© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 1 Marketing II The Chang School-Ryerson University Continuing Education preferred Web: Office: Bus 308 Phone: Ext 4215 CMKT 200 Fall 2005 Instructor: Armand Gervais

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 2 Lecture Agenda  Don’t Forget Name Tags  Interactive Marketing  Video Ebay  Break  Simulation  To Do’s for next weeks class  Time to work in Groups

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 3 IMPLEMENTING INTERACTIVE AND MULTICHANNEL MARKETING C HAPTER 2121

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 4  Understand what interactive marketing is and how it creates customer value, customer relationships, and customer experiences in the new marketplace.  Identify the online consumer, their profiles, and their purchasing behaviours. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO:

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 5  Recognize why certain types of products and services are particularly suited for interactive marketing.  Distinguish between multiple channels and multi-channel marketing in reaching online customers. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO:

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 6  Understand the differences between transactional Websites and promotional Websites in multichannel marketing. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO:

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 7 ANYTIME, ANYWHERE, ANYWAY: ANYTIME, ANYWHERE, ANYWAY: THE NEW MARKETING MANTRA THE NEW MARKETING MANTRA IMPLEMENTING INTERACTIVE AND MULTICHANNEL MARKETING

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 8  Customer Value Creation in Market-space  Interactivity, Individuality, and Customer Relationships in Marketspace  eCRM  Interactive marketing –Choiceboards DELL DELL  Collaborative filtering Chapters.ca Chapters.ca –Personalization Yahoo.ca  Permission marketing CREATING CUSTOMER VALUE, RELATIONSHIPS, AND EXPERIENCES IN THE NEW MARKETSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 9  Creating an Online Customer Experience  Consistent message and service across channels?  Chapters vs. Future Shop  Channel conflict CREATING CUSTOMER VALUE, RELATIONSHIPS, AND EXPERIENCES IN THE NEW MARKETSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 10 FIGURE 21-2 Website design elements that drive customer experience

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 11 Concept Check 1. The greatest marketspace opportunity for marketers lies in the creation of what kind of utility? A: Form utility

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson The consumer-initiated practice of generating content on a marketer’s Website that is customer tailored to an individual’s specific needs and preferences is called _____________. personalization Concept Check

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 13 Concept Check 3. Companies produce a customer experience through what seven Website design elements? A: The seven design elements are context, content, community, customization, communication, connection, and commerce.

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 14  The Online Consumer –Profiling the Online Consumer ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 15 Online Segments  The largest online consumer lifestyle segment, called click-and-mortar, consists of female homemakers who tend to browse retailer Websites but actually buy products in traditional retail outlets. They make up 23 percent of online consumers and represent an important segment for multichannel retailers that also feature catalogue and store operations, such as J. Crew and JCPenney.  Twenty percent of online consumers are hunter-gatherers—married baby boomers with children at home who use the Internet like a consumer magazine to compare products and prices. They can be found visiting comparison shopping Websites such as Dealcatcher.com and Mysimon.com on a regular basis.  Nineteen percent of online consumers are brand loyalists who regularly visit their favourite bookmarked Websites and spend the most money online. They are better-educated and more-affluent Internet/Web users who effortlessly navigate familiar and trusted Websites and enjoy the online browsing and buying experience..

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 16 Online Segments Con’t  Next there are time-sensitive materialists who regard the Internet as a convenience tool for buying music, books, and compute software and electronics. They account for 17 percent of online consumers and c be found visiting Amazon.com, Dell.com, Sony.com, and BMG.com  The hooka online, and single segment consists of young, affluent, and single online consume! who bank, play games, and spend more time online than any other segment a documented in the accompanying Web Link. They make up 16 percent of online consumers, enjoy auction Websites such as eBay, and visit game Websites lil iWon.com, ea.com, and games.yahoo.com.  Five percent of online consumers are the ebivalent newbies— newcomers to the Internet who rarely spend money online, bii seek product information.

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 17 FIGURE 21-3 Profiles of Canadian online users

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 18 Canadians Online

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 19 Canadian Online Retailing

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 20  The Online Consumer (cont) –Online Consumer Lifestyle Segmentation  What Online Consumers Buy  What have you purchased online?  What would you not purchase and why? ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 21 FIGURE 21-4 Online consumer sales by product/service category: 2001 and 2005

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 22 U.S. Internet Users

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 23  Why Do Consumers Shop and Buy Online?  What are the advantages and disadvantages? ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 24 FIGURE 21-5 Why consumers shop and buy online

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 25  Why Consumers Shop and Buy Online (cont) –Convenience  Bots Bizrate.com Bizrate.com  Eight-second rule –Choice –Customization  Customerization ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 26  Why Consumers Shop and Buy Online (cont) –Communication  Web communities  Spam  Viral marketing ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 27  Why Consumers Shop and Buy Online (cont) –Cost  Dynamic pricing –Control  Portals 80% regularly use portals and search engines  Google.com yahoo.ca canoe.ca  Cookies Advantages and Disadvantages?  SPAM  Permission based marketing ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 28  When and Where Online Consumers Shop and Buy  80% of online sales occur during the week during normal working hours  40% shop online from work ONLINE CONSUMER BEHAVIOUR AND MARKETING PRACTICE IN CYBERSPACE

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 29 The worst Flash intros Concept Check 1. What is the eight-second rule? A: Customers will abandon their efforts to enter and navigate a Website if download time exceeds eight seconds.

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 30 Concept Check 2. Which online consumer lifestyle segment spends the most money online and which spends the most time online? A: Brand loyalists spend the most money online. The hooked, online, and single segment spends the most time online.

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 31 Concept Check 3. What are the six reasons consumers prefer to shop and buy online? A: The six reasons are convenience, cost, choice, customization, communication, and control.

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 32  Integrating and Leveraging Multiple Channels with Multichannel Marketing  Implementing Multichannel Marketing –Multichannel Marketing with Transactional Websites –Multichannel Marketing with Promotional Websites MULTICHANNEL MARKETING TO THE ONLINE CONSUMER

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 33 FIGURE 21-6 Implementing multichannel marketing with promotional Websites

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson Multichannel marketing is: the blending of different communication and delivery channels that are mutually reinforcing in attracting, retaining, and building relationships with consumers who shop and buy in the traditional marketplace and marketspace. the blending of different communication and delivery channels that are mutually reinforcing in attracting, retaining, and building relationships with consumers who shop and buy in the traditional marketplace and marketspace. Concept Check

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson Channel conflict between manufacturers and retailers is likely to arise when manufacturers use ___________ Websites. transactional Concept Check

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 36 To Do’s for Next Class –Next week Chapter 10 –Work on Simulation –Study for exam –

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 37 A Web-centric, personalized approach to managing customer relationships electronically. eCRM

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 38 Two-way buyer-seller electronic communications in a computer- mediated environment in which the buyer controls the kind and amount of information received from the seller. Interactive Marketing

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 39 An interactive, Internet/Web-enabled system that allows individual customers to design their own goods and services. Choiceboard

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 40 A process that automatically groups people with similar buying intentions, preferences, and behaviours and predicts future purchases. Collaborative Filtering

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 41 The consumer-initiated practice of generating content on a marketer’s Website that is custom tailored to an individual’s specific needs and preferences. Personalization

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 42 The solicitation of a consumer’s consent (called “opt-in”) to receive and advertising based on personal data supplied by the consumer. Permission Marketing

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 43 The sum total of interactions that a customer has with a company’s Website. Customer Experience

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 44 The subsegment of all Internet/Web users who employ this technology to research products and make purchases. Online Consumers

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 45 Electronic shopping agents or robots that comb Websites to compare prices and product features. Bots

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 46 Customers will abandon their efforts to enter and navigate a Website if download time exceeds eight seconds. Eight-Second Rule

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 47 The growing practice of customizing not only a product but also personalizing the marketing and overall shopping and buying interaction for each customer. Customerization

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 48 Websites that allow people to congregate online and exchange views on topics of common interest. Web Communities

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 49 Electronic junk mail or unsolicited e- mail. Spam

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 50 An Internet/Web-enabled promotional strategy that encourages users to forward marketer-initiated messages to others via . Viral Marketing

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 51 The practice of changing prices for products in real time in response to supply and demand conditions. Dynamic Pricing

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 52 Electronic gateways to the World Wide Web that supply a broad array of news and entertainment, information resources, and shopping services. Portals

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 53 Computer files that a marketer can download onto the computer of an online shopper who visits the marketer’s Website. Cookies

© 2003 McGraw-Hill Companies, Inc. McGraw-Hill Ryerson 54 The blending of different communications and delivery channels that are usually reinforcing in attracting, retaining, and building relationships with customers. Multichannel Marketing