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
A
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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
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