Page 300 - Introduction to Electronic Commerce and Social Commerce

286 9 Marketing and Advertising in E-Commerce

resources effectively on VIP customers (e.g., giving them benefits of mobile coupons are larger than their
high priority)? limitations.
2. Which Internet marketing/advertising channel(s) do Many large retailers (e.g., Walmart) offer coupons on
we use? An increasing number of online methods are their websites. Smaller companies may use intermediar-
available from which advertisers can choose. These ies that have coupons of many companies in their
include banners, search engines, video ads, blogging, database.
social networks, and more. 8. What ethical issues should we consider in online mar-
3. What metrics do we use to guide advertisers? A large keting? Several ethical issues relate to online advertising.
amount of information has been developed to guide One issue that receives a great deal of attention is spam.
advertisers as to where to advertise, how to design ads, Another issue is the selling of mailing lists and customer
and so on. Specific metrics such as CPM (cost per million information. Some people believe that not only does a
impressions), click-through rate, stickiness, and actual company need the consent of customers before selling a
purchase rate may be used to assess the effectiveness of list, but that the company should also share the profits
advertising and calculate the return on investment from derived from the sale of such lists with the customers.
an organization’s online advertising campaign. The met- Using cookies without an individual’s consent is consid-
rics can be monitored by third-party monitoring compa- ered by many to be unethical. The negative impacts of
nies. For example, the Mobile Marketing Association and advertising need to be considered.
IAB developed the industry standards for measuring
mobile ad delivery.
4. What is our commitment to Web advertising? Once a SUMMARY
company has committed to advertising on the Web, it
must remember that a successful program requires the In this chapter, you learned about the following EC issues as
collaboration of the marketing, legal, and IT departments. they relate to the chapter’s learning objectives.
In addition, coordination with non-Web advertising as
well as support from top management is needed. 1. Factors influencing online consumer behavior. Con-
5. Should we integrate our Internet and non-Internet sumer behavior in EC is similar to that of any consumer
marketing campaigns? Many companies are integrating behavior, but it has some unique features. It is described
their TV and Internet marketing campaigns. For example, in a stimuli-based decision model that is influenced by
a company’s TV or newspaper ads direct the viewers/ factors that include the consumer’s personal characteris-
readers to their website, where short videos and sound tics, environmental characteristics, product/service fea-
ads, known as rich media, are used. With click-through tures, merchants and intermediaries, and the EC systems
ratios of banner ads down to less than 0.5% at many sites, (logistics, technology, and customer service). All of these
innovations such as the integration of offline and online characteristics and systems interact to influence the
marketing are needed to increase click-through rates/ decision- making process and produce an eventual buyer
ratios. decision.
6. Who will conduct the market research? B2C requires 2. Online personalization. Using personalized Web pages,
extensive market research that may be costly and difficult customers can interact with a company, learn about its
to conduct. Thus, it may be necessary to outsource some products or services in real time, or receive customized
or all of the marketing research activities. If a company products or services. Companies can allow customers to
owns a large-scale customer database, the research on the self-configure the products or services they want.
internal database itself can be an important market Customization also can be done by matching products
research activity, and data mining techniques may be with customer profiles. Personalization includes the rec-
helpful. ommendation of products (services) and delivering con-
7. Should we use mobile coupons? Consumers and adver- tent that customers want.
tisers are curious about mobile coupons, but current usage 3. EC consumer market research. Several fast and eco-
is still low. Advertisers do not yet feel pressured to launch nomical methods of online market research are available.
a nationwide coupon effort, but they should start to plan The two major approaches to data collection are (1) solic-
for it. Forrester Research Corp. claims that Instagram is iting voluntary information from customers, and (2) using
the king of social engagement. Mobile coupons are gain- cookies, transaction logs, or clickstream data to track cus-
ing more popularity. The advantage of mobile coupons is tomer movements on the Internet and discover their inter-
that you can see them when you need them. Showing the ests. Understanding market segmentation by grouping
coupon to a vendor may be sufficient to get the discount consumers into categories is also an effective EC market
(there is no need to print the coupons). In general, the research method. However, online market research has