often, this SMS message also includes an advertising message. 

A USSD query often initiates a session where the response from the service includes a simple text menu with further options or a response with instructions for the user. Users need to respond within a limited time frame, usually 30 seconds but up to 2 minutes, in order to maintain the session. If the session is not maintained, the user will need to initiate the service again. 

Users can select menu options by returning a message with the number of the appropriate menu selection. This continues until the appropriate content has been displayed. 

It is a rudimentary navigation, but with far faster response times and lower costs when compared to SMS or to mobile browsing. 

USSD and Marketing

USSD is being used as a payment application, turning the mobile phone into a virtual wallet.  

USSD is exceptionally useful as self-service customer service, and is attractive to customers when it is offered for free. Advertising can easily be displayed in the messages returned when using this service. 

Voting, such as for reality TV programmes, and entering of competitions can all be handled through USSD. USSD services allow greater flexibility than SMS services as they allow a query and response type of interaction as opposed to a single message to perform these tasks. This allows the marketer to request additional information from consumers using these services. 

USSD can be used to provide information to, and collect information from, customers and potential customers. However, from a marketing and advertising perspective, its take up has not been as great as that of SMS. While USSD services are more cost effective than SMS services and can allow for more detailed data to be collected, SMS services are often preferred by the customer. SMS short codes are easier to remember than USSD codes, and the concept of sending a text message is more familiar to the customer. 

[Mini case study: Use of Please Call Me messages to encourage South Africans to be tested for HIV/AIDS.] 

Mobile Web 

As much as websites need to cater for a number of browsers, they now need to cater for a number of devices as more and more people are using their mobile phones, PDAs and other mobile devices to connect to the Internet. However, visits from mobile devices are likely to be quite different to visits from PCs. Visits from mobile phone users are likely to be more purpose driven or task specific, as opposed to leisurely browsing from PCs. 

[Discussion point: Why do you think that visits from mobile phones are different to other web visits? How can this be used in marketing strategy?] 

Just as with PCs, mobile phones can have different operating systems and different browsers, both affecting the way that websites and webpages are viewed and used. In addition to this, webpages are viewed on far smaller (and non-standard) screens, and navigation is controlled through a keyboard or limited scrolling device. There are also a number of different ways that mobile phones and devices connect to the Internet. In particular, mobile phones can use either the GSM network (where access is via EDGE or 3G, depending on availability) or Wifi enabled devices can connect to wireless networks. 

WAP stands for Wireless Application Protocol and is a technology platform aimed at making websites accessible to mobile phones, despite the small screens and keypad limitations. WAP is essentially a wireless data connection and browser that can read a pared down version of HTML. If a phone has only WAP access, it can only access websites that have been developed for this type of access. 

More sophisticated phones and devices, and increasingly almost all phones sold are falling into this category, can use HTML browsers that have been specifically designed for mobile phones. These are pared down versions of browsers that run on PCs or notebooks, and have been specifically designed to take into account the limitations of mobile devices. In particular, browsers need to accommodate both the low bandwidth and the low memory capacity of mobile devices. Mobile browsers also need to cater for the navigation limitations of mobile devices as well as the fact that navigation is not standard across the various models of  phones. 

When it comes to websites and mobile phones, there are three options for webmasters:

1. Do nothing and hope that the web experience is not too painful for mobile visitors.
2. Make sure that your website is built using W3C compliant CSS so that it can be more easily navigated.
3. Build a version of your website tailored to mobile visitors. 

[Note: The chapter on web development and design has more information on using CSS and W3C standards when building websites. If you are commissioning an agency to build a website for you, and mobile is important, ask to see what the website will look like without presentation mark up or on a mobile phone.] 

For certain kinds of websites, there are “quick fixes” that allow a mobile version of the website to be created fairly easily. For example, http://mobilepress.co.za/ from Younique allows for websites and blogs based on the WordPress platform to be made mobile browser friendly. A quick search on Google will also give instructions on how to make small changes to your code in order to create a mobile friendly version of a website. 

Tailoring websites for mobile

Some websites are more likely to be accessed from mobile phones than others, and savvy webmasters can make sure that visitors have an excellent experience by building mobile versions. 

As with all good web design, the first step is in understanding users’ needs. When accessing a website from a mobile phone a user is generally very task driven, time sensitive and is also likely to be location aware. 

Task driven means that the user has a very specific purpose for visiting a website, and the website needs to help the user to achieve their objective with minimum fuss. For example, a user might want go to a website to check the score of a cricket match. 

Time sensitive means that the user is even less likely to be able to spend time hunting for a solution to their problem, but instead expects to achieve tasks quickly. For example, a user en route to the airport may want to check to see if her flight is on time. 

Location aware means that the location of the user often plays a large role in determining her objectives. For example, a user might be looking for restaurant suggestions in a town she is holidaying in. 

These need to be factored in when creating websites for mobile users. Mobile websites need to be easy to navigate, should not contain more information than they need to, and services should also be tailored to a user’s location. 

Here are some tips when it comes to designing or optimising websites for mobile: 

• Keep it simple - Flash is, for now, still only a dream on most phones. Animated .gif images are probably your best bet, but make sure the main message is contained in the first frame, as this at least will be displayed.
• Stay away from tables - Most devices will ignore tables and content will get completely scrambled. Rather use lists where possible.
• Have sufficient links at the top and bottom of each page to easily navigate to other pages on the site and don't try to cram too much content onto a page. Unless you have a touch screen device, scrolling using the keypad is never much fun.
• Keep it portrait - As most devices are still only able to display content in portrait mode, it is important to keep horizontal scrolling down to a minimum - avoid it completely if possible. Some browsers may resize content to fit the width of the screen, so keep this in mind - it might distort the graphical impact. Depending on requirements, aligning content to the left or centre of the screen works quite well.
• Keep images as small as possible - Most graphical editing tools have a "save for web or devices" option - use this when possible.
• Transparency is not guaranteed to work - Hover effects on anchor tags are not supported for the most part and making use of the “background-image” directive is bound to give problems on a number of devices.
• JavaScript and Ajax is another grey area - Even though a couple of WAP browsers have been "supporting" JavaScript for a while now, it is still advised to use it sparingly, if at all. 

One Web

“One web” refers to ensuring, as far as possible, that the same information and content is available to web users, regardless of the device they are using to access the Web. So while websites should be optimised for presentation on various devices, proponents of “one web” would argue that the actual content should not be different. 

[note: W3C publishes guidelines for mobile web standards as well as for web standards. These can be accessed at www.w3.org/TR/mobile-bp.] 

Getting users to the Mobile Web 

Creating content and websites is one thing, but how do you actually get users to access them via their mobile phone?  

WAP push  

WAP push messages are messages sent to a mobile phone that direct the user towards WAP content. Whilst they may appear similar to SMS messages, these are a different type of message. The WAP push message contains a link that a user can follow to access WAP content. 

Sending rich messages to mobile phone users can be tricky to handle. Until there is increased general awareness of the types of messages that can be sent to and from mobile phones, MMS messages can represent a problematic push marketing medium. However, a WAP push message can direct users to rich content, enabling a sense of user control over content viewed.  

2D Barcodes

(image source: http://invx.com/code/?code=www.quirk.biz)  

Two dimensional barcodes are similar to one dimensional barcodes in that they can be scanned to access the information encoded, but two dimensional codes can contain a lot more information. In addition to this, with appropriate software, these codes can be photographed with a mobile phone, which then unpacks the information contained within the barcode. 

Does that sound a little complicated? Essentially, the software that can be installed on the mobile phone turns the phone into a scanner. Information such as URLs, telephone numbers or business names can be encoded in the barcode. When the code is scanned, the information is displayed on the phone. If this is a URL, for instance, the user can then visit that website without having to enter any additional information into the phone. 

There are two encoding types in use: Datamatix (DM) or Quick Response (QR) barcode. These can be open-standard, or proprietary. The type of barcode affects the amount of information that may be stored in the barcode, while the standards used can affect the number of barcode readers that can successfully read the barcode. 

Two dimensional barcodes are often also referred to as tags. These tags can be used in offline advertising and marketing campaigns to push consumers towards specific websites. Instead of having to remember and type in a URL, a user simply has to photograph the tag in order to visit the website.  

ags can be printed on billboards, on magazine pages, on t-shirts, in fact, on just about anything. The image here is the tag for www.quirk.biz. Download the software to your mobile phone, photograph it, and visit the Quirk website on your mobile! 

[note: Semacode is the name of the company who have developed software for reading 2D bar codes. They have an application that integrates Semacode tags with Facebook. Check it out at www.semacode.com.]  

Mobile URLs 

Most companies now think nothing of including their website address on marketing collateral. However, in many cases, when this collateral is being viewed by potential customers, it is the mobile phone that is closer to hand than the PC. Remember, the phone is always carried and always on. Some organisations are cognisant of this and are now printing their mobile website URLs instead of or as well as their standard website address. 

Mobile Search 

Everyone’s favourite Internet feature – search – has become an integral part of our lives, and is an important part of the mobile marketing mix. However, as with users’ intentions when accessing the mobile Internet, the needs of the user are different when compared to search on a PC. 

The limitations of the device, the mobile phone, and the needs of the user are what drive the differences for mobile search.  

Firstly, with smaller keypads, whether QWERTY, touchscreen or numeric, users are likely to enter shorter queries into search engines on mobile phones. Search engine results need to be displayed on a smaller screen, and need to be easy to navigate. 

Users are more task driven when using mobile phones to search, seeking concise information which answers their queries as opposed to using search as part of a discovery process. 

Natural Search

Just as with search on a PC, there are two types of search listings for mobile phones: natural or organic results and paid for results. Optimising web content for mobile search involves optimising content for mobile use in general. Navigation needs to be simple to use without a mouse, and website owners should consider ensuring that content most relevant to the mobile user is readily available. 

Paid Search

Mobile search engines are seeking to create revenue from their services through offering paid listings in a similar fashion to traditional search. As technology develops, so search providers are able to offer more sophisticated targeting options to advertisers. Geo-targeting can be incredibly specific, allowing businesses to offer targeted advertising when a customer is located nearby. 

Applications  

It’s not only websites that can be designed specifically for mobile devices. Applications and widgets can be created that are specifically for the mobile phone. For example, Google’s popular webmail service Gmail can be accessed via the mobile web, or Gmail users can download a Java application to their phone that gives them access to their Gmail account. The application presents a user experience that has been tailored to the mobile phone, and can even be tailored to a particular handset. 

Similarly, Apple’s popular iPhone uses widgets allowing iPhone users to access all manner of Web applications.  

As of 2008, widgets represent a marketing opportunity for products and companies reaching out to a tech savvy, affluent community. Widgets can be products on their own, such as the Baby Monitor for the iPhone, or they can be used to market other products, such as a widget that provides easy access to the blog BoingBoing.net. 

There is no doubt that the mobile phone presents an enticing marketing opportunity and market space. Early movers in the mobile space have seen remarkable success, and some have made remarkable amounts of money. How do you prepare to go mobile? 

As with any marketing activity, planning and setting goals is key. What do you want your campaign to achieve? How can mobile be used to help you achieve those goals? 

Secondly, you need to consider your audience. Who do you need to reach? What sort of phones and features of their phones do they have and, importantly, use? iPhone applications may be more fun to develop than a campaign based on SMS, but iPhone applications can only reach iPhone users, while SMS can reach almost everyone who has a mobile phone. 

Thirdly, how will users actually access your campaign? Do you need permission first to send them messages, or will you be advertising or marketing the campaign to get them to access it? 

You also need to choose partners for your campaign for their technology and distribution networks, and of course for their expertise. Ensure that the partners you choose adhere to your country’s mobile ethics and standards code.  

Lastly, you need to determine how mobile fits into your overall marketing strategy. Will mobile be complementing existing services and campaigns, or will you be developing campaigns, goods and services specifically for the mobile environment? 

Pros and Cons 

The mobile phone has many benefits (there are those seven unique features after all), but comes with its own challenges. The reach of the mobile phone alone makes it a very attractive marketing channel.  

Many mobile marketing mediums need little audience education, but marketers need to be aware of creating more complicated campaigns and applications. If there is an extensive education process required in order for a campaign to succeed, it probably needs to be rethought. 

Because the mobile phone is so personal, permission and privacy need to be at the foundation of any mobile campaign. Unlike an email or webpage where there is space available on-screen to explain privacy and permission, there is very little real estate on the mobile to do so. Ensure that you have very clear permission to market to the phone numbers on your database and that it is easy for users to opt out of receiving your messages.

We're getting the chapters out in quick succession now, and are eager for your feedback. Available for review today is the chapter on CRM. As always, please have a read through and make suggestions for improvement.

Introduction

If anything, the Internet and the World Wide Web have highlighted the importance of a customer-focused approach to business and marketing. It may seem obvious now, but the heydays of mass media marketing seemed to assume that people could be persuaded to purchase anything, provided there was sufficient advertising to promote a product. While signs declaring, “The Customer is Always Right” may have been stuck to the walls of shops and restaurants, the customer did not have much of a voice outside of that shop or restaurant.

Move forward a few decades to an increasingly connected society and market place, and the customer’s voice is being heard in blogs, forums, reviews and other forms of social media. It easier for consumers to connect with one another, albeit virtually, to share experiences with services and products.

Customer Relationship Management (CRM) is, as the name suggests, about managing relationships with customers. It should imply a customer-focused approach to business focussed on fostering real relationships with these important stakeholders: customers.

Often, online marketing is referred to as eCRM (electronic customer relationship management). This appears to underline the importance of technology in CRM. It also highlights the most important consideration of any eMarketing tactic: customers.

Why eCRM

Customers can be seen as the most important stakeholder in a business’s success. Without customers purchasing goods or services, most businesses would not have a revenue stream. But it can be difficult to shift from realising this important fact to implementing it into day-to-day business decisions and strategy.

A successful relationship with a customer is based on meeting (and perhaps even exceeding) their needs. It is in determining what problems the customer has, and in providing solutions to those problems.

Maintaining good customer relationships is critical to the success of a business. The costs associated with a acquiring a new customer are generally far higher than the cost of maintaining an existing customer relationship. This is why is investing in CRM should result in increasing revenue for the business.

The cycle of CRM starts with determining what problems potential customers might have, and then presenting solutions to those problems. Solutions are implemented, and then ongoing service maintains the relationship with the customer.

Take, for example, two people booking an overseas holiday. One is a 23 year old recent graduate who is visiting Argentina for three months with a friend; one is a 38 year old mother of two young children planning a family holiday to Thailand. If they both walked into a travel agency, the travel agents would make judgements on their dress and appearance to determine how they will aid each of them in booking their holiday (and how much commission the agent will be able to earn). The travel agent will also ask further face to face questions to try to sell additional services to these two customers. For the 23 year old, additional services might include travel insurance that covers extreme sports activities and a calling card that allows her to call home from anywhere in the world. For the 38 year old, additional services could include babysitting services included at a hotel reservation.

Seat the two potential travellers in front of their computers, and you no longer have human travel agents to make snap judgements based on appearance or to try to sell additional services based on the type of traveller they see. Of course, you also no longer have the overhead costs of a travel agency and agents. However, web technology does allow for similar, and often superior, judgements and sales opportunities.

For example, both travellers are likely to have started researching their trips using a search engine. Creating landing pages tailored to the types of searches being made can allow the opportunity to tailor the products being presented to each traveller.

Technology can also be used to allow the online business to interact personally with a web visitor, and also to provide the visitor with information they might not get in a travel agents - unbiased reviews from other customers. Technology can and should be used to treat different customers differently.

Web technology allows for customer related marketing decisions to be made and tested relatively quickly, and adjusted as required.

For example, in 2002, Jeff Bezos of Amazon.com launched free shipping for orders over $99 in value. While the offer was advertised as being for a limited time only, this time limit enabled Amazon to test the effect of the offer on its bottom line and still retract it if necessary. Over the months, the order threshold for free shipping dropped, and today US Amazon.com orders over $25 ship for free. However, free shipping does not mean priority shipping, so orders can be delivered in a shorter period of time – for a delivery fee.

eCRM uses technology in a number of ways to cement CRM into the way that organisations conduct themselves. Once a business shifts its focus to consumer needs, they will find that all these technologies feed each other. However, the fundamental principle of eCRM is to remember that technology should be used to enable customer relationships, not replace meaningful relationships.

Firstly, the data that is collected online should be used to build meaningful profiles of potential customers, and that information should be used in fostering relationships. Web analytics tools gather a wealth of data that can inform customer relationships, from search keywords used to reach a website, to navigation paths on a website. It is even possible to capture this kind of information against specific customers when they perform an action such as purchasing or subscribing on a website. Without the customer knowing, the referral source of their visit and even an indication of their navigation path can be captured along with their order or registration details and stored for future use.

[Discussion point: Why is knowing what keywords purchasing customers use helpful for CRM?]

Bespoke CRM software enables businesses to manage all customer and lead information across all departments in a centralised place. No matter whom a customer speaks to within a business, all employees can access the same information recorded over time – a 360 degree view of the customer. This means that any time someone inside the organisation looks up the customer, he can see every interaction the organisation has had with the customer, what previous queries have been raised, and how these have been solved in the past.

Bespoke CRM software also enables businesses to automate much of the sales cycle, freeing salespeople to spend time on creating personal relationships where it matters – with potential and existing customers.

Technology, of course, has also changed the ways that customers can contact companies. In the chapters on social media and online reputation management (ORM), the importance of letting the customer select communication channels was highlighted. Customer relationships are no longer driven by telephone contact centres, but instead blogs, Twitter, email and instant messenger (IM) are all used as customer service channels both pre and post sale.

Customer-centric and customer-driven

It is one thing placing the customer at the centre of an organisation’s planning and execution of business plans, and another having customers driving the direction of a business. Many new, web-based businesses rely on the latter for their business to succeed, and actively encourage customers to take the lead and add value to the business. Services such as Flickr, Delicious and Twitter are examples of services that are user-driven rather than user-centric. They provide tools that enable users to make the service their own, often by allowing outside developers access in order to create supplementary services.

Savvy organisations can also provide tools to customers to drive their business, passing on tasks to customers that might ordinarily have been performed by the organisation. For example, many airlines now allow travellers to check-in online prior to arriving at the airport. Although they are giving travellers convenient tools and increased options when it comes to checking in, the airlines are also outsourcing the check-in process to their travellers. As more travellers select to check themselves in, staff costs for airlines can be reduced. The travellers are doing the job for free.

Types of CRM in organisations

CRM should infuse every aspect of a business (in the same way that marketing should infuse every aspect of a business), but it is useful to look at the different ways that CRM is implemented.

Operational CRM refers to the most obvious channels that relate to customers: the front end of a business and its customer service. From a web technology point of view, operational CRM informs the website a customer sees as well as their entire online user experience. Technology also enables effective customer service from providing numerous contact channels, to presenting technology that records all customer contacts.

Analytical CRM analyses data collected by a business to determine information about customers that can inform sales and marketing decisions. Data mining is a crucial step to effective CRM. Web analytics and conversion optimisation can be seen as part of the CRM process. Data collected about the nature of visits to your website can be used to make informed decisions about where to focus attention based on customer behaviour. Past purchasing behaviour of customers can be analysed to predict future purchasing behaviour. Data can be used to segment customers, and so communications can be tailored.

[Note: Data mining is the analysis of large volumes of data in order to determine patterns, correlations, relationships and trends in the data.]

For example, Amazon.com uses the purchase history of a customer to make recommendations to that customer for future purchases. Thus, a customer who has purchased a number of cookbooks in the past will be sent offers related to cookbooks. Amazon.com also looks at the purchase behaviour of customers who buy the same book, and uses that data to recommend books based on similar customer’s preferences. This process is referred to as collaborative filtering.

Sales force automation uses CRM software to manage sales cycles and to collect customer sales data. The software enables businesses to track leads, schedule transactions and communications with potential and existing customers and to generate detailed reporting on the sales process. There are numerous software providers, some of which are listed later in this chapter.

Collaborative CRM refers to a process, which combines customer data across all facets of a company. For example, queries regularly submitted to the technical support or customer service arm of a business can be used to inform website updates (updating content on the website to address a query that is regularly submitted) and to inform product development. Instead of various departments collecting their own customer data and using this in isolation, data is collaborated so that all channels are making informed decisions based on an entire customer experience.

Putting a value on CRM

Broadly, CRM can be looked at from:

• a marketing perspective (increasing the number of people who know about your service or product)
• a sales perspective (turning the people who know about your service or product into people who have purchased your service or product)
• a service perspective (ensuring that people who have interacted with you are satisfied and delighted).

Effective CRM across all three channels can also create a powerful new marketing and referral force for a company: its happy customers. Delighting customers fosters positive word of mouth.

While CRM is a customer centric approach to doing business, CRM needs to be approached strategically – in line with the business objectives of a company.

The first step to any CRM initiative is to understand the value of a customer relationship to a business. While this is unique to each customer, data mining can be used to determine the value of segments of customers.

The revenue generated by a customer is literally the sales made to the customer. This can be calculated on a one-off basis directly related to the cost of the acquiring that particular sale, or it can be calculated over the lifetime of the customer relationship. However, referrals made by a customer can also be included as part of the revenue generated by the customer.

The cost of acquiring the customer refers to the marketing and advertising channels used to acquire that customer. In eMarketing, this is the CPA (cost per acquisition) of any of the channels used to acquire a customer. The benefit of eMarketing is that it is highly measurable and trackable, enabling a relatively accurate calculation of CPA.

The lifetime value of a customer refers to calculating the costs of both acquiring and retaining a customer against all purchases made over the lifetime of the customer relationship. One can also look at customer value in terms of the referrals that a customer generates for a company.

For example, a potential customer looking to purchase a digital camera is likely to search on Google for cameras. As a company selling digital cameras, your excellent PPC advert and compelling offer attracts the potential customer who clicks through to your website. Impressed with your product offering, she purchases a camera from you, and signs up to your email newsletter as part of the payment process.

Analysing the spend on your PPC campaign against the sales attributed to the campaign will give the cost per acquisition of each sale. In this case, this is the cost of acquiring the new customer.

As she has now signed up to your newsletter, each month you send her compelling information about products she might be interested in. If you have taken note of her obvious interest in photography, these newsletters could be focused on photography, and highlight additional products she can use with her new camera. The costs associated with sending these emails are the costs of maintaining the relationship with the customer. When she purchases from you again, these costs can be measured against the repeat sales she is likely to make.

While most companies define customer loyalty based on the repeat purchases of happy customers, some businesses are built around one-off purchases. Wedding photography is one of those businesses. With so much time and effort invested in each customer relationship, how can this be returned into repeat business?

Bella photography focuses on ensuring that its very satisfied brides refer their service to friends and family. In fact 18% of new business comes from these referrals.

They also offer services to wedding guests, such as allowing them to make orders of wedding photos themselves, which increases their customers for each wedding.

Source: http://www.insidecrm.com/features/new-definition-loyalty-102308/]

While CRM initiatives need to satisfy customer goals – increased customer satisfaction and approval – these need to be in line with business goals. Business goals are to increase overall revenue. In terms of CRM, this can be either to increase revenue generated by each customer, to increase the number of customers or to reduce the costs of acquiring a customer, or a combination of all three.

It is important to align CRM initiatives with business goals, so that success of the initiatives can be measured.

It is here especially that CRM goals can be set across marketing channels, sales channels and service channels.

[Mini Case Study: Customer Service as PR

Zappos, a US online shoe retailer, bases much of its success on its customer service. It offers free shipping on all its purchases, as well as free returns. In fact, goods are shipped with a pre-printed return label, making the process straightforward for customers. Zappos also invests heavily in its customer service team, empowering each member of the team to do what they need to do to delight customers.

For example, Zaz LaMarr blogged about her experience with Zappos. Have some tissues handy, because it’s heartwarming stuff, and read her post “I heart Zappos” at http://www.zazlamarr.com/blog/?p=240. She had meant to return some shoes to Zappos, but her mother passed away and, naturally, she just didn't have time. Zappos arranged to have UPS come pick up the shoes. And then sent her flowers.

Yahoo! shows nearly 2,000 links to her blog post, which has generated comments such as:
“Zappos is the best company in America.”
“Zappos is pretty amazing...you can sometimes find better prices at other stores for the same shoes, but their customer service is worth a few extra dollars.”
“Wow, customer service still exists. This company will get my business.”

There is no doubt that Zappos customer service costs are high. Not only is shipping free, but their customer service team has been given the authority to make gestures like the one above. The return to Zappos in terms of goodwill is almost immeasurable (although, their online reputation is excellent), but no doubt leads to increased referrals and sales and customer loyalty.

Sources: http://consumerist.com/consumer/above-and-beyond/zappos-sends-you-flowers-311369.php, http://www.zazlamarr.com/blog/?p=240]

When it comes to the marketing channel, CRM initiatives can be used both in the acquisition of new customers and in the marketing to existing customers (which can be seen as acquiring new sales from existing customers).

Using CRM to inform your eMarketing tactics

The chapters in this book have focused on the tactics of eMarketing. Managing customer relationships should be built into each tactic and all eMarketing activities.

Successful email marketing stems from a very basic customer need: privacy and permission. The very first step required in using email to establish a relationship with a customer is in gaining their permission.

Data mining and segmenting customer databases allows for email marketing to be tailored to customers, while emails allow for extensive personalisation albeit on a mass scale.

Email is often the primary point of contact for all customer service related messages, from automated emails dealing with the administration of orders, to contacts with the customer service team.

Online advertising is a double-edged sword when it comes to CRM. It can be a very effective acquisition tool for new customers, but intrusive advertising can attract attention for all the wrong reasons. Effective online advertising speaks to customers’ needs and presents solutions to them, hopefully attracting attention without being overly intrusive.

Affiliate marketing started by making the most of existing relationships other parties have with potential customers. Affiliate marketing can be an excellent sales and acquisition channel, but is not without its problems from a CRM perspective. Another entity is acquiring leads on your behalf, which can mean a loss of control when it comes to the messages used to attract leads. Ensure effective communication with affiliates so that they are sending the right message to your leads.

Search engine marketing, whether search engine optimisation (SEO) or pay per click advertising (PPC) starts with customer intent. Existing customer data can indicate where to focus search engine marketing efforts, especially when it comes to analysing how well a website caters to the intent indicated by a customer’s search term.

The use of social media is based on customer needs and preferences. Online reputation management tracks social media in particular (as well as other online sources) to establish consumer sentiment. This valuable data should then be used to inform an organisation’s marketing strategy. Social media also present a powerful tool for turning delighted customers (who are expressive online) into advocates for an organisation. Lastly, social media allows several new communication channels for an organisation, enabling customer communications and customer service to take place where the customer feels most comfortable.

Effective web development and design starts with customer needs, and should focus on the experience of web user. Designing for customers first and foremost should give web visitors a seamless experience, presenting your goods and services to them without effort on their behalf.

Through all of the eMarketing tactics, effective analytics is the most useful CRM tool. It allows each channel to be measured on its merits, and the customers acquired by each channel can be analysed.

Technology and CRM

Technology, and especially the technology enabled by the Internet, has had enormous repercussions for CRM. In many cases, technology has helped to streamline many CRM processes as well as to cut the costs of CRM initiatives.

Talking to customers: customer service
It is amazing how much technology has changed the ways we communicate with each other. In the same way, it has changed the way that organisations and companies can communicate with us.

Email
Perhaps one of the first customer service developments to come from the Internet is customer service over email. It is standard for websites to have contact addresses as well as telephone numbers, adding an additional channel for customer contacts. Emails can also be automated to keep customers informed of progress of a transaction, whether it be shipping goods bought online, or the progress of an insurance claim. Each action within an organisation can trigger an automatic email, serving to ensure customers feel informed at every step.

Mobile
Similarly to automated emails, the mobile phone is also being used to keep customers informed of the progress of transactions. SMS messages can be automated in the same way that emails are, again ensuring customer peace of mind.

Call centres
Technology such as VOIP (voice over IP) means that voice calls can be routed cheaply over the Internet. Thousands of people keep in touch around the globe with services such as Skype (www.skype.com), and this has impacted call centres as well.

Using similar technology, phone calls can be routed to call centres in any location around the globe. Many companies in developed nations have located their customer call centres to developing nations, where staff and other overhead costs are far lower. The Internet means that these calls can be routed for a lower cost than in country calls, with minimal loss of call quality. That means that a UK customer calling Lastminute.com, for example, to book a flight could in fact be speaking to someone in India.

The staff in these call centres undergo extensive training on the culture of the people they will be speaking to, as well as on the ethos of the company they represent. Even though a customer is speaking to someone on another continent, it is imperative for the business that the experience matches their brand as closely as possible.

IM and chat rooms
Instant messenger (IM) allows fast, instant text based chat. Services such as Windows Live Messenger, GTalk and Jabber keep people around the world (and in the same room!) connected. IM can also be an effective customer service channel.

When potential customers are on a website, they may have very quick questions or concerns that they need to have addressed before proceeding with an order. Sending an email with these questions can mean a lengthy period before these questions are answered, and they may be loath to pick up a phone to have the queries answered. In instances such as these, an IM service can easily, quickly and at low cost, solve these queries.

There are two main ways that IM is integrated onto websites. The first is customer initiated, and the second is initiated by a script on the webpage being viewed.

Customer initiated IM involves indicating clearly to a customer that the IM channel is available, while giving clear instructions on how to use it. Many free chat clients may be easily integrated in this way, such as Skype and Meebo.

A script can also be used to initiate a chat with a potential customer. When a web visitor has been on a webpage for a fixed period of time without performing any action (such as clicking on a link), a window can appear in the browser asking if they would like to chat with someone about the products on offer. The web visitor can then either close the window and continue on their own, or can choose to chat. If the latter is chosen, a customer service representative will then commence to chat to the consumer.

This can be extremely effective for complicated or expensive purchases. At the point of decision-making, the organisation can provide personal support and reassurance.

Managing interaction data
CRM software can be used to automate lead and sales processes, and to collect customer information in a centralised place.

Organisations are large, and a customer may speak to any member of an organisation, depending on the nature of the communication. It would be extremely frustrating for the customer to have to explain all previous dealings with the organisation with each communication, and it can be extremely frustrating for an organisation not to know who has spoken previously with a customer and what was dealt with.

Fortunately, there are many technology options that help to record all this information in one place, whether it be related to potential, current or past customers.

As well as enabling recording of data, most of these services can also schedule elements of the sales process, and set reminders where appropriate for follow up action.

Some notable examples include SalesForce, Genius and Highrise from 37 Signals.

Bespoke technology tailored to business problems can have remarkable results. The chapter case study highlights this.

Analysing data
One of the most powerful features of interactions and transactions over the Internet is that everything is tracked and recorded in server logs (see the chapter on web analytics and conversion optimisation), providing a wealth of data that can be analysed to make business decisions.

Importantly for CRM, this means that the acquisition source of customers may be recorded, and analysed against sales data for customers from the source. This leads to a very accurate ROI (return on investment) calculation and indicates where CRM and marketing efforts should be focused.

The key to effective use of technology in CRM is integration. Ensure that all channels can be tracked, and that that information is usable to all parties within an organisation. Knowing where your customers come from, but not what they purchase is pointless: these two metrics need to be compared in order to produce actionable insights.

VRM – a new way of looking at relationships

Vendor Relationship Management (VRM) is the reciprocal of CRM. VRM in this context describes an emerging, progressive school of thought, technology, tools and services that help customers to manage relationships with vendors. VRM tools and services are still very much in their infancy, as is the concept of VRM.

[note: If you are interested in reading further about VRM, the article “VRM in a nutshell” is a great place to start: www.vrmlabs.net/vrm-in-a-nutshell.]

VRM seeks to address the imbalance of power when it comes to customer and vendor relationships. Traditionally, vendors collect and hold information about a customer, and use it to get the most out of their relationship with the customer. For many vendors, “get the most out of the customer relationship” translates to making the most revenue for the lowest cost from a particular customer or group of customers. VRM notes that customers can be far better custodians of data that is very useful to vendors. For example, Amazon.com collects data about a customer’s purchasing and browsing history, and makes recommendations based on that history. However, the customer possesses information that Amazon.com doesn’t: e.g. the customer knows which books were purchased as gifts and therefore are not indicative of personal preferences.

The goal of VRM, however, is not to make sure that vendors have access to this information, instead it is to give customers the power over the information that is shared with vendors. Traditional CRM locks that data into a single relationship, while VRM seeks to give the customer the power to share pertinent data with vendors as he sees fit. These relationships can be controlled by the customer as opposed to by the vendor.

 VRM is a dynamic way of looking at customer-vendor relationships. Although the terms and tools may be new, the principles and the frustration with current practices are not.

For more information on VRM, visit the Project VRM wiki at http://cyber.law.harvard.edu/projectvrm/Main_Page, read the blog for the project at http://blogs.law.harvard.edu/vrm/ or visit VRM Hub at http://www.vrmhub.net or VRM Labs at http://www.vrmlabs.net.

Further reading
http://www.insidecrm.com/
http://www.churchofthecustomer.com/
http://blogs.law.harvard.edu/vrm/
The Cluetrain Manifesto



 

The second version of the textbook is growing step by step, and the latest chapter on Market Research is ready to be reviewed. As usual please have a look through and let us know what you think and if if there changes or additions you feel should be made. We look forward to your feedback!

Introduction

While the Internet was developed as a military project, the World Wide Web was developed as tool for academics to allow information to be shared freely. This foundation of the Web as an information tool has had profound effects on the markets we transact in.

Consider that consumers are able to research companies and products easily, gathering information to compare prices and service with a few clicks of the mouse. Consumers are also able to share likes and dislikes easily, whether that information is shared with companies or with friends.

Likewise, the Web has an impact on market research. Its foundations in academia make it ideal for secondary research, with reports and data filed, indexed and available via a few savvy searches. Technology can also be used to easily, and accurately, conduct surveys. The connected nature of the Web also makes it possible to record data about consumers’ online habits.

For example, when researching the penetration of broadband in a particular market, a few web searches will reveal plenty of sources that can be compared and verified. If a company is wanting to gauge the demographics of visitors to their website, an online survey may be offered to website visitors. Thirdly, online reputation management tools allow companies to track consumer sentiment expressed online.

Key terms and concepts

What is market research?

Market research is a process that aids business decisions. It involves systematically gathering, recording and analysing data and information about customers, competitors and the market.

Research can be based on primary data and information, or secondary data and information. Primary research is conducted when data or information are gathered for a particular product or hypothesis. This is where information does not exist already or is not accessible, and so needs to be specifically collected from consumers or businesses. Surveys, focus groups, research panels and research communities can all be used when conducting primary market research.

Secondary research uses existing, published data and research as a source of research. It can be more cost effective than conducting primary research, and the Internet opens a wealth of resources for conducting this research. However, the data would have originally been collected for solving problems other than the one at hand, so might not be sufficiently specific. That being said, secondary research can be useful in identifying problems to be investigated through primary research.

Research can also be classified as qualitative or quantitative. Qualitative research can be classified as exploratory. Qualitative research aids in identifying potential hypotheses, whereas quantitative research puts hard numbers behind these hypotheses. Qualitative research seeks to find out what potential consumer perceptions and feelings exist around a given subject. This research can often be used to advise the design of quantitative research, which relies on numerical data to demonstrate statistically significant outcomes.

The Internet is a useful tool for both primary and secondary research, and can be used to gather both qualitative and quantitative data. In fact the communities on the Web can be viewed as one large focus group, regularly and willingly sharing their opinions on products, markets and companies. Today, organisations transacting online have a wealth of research information freely available to them, and sophisticated tools for gathering further data.

Market research should produce information that leads to actions.

Quantitative and Qualitative Research

Quantitative research gathers data that can be statistically analysed to determine results. Data must be formally gathered, and should be collected to test a hypothesis as opposed to determine a hypothesis.

Qualitative data can be more difficult to quantify. Typically, because base sizes are smaller and not necessarily representative of the market under investigation (as it can be more expensive and time consuming to gather and analyse the data), qualitative data cannot be taken as quantified.  It is however valuable in aiding a researcher in interpreting the market perspective. It is possible to combine approaches, producing data that can be used both qualitatively and quantitatively.

For example, in the chapter on online reputation management, tools that can track brand name mentions are outlined. This data can then be analysed qualitatively, where the researcher can examine the mentions and use their judgement to determine sentiment, or quantitatively, where mentions can be assigned numeric values across a range of categories which are used to generate a reputation score, such as BrandsEye’s online reputation algorithm.

When both qualitative and quantitative research are used, usually qualitative research takes place first to get an idea of the issues to be aware of, and then quantitative research tests the theories put forward in qualitative research.

The following table aims to look at the main differences between quantitative and qualitative research.

(**Example table, to be adapted).

(source: http://www.gifted.uconn.edu/siegle/research/Qualitative/qualquan.htm)

Gathering data: quantitative and qualitative research

Both quantitative and qualitative research can be conducted using primary or secondary data, and the Internet provides an ideal tool for both avenues.

Web analytics packages are a prime source of data. Using data such as search terms, referral URLs and internal search data can lead to qualitative assumptions about the consumers visiting a website. However, when data is measurable and specific, such as impressions and click through rates, this leads to quantitative research.

[note: Sample size is an important factor in conducting research, and that sample should be representative of the population you are targeting as a whole. If your business transacts both online and offline, beware that using only online channels for market research might not be representative of your target market. However, if your business transacts only online, offline channels for your market research are less necessary.]

Online research panels and online research communities

Research panels and research communities are two means for conducting research. Whereas research panels are primarily used when conducting quantitative research, research communities primarily provide quantitative data. The Internet comes to the fore when considering research communities, as social media such as social networks and blogs already provide the framework for people to connect and interact with each other. Most panels, whether online or offline, are not about member-to-member interaction. Research panels seek to address the “what” using surveys to gather quantitative data. Research communities primarily use discussions, driven online by blogs and other media sharing communities.

For example, for the launch of a new product a company might want to determine what customers have in their fridge. Quantitative analysis would be to develop a survey that could be completed by a representative sample of their target market, aimed at discovering what consumers have in their fridges.

Qualitative analysis would be to go to a community photo sharing site, such as www.flickr.com, and use a simple search to look at the photos the members have uploaded of the content of their fridges.

[Discussion point: Qualitative research and quantitative research must both be presented in such a way that they can lead to actionable insights. How would you use a community tool such as Flickr when presenting this data?]

Surveys are an ideal means of gathering quantitative data, provided they are designed in such a way that the answers are assigned values that can be measured statistically. See later in this chapter for a consideration of survey design.

Focus groups have long been a stalwart of market research, and the Internet provides a means to conduct regular focus groups. Focus groups can consist of one person, such as in a listening lab when testing the usability of a website, or can be of the entire Internet population, such as when looking at global search data.

If your online audience is large enough and vocal enough, their opinions can and should be tracked and measured as part of a market research process. Be aware, however, to account for the bias in this group.

Primary and secondary research

The Internet is a useful tool when conducting both primary and secondary research. Not only are there a number of free tools available when it comes to calculating things such as sample size and confidence levels (see Tools of the Trade for some examples), but it is also an ideal medium to reach large numbers of people for a relatively low cost. Notably, the origins of the Web as a network for academics to share information make it a useful tool for researching existing research reports.

The Internet and secondary research

Market research based on secondary resources uses data that already exist for analysis. This includes both internal data and external data, and is useful for exploring the market and marketing problems that exist.

Research based on secondary data should precede primary data research. It should be used in establishing the context and parameters for primary research.

Uses of secondary data:

1. The data can provide enough information to solve the problem at hand, thereby negating the need for further research.
2. Secondary data can provide sources for hypotheses that can be explored through primary research.
3. Sifting through secondary data is a necessary precursor for primary research, as it can provide information relevant to sample sizes and audience, for example.
4. The data can be used as a reference base to measure the accuracy of primary research.

Companies that transact online have a wealth of data that exists due to the nature of the Internet that can be mined. Every action that is performed on the company website is recorded in the server logs for the website.

[note: See the chapter on web analytics and conversion optimisation for details of how to use web analytics.]

Customer communications are also a source of data that can be used, particularly communications with a customer service department. Committed customers who either complain, comment or compliment are providing information that can form the foundation for researching customer satisfaction.

Social networks, blogs and other forms of social media have emerged as forums where consumers discuss their likes and dislikes, and can be particularly vocal about companies and products. This data can, and should, be tracked and monitored to establish consumer sentiment. If a community is established for research purposes, this should be considered primary data, but using social media to research existing sentiments is considered secondary research.

[note: The chapter on online reputation management goes into detail on using the Internet to track and monitor online mentions of a product, company or brand.]

The Internet is an ideal starting point for conducting secondary research based on published data and findings. But, with so much information out there, it can be a daunting task to find reliable resources.

The first point of call for research online is usually a search engine, such as www.google.com or www.yahoo.com. Search engines usually have an array of advanced features, which can aid online research. For example, Google offers:

• Advanced search
• Google Scholar
• Google Book Search

Learning how to use search engines to find the information you need is a valuable skill in using the Internet for research.

Many research publications are available online, some for free and some paid for. Many of the top research companies feature analyst blogs, which provide some industry data and analysis for free. Some notable resources are:

• www.e-consultancy.com
• www.jupiterresearch.com
• www.hitwise.com
• www.pewinternet.org (US data)
• www.worldwideworx.com (SA data)

The Internet and primary research

Primary research involves gathering data for a specific research task. It is based on data that has not been gathered beforehand. Primary research can be either qualitative or quantitative.

Primary research can be used to explore a market and can help to develop the hypotheses or research questions that must be answered by further research. Generally, qualitative data is gathered at this stage. For example, online research communities can be used to identify consumer needs that are not being met and brainstorm possible solutions. Further quantitative research can investigate what proportion of consumers share these problems and which potential solutions best meet those needs.

[Note: In 2005, General Motors launched a blog called Fast Lane. They said: “We've been wanting to create this direct line of communication so that our various stakeholders aren't going to message boards to talk about us - they have an opportunity to come and talk directly to us. We're big into getting feedback from our customers, employees and others, taking their comments to become a better company and develop better products. We're really getting some excellent feedback. Just about every discussion we have on the FastLane blog, we've had an excellent dialog.” This communication medium has become an important source of customer research, eliciting comments and feedback from committed consumers. Source: http://www.commoncraft.com/interview-michael-wiley-gm-fastlane-blog]

Online research communities

Although online communities are a valuable resource for secondary research, communities can also provide primary data. General Motors’ Fast Lane blog is an example of an online research community that aids gathering of research data. The blog can be used as a means to elicit feedback to a particular research problem. This is qualitative data that can aid the company in exploring their research problem further.

Listening labs

When developing websites and online applications, usability testing is a vital process that will ensure that the website or application is able to meet consumers’ needs. Listening labs involve setting up a testing environment where the use of a website or application by a consumer may be observed.

[Discussion point: Whom would you select to participate in listening lab exercises? How do you think the demographic of your population affects the outcome of these tests?]

Conversion optimisation

Conversion optimisation aims to determine the factors of an advert, website or webpage that can be improved so as to make the website convert best. From PPC advertising, to email subject lines to shopping cart design, tests can set up to test what variables are affecting the conversion rate of visitors to the website.

In the chapter on web analytics are details and tools for running tests, such as A/B split testing and multivariate testing.

Online surveys: gathering data

When developing surveys you can combine qualitative data with quantitative data – it just depends on how the questions are asked. Conducting surveys online allows for data to be captured immediately, and data analysis can be performed easily and quickly. By using email or the Web for conducting surveys, geographical limitations for collecting data can be overcome cost effectively.

Developing technology also allows for sophisticated and user-friendly surveys to be compiled. For example, as opposed to indicating impressions on a sliding scale, respondents can indicate emotional response.

(Source: http://www.metaphorix.uk.com/)

Vs.

Rate how you feel about a brand:
negative      neither positive nor negative      positive

Developing surveys: asking questions

The success of a survey in gathering useful data is largely determined by the design of the survey, and particularly by the questions that are asked. A survey can comprise of any number and types of questions, and these should be structured in such a way that more complicated questions only appear once users are comfortable with the survey.

Be careful when creating questions that you do not introduce bias by asking leading questions.

Example of leading question bias:  

Example: We have recently introduced new features on the website to become a first class web destination. What are your thoughts on the new site?

Replace with: What are your thoughts on the changes to the website?

Questions in the survey should be brief, easy to understand and, most of all, easy to answer.

Types of survey questions

1.Open-Ended Types

Open-ended questions allow respondents to answer in their own words. This usually results in qualitative data.

[note: If there are enough respondents to an open-ended question, the responses can be used quantitatively. For example, you can say with some certainty, “37% of people thought that case studies were an important feature.”]

Example:
What features would you like to see on the website for the eMarketing textbook? _____________________________________________________

2.Closed–Ended Types (Multiple Choice – One Answer or Multiple Answers)

These questions give respondents specific responses to choose from. This results in quantitative data.

Example:
Do you use the eMarketing textbook website? Choose one that applies.
Yes
No

What features of the eMarketing textbook website do you use? Check all that apply.
Blog
Case studies
Free downloads
Additional resources

3.Ranked or Ordinal Questions

These questions ask respondents to rank items in order of preference or relevance. Respondents are given a numeric scale to indicate order. This results in quantitative data.

Example:
Rate the features of the eMarketing textbook website, where 1 is the most useful and 4 is the least useful.
Blog
Case studies
Free downloads
Additional resources

4.Matrix & Rating Types

These types of questions can be used to quantify qualitative data. Respondents are asked to rank behaviour or attitude.

Example:
The eMarketing textbook website is a useful tool for further studies.

Strongly Disagree    Disagree   Neutral  Agree  Strongly Agree

         1                            2              3           4                5

Or
The eMarketing textbook website is a useful tool for further studies.

Strongly Disagree                                         Strongly Agree

         1                        2            3           4            5

Rating scales can be balanced or unbalanced. When creating the questions and answers, choosing balanced or unbalanced scales will affect whether you are collecting data where someone can express a neutral opinion or not.

Example 1 Balanced:

Very Poor     Poor     Average    Good   Excellent

    1                  2             3              4            5

Example 2 Balanced:

  Poor         Average      Good      Very Good      Excellent

    1                   2               3                4                    5

How to get responses: incentives and assurances

(source: http://www.mobilemarketingwatch.com/)

As the researcher, you know what’s in it for you in sending out a survey: you will receive valuable data that will aid in making business decisions. But what is in it for the respondents?

According to Survey Monkey, the ways in which the surveys are administered play a role in response rates for surveys and these can be relative:

• Mail: 50% adequate, 60-70% good to very good
• Phone: 80% good
• Email: 40% average, 50-60% good to very good
• Online: 30% average
• Classroom pager: 50+% good
• Face to Face: 80-85% good

Response rates can be improved by offering respondents an incentive for completing the survey, such as a chance at winning a grand prize, a lower priced incentive for every respondent, or even the knowledge that they are improving a product or service that they care about.

There is a train of thought that paying incentives is not always a good thing.  Amongst less affluent or educated respondents it may predispose them to feel that they need to give so-called “good” or “correct” answers which may bias your results. Alternatively you may attract respondents who are in it just for the reward. One approach could be to run the survey with no incentive with the option to offer one if responses are limited. 

Designing the survey so as to assure respondents of the time commitment, and privacy implications, of completing the survey can also help to increase responses.

Conducting research surveys: a step-by-step guide

As with all things eMarketing, careful planning goes a long way to determining success. As market research can be an expensive project, it is important that planning helps to determine the cost vs. the benefit of the research. Qualitative research and secondary research are critical steps in determining whether a larger scale research project is called for.

Bear in mind that many tasks that fall under the umbrella of research should be ongoing requirements of eMarketing activities, such as conversion testing and optimising and online reputation management. Polls and small surveys can also be conducted regularly, and non-intrusively, among visitors to your website.

1. Establish the goals of the project - What you want to learn

Secondary research can be used to give background and context to the business problem, and the context in which the problem can be solved. It should also be used to determine alternative strategies for solving the problem, which can be evaluated through research. Qualitative research, particularly using established online research communities, can also help in determining what the business problems are that need to be solved. Ultimately, determine what are the actions you will be considering after the research is completed, and what insights are required to make a decision on those actions.
 
2. Determine your sample - Whom you will interview

You do not need to survey the entire population of your target market. Instead, a representative sample can be used to determine statistically relevant results. See Tools of the Trade for some online calculators for determining sample size.

In selecting a sample, be careful to try to eliminate bias from the sample. Highly satisfied customers, for example, could give very different results to highly dissatisfied consumers.

3. Choose research methodology - How you will gather data

The Internet provides a multitude of channels for gathering data. Surveys can be conducted online or via email. Online research panels and online research communities can all be used for gathering data. Web analytics can also be used to collect data, but this is passive form of data collection. Determine what will provide you with the information you need to make decisions. Be clear of your research calls for qualitative or quantitative data as this determines the methodology as well.

4. Create your questionnaire - What you will ask

Keep the survey and questions simple and ensure that the length of the survey does not overwhelm respondents. A variety of questions can be used to make sure that the survey is not repetitive.

Be sure when creating the questions that you keep your goals in mind: don’t be tempted to try to collect too much data, or you will likely overwhelm respondents.

5. Pre-test the questionnaire, if practical - Test the questions

Test questionnaires to determine if questions are clear and that it renders correctly. Ensure that test respondents understand the questions, and that they are able to answer them satisfactorily.

6. Conduct interviews and enter data - Ask the questions

Run the survey! Online surveys can be completed by respondents without your being present, you just need to make sure that you get it in front of the right people. A survey can be sent to an email database or can be advertised online.

7. Analyse the data - Produce the reports

Remember that quantitative data must be analysed for statistical significance. The reports should aid in the decision making process and produce actionable insights.

Room for error

With all research, there is a given amount of error that needs to be dealt with. Errors may result from the interviewers administering a questionnaire (and possibly leading the respondents) to the design and wording of the questionnaire itself, sample errors and respondent errors. Using the Internet to administer surveys and questionnaires removes the bias that may arise from an interviewer. However, with no interviewer to explain questions, there is potential for greater respondent error. This is why survey design is so important, and why it is crucial to test and run pilots of the survey before going live.

Respondent error also arises when respondents become too used to the survey process. There is the possibility of respondents becoming desensitised. There is even a growing trend of professional survey takers, especially where there is an incentive involved. The general industry standard is to limit respondents to being interviewed once every six months.

Sample error is fact of market research. Some people are just not interested in, nor will ever be interested in, taking part in surveys. Are these people fundamentally different, with different purchasing behaviour, from those who do? Is there a way of finding out? To some extent, web analytics, which tracks the behaviour of all visitors to your website, can be useful in determining the answer to this question.

When conducting any survey, it is crucial to understand who is in the target universe, and what the best way to reach that target universe is. Web surveys exclude elements of the population, due to access or ability. It is vital to determine is this is acceptable to the survey, and to use other means of capturing data if not.

Conducting research: who’s going to pay?

Regular research is an important aspect of the growth strategy of any business, but it can be tough to justify the budget necessary for research without knowing the benefit to the business. Conducting research can cost little more than the time of someone who works for a company, depending on the skills base of employees, or it can be an expensive exercise involving external experts. Deciding where your business needs are on the investment scale depends on the depth of the research required, and what the expected growth will be for the business. When embarking on a research initiative, the cost to benefit ratio should be determined.

Testing should be an ongoing feature of any eMarketing activity. Tracking is a characteristic of most eMarketing, which allows for constant testing of the most basic hypothesis: is this campaign successful in reaching the goals of the business?

Summary

Market research is the gathering and analysing of data for the purpose of understanding a market and making business decisions. Information can be gathered about customers, competitors and the market.

Research can be conducted based on secondary data, which refers to information or data that is already published or recorded, or based on primary data, which are data gathered specifically for a particular research problem.

Research can also be qualitative or quantitative. The Internet provides the tools for online research communities for gathering qualitative data, while online tools such as surveys and web analytics packages are ideal for gathering quantitative data.

Tools of the trade

www.surveymonkey.com for creating online surveys
Split test calculator
Sample size calculator:
http://www.rogerwimmer.com/mmr/samplesizecalculator.htm
http://www.rogerwimmer.com/mmr/mmrsampling_error.htm
http://www.rogerwimmer.com/mmr/mmrsampling_error99.htm
Internet Usage World Stats http://www.internetworldstats.com/
Google Insights http://www.google.com/insights/search/
Silverback usability testing software http://www.silverbackapp.com/

Further reading

http://www.pluggedinco.com/blog/
http://blog.freshnetworks.com/category/topics/onlineresearchcommunities/
http://s3.amazonaws.com/SurveyMonkeyFiles/SmartSurvey.pdf Smart Survey Design

References

To be included with textbook.

 

This is the final draft of the our new chapter: eMarketing Strategy. I'm publishing it here to get any feedback or comments you may have, so please don't hold back! Have a read through and please make suggestions in the comments.

Introduction

A strategy is a long-term plan of action aimed at achieving a particular outcome. Tactics refer to the immediate actions taken to execute a strategy. While most of the chapters in this textbook refer to the tactics that the Internet has afforded to marketing, the essential first step to executing any online campaign is in the planning: strategy.

Strategy comes from the Greek stratēgos, which itself is derived from two words:
- stratos for army, and
- ago for leading.

Tactic also comes from Greek: taktika for deploying or arranging.

In wars and business, a strategy usually intends the same outcome: winning.

Treatises on strategy abound. "The Art of War" was written by Sun Tsu in the 6th century BC, and this ancient Chinese text on military strategy today often forms the foundation of business strategy. Move forward a few millennia, and a course in marketing will include Porter’s five forces, McCarthy’s 4 Ps and Humphrey’s SWOT analysis. At the time that the framework for the Internet was being researched and developed, economists and academics were laying the foundation for principles still leading marketing thought today.

How the Internet has changed the world we market in

The connected Internet has had a far greater impact on marketing and business than the ubiquitous email newsletter and the need for search engine optimisation. It is not only the way in which products and services can be marketed that has changed, but new products and services are being developed. It has changed the types of products that can be sold, changed the market for products in terms of geography, had a huge impact in the way products are sold and marketed, and importantly has seen a significant shift in the balance of power between businesses and consumers. Where marketing once was seen as a one way broadcast channel, with customer wants and needs driven by focus groups, today effective marketing is based on a two-way conversation that happens person to person.

However, the Internet does not necessarily mean throwing out the rule book of marketing and business foundations and principles. Instead, the Internet provides a new environment in which to build on these principles. Profit is still revenue less cost. The Internet does not change that.

The Internet and the Marketing Mix

McCarthy’s four Ps of marketing are Product, Price, Placement and Promotion. Developing technology, naturally, has an effect on all of these, and the Internet in particular has seen fundamental shifts not only in the means available to promote products, but also in the placement, or distribution of products. Although tools for research, retention, distribution and product creation have changed dramatically, the fundamental principles of marketing still guide strategy.

Products and Services
Products and services are what a company sells. From fast moving consumer goods to digital products such as software to services such as consultancy, the Internet has allowed for a plethora of new products.

Technology allows for mass customisation of products, seen in a growing trend of letting customers customise goods online before they are created. For example, NIKEiD and Converse both allow customers to create their own trainers based on a number of preset options, that will then be manufactured to the customer requirements. In a similar fashion, computer products can be built to specifications, as the costs of offering this type of service to customers is reduced by the Internet.

Digital products can exist because of the Internet. The very framework of the Internet allows for products such as software and digital music to be distributed. The Internet as a distribution medium is what makes these products possible.

Price
With customers able to easily access pricing information from a number of suppliers with relative ease, the Internet is growing a market of near perfect competition (Porter, 2001). The prevalence of search engines and of shopping comparison websites, such as www.pricerunner.com and www.nextag.com, make it easy for customers to compare product prices across a number of retailers. The temptation for companies to differentiate themselves on price has lead to decreased prices for many commodities, from the regularly reduced pricing of books on Amazon.com to ticket prices on low cost airlines such as EasyJet in Europe.

Placement or Distribution
Particularly for digital products and services, the Internet gives companies access to a global marketplace. Product distribution and markets no longer have to be dictated by location. With efficient delivery and shipping channels, products that are not digital can also benefit from a far wider market place. The Internet allows the basic foundations of mail order businesses to flourish online with a catalogue that is cheaper to produce and update, and cheaper to distribute: a website. In the travel industry, travel agents stopped issuing paper tickets as of 31 May 2008. Nearly all aeroplane tickets are now e-tickets.

Technology such as APIs, SOAP services, RSS and XML allow information and services to be distributed throughout the world. For example, the API for a hotel reservations database, Starfish Luxury Travel Distribution, allows a diverse range of websites to offer instant online bookings for hotels in the inventory. Partners with booking engines include http://starfishinteractive.com/, http://www.spaworld.tv/ and http://www.timesonline.co.uk/.

[note: An API is an Application Programming Interface. Essentially, an API gives instructions and rules for communicating with another programme or database. This allows, for example, different companies and developers to build different front-end systems that all communicate with the same database.]
 
This is both a huge opportunity and a huge challenge for businesses. On the one hand, it can allow niche products and markets to flourish in a global space. On the other hand, it can be tempting for a marketer to try to reach too many markets at once. A global market place is also not yet fully supported by national banking and tax legislation.

Promotion
The Internet as an information and entertainment medium naturally lends itself to be used to promote products. The online promotional mix is an extension of the offline, but with some significant differences: online promotion can be tracked, measured and targeted far more sophistically than offline. Advertising, personal sales, promotions based marketing and public relations can all be conducted through the online medium. These tactics are developed further in this textbook.

New Ps and New Marketing
Well known marketing guru Seth Godin says that marketing is actually about five elements

• Data - that which we observe (and made the easier to gather and mine through the use of the Internet)
• Stories - everything you do and say
• Products (services) - the physical manifestation of the story
• Interactions - all the tactics a marketer can use to "touch" the prospect or customer
• Connection - the end goal: creating a relationship

But Seth Godin is not the only smart marketer challenging the 4 Ps. Iris Mootee put forward 4 new Ps for marketing in the connected environment:

• Personalisation
• Participation
• Peer-to-Peer Communities
• Predictive Modelling

Personalisation
Databases and the use of cookies to remember web visitors allow for online experiences to be tailored to particular web visitors. Amazon makes use of personalisation to recommend books to customers based on their past purchases.

Participation
With the growth in social media and consumer generated content, customers are demanding, and taking, a stake in the brands that they use. Savvy companies can encourage participation through onsite reviews and allowing customers to upload images and video, and all companies should be aware of the many ways that consumers are participating.

Peer-to-Peer Communities
Peer-to-peer communities can be seen to work with customer participation. Through social media, existing customers can be a company’s greatest asset, or greatest detractor. Equipping an engaged and active customer base with the tools to spread a message should be an integral part of a long-term eMarketing strategy.

Predictive Modelling
The connected nature of the Internet allows for every action online to be tracked, measured and stored. Huge amounts of data, both anonymous and identifiable, are being stored daily. Analysis on this data can provide insight into solving marketing problems. For example, in PPC advertising, data is gathered that over time will indicate the optimal keywords and max CPC bids for effective bidding.

Godin’s five marketing elements are reminiscent of The Cluetrain Manifesto’s premise that “markets are conversations”, and both highlight the importance of marketing as people talking to people. This is not a new phenomenon brought on by the World Wide Web. Instead, the Web has served to act as a global focus group, with participants eager to share their thoughts, discoveries, likes, dislikes and any other sentiment.

Mootee’s 4 Ps focus on what technology brings to the original marketing mix. Technology has allowed for mass customisation, not just in marketing messages, but in content and product creation. It has seen brands that allow customer participation in spreading and even creating their messages and products succeed. The growth of social networks online, and the recognised importance of product reviews in the buying cycle is reflected in peer-to-peer communities. Lastly, the Internet is useful in tracking and gathering data, which can be mined and analysed for opportunities for growth.

What recent approaches to marketing strategy have in common is one growing theme: customer centric marketing.

The strength of the Internet is demonstrated in the way it underlines connections. The very fabric of the Internet is based on hyperlinks – being able to link from one document to another. These technical connections are mirrored in the need for marketing to appeal to customer’s feeling of connection in the social sense.

Customer centric marketing
Customer centric marketing infers that by understanding the needs of the customer first and foremost, business outcomes will be achieved. Looking at the marketing mix from a customer centric perspective should result in products and strategies that are meeting the needs of potential customers, as opposed to a need to invest in expensive, interruptive advertising to convince customers of a need that they do not have.

Products
Products and services should be designed from a customer perspective, based on their needs.

Price
When considering pricing from a customer perspective, it is tempting to believe that lowest price is best. While that can attract customers in the short-term, focusing on the value of the product and the services offered with it is a better strategy for long-term growth. The customer approach to pricing considers value. The key is to build a long-term cost advantage.

Placement
The customer centric approach to placement recognises that you cannot dictate the manner in which customers find you online: from the search engine and keywords they could use to find your service, to the browser and device they are using when accessing your website.

Promotion
The Internet was not created as a marketing tool: it was created to share information. The number of people accessing the Internet, the amount of time spent online and the commerce that takes place online make it an attractive marketing environment.
 
eMarketing Strategy: developing a marketing plan

An eMarketing strategy should not be created in isolation to an offline strategy. Instead, marketers need to take a holistic view of all business objectives and marketing opportunities. Offline and online activities should complement each other, both having the potential to reach different audiences in different ways. However, the Internet is exceptionally useful as a research and information tool in the strategy process.

Step 1: Know yourself and know your market

The starting point for any business and marketing strategy is to know who you are. “You” refers to the organisation as a whole (although, of course, a little bit of self discovery is always advised). While this can, and should, be re-addressed periodically, start by looking at what the business problems are right now, so that a strategy can be developed that solves these problems.

• What is the nature of the organisation now?
• Who are the customers and what are their needs? How can the organisation fulfil the needs of the customer?
• What is the social context that the organisation operates in?

Step 2: Strategic Analysis

With a solid understanding of where the organisation is right now, further analysis systematically evaluates the organisations environmental and social context, objectives and strategies so as to identify weaknesses and opportunities.

Porter’s Five Forces Analysis

Porter’s Five Forces Analysis is useful in understanding the attractiveness of the market in which an organisation is transacting. However, this framework for analysis was developed before the Internet, which has disrupted the markets in which we operate.

Production and distribution costs in many industries have been drastically lowered; the barriers to entry and costs of switching are reduced. This means that there are more competitors in the market as the barriers to entry for new organisations is reduced, and that cost is less likely to inhibit customers from switching to a competing product as there are less likely to be high costs associated with doing so. Perhaps most importantly, the bargaining power of end users is increased as they have greater access to information when making a purchase decision.

Often, the Internet migrates competition primarily to price (Porter, 2001). This means that organisations seek to attract and retain customers solely through offering services and goods at a lower price, though this is not necessarily the best strategy for companies to follow. Strategic differentiation comes from the value that a company can provide to a consumer.

Competitors

When analysing competitors, it is not only product and price that lead the discovery process. While there may be obvious competitors in the same industry, an organisation needs to consider what (or who) else may be vying for consumers’ attention and valuable search engine traffic

In identifying competitors, analyse the needs of your customers, and determine how else customers might fulfil those needs. Products and services are not only competing for customers’ money: they are fundamentally competing for customers’ attention.

Considering the customised Converse shoes: the customer needs are not likely to be that they have bare feet. Instead, the shoes are fulfilling a customer’s need for individuality and self-expression. NikeID is an obvious competitor, but so is a service like Face Your Manga that allows Web users to create custom Manga avatars to use online.

Step 3: Set Marketing Objectives

Marketing objectives are the desired outcomes of the marketing plan. What are the specific goals that will indicate the success of the marketing strategy?

These should be unique to an organisation, and are based around the outcomes that will make money for the organisation. This is a strategy, so the focus is on long-term success. Establish milestones that will indicate that the strategy is on the path to success.

Step 4: Generate Strategies and Tactics for Achieving Objectives

It’s time to put into practice the tactics covered in this textbook. Based on your analysis of your organisation and its objectives, consider strategies and tactics that will help you to meet these objectives.

For example, an objective could be the acquisition of new customers. A tactic could be display advertising on content websites that reflect your target market.

If customer retention is the objective, an email newsletter strategy can help to build relationships with an existing interested database of prospects.

Step 5: Evaluate Strategies

After having generated strategies, they need to be evaluated against the needs and resources of your organisation. At this stage, it can be useful to follow Humphrey’s SWOT analysis for a full analysis of the strategies generated.

For each strategy, a SWOT analysis reveals the Strengths, Weaknesses, Opportunities and Threats afforded by a strategy (and of course can be used to evaluate the plan in its entirety).

SWOT analysis will reveal the feasibility and the attractiveness of the strategies generated.

[diagram of SWOT analysis]

The needs of the organisation include:

• Long-term goals
• Short-term objectives
• ROI

The resources of the organisation include:

• In house talent and staff
• Budget
• Contracted agencies

Step 6: Implement

You know what you want, and you’ve made a plan for how to get it. Now do it.

Step 7: Track, Analyse, Optimise

eMarketing’s chief advantage over offline marketing? It uses hyperlinks to spread messages. This means that eMarketing can be tracked, the data can be analysed and this can then feed back into the planning to optimise the marketing strategy.

The Internet allows you to track each tactic on its own, and then intelligent analysis should allow you to consider how these tactics work together.

eMarketing and Marketing

eMarketing refers specifically to marketing using the Internet, but holistic strategies allow companies to make the most of their budget through integrating online and offline activities. eMarketing should not be seen as separate or an afterthought to a marketing strategy. Instead, businesses should focus on their customers, and use the channels most likely to reach their target market based on budget.

The cornerstone of a successful eMarketing strategy is flexibility. With near real-time reporting, the likely success of any campaign or channel can be gauged quickly. Flexibility allows for focus to be shifted as new opportunities and challenges arise.

• Tactic
• Outcome
• Email Marketing
• Customer Retention
• Online Advertising
• Branding, Acquisition
• Affiliate Marketing
• Sales, Branding
• SEO
• Customer Retention and Acquisition
• PPC
• Customer Retention and Acquisition
• Social Media
• Branding and Participation
• Viral Marketing
• Acquisition and Branding
• ORM
• Customer Retention, Branding, Participation
• WebPR
• Acquisition and Branding

Online tools for gathering market intelligence

In the chapter on online reputation management, many tools were detailed which allow an organisation to gather information related to their business and those of competitors. These same tools also prove invaluable for market research, especially when keywords monitored are chosen to reflect industry trends.

Search data for both SEO and PPC
SpyFu
Quirk SearchStatus
SEO Book's Rank Checker

Watching competitor activities
ChangeDetection
Google Alerts
BrandsEye
Google Patent Search

Trends and market research
Google Insights
Flickr
Delicious
Google AdWords External Keyword Tool

When researching competitors, never forget the basics: visit their websites! Not only can you gather basic price and product information, but it can be relatively easy to discover information about their marketing initiatives such as affiliate marketing.

eMarketing strategy in action

We need a case study here – can we use the textbook?