The E-Marketing Plan

The E
-
Marketing Plan

Creating an E
-
Marketing Plan


Why would a company pay
so much to design and build
its Internet presence ?


–
To protect the corporate and
brand identities

–
Complexity of designing e
-
marketing strategies

Creating an E
-
Marketing Plan


An E
-
Marketing Plan is a company’s
blueprint for strategic direction



Ad hoc
–

Companies develop strategies
without the development of an E
-
Marketing Plan

•
Example:
www.yahoo.com



75% of e
-
business will fail due to flaws
in planning

A Seven Step Marketing Plan

1.
Conduct a situation analysis.

2.
Identify target stakeholders

3.
Set objectives

4.
Design marketing mix strategies to meet
objectives

5.
Design action plan

6.
Develop a budget

7.
Develop an evaluation plan


Exhibit 8
-

2 Marketing Plan Process


•

Large Web sites are not profitable ventures, but
they are more concerned with establishing their
brands, ex: Amazon


•

Start
-
Up companies are funded by:


–
Private funds (family and friends)

–
Angle Investors

–
Venture capitalist (VCs)

•
“I invest in people, not ideas,” Arthur Rock (VC), “If
you find good people, if they’re wrong about the
product, they’ll make a switch.”

Venture Capital E
-
Marketing Plan

•

VCs look for plans that show:

•

the e
-
business idea is a solid one,

•

the entrepreneur has some idea of how to run the
business


•

Once the start up business begins to boom, the VC
looks for an exit plan, and the stock usually goes
public, IPO


•

The VC gets their money back and looks for
another investment

Venture Capital E
-
Marketing Plan

Key Success Factors


Key Dangers


§


Make it easy for customers to do
business with you.

§


Focus on the end customer for
your products and services.

§


Redesign your customer
-
facing
business processes from the end
customer’s point of view.

§


Wire your company for profit:
Design a comprehensive, evolving
electronic business architecture.

§


Foster customer loyalty, the key
to profitability in electronic
commerce.


§


Don’t completely redesign a
business to become an e
-
business.

§


Don’t suspend good project
management rules in the name of e
-
business.

§


Don’t assume technology can do
all the heavy lifting in e
-
business
implementation.

§


Don’t focus solely on current
customers for e
-
business.

§


Stay alert for new competition.


Exhibit

8

-

3

Critical

Success

Factors

and

Dangers

for

E
-
Business

Source
:

Success

from

Seybold

(
1998
)
;

danger

from

GartnerGroup

(
1999
)


The Existing Marketing Plan


•

Working with existing information is the
best place to start, if you want to follow
current positing strategies.

Conduct an Environmental Scan


–
Legal/Political Environment


•
Taxation, access, copyrights, & encryption


–

Technological Environment

•
Communication Infrastructures

•
Bandwidths, and New browsing devices

Situation Analysis

Conduct an Environmental Scan


–
USER Trends

•
Focus on how the net audience has changed over the last six
months, last year, etc…

•
Are there any trends?

•
Is there any important target segments coming online?


–
World Economies

•
Understand overseas economies, also do they have the proper
infrastructures to support what we are doing?

Situation Analysis

Develop a Market Opportunity Analysis


-

Includes both demand & supply analysis

•
Demand side, reviews potential profitability

•
Supply side, reviews competition, and finds
competitive advantages



-

SWOT

Situation Analysis

Internal

Capability


Examples


Customer

interactions


E
-
commerce, customer service,
distribution channels


Production

and

fulfillment


SCM, production scheduling,
inventory management


People


Culture, skills, knowledge
management, leadership and
commitment to e
-
business


Technology


ERP systems, legacy applications,
networks, Web site, security, IT skills


Core

infrastructure


Financial systems, R&D, HR


Exhibit 8
-

4 Key Internal Capabilities for E
-
Business

Source:

Adapted from Kalakota (1999)

Situation Analysis


Develop a Market Opportunity Analysis


Market Opportunity Analysis includes both demand
and supply analyses.



The demand portion reviews various market
segments in terms of potential profit.



The supply analysis review competition in selected
segments that are under consideration



The purpose of the supply analysis is to assist in
forecasting segment profitability and finding
competitive advantages in the online market.

SWOT


Strengths, Weaknesses, Opportunities and Threats

This analysis objectively evaluates the
company’s strengths and weaknesses with
respect to the environment and the
competition

Strategic Opportunities


A Key element in setting strategic goals is to take stock of
where the company currently is and the level of commitment
that it wishes to make to a business.



The lowest level impacts individual business activities such as
order processing.



The next level impacts business processes such as customer
relationship management



The next level, enterprise is where the firm automates many
business processes in a unified system



EB = EC + BI + CRM + SCM + ERP



ERP
–

the key here is to make sure that the processes work
well together in a unified system

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Exhibit

8

-

5

Level

of

Commitment

to

E
-
Business

Source
:

adapted

from

www
.
mohanbirsawhney
.
com

Pure Play


Advantages


They are not held to the
same standards of
profitability as the brick
-
and
-
mortar stores


They are held to be
smaller and have more
agile cultures able to
move quickly in response
to market fluctuations



The final level is comprised
of internet pure plays




Pure plays are companies
without brick and mortar
presence

Activity

Level


Business

Process

Level


Enterprise

Level



Online market research


Online purchasing


Brochureware


Content publisher


E
-
mail


Online advertising


Online sales promotions


Order processing


Cost reduction using
electronic means


Negotiated pricing online


Segmented pricing online


Content sponsorship online


Knowledge management

Customer relationship
management (CRM)

Supply chain management
(SCM)

E
-
Commerce: tangible
products

Direct selling

Community building online

Affiliate program

Database marketing


E
-
tailer

Bit vendor

Online exchange

Online brokerage

Metamediary

Infomediary

Virtual mall

Shopping agent

Reverse auction

Online buyer’s coop

Mass
-
customization tools


Exhibit 8
-

6 Menu of Opportunities at Various Levels
of Commitment

Identify Target Stakeholders

When multiple targets are identified, they should be
ranked in order of importance so resources can be
allocated accordingly




Each market should be well profiled by its
characteristics, behavior and desires




Firms must understand the value proposition for
each market.

Set Objectives


Use carefully worded objectives that flow from
plan analyses that have a task, contain a specific
measurement device, and has a time frame for
accomplishment.

Design Marketing Mix Strategies to
Meet the Objectives


Strategic justification
–

shows how the strategy
fits with the firms overall mission and objectives



Operational justification
–

identifies and
quantifies the specific process improvements that
will result from the strategy



Technical justification
–

shows how technology
will fit and provide synergy with current IT
capabilities



Financial justification
–

examines cost/benefit
analysis

Marketing Mix Component


Chapter


Business Model


Product


4


Digital

value

through

new

products


Price


4


Cost

reduction

using

E
-
marketing

Negotiation

Segmented

pricing


Distribution




5


Content

sponsorship

Direct

selling

Infomediary

Intermediaries


Broker
:

Online

exchange

Online

auction


Agent
:

Manufacturer’s

agent

Affiliate

program

Metamediary

Virtual

mall

Shopping

agent


Reverse

auction

Buyer

cooperative


E
-
tailer

bit

vendor

Tangible

products


Marketing

Communication


6




Content

publishing

E
-
mail

Community

building

Online

advertising

Online

sales

promotion


Relationship

Marketing


7


CRM


Exhibit 8
-

7
Selected E
-
Business
Models Are
Also Marketing
Strategies


Action Plan


Project Scope


Site Development


Site Promotion


Site Maintenance

An action plan will decide which strategies are best to
promote the business or company. Having decided that
an Internet presence is essential the following
considerations are necessary:

Web Site Example:

Project Scope

•
To decide the level of Internet and e
-
commerce commitment
that is both beneficial, cost effective and advantageous to the
company.


•
To evaluate the need for e
-
mail contact between stakeholders
and staff, and what staffing is necessary to implement such a
program.

Site Development

Build, Buy or Rent, t
he Following Considerations
Apply:



Outsourcing
–

speeds completion of the project


Personnel Cost Savings


Faster Loading Site


User Friendly Product


More Professional Graphics & Information


Outsourcers are aware of Copyright Rules


First Impression is Paramount




http://www.forrester.com/







Agency (Affiliation)





Headquarters


1999
Projected
Revenue (in
thousands)



%
Increase
over 1998




1999
Employees


1


Sapient
1


Cambridge,

MA


276,844


67.9


2,011


2


iXL, Atlanta
1


Atlanta


*214,000


230.8


*1,700


3


USWeb/CKS
1, 2


San

Francisco


*170,000


86.8


*1,050


4


Razorfish (Omnicom)
1


New

York


150,000


983.6


1,300


5


Digitas
2


Boston


*135,000


237.5


700


6


TMP Worldwide
1, 2


New

York


*125,000


149.2


*350


7


c2o Interactive Architects
(EDS)

1


Dallas


125,000


177.8


350


8


Euro RSCG Worldwide
Interaction (Havas)
1


New

York


120,900


54.0


793


9


AppNet
1


Bethesda,

MD


110,000


521.5


1,000


1
0


Grey New Technologies
1


New

York


106,000


41.3


850


1
1


OgilvyInteractive
1

(WPP)


New

York


100,000


66.7


650


1
2


Agency.com
1

(Omnicom)


New

York


*100,000


278.0


1,000


1
3


Luminant Worldwide
(Y&R)


Dallas


95,883


NA


800


1
4


Organic (Omnicom)


San

Francisco


*80,000


188.8


681


1
5


Xceed
1


New

York


74,000


19.4


450


Exhibit 8
-

8 Top
15 U.S. Interactive
Advertising
Agencies

Source
:

Adapted

from

AdweekOnline

(
www
.
adweek
.
com
)


Site Promotion


Register Site with Search Engines


Use Metatags, Keywords and HTML tags


List Site with Appropriate Directories


Utilize Electronic Press Releases


Link to Complimentary Web Sites


Incorporate Web Site Address in all Media


Consider Banner Advertising


Consider Hiring an Outside Firm to Promote Web Site



Links to Site Promotion & Search Engines:


www.yahoo.com/


www.hotbot.com


www.excite.com


http://www.adjacency.com/



Exhibit

8

-

9

Adjacency

(Sapient)

Builds

and

Promotes

Web

Sites

for

Clients

Source
:

www
.
adjacency
.
com


Site Maintenance


Decide How Often to Update Site



Decide Whether to Outsource or Update in


House



Evaluate the need for Human Resource for Web

Site Maintenance

Budgeting


Evaluate the cost/benefits analysis &

Identify Potential Revenue Streams:



E
-
Commerce
–

Do we sell on
-
line?



Content Sponsorship
–

Banners, Buttons,
Sponsorships



Intermediary Fees
–

Broker and Agent Fees

Revenue Streams


Initial funds to support a Web site come from:

–
Investors

–
Loans

–
Firm’s operating budget



Revenue streams that produce Internet profits
come mainly from:

–
Direct sales

–
Advertising sales

–
Other fees


Cost Savings

By Selling and Marketing On
-
line


Eliminating elements of the traditional
distribution chain



Increases possibilities of greater revenue



Saves on traditional marketing costs (printing,
postage)



Increases target market to world
-
wide audience

Intangible Benefits


Goodwill


Brand Equity


Audience Measurement


Public Relations


Customer Satisfaction

The industry is developing exponentially
creating new marketing opportunities, although
they may be hard to measure

Cost/Benefit Analysis

Analyze the cost

of e
-
marketing versus the benefits


Revenue increases


Cost decreases


Intangible benefits


Goodwill


Brand/Image Building


Relationship Building


ISP Costs


Hardware and
Software Costs


Design Costs


Maintenance Costs

Benefits

Costs

Evaluation Plan

Monitor and Track Site Usage


Cognitive



Measure unique visits and impressions


Attitudinal




Survey customers for brand satisfaction




objective: CRM, firm would use AOV




(average order value) and LTV (lifetime


customer value)


Transactive




Measure purchases, site traffic, previous




paths and click
-
through rate

The End