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COMP2113: Introduction

to E
-
business

Richard Henson

University of Worcester

March

2008

Week 5: E
-
Marketing


Objectives:


Define marketing & e
-
marketing


Compare and contrast different aspects e
-
marketing with traditional marketing use of mass
media (TV, press, etc.)


Explain how the role of the customer has been
changed by e
-
commerce


Explain crucial role of search engines in attracting
customers


Apply the basic principles of designing a website
that will attract and retain customers

E
-
Commerce Marketing


Marketing is about:


identifying, anticipating and satisfying customer
needs and setting out to do so profitably!


E
-
commerce marketing is about using the
World Wide Web for achieving the above
ends.


different way to get the message across


new business challenge


Marketing plans now need to include a
consideration of the E
-
Commerce channel

E
-
Commerce

Marketing Issues


What is happening out in the commercial
world?


typically: site
-
centric models (product
-
driven)…


shifting to user
-
centric models (consumer
-
driven)


Huge growth of “customisation”


one to one service


driven by effective use of web(site) technologies


Businesses being forced to continual review
their different ways of giving service to the
customer

Egg: an example


Launched by Prudential in October
1998


£7bn worth of deposits in first year of
business


Soon expanded into a range of financial
services (banking, credit, insurance)

Egg’s strategy


E
-
commerce supports two generic
business strategies:



Lowest delivered cost


Highest perceived quality

Egg’s strategy (cont’d)



Lowest delivered cost


No branch network


Customers input transactions


Highest perceived quality


‘personalised’ service


Rapid response


Customer Relationship Management systems


All enabled via the
electronic

(e
-
) business
model

What’s different about the

e
-
Marketing channel?


Customer controls the relationship


chooses to visit the web site…


more formally known as a “pull medium”
(customer pulls the information to him/her)


Opposite of “push medium”


more conventional mediums such as the
press or TV advertising


products “pushed” onto customer

Advantages of the

e
-
marketing channel


Customer has free choice to visit the site (or
NOT!):


may look at one page or many…

»
could be impressed and make it their home/favourite page

»
may never visit again!


Business merely provide the information…


customer decides whether or not

»
to pull that information

»
to then read it


To use e
-
marketing successfully, the business
has to get their website right…

Effective use of the e
-
Marketing Channel


Very many websites been developed to sell
products


some very successful


many abject failures…


On
-
line trading websites now been around for
more than 10 years


well established
guidelines for success


freely available on the world wide web…

»
e.g.
http://e
-
marketing
-
tips.distinctia.com/analyzing
-
design.html


Effective e
-
Marketing


Many businesses still not following these
guidelines…


WHY NOT?

»
Discuss (10 mins) in groups…

The Recent Growth of

e
-
Marketing


Huge growth area in recent years…


Now attracts large conferences


e.g. “Technologies for Marketing” Earl’s
Court, two days…


Focus on all aspects of using marketing
technologies to fulfil the marketing
function

New Opportunities available
through e
-
Marketing


Products can easily be marketed to
countries beyond the UK…


Not a light enterprise…


need to be sensitive to other cultures!


need to get advice on the local culture(s) before
creating the website aimed at that culture


Famous advice (from whom?)


“When in Rome do as the Romans do.”


Particularly, what are the local ways:


to present products


of doing business

Selling via website to

other cultures


Need to communicate and engage with
the locals:


Some will speak English


Many (most?) will not


consider a translation into a local language

»
but has to be accurate!!!


Find out something of the local buying
habits

What NOT to sell

to other cultures


Don’t waste your time selling what the
locals already have in abundance


coals to Newcastle!


‘fridges to Iceland!!


sand to the Arabian Gulf!!!


Or what they make better at home:


cheese to the French (eg recent “The
Apprentice”)

Taxation Issues

and other cultures


For trading outside the EU, need to consider
tax implications:


here in the UK


also in your target market


Otherwise, the business may find that:


the customer has cancelled his/her credit card
transaction


Their goods are impounded on some foreign
shore with a clearance bill attached

»
and made out to them…

The Law and Selling

to other Cultures


The seller is responsible for keeping to the
law:


where the customer resides…


AND where the business is based


the Internet may makes the selling and
representation of products easier…


But nothing changes in terms of the need for you
to trade legally according to the laws of both
origination and destination countries


Ignorance is never a defence in the eyes of
the law !!!

Designing the website

for customers


As with all marketing materials…


design is VERY important

»
used by the customer to assess the quality of product
AND business itself


Think and behave like a “local” customer


design pages accordingly…


may mean different sites for different markets

Designing the website

for customers


Customer perception of “quality” will come
from all aspects of interacting


web page fonts & colour scheme

»
“corporate feel”


ease of selecting products


security of their personal and financial data


assurances about;

»
delivering the product?

»
the goods performing as advertised

»
dealing with complaint/problems

Site design


Use ALL principles learned in
COMP1141:


http://www.worc.ac.uk/departs/bm_it/viv/c
omp1141/resources/activities.htm



Choose the URL (site locator on the
www) CAREFULLY:


“guessable” URL will get more hits


URL based on a/the brand name will
probably get more hits

Bad design features


Scrolling


Poor navigation between pages


Large graphic files


One page only


Irrelevant or boring information only
of interest within the organisation


No telephone number or email
address

Good design features


Plenty of opportunity for interaction


Multimedia/sound


Support “streaming” so sound/video can
be appreciated in real time rather than
having to wait for the whole thing to
download


(eventually!) smell


via hardware
device attached to the user’s computer

Other good features of a

well
-
managed site


After sales service info!


Customer Relationship Management (CRM)


Use of email for customer reaction/feedback


Response to emails


manage it and action it!


Otherwise, goodwill will suffer


Have an infrastructure to support enquiries
-

look after customer relations


Refer to telephone help
-
line and call centre to
deal with high volume after sales service

“Adding Value”

via the website


In the early days, the rate of hits (visits) to the
website WAS the value of the “virtual” (i.e no
physical shop) company (!)


formula based on hugely optimistic hits
-
sales ratio


Caused stock market BOOM… and BUST!


Formula revised downwards, but same
principle applies…

»
e.g. every tenth visitor will be a customer…

»
Website value to the business is a function of it’s “hit
rate”

Getting a good “hit rate”

for the Website


The business won’t get ANY benefits from
increase in sales if there are no visitors


however excellent the site may be


MANY, MANY ways to maximise the number
of visitors to a site…


Suggestions? Group Activity…

What are Search Engines?


Computer systems designed for locating
information on the web


Accessible, free of charge, through the

Internet


Consist of:


a database of keywords, URLs, and websites


a program which allows Internet users to search
through its indexes, normally using keywords, in
order to find sites of interest


special web
-
browsing programs known as ‘spiders
’or ‘robots ’

How do Search Engines
work?


Gather keywords through “spidering” around
websites


The spiders:


crawl round the net looking out for keywords in
web pages


retrieve keywords


take keywords back to the search engine
database


A program automatically adds the lists of
keywords to the database


All the information in the database is
continually available, via indexes, to users

Why are Search Engines
crucial to Marketing?


FREE!


all of the search engines provide a free service to
both shopper and merchant


Make their money through advertising…


based on their own HUGE volumes of traffic


Harnesses the most powerful and most
frequently used technology on the web


But use needs to be monitored:


the site should be re
-
submitted on a regular basis


the content, especially the searchable ‘tags ’,
should be kept ‘fresh ’

(i.e. representative)

Search Engine Tips


Search engine searching is based on page
content as well as the URL


Essential to choose the keywords carefully


Use keywords in:


title tags & “metatags” (page description and
keywords)
-

kept up to date!


first paragraph of page content


Search engines should be monitored to see if
the site is no longer featured


if so, resubmit…

Effective Use of

Search Engines (1)


Search engines like Google categorise
pages based on (amongst other things):


hit rate


number of external links on site


The Objective should always be:


to use appropriate techniques to cause the
search engine display your site in its “top
ten”

Practical Exercise

(on your own


10 min)


Think about the website you started to
develop last week


Write down six keywords to represent
your site


Now include a short paragraph for the
home page that includes as many of
those keywords as possible, as often as
you can…

Effective Use of

Search Engines (2)


Once an e
-
commerce site does achieve the
dizzy heights of a “top ten” placing with the
search engines for appropriate keywords…


you’re in the big time!


short
-
term, a lot of traffic can be expected to the
site


HOWEVER…


The real challenge is to KEEP IT THERE…


The rest of this lecture looks at strategies for doing
just that…

Direct Advertising


Put the URL everywhere you can…


TV, radio (expensive)


newspapers, magazines


email messages


paper correspondence


business cards


side of the van


in a field adjacent to a motorway

Email Advertising


Business needs to capture an email address
before can send mail advertising its website


Need to have a means of capturing and
storing email addresses on the website


Blocks of email address actually sold based
on perceived interests of (potential)
customers


on
-
line customers can be targeted with products,
based on clicking behaviour

Stickiness!


This is about using techniques to
keep users:


looking round the site


returning to it
once they have discovered it


D
ifferent problem to getting them t
o the site

in
the first place


The concept of “stickiness” drives

web site
development commercially


every site owner wants to get plenty of hits


but also plenty of repeat hits…

Stickiness
T
ips


Site must have p
lenty of content


must be the right
sort of
content

for the type
of visitors expected…


C
ontent

must also be:


e
asy to find (navigation!)


u
p to date


C
ontinuous change and improvement

are therefore required…

Stickiness
Tips


Offer additional services
:


free email


calendaring service


Thinking behind this:


can cause considerable
inconvenience
if
email
address
is changed
or calendar
entries have to be
re
-
key
ed


therefore “
gets the user hooked


»
unlikely that
their Internet behaviour
will chang
e…

»
Would be too much hassle!

Looking after visitors:

reward them!


Just by visiting your site and registering
the prospective customer can get
“points” (or e.g. air miles)


My points


Nectar points


The personal details may then be used
for marketing purposes


Buying products from the site might
bring them more points…

Looking after visitors:

publicising discounts


Award discounts to customers ordering
online


Let it be known that such discounts are
only available from the website


Examples:


Go

-

discount for booking tickets online


Train tickets

-

online discount provider of
train tickets

Other Promotional Ideas


Develop trade links with other sites with
related interests/collaboration


Regional/trade/interest group
-

spine or
“feeding chain” approach


Newsgroups
-

take care however as they are
not meant for promotion


Use “portals”


enriches value by providing an information
service


Hot links (agreed and mutual)


switch to the site from another site/vice versa

Gathering Marketing
information on customers


Using the web to gather valuable market
information:


overtly e.g. “Mypoints” collects customer
information by insisting that a form is filled in


Anonymously

»
e.g. using cookies

»
e.g. analysing web server log files


MUST (privacy issue) look after customer
data

“Cookies”


Files that sit on your computer and tell web
sites:


your personal “clicking” preferences


e.g. how many times you have visited a particular
site


Controversial


write data onto the user’s
hard drive, probably “on the sly”


Each participating website will store its own
cookie, with its own security arrangements


Cookies take up very little disk space (e.g.
256 bytes)

“Cookies”


Potentially a privacy issue:


should be helpful to the consumer and add
value


should not be intrusive


Should not be accessible to anyone else!


Cookies can be “switched off” (i.e.
filtered out/deleted) as a browser
preference!

Analysing web server log files


Most types of web server support this. Examples:


Microsoft IIS


Apache


LotusDomino


Oracle


Netware


Gatherable information :


Who has been using your site?


Which parts of the sites were visited most


Can be done manually


Best to use specialist packages


e.g. Log Analyzer v5.0 from
WebTrends

cost £300

Customer led advertising


Possible to track a customer’s web habits so
adverts can be appropriately targeted


e.g.
Doubleclick.com


Portals could link to e.g.


local purchasing consortia


rswww.com
(RS components online engineering
catalogue)


Software available to learn about users' buying
habits and consequently direct aim


Aim news feeds and advice content at
users/potential customers to maintain their
loyalty

Technologies for

Improving Hit Rate


Many specialised applications:


Some very simple

»
counters

»
meta name generators

»
date/time/special effects, etc. (client end)

»
links to code located on other sides (e.g weather
forecast)


Others more sophisticated: two categories:

»
watch/record visitor behaviour


Example: ASP Sheriff

»
provide more features for the site


Any number of possibilities

The Low
-
Tech Business:

Getting someone else

to do it for you…


Fine, but web design and e
-
Marketing
are two different things


Suggestion:


web designer to create the site


E
-
Marketeer to use appropriate methods
from the above and work with the designer
to enhance the site so it will always appear
in the search engine top ten…

Cost of e
-
Marketing


Needs to be seen in terms of Return on
Investment (ROI)? or payback?


many SMEs report they have had little benefit from
their investment in getting a web presence


ROI therefore zero!!!


Usually this is because:


they have not promoted (or been advised to
promote) their site sufficiently/effectively


not aware that the initial and ongoing cost of
appropriately marketing a site may exceed the cost
of developing/maintaining the site!


Invest a little and get nothing back


or invest
several thousands, and get a big response…

Next week


Specific features of an e
-
commerce web
site