Digital Marketing MRKT309 - Introduction to Digital Marketing PDF

Digital Marketing MRKT309 Dr. Sarah Al-Shamali Chapter 2: Introduction to Digital Marketing  Digital Marketing Definition: Achieving marketing objectives through applying digital media data and technology. Digital marketing used to be referred to as e-marketing or internet market...

Digital Marketing MRKT309 Dr. Sarah Al-Shamali Chapter 2: Introduction to Digital Marketing  Digital Marketing Definition: Achieving marketing objectives through applying digital media data and technology. Digital marketing used to be referred to as e-marketing or internet marketing. A way of thinking where you put customers at the heart of online activities. This includes understanding them better, getting closer to them, adding value to products, widening distribution channels, and boosting sales through digital marketing campaigns using digital media channels. Simply put, digital marketing is marketing online via websites, online ads, email, apps and other emerging platforms. This is very important because consumers are using more and more platforms from mobiles, to tablets, to cars and they’re all connected.  Marketing principles and digital marketing Basic Marketing Principles Get close to customers, listen to them Involve them Serve them Digital Marketing Principles Add value Identify, Nurture them into Anticipate, lifelong customers Satisfy customers needs and advocates Test, measure and efficiently through improve digital means (next slide) 3  The Process of Digital Marketing Digital marketing uses tools such as web sites, CRM systems and databases to get closer to customers – to be able to identify, anticipate and satisfy their needs efficiently. 1- Identify the needs/wants of consumers by chatrooms, surveys, sales patterns, assessing satisfaction or by secondary source. 2- Anticipate by forecasting behavior based on the information you have gathered. This can also be done by using technology e.g. the cookie, which is a bit of code sent your device, and records your activity without even knowing your name, records your activity so when you get a banner its not by luck, it is relevant and sent to you based on your behavior to anticipate your desires and needs. 3- Satisfy customers with prompt responses, punctual deliveries, order status updates, reminders ect. 4- Efficiently mass customization via CRM to understand, analyze and tailor-made communication with customers.  Marketing backlash: Overwhelmed consumers are tuning out marketing messages  E-mail filters to block spam  Digital video recorders (DVRs) to skip commercials  Caller ID/apps to screen telemarketers  Recycling/throwing out direct mail or other physical material without opening them  Marketing backlash The Big Four networks (ABC, NBC, CBS & Fox) all filed lawsuit against satellite cable provider Dish Network in 2012 after it introduced a new DVR feature that allows Dish viewers to automatically skip commercials In 2013, the courts ruled in favor of Dish Network in a ruling Dish called "a victory for American consumers.”  Clutter is a major problem for today’s marketer  The cost of selling has increased (though digital marketing has provided cheaper alternatives)  Today’s consumer has a broken trust with traditional marketing means (broadcast media, print media etc.) Consumers are also paying more to AVOID marketing e.g. Youtube premium  How does clutter impact marketers?  Marketers today must determine ways to effectively cut through the clutter if the firms they represent are to financially thrive.  Today’s digital marketers must become more creative and free thinking in their approach to promoting company products and services.  Digital Marketing (DM) has the ability to customize messages, whereas traditional marketing methods often does not. DM can achieve this through: Internet marketing, Mobile marketing, Social marketing, Viral marketing.  How are marketers adjusting? Another goal for digital marketers is to focus on interactive elements (e.g. Consumer Generated Media), encouraging consumers to participate in the marketing process. Consumer-Generated Media (CGM): Encompasses the millions of consumer-generated comments, opinions and personal experiences posted in publicly available online sources on a wide range of issues, topics, products and brands. CGM is also referred to as Online Consumer Word-of-Mouth or Online Consumer Buzz. Examples of CGM include: Blogs, Message boards and forums, Social media, Discussions and forums. We will be covering the majority of topics in this image.. As of 2023 onwards we can also include AI  Started from the bottom (e-commerce) + (social commerce) = (digital marketing) now we here Social commerce is a subset of electronic commerce that involves social media and online media that supports social interaction. E-commerce means buying and selling goods, products, or services over the internet. Social commerce is an increasingly important part of e- commerce for site owners, since incorporating reviews and ratings into a site and linking to social networking sites can help understand customers’ needs and increase conversion to sale. 10  Assignment 1 Digital marketing has never been more relevant or important than during and post COVID-19. Can you please explain why you think digital marketing is so crucial in today’s markets and trends relevant to this surge of usage? Internet of The impact of IoT: Things (IoT) Billions of devices will be connected to the A system of net and will be collecting vast amounts of devices, information. software, objects, people or animals with unique Devices that are connected to each other identifiers that can and the net have seemed to make our lives transfer data over easier. Some, lazier ands with privacy a issues. network via machine-to https://www.youtube.com/watch? machine (M2M) v=LlhmzVL5bm8 interactions without 12 human interaction. 13 Researching digital marketing To effectively plan your digital marketing to predict your results, you need to tap into the wealth of research about current Internet usage and future trends. More customers are spending an increasing part of their lives in the digital world. Marketers need to analyze demand by consumers for online services and respond to customers’ needs in this new connected world. Digital activity Need for analysing and from consumers meeting demand for online services Tools for assessing your online marketplace: 1. Google insights tools 4. Government sources 2. SimilarWeb 5. Internet surveys 3. Nielsen 14  Physical platforms of digital marketing Digital marketing: physical Physical Marketplace platforms Desktops, laptops and notebooks Mobile phones and tablets Other hardware Electronic marketspace 15 Digital marketing platforms Desktop browser-based platform: traditional web access e.g. google chrome, apple safari, microsoft explorer Desktop apps: apple users accessing free and paid apps from their desktop via the app store. Microsoft, samsung have the equivalent Email platforms: its not really a platform, nevertheless its part of an online experience and can be used to communicate to consumers Feed-based API data exchange platform: twitter and facebook status where ads can be inserted Video-making platforms: youtube, tiktok Mobile-based apps: apps specifically developed for mobile operating system Gaming platforms: playstation, xbox all carry marketing tools such as in-game ads Indoor/out-door kiosks and interactive signage: touchscreen to encourage interactivity and other options to interact with consumers.  Types of online presence any online presence: Different forms of online media controlled by a company including their e, blogs, email list and social media presences. Transactional e-commerce site: online retailers available for online purchase e.g. amazon.com Services-oriented relationship building or lead-generation website: generates enquires or leads from potential customers. Provide new and current customers with additional information e.g. pwc.com or car manufacturer sites. Brand building sites: provides experience to the brand and and support for campaigns. Products not typically sold on the site, but murchandise maybe e.g. guinness, lynxeffect.com Portal or media site: these sites act as intermediateries or additional information and content e.g. yahoo, tripadvisor. Social media: interactions between different consumers in the form of comments, messages, rating, tagging. Snickers website vs Alsarraf wallpaper What do you see? 18  How many SMEs in Kuwait do you know that just contend with social media presence? In practice, digital marketing focuses How many traditional on managing businesses in Kuwait do you see different forms of that were forced to start an e- commerce site in addition to online company their traditional brick- and - presence. mortar?  In simple terms, the Internet of Value (IoV) refers to an online Internet space in which individuals can of Value instantly transfer value between each other, negating the need for (IoV) + middleman and eliminating all third- Blockchai party costs. n Blockchain a system in which a record of transactions made in bitcoin or another cryptocurrency are maintained across several computers that are linked in a peer- to-peer network. 20 21 5G: The Enabler 5G is the fifth generation cellular network technology. South Korea being the first country to deploy the technology in April 2019. An increase in speed and broadband of wireless networks up to 100 times faster than 4G. Additionally, it will also allow massive device connectivity, providing immediate and uninterrupted ultra-low latency communication. 5G is essential to the IoT, such as smart cities and smart farming, telesurgery, and virtual reality. 22  5G: The Enabler Opportunities and issues On the economic front, for instance, 5G could trigger significant competitive advantages in the short and medium term. Globally, it will generate $12.3 trillion in economic outputs and support 22 million jobs by 2035. However, 5G will also lead to security and privacy concerns. As sensitive industries such as autonomous vehicles, health or industrial processes become more reliant on wireless connectivity, they will also become more exposed to cyber-threats. Risks such as remote sabotage of medical devices or automotive cyber-attacks could turn into a reality. This creates a higher than ever need for strong security measures. Additionally, researchers found that 5G protocol known as Authentication and Key Agreement (AKA) still presents security insufficiencies. This can translate into challenges for national security in the form of more sensitive data theft or sabotage. 23 24  The future of digital marketing usage Over 3 billion people around the world now regularly use online services to find products, entertainment, friends and romance, and consumer behaviour and the way companies market to both consumers and businesses have changed dramatically. To understand the importance of digital marketing to the future of marketing in general, it’s helpful to think about what audience interactions we need to understand and manage. Digital marketing today is about many more types of25 Digital data + digital technology Digital data: The insight businesses collect about their audience profiles and their interactions with businesses now needs to be protected by law in most countries. - This can be achieved by having a CRM system Digital technology: This is the marketing technology –that businesses use to create interactive experiences from websites and mobile apps to in-store kiosks and email campaigns. - Charlotte Tilbury or Burberry instore interactions  Data warehouse: is a type of data management system that is designed to enable and support business intelligence (BI) activities, especially analytics. The large amount of data in data warehouses comes from different places such as internal applications such as marketing, sales, and finance; customer- facing apps; and external partner systems, among others. Data mining: is a process of extracting and discovering patterns in large data sets involving methods at the intersection of machine learning, statistics, and database systems.  Customer relationship management (CRM) A CRM system helps businesses keep customer contact details up to date, track every customer interaction, and manage customer accounts. It is designed to help businesses improve customer relationships CRM is defined as customer relationship management and is a software system that helps business owners nurture their relationships with their clientele. A CRM records and analyzes all calls, emails and meetings, helping improve customer service, drive sales, and increase revenue. 28  Digital disruptors The challenge for marketers is to assess which innovations or digital disruptors are most relevant to their organisation and to seek to gain advantage through introducing them to a company. Digital disruptors are innovations in digital media, data and marketing technology which enable a change to a new basis for competition in a market or across markets. Disruptors are also used to refer to start-ups or existing companies that, through their agility, are good examples of impacting competitors through disruption. 29 30 31 32  Any digital disrupters in Kuwait? The pure tech Startup (Google, Ghaliya?) The market place (intermediaries) Startup (talabat, boutiqat) The e-commerce Startup (blinkkw) 33 Types of media: Paid, owned and earned media Paid, earned and owned media 1- Paid media: where there is investment to pay for visitors, reach or conversions through search and display ad networks. Offline traditional media like print and TV advertising and direct mail remain active but not used with all organizations. 2- Earned media: includes word of mouth that can be stimulated through viral and social media marketing and includes conversations in social networks, blogs and other communities. Think of earned media as different forms of conversations occurring both online and offline; these still all require investment. 3- Owned media: This is media owned by the brand. Online, this includes a company’s own web sites, blogs, mobile apps or their social presence on Facebook, LinkedIn, Google+, Twitter or YouTube. Offline-owned media may include brochures or retail stores.  Integrated digital marketing activities Activities that require planning, management and optimization for online marketing to be competitive and maximize ROI. With so many outlets, you should plan, manage, and optimize each marketing technique so that your online marketing is competitive and Figure 1.5 Eight key digital marketing activities to manage in organizations 36 reaches its highest potential. Minimizing the impact of sloppy/poor digital marketing: The customer service operation is equipped to monitor and engage with a targeted spectrum of media. Companies fully understand where, why and how their customers are using social media before making any social media marketing changes. A balance is struck across different types of media – telephone, email, web, social, Figure 1.7 Digital marketing sloppiness causes high attrition rates network and mobile. Specialist tools are used to 37 measure the impact of  Push – Pull media Traditional media is predominatly push media, where a message is broadcasted from the company to the customer. Inbound marketing How do you increase Pull media is when inbound marketing/pull? the contact with the By having optimal content brand is initiated by marketing (next slide) the customer, this often happens online Good visibility from or with digital companies in search marketing engines is also essential 38  Content marketing Content marketing today requires exceptional, compelling content e.g. videos, podcasts or user-generated content. This is a challenge due to so much content, in so many forms, to different places on different platforms. Basically, everything we see online is content and we’re consuming so much of it every day in different forms. DIGITAL MARKETING STRATEGY  Digital marketing strategy What is it? Channel strategy where electronic channels and digital media support other communications and distribution channels. 1. Clear prioritization to how the channel should be used 2. Mix of digital media channels to acquire new customers and contact strategies to welcome and develop existing customers 3. How the channel will be used and for who 4. We have to keep in mind that these digital channels do not exist in isolation, so we need to figure out how and when they are integrated too. 5. e.g. Instagram and Twitter have different audiences so the accounts should not be identical, but similar to 41  Key features of digital marketing strategy A digital marketing strategy is essentially a channel marketing strategy and it needs to be integrated with other channels. An effective digital marketing strategy should: be aligned with business and marketing strategy (e.g. many companies use a rolling three-year plan and vision), with more specific annual business priorities and initiatives; use clear objectives for business and brand development and the online contribution of leads and sales for the Internet or other digital channels; define a compelling, differential value proposition for the channel; specify the mix of online and offline communication tools used to attract visitors to the company website, or interact with the brand through other digital media such as email or mobile; support the customer journey through the buying process as they select 42 and purchase products using the digital channel in combination with other  Online value proposition (OVP) The key strategic decisions for digital marketing are in common with traditional business and marketing strategy decisions. A process for developing a digital marketing strategy, customer segmentation, targeting and positioning are all key to effective digital marketing. These familiar target marketing strategy approaches involve selecting target customer groups and specifying how to deliver value to these groups as a proposition of services and products. As well as positioning of the core product or brand proposition, online development of a compelling extended product or online value proposition (OVP) is also important. An OVP is a simple statement that summarizes why a customer would choose your product or service. A great OVP may highlight what makes you different from competitors, but it should always focus on how customers define your value. This defines how the online experience of a brand is delivered through content, visual design, interactivity, sharing, rich media and how the online presence What is Uber’s OVP? integrates with the offline presence. 43  Applications of digital marketing: MC DONALDS McDonalds- there are three different entrances to accommodate the volume of people expected, as well as digital menus and 18 kiosks where consumers can order meals and then have it delivered to them via table service. Digital drive-through menu boards and ordering via the app have also been implemented. “The expectation is customers are getting more demanding, they’re looking for things that are even more convenient,” said Chris Kempczinski, McDonald’s USA president. “This is meant to be a showcase to show the world where we’re trying to take McDonald’s.” 44  Applications of digital marketing: MC DONALDS According to Kempczinski, the change has been good. The company’s seen a 5% in lift in restaurants that underwent a “significant overhaul” and others that were already somewhat modernized are seeing 1- 1.5% lift. McDonald’s isn’t simply investing in its digital transformation through acquisitions like Dynamic Yield or investments in Plexure, a mobile software company; the company’s using some of this technology to power several of the upgrades at its restaurants.  Digital marketing strategy directions The Internet can potentially be used to achieve four strategic directions: 1) Market penetration. The Internet can be used to sell more existing products into existing markets. – restaurants, flower shops and toy shops – xcite, saveco. 2) Market development. Here the Internet is used to sell into new geographical markets, taking advantage of the low cost of advertising internationally without the necessity for a supporting sales infrastructure in the customers’ countries. Carriage’s expansion, instead of having an actual shop in another country. 3) Product development. New products or services are developed that can be delivered by the Internet. These are typically pure digital products. Kindle, Tap, Bitcoin and the blockchain, apps, platforms, crypto currencies 4) Diversification. In this sector, the Internet supports selling new products,46 Another point of view.. Geyskens et al. (2002) suggested an alternative perspective – that there are three main forms of demand expansion for an existing company. These are: 1. Market expansion. This occurs when new segments of customers are reached who did not previously buy in a category – e.g. MyFatoora/Kindleapp instead of the kindle tablet. 2. Brand switching. This is done by winning customers from competitors – e.g. Xcite vs Blink/saveco vs taw9weel 3. Relationship deepening. This is selling more to existing customers. 47  The 5S – digital marketing objectives Benefit of How it is Examples digital delivered marketing Sell – Grow sales Through wider distribution, Achieve 10% of sales online promotion, sales Through giving customers extra benefits Increase conversion Serve – Add value online or inform product development rate by 5% through online dialogue and feedback. Grow email coverage to Speak – Get By tracking them, asking them 50% of current customer closer to questions, creating a dialogue, learning database customers about them. Through online email communications, Generate 10% more Save – Save costs sales and service transactions to reduce sales for same staff, print and postage costs. communications budget Sizzle – Extend Through providing a new proposition and Add two new significant the brand online new experience online while at the same enhancements to the time appearing familiar. customer online experience 48 Other forms of companies that can use digital media includes government and public-service organisations that deliver online or e- government services. It has also been suggested that employees should be considered as a separate type of consumer through the use of intranets, which is referred to as employee-to- employee or E2E.  Tactics, Action and Control Tactics are the details of strategy. Tactical e-tools include the web site, opt-in email, banner ads, virtual exhibitions and sponsorship. Actions include project planning and implementation, while control involves assessing the results against objectives. Control assessing the results against objectives. Figure 1.13 Using the Smart Insights RACE Planning framework to link business objectives to digital marketing tactics 50  Benefits of going digital: Conducting online research Digital channels provide many options for learning about product preferences and it can be used as a relatively low-cost method of collecting marketing research, particularly when trying to discover customer perceptions of products and services. Options for performing new product development research online include: Online focus group & questionnaire/survey Social media listening Customer feedback or support forums: Comments posted to the site or independent sites may give suggestions about future product innovation Web analytics: A wealth of marketing research information is also available from response data from email and search campaigns and the website itself 51  Speed of new product development Digital channels give instant access to target markets and provide platforms, which enable new products to be developed more rapidly as it is possible to test new ideas and concepts and explore different product options through online market research. Companies can use their own panels of consumers to test opinion more rapidly and often at lower costs than for traditional market research.  Another aspect of the velocity of new product development is that the network effect of the Internet enables companies to form partnerships more readily in order to launch new products. 52  Challenges in developing & managing a digital marketing strategy Some of the challenges in managing digital marketing strategy that are commonly seen in organizations include: There are unclear responsibilities/objectives for the many different digital marketing activities. Insufficient budget is allocated for digital marketing. New OVP for customers are not developed since the Internet is treated as ‘just another channel to market’ without review of opportunities to offer improved or differentiated online services. Results from digital marketing are not measured or reviewed adequately, so actions cannot be taken to 53