Copyright © 2010 Pearson Education, Inc.Copyright © 2007 Pearson Education, Inc. Slide 1-1 ELC 200 Day 15

Agenda Questions? Assignment 4 Corrected  1 A, 1 B, 2 C’s, 2 D’s, 1 F & 2 non-submits Assignment 5 posted  Due March 16 (next classs)  assignment5.pdf assignment5.pdf Assignment 6 Posted  Due Mar 23  assignment 6.pdf assignment 6.pdf 2 more assignments to go Quiz 2 on Mar 23  Chap 5-8  Short Essay & Multiple Choice  On Blackboard Finish E-commerce Marketing Communications

Possible Bonus Points Questions Name and origin of   What does his name mean?  What does he look like all  “grown up”? Origin of the word SPAM for  First SPAM  First SPAM Copyright © 2010 Pearson Education, Inc. Slide 1-3

Copyright © 2010 Pearson Education, Inc.Copyright © 2009 Pearson Education, Inc. Slide 7-4 Chapter 7 E-commerce Marketing Communications

Learning Objectives Identify the major forms of online marketing communications. Explain the costs and benefits of online marketing communications. Discuss the ways in which a Web site can be used as a marketing communications tool. Copyright © 2010 Pearson Education, Inc. Slide 7-5

Copyright © 2011 Pearson Education, Inc. Mobile Advertising Half of U.S. Internet users access Internet with mobile devices Currently small market, but fastest growing platform (35%) Google and Apple in race to develop mobile advertising platform Ads in Apps AdMob, iAd AdMobiAd Slide 7-6

Copyright © 2010 Pearson Education, Inc. Sponsorships and Referrals Sponsorships  Paid effort to tie advertiser’s name to particular information, event, venue in way that reinforces brand in positive yet not overtly commercial manner Referrals  Affiliate relationship marketing  Permits firm to put logo or banner ad on another firm’s Web site from which users of that site can click through to affiliate’s site Slide 7-7

Copyright © 2010 Pearson Education, Inc. Slide 6-8

Copyright © 2010 Pearson Education, Inc. Marketing and the Spam Explosion Direct marketing  Low cost method  Primary cost is purchasing addresses Spam: unsolicited commercial  80%–90% of all purportedly is spam  Efforts to control spam: Technology (filtering software) Government regulation (CAN-SPAM and state laws) Voluntary self-regulation by industries  DMA DMA Slide 7-9

Copyright © 2011 Pearson Education, Inc. Percentage of That Is Spam Slide 7-10 Figure 7.6, Page 448 SOURCE: Symantec MessageLabs, 2010

Symantec Intelligence Report Feb 2012 Report highlights  Spam – 68.0 percent (a decrease of 1.0 percentage points since January): page 7  Phishing – One in s identified as phishing (an increase of 0.01 percentage points since January): page 10  Malware – One in s contained malware (an increase of 0.03 percentage points since January): page 12  Malicious Web sites – 2,305 Web sites blocked per day (an increase of 9.7 percent since January): page 13  New wave of cyber-attacks designed to impersonate the Better Business Bureau: page 2  Blogs review: page 6  Best Practices for Enterprises and Users: page 16  b-intelligence_report_02_2012.en-us.pdf b-intelligence_report_02_2012.en-us.pdf Copyright © 2010 Pearson Education, Inc. Slide 6-11

Copyright © 2010 Pearson Education, Inc. Spam Categories Figure 7.7, Page 445 Slide 7-12 SOURCE: Symantec, 2009.

Copyright © 2010 Pearson Education, Inc. Online Catalogs Equivalent of paper-based catalogs Graphics-intense; use increasing with increase in broadband use Two types: 1. Full-page spreads, e.g., Landsend.com 2. Grid displays, e.g., Amazon In general, online and offline catalogs complement each other Slide 7-13

Copyright © 2010 Pearson Education, Inc. Social Marketing “ Many-to-many” model Uses digitally enabled networks to spread ads  Blog advertising Online ads related to content of blogs  Social network advertising Ads on MySpace, Facebook, YouTube, etc.  Game advertising Downloadable “advergames” Placing brand-name products within games Slide 7-14

Copyright © 2010 Pearson Education, Inc. Behavioral Targeting Web as “Database of Intentions” Behavioral targeting  Combines real-time information on visitors online behavior with offline identity, consumptive information  Data analyzed to develop profiles  Ads delivered based on profile  Hundreds of versions of ad for different profile groups One of fastest growing online marketing techniques Raises privacy concerns Slide 7-15

Copyright © 2010 Pearson Education, Inc. Mixing Offline and Online Marketing Communications Most successful marketing campaigns incorporate both online and offline tactics Offline marketing  Drive traffic to Web sites  Increase awareness and build brand equity Consumer behavior increasingly multi-channel  60% of consumers research online before buying offline Slide 7-16

Copyright © 2010 Pearson Education, Inc. Online Marketing Metrics: Lexicon Measuring audience size or market share  Impressions  Click-through rate (CTR)  View-through rate (VTR)  Hits  Page views  Stickiness (duration)  Unique visitors  Loyalty  Reach  Recency Slide 7-17

Copyright © 2010 Pearson Education, Inc. Online Marketing Metrics Conversion of visitor to customer  Acquisition rate  Conversion rate  Browse-to-buy-ratio  View-to-cart ratio  Cart conversion rate  Checkout conversion rate  Abandonment rate  Retention rate  Attrition rate metrics  Open rate  Delivery rate  Click-through rate ( )  Bounce-back rate Slide 7-18

Copyright © 2010 Pearson Education, Inc. An Online Consumer Purchasing Model Figure 7.9, Page 465 Slide 7-19

Copyright © 2010 Pearson Education, Inc. How Well Does Online Advertising Work? Ultimately measured by ROI on ad campaign Highest click-through rates: search engine ads, permission campaigns Rich media, video interaction rates high Online channels compare favorably with traditional channels Most powerful marketing campaigns use multiple channels, including online, catalog, TV, radio, newspapers, stores Slide 7-20

Copyright © 2010 Pearson Education, Inc. Comparative Returns on Investment Figure 7.9, Page 471 Slide 7-21 SOURCE: Industry sources; author estimates.

Copyright © 2010 Pearson Education, Inc. The Costs of Online Advertising Pricing models  Barter  Cost per thousand (CPM)  Cost per click (CPC)  Cost per action (CPA) Online revenues only  Sales can be directly correlated Both online/offline revenues  Offline purchases cannot always be directly related to online campaign In general, online marketing more expensive on CPM basis, but more effective Slide 7-22

Customer Acquisitions Costs Copyright © 2010 Pearson Education, Inc. Slide 6-23 Internet search engine8.50 (opt-in)10.00 Television11.00 Magazine19.00 Yellow pages20.00 Newspaper25.00 Online Display Ads50.00 Direct Mail50.00

Copyright © 2010 Pearson Education, Inc. Web Site Activity Analysis Figure 7.11, Page 472 Slide 7-24

Copyright © 2010 Pearson Education, Inc. The Web Site as a Marketing Communications Tool Web site as extended online advertisement Domain name:  First communication e-commerce site has with prospective customer Search engine optimization:  Register with as many search engines as possible  Ensure keywords used in site description match keywords likely to be used as search terms by user  Link site to as many other sites as possible  Get professional help Slide 7-25

Copyright © 2010 Pearson Education, Inc. Web Site Functionality Main factors in effectiveness of interface  Utility  Ease of use Top factors in credibility of Web sites  Design look  Information design/structure  Information focus Organization is important for first-time users, but declines in importance  Information content becomes major factor attracting further visits Slide 7-26

Copyright © 2010 Pearson Education, Inc. Factors in the Credibility of Web Sites Figure 7.12, Page 477 Slide 7-27 SOURCE: Based on data from Fogg, et al, 2003.

Copyright © 2010 Pearson Education, Inc. Slide 7-28 Table 7.9, Page 478