1. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-1

2. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-2 IMPLEMENTING INTERACTIVE AND MULTICHANNEL MARKETING C HAPTER

3. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-3 AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: 1.Describe what interactive marketing is and how it creates customer value, customer relationships, and customer experiences. 2.Identify the demographic and lifestyle profile of online consumers. 3.Explain why certain types of products and services are particularly suited for interactive marketing.

4. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-4 AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: 4.Describe why consumers shop and buy online and how marketers influence online purchasing behavior. 5.Define multichannel marketing and the role of transactional and promotional websites in reaching online consumers.

5. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-6 CREATING CUSTOMER VALUE, RELATIONSHIPS, AND EXPERIENCES IN MARKETSPACE Customer Value Creation in Marketspace Marketplace Marketspace

6. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-8 FIGURE 21-1A FIGURE 21-1A Online shoppers in the United States

7. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-9 FIGURE 21-1B FIGURE 21-1B Online retail sales revenue in the United States

8. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-10 Godiva Chocolatier What utility is created by its website?

9. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-11 CREATING CUSTOMER VALUE, RELATIONSHIPS, AND EXPERIENCES IN MARKETSPACE Interactivity, Individuality, and Customer Relationships in Marketspace  Interactivity  Interactive Marketing Interactive Marketing  Choiceboards Choiceboards Collaborative Filtering Collaborative Filtering

10. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin WEB LINK Interactivity and Individuality— Your Nike iD Customized Product? Slide 21-12

11. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-13 CREATING CUSTOMER VALUE, RELATIONSHIPS, AND EXPERIENCES IN MARKETSPACE Interactivity, Individuality, and Customer Relationships in Marketspace  Permission Marketing Permission Marketing  Personalization Personalization Opt-In Opt-Out

12. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-14 CREATING CUSTOMER VALUE, RELATIONSHIPS, AND EXPERIENCES IN MARKETSPACE  Content  Context Creating an Online Customer ExperienceCreating an Online Customer Experience  Connection  Customization  Community  Communication  Commerce

13. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 21-2 FIGURE 21-2 Website design elements that drive customer experience Slide 21-15

14. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-17 Concept Check 1. The greatest marketspace opportunity for marketers lies in the creation of what kind of utility? A: form utility

15. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-18 Concept Check 2. The consumer-initiated practice of generating content on a marketer ’ s website that is custom tailored to an individual ’ s specific needs and preferences is called ____________. personalization

16. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-19 Concept Check 3. Companies produce a customer experience through what seven website design elements? A: These design elements are: context, content, community, customization, communication, connection, and commerce.

17. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-20 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  Online Consumer Lifestyle Segmentation  Profiling the Online Consumer The Online ConsumerThe Online Consumer Click-and-Mortar Hunter-Gatherers Brand Loyalists Time-Sensitive Materialists Hooked, Online, & Single Ebivalent Newbies

18. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-21 FIGURE 21-3 FIGURE 21-3 Internet access at home among U.S. households

19. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-22 FIGURE 21-3A FIGURE 21-3A Internet access at home among U.S. households

20. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-23 FIGURE 21-3B FIGURE 21-3B Internet access at home among U.S. households

21. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-24 FIGURE 21-3C FIGURE 21-3C Internet access at home among U.S. households

22. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-25 FIGURE 21-3D FIGURE 21-3D Internet access at home among U.S. households

23. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-27 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  What Online Consumers Buy Product Information Audio/Video Demos Delivered Digitally Unique Items Regular & Convenient Items Standard Items/Price The Online ConsumerThe Online Consumer

24. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-28 FIGURE 21-4 FIGURE 21-4 Online consumer retail sales by product/service category: 2003 and 2007

25. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-29 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  Why Consumers Shop and Buy Online Convenience Choice  Bots Bots  Eight-Second Rule Eight-Second Rule The Online ConsumerThe Online Consumer

26. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-30 FIGURE 21-5 FIGURE 21-5 Why consumers shop and buy online

27. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-31 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  Why Consumers Shop and Buy Online Customization  Customization  Customerization Customerization The Online ConsumerThe Online Consumer

28. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-32 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  Why Consumers Shop and Buy Online Communication  Marketer-to-Consumer  Consumer-to-Marketer  Consumer-to-Consumer The Online ConsumerThe Online Consumer

29. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-33 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  Why Consumers Shop and Buy Online Communication  Web Communities Web Communities  Blog Blog  Spam Spam  Viral Marketing Viral Marketing  Buzz The Online ConsumerThe Online Consumer

30. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-35 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  Why Consumers Shop and Buy Online Cost  Dynamic Pricing Dynamic Pricing  Portals Portals  Cookies Cookies Control The Online ConsumerThe Online Consumer

31. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-37 ONLINE CONSUMER BEHAVIOR AND MARKETING PRACTICE IN MARKETSPACE  When and Where Consumers Shop and Buy Online Monday - Friday Normal Work Hours The Online ConsumerThe Online Consumer

32. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-38 Concept Check 1. What is the eight-second rule? A: The eight-second rule is a view that customers will abandon their efforts to enter and navigate a website if download time exceeds eight seconds.

33. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-39 Concept Check 2. Which online consumer lifestyle segment spends the most money online and which spends the most time online? A: The “brand loyalists” segment spends the most money online whereas the “hooked, online, and single” segment spends more time online.

34. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-40 Concept Check 3. What are the six reasons consumers prefer to shop and buy online? A: convenience, choice, customization, communication, cost, and control

35. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-41 MULTICHANNEL MARKETING TO THE ONLINE CONSUMER  Dual Distribution Integrating and Leveraging Multiple Channels with Multichannel Marketing  Multichannel Retailers  Multichannel Marketing Multichannel Marketing

36. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin MARKETING NEWSNET Slide 21-42 The Multichannel Marketing Multiplier

37. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-43 MULTICHANNEL MARKETING TO THE ONLINE CONSUMER Implementing Multichannel Marketing  Multichannel Marketing with Transactional Websites Channel Conflict  Multichannel Marketing with Promotional Websites

38. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-44 FIGURE 21-6 FIGURE 21-6 Implementing multichannel marketing with promotional websites

39. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-45 Concept Check 1. Multichannel marketing is _______. the blending of different communi- cation 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

40. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-46 Concept Check 2. Channel conflict between manufacturers and retailers is likely to arise when manufacturers use __________ websites. transactional

41. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-61 Interactive Marketing Interactive marketing involves two-way buyer-seller electronic communication in a computer-mediated environment in which the buyer controls the kind and amount of information received from the seller.

42. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-62 Choiceboard A choiceboard is an interactive, Internet-enabled system that allows individual customers to design their own products and services by answering a few questions and choosing from a menu of product or service attributes (or components), prices, and delivery options.

43. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-63 Collaborative Filtering Collaborative filtering is a process that automatically groups people with similar buying intentions, preferences, and behaviors and predicts future purchases.

44. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-64 Personalization Personalization is the consumer-initiated practice of generating content on a marketer’s website that is custom tailored to an individual’s specific needs and preferences.

45. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-65 Permission Marketing Permission marketing is the solicitation of a consumer’s consent (called “opt-in”) to receive e-mail and advertising based on personal data supplied by the consumer.

46. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-66 Customer Experience Customer experience is the sum total of the interactions that a customer has with a company’s website, from the initial look at a home page through the entire purchase decision process.

47. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-67 Online Consumers Online consumers are the subsegment of all Internet users who employ this technology to research products and services and make purchases.

48. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-68 Bots Bots are electronic shopping agents or robots that comb websites to compare prices and product or service features.

49. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-69 Eight-Second Rule The eight-second rule a view that customers will abandon their efforts to enter and navigate a website if download time exceeds eight seconds.

50. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-70 Customerization Customerization is the growing practice of not only customizing a product or service but also personalizing the marketing and overall shopping and buying interaction for each customer.

51. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-71 Web Communities Web communities are websites that allow people to congregate online and exchange views on topics of common interest.

52. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-72 Blog A blog is a webpage that serves as a publicly accessible personal journal for an individual.

53. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-73 Spam Spam is communications that take the form of electronic junk mail or unsolicited e-mail.

54. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-74 Viral Marketing Viral marketing is an Internet-enabled promotional strategy that encourages individuals to forward marketer-initiated messages to others via e-mail.

55. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-75 Dynamic Pricing Dynamic pricing is the practice of changing prices for products and services in real time in response to supply and demand conditions.

56. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-76 Portals Portals are electronic gateways to the Internet that supply a broad array of news and entertainment, information resources, and shopping services.

57. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-77 Cookies Cookies are computer files that a marketer can download onto the computer of an online shopper who visits the marketer’s website.

58. © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 21-78 Multichannel Marketing Multichannel marketing consists of 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.