L2 Digital Landscape & Digital Consumers PDF

L2 Digital Landscape & Digital Consumers IT2863 Digital Marketing AY2023S2 Official (Closed) and Non-Sensitive Learning Outcomes 1. Describe the changing business landscape for online business models. 2. Outline the basic principles of on...

L2 Digital Landscape & Digital Consumers IT2863 Digital Marketing AY2023S2 Official (Closed) and Non-Sensitive Learning Outcomes 1. Describe the changing business landscape for online business models. 2. Outline the basic principles of online consumer behaviour and online customer journey. 3. Identify and apply the concepts of persona creation. Official (Closed) and Non-Sensitive Changing Landscape I : Online Business Models  Strategy is the means to achieve any goal. Organisations will select 1 or more business models as part of its business strategies to accomplish its organisational goals  An e-business or online business model refers to the method by which the organisation chooses to sustain its business online, which includes the value proposition of the business for customers and revenue streams, through the use of digital technologies. Official (Closed) and Non-Sensitive Changing Landscape I : Online Business Models  Examples of Business-to-Consumer (B2C) Business Models  E-tailer (eg Fairprice, Zara, Apple)  Community Provider (eg Facebook, LinkedIn)  Content Provider (eg Netflix, E-magazines, The Straits Times Online)  Portal (eg Yahoo)  Transaction Broker (eg real estate broker, stock broker)  Market Creator (eg eBay, Shopee)  Service Provider (eg photo sharing, Google docs) Official (Closed) and Non-Sensitive Changing Landscape II: Technological Convergence to Disruptive Technologies  Technological convergence is the process by which existing technologies merge into new forms that bring together different types of media and applications.  Eg Smart TV, Internet Radio, Smart refrigerator  Seek ways to delight consumers through technological convergence  Companies are moving away from singular purposes or functions, to devices or platforms that perform a range of functions. Official (Closed) and Non-Sensitive Disruptive Technologies  Successful firms such as Grab, Airbnb, Carousell, Foodpanda etc are usually referred to as disruptors as they usually disrupt an entire industry.  The rise of sharing economy has also brought about innovative platforms for users to share/lease assets and resources Official (Closed) and Non-Sensitive Disruptive Technologies  Disruptive Technologies usually:  Create or attract a new market segment  Disrupts an existing market with the introduction of new substitute products  Present a different business model from existing businesses in the industry Official (Closed) and Non-Sensitive The Digital Consumer  Individuals who grew up in the era of the Internet would have become very used to connectivity online.  They usually turn first to digital channels for communication, information and entertainment.  This is termed Digital Primacy  Digital Primacy is growing given the rise in number of people who cannot do without connectivity online.  What do we know of the digital consumer? The core principle of marketing and sales is "Know The Customer" Who "consumes" (shop, entertain, browse etc) online? How do consumers behave online? Why shop online? What do they buy? Official (Closed) and Non-Sensitive The big surge in digital adoption is the real deal  With the pandemic waning, adoption is still strong even as consumers venture out of their homes to shop and conduct business.  Consumers are accessing twice the number of industries online, on average, as they did before the pandemic Source : https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/digital-resilience-consumer-survey-finds- ample-scope-for-growth Official (Closed) and Non-Sensitive Community Effects  Social networks, recommender systems and co-purchase networks, such as TripAdvisor, Amazon, Taobao, Lazada etc, play an important role in influencing consumer purchase decisions.  Consumers usually share their purchase patterns through networks online and in turn create greater interest in potential consumers to buy online or offline. Official (Closed) and Non-Sensitive Official (Closed) and Non-Sensitive Brand Presence in Online Community 1. Raise brand awareness 2. Improve favourable perception of a brand/product/service 3. Increase customer acquisition (another channel to gain potential customers) 4. Maintain customer loyalty through constant engagement with consumers 5. Create user advocacy by encouraging conversations around the brand/product/service 6. Create word-of-mouth marketing opportunities 7. Increase consumer engagement with the brand Official (Closed) and Non-Sensitive Online Consumer Behaviour  Consumer behaviour is the study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires. It includes all the decisions a consumer makes when spending their time and money.  In digital markets, consumer behaviour analysis involves research into the motivations, media consumption preferences and selection processes used by consumers as they use digital channels together with traditional channels to purchase online products and/or use online services.  The what, why, when, where, and how of consumer’s activities are examined in consumer behaviour. Official (Closed) and Non-Sensitive Factors affecting online consumer behaviour Official (Closed) and Non-Sensitive The external factors are the ones Factors 1. beyond the control of the customers. affecting  They can divide into the following sectors: Demographics, socio- online economics, technology and public policy; culture; sub- culture; consumer reference groups; and marketing. Internal factors are personal traits or behaviour 2. behaviours and include attitudes, learning, perception etc. Official (Closed) and Non-Sensitive 2 types of buying motives Factors 3.  functional motives relate to affecting consumer needs and could include factors like time, online convenience of shopping online, price, selection of products etc. consumer  non-functional motives relate more to the culture or social behaviour values like the brand of the store or product for instance. Official (Closed) and Non-Sensitive 4. Filtering elements include:  Security: Consumers are more aware of the dangers of stolen data from the web, hence they filter their Factors purchasing alternatives against security criteria. affecting  Privacy: A lack of trust in a store’s online privacy policies is an obstacle for many customers. Customers look for consumer reassurance that their data will be protected and not handed over to any behaviour 3rd parties for further use in marketing.  Trust & Trustworthiness: Online trust is essential in building any relationship with customers. Official (Closed) and Non-Sensitive The Customer Journey  Customer Journeys refer to the sequence of online and offline touchpoints a customer takes during a buying process or broader customer experience. Online may include a range of digital platforms, communication media, websites, pages and engagement devices. Official (Closed) and Non-Sensitive Source: http://blog.clickdimensions.com/how-to-create-a-customer-journey-map-and-why-you-need-one/ Official (Closed) and Non-Sensitive Consumer Buying Process Supplement Offline Awareness Building Position features, benefits and brand Generate leads (Engage & capture interest) Assist purchase decision Facilitate purchase Support product use and retain business Official (Closed) and Non-Sensitive Persona  A persona is a powerful technique for developing customer-centric online strategies, company presences and campaigns, an essential while studying the consumer behaviour. 2 Steps to create personas 1. Build personal attributes into personas:  Demographics  Psychographics (e.g. tasks, goals, motivations)  Ethnographic (e.g. daily routines)  Transactional (e.g. historical customer relationship and sales record)  Behavioural (e.g. web experience, usage location, usage frequency) 2. Identify & develop scenarios for each persona, e.g.  Information seeking scenario (leads to site registration)  Purchase scenario – new customer (leads to sales)  Purchase scenario – existing customer (leads to sales) Official (Closed) and Non-Sensitive Persona for an online banking scenario Official (Closed) and Non-Sensitive