© 2013 Cengage Learning. All rights reserved.

1-1
9: E-Marketing, Digital Media, and
Social Networking
Part 3: Customer Behavior and E-Marketing

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  Define digital media and electronic marketing and
recognize their increasing importance in strategic
planning
 Understand the characteristics of digital media and
electronic marketing—addressability, interactivity,
accessibility, connectivity, control—and how they
differ from traditional marketing activities
 Identify and understand the role of digital media in a
marketing strategy and how each type of digital
media can be used as an effective marketing tool
 Understand and identify how digital media affect the
marketing mix and marketing research techniques
 Identify legal and ethical considerations in digital
media and electronic marketing

© 2013 Cengage Learning. All rights reserved. 1-3

  Digital media: Electronic media that function
using digital codes
 Digital marketing: Uses digital media to
develop communications and exchanges
with customers
 Electronic media (E-marketing): Refers to the
strategic process of distributing, promoting,
pricing products, and discovering
the desires of customers using
digital media and digital marketing
© 2013 Cengage Learning. All rights reserved. 1-4
  Allow marketers to
 Forge interactive relationships with consumers
 Reach new markets
 Target markets more precisely
 It is important to
 Use multiple digital media in marketing
strategies
 Be aware of rapid changes in
technology
 Can be an essential part of gaining a
competitive advantage
© 2013 Cengage Learning. All rights reserved. 1-5
  The most important benefit is the ability
to share information
 Between marketers and consumers
 Among employees
 With suppliers

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  E-marketing is increasingly common across
all industries
 Most marketers utilize e-marketing
 What examples of digital marketing have you
come across lately?
 What is your favorite example of a digital
marketing campaign or promotion?

© 2013 Cengage Learning. All rights reserved. 1-7

  Digital marketing differs from traditional
marketing in five key ways
1. Addressability
2. Interactivity
3. Accessibility
4. Connectivity
5. Control

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  The ability of a marketer to identify
customers before they make a purchase
 Social network: Web-based meeting place that
allows users to create a profile and connect with
other users for many different purposes
 Addressability facilitates relationship marketing
by enabling customer engagement to
create product innovation

© 2013 Cengage Learning. All rights reserved. 1-9

  Allows customers to express their needs and
wants directly to the firm in response to
marketing communications
 Contrasts with the one-way communications of
traditional marketing media
 Many digital media allow for ongoing, real-time
conversations between marketers and
consumers

© 2013 Cengage Learning. All rights reserved. 1-10

  YouBar is an online nutrition bar company
 Creates completely customizable energy bars,
granola, and cookies
 All of its business is conducted online
 No bricks-and-mortar store
 Click here to access a clip from a Food
Network show featuring YouBar

© 2013 Cengage Learning. All rights reserved. 1-11

  The ability to obtain digital information
on competing products, prices, reviews,
and details on firms
 Mobile marketing allows marketers to offer
promotions and incentives via customers’
mobile devices

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  Sports Illustrated was
once only a magazine–
it now offers services
and features on digital
media
 How do digital media
help companies stay
competitive?
© 2011 Time Inc.

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  The use of digital networks to provide
linkages between information providers
and users
 Online social networking sites improve
connectivity by providing large, diverse
audiences

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© 2013 Cengage Learning. All rights reserved. 1-15
  Consumers’ ability to regulate the
information they view and the rate and
sequence of their exposure
 The Internet is a pull medium because users
control what information they view
 More power is in the hands of
consumers

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  Consumers increasingly tend to publish their
thoughts, opinions, reviews, and product
discussions on blogs or digital media
 More interactive than traditional marketing
media
 Consumers trust other consumers over
corporations
 They rely on the recommendations
of family, friends, and fellow
consumers when making purchases

© 2013 Cengage Learning. All rights reserved. 1-17

  Most consumers have visited online social
networking sites
 There are many different sites, and the
number is growing
 Facebook
 LinkedIn
 Twitter

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  The most popular social networking site
 Appeals to a broad demographic
 Fastest-growing segment is women over 55
 Encourages consumer interaction with
companies and products
 Good resource for marketers
 Low-cost advertising
 Reaches new markets

© 2013 Cengage Learning. All rights reserved. 1-19

  A social network for professionals
 A profile resembles a résumé
 Facilitates professional networking, job
searches, and recruiting
 Companies use the site to familiarize
people with their businesses

© 2013 Cengage Learning. All rights reserved. 1-20

  A hybrid social networking and micro-
blogging site
 “Tweets” are 140 characters or less
 Companies announce sales, promotions, and
product updates via tweets
 Can help (re)build customer
relationships

© 2013 Cengage Learning. All rights reserved. 1-21

  Blogs (Web-logs): Web-based journals through
which authors can editorialize and interact with
other Internet users
 2/3 of Internet users have read blogs
 Give consumers power over companies because
they cannot control what bloggers write
 Wikis: Type of software that creates an
interface that enables users to add or edit the
content of some types of websites
 Monitoring wiki sites can give firms ideas
about how consumers feel about their
company or products
 Some companies use wikis as internal
tools for project teams
© 2013 Cengage Learning. All rights reserved. 1-22
  Photo sharing: Sites allow users to upload,
edit, and share photos
 Businesses use photo sharing to display images
of products
 Video sharing: Lets users upload videos to
the Internet
 Companies increasingly use consumer-
generated content from amateur
filmmakers rather than professional
ad agencies

© 2013 Cengage Learning. All rights reserved. 1-23

  Podcasts are audio or video files that can be
downloaded from the Internet via a program
that delivers content to listening devices or
personal computers
 Convenient
 Popular with the 18-29 demographic

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  Computer-based, online, simulated
environments where users create three-
dimensional worlds with their own
economies, lands, and residents
 Can involve many thousands of players
 Many real businesses have set up
virtual stores to take advantage of
the popularity

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  Consumers
 Want more and faster access to information
 Are empowered to comparison shop for the
best deals
 Can connect with each other
 Marketers must adapt to and use the new
media to their advantage
 Examine how consumers are using
the Internet to create better
marketing mixes

© 2013 Cengage Learning. All rights reserved. 1-26

  According to this poll, the majority of
companies do not monitor or audit postings
to social networking sites
 Does this surprise you?
 Are companies missing out
on an opportunity?

Source: PricewaterhouseCoopers, The Global State of

Information Security Survey 2010 (survey of 7,200
managerial positions).

© 2013 Cengage Learning. All rights reserved. 1-27

  Requires constant effort to stay on top of
technological change
 Customers’ habits and consumption patterns
change
 Learning how to use new media can be
daunting for many marketers

© 2013 Cengage Learning. All rights reserved. 1-28

  The Pepsi Refresh Project launched in 2008
 Provides funding for worthy non-profits and
community organizations in the United
States
 Consumers vote for their favorites on the
Pepsi Refresh website
 Encourages online interaction between
customers and Pepsi
 Improves goodwill and positive image of the
company
© 2013 Cengage Learning. All rights reserved. 1-29
  Creators: Create their own media outlets
 Critics: Comment on blogs or post ratings and
reviews
 Collectors: Collect and organize content generated
by creators and critics
 Joiners: Anyone who becomes a user of social
networking sites or other online communities to
connect and network
 Spectators: Read online information but
do not produce any themselves
 Inactives: Do not participate in online
digital media; numbers are dwindling
© 2013 Cengage Learning. All rights reserved. 1-30
© 2013 Cengage Learning. All rights reserved. 1-31
  The connectivity of digital media creates
opportunities for businesses to add services
and to enhance product benefits
 Some products are now only available digitally
 Some companies use advertising campaigns
and contests to develop better products
 The Internet can make it easier to
anticipate consumer needs

© 2013 Cengage Learning. All rights reserved. 1-32

  Digital marketing is a new distribution
channel
 Reduces inefficiencies, costs, redundancies, and
increases speed
 Shipping times and costs are an important
element in attracting customers
 Distribution involves a push-pull dynamic
 Companies push to get products to
consumers, and channel members pull
to find one another

© 2013 Cengage Learning. All rights reserved. 1-33

  Promotion is one of the best applications for
digital media
 Discounts and other promotions can be quickly
communicated
 Consumer consumption patterns are
changing rapidly and marketers must adapt
 Almost any traditional promotion
can be enhanced or replaced by
digital media

© 2013 Cengage Learning. All rights reserved. 1-34

  Price is the most flexible element of the
marketing mix
 Increased consumer demand for low prices
 Broad access to pricing information puts
pressures on marketers to differentiate
products
 Customers will focus more on
attributes than on price

© 2013 Cengage Learning. All rights reserved. 1-35

  Many websites allow consumers to compare
prices to find the best deals on goods and
services
 Have you ever used the following sites?
 mySimon
 Bizrate
 Nextag

© 2013 Cengage Learning. All rights reserved. 1-36

  Digital media can be a useful resource for
marketing research
 Many online research services are cheaper
than traditional counterparts
 Digital media help level the playing field
between large and small firms
 Crowdsourcing: Outsourcing
marketing tasks to a large group of
people

© 2013 Cengage Learning. All rights reserved. 1-37

  Marketers should ask
 Did the online campaign generate more
business for or more interest in the
company?
 Is this increase in demand significant?
 The company should set a goal of by how much
it wants demand to increase
 Are there any extraneous variables
that could account for an increase
in sales?
© 2013 Cengage Learning. All rights reserved. 1-38
  In a viral marketing campaign, the Girl Scouts
organization utilized the Internet to promote
Girl Scout cookies
 Do you think this ad is successful?

© 2013 Cengage Learning. All rights reserved. 1-39

  How marketers and others use digital
technology to gather information can raise
ethical questions
 Regulation has not kept pace with
technological advances
 Major issues
 Privacy
 Online fraud
 Intellectual property protection

© 2013 Cengage Learning. All rights reserved. 1-40

© 2013 Cengage Learning. All rights reserved. 1-41
  A significant privacy issue is the use of
personal information that companies collect
from website visitors
 Concerns that this violates privacy rights
 Some fear that hackers can gain information
stored by companies

© 2013 Cengage Learning. All rights reserved. 1-42

  Legislation in the works
 The U.S. Federal Trade Commission is
considering limiting the information companies
can gather
 The American Association of Advertising
Agencies, the Association of National
Advertisers, the Direct Marketing Association
and the Interactive Advertising Bureau are
developing policies to give consumers
more control over how their
information is used online

© 2013 Cengage Learning. All rights reserved. 1-43

  Any attempt to conduct dishonest/fraudulent
activities online
 Cybercriminals increasingly use popular social
networking sites to commit fraud
 Gather private consumer information
 Damage a company’s reputation
 Some organizations and social networking sites
are developing ways to combat
fraud
 Consumers must be careful what
information they disclose online
© 2013 Cengage Learning. All rights reserved. 1-44
  The United States government offers tips on
how to avoid Internet fraud and what to do if
you are a victim
 Click here to learn more
 Have you ever been the victim of Internet
fraud? Do you know anyone who has?

© 2013 Cengage Learning. All rights reserved. 1-45

  Intellectual property can be ideas and
creative materials, songs, movies, books, or
other products
 IP is generally protected by copyrights and
patents
 Not enforced uniformly in different countries
 IP protection is a growing problem in a
digital age
 Software, electronics, entertainment
media, and fashion are especially
vulnerable
© 2013 Cengage Learning. All rights reserved. 1-46
 Digital media Control
Digital marketing Blogs
Electronic marketing Wiki
(e-marketing)
Addressability Podcast
Social network Crowdsourcing
Interactivity Online fraud
Accessibility
Connectivity

© 2013 Cengage Learning. All rights reserved. 1-47