CHAPTER FOURTEEN
E-MARKETING
LEARNING OBJECTIVES
After reading this chapter, you should be able to:
1. Define E-Marketing
2. Highlight the new market trends
3. Explain key terms associated with e-marketing
4. Identify and explain types of products that can be purchased online
5. Explain the e-marketing techniques
6. Explain the advantages of e-marketing
DEFINITION OF E-MARKETING
E-marketing can be viewed as a marketing activity, a marketing process, a marketing element, and a form of direct marketing.
1. E-marketing as a marketing activity: E-marketing means marketing of a firm’s products and services via internet and World Wide Web (WWW) platforms.
2. E-marketing as a marketing process: E-marketing is the planning and execution of the development, pricing, delivery, and communication of a firm’s products and services through the internet or WWW to facilitate exchange for mutual satisfaction.
3. E-marketing as a marketing element: E-marketing is a direct marketing channel through which business enterprises share information about their products and services with customers online in order to boost sales and profit.
NEW MARKET TRENDS
1. From market place to market space
1. From analogue economy to digital economy
2. From cash economy to cashless economy
3. From internet age (PCs) to wireless age (Smartphones)
4. From email marketing to social media marketing
5. From traditional marketing to e-marketing
6. From marketing mix to e-marketing mix (remix)
7. From local reach to global reach
8. From small sales to large and mega sales
Key Terms Associated with Internet Marketing
1. Intranet: This refers to a private computer network that uses internet technology to connect people within a building or an organization. Such connectivity allows employees of an organization to share work information for smooth operations and decision making. It usually excludes and denies members of the public (non-members of the organization) access to log in and use the network. E-business falls under this category; it is facilitated by intranet. Through intranet, marketers can relate with managers and employees in other functional areas of the organization.
2. Extranet: This refers to a private computer network that uses internet technology to connect and allow an organization’s key stakeholders – customers, supplies, and distributors – access and shares some of its information. E-business and e-marketing fall under this categorization; they are facilitated by extranet. Thus, extranet enables marketers to communicate with co-workers, customers and distributors.
3. E-marketing (digital marketing): Electronic marketing (e-marketing) refers to the use of internet and digital ICT to conduct marketing activities which include identifying customer needs, informing the market about company’s products and prices, facilitating payments, delivering virtual goods, and building customer relationship to ensure customer satisfaction profitably. Specifically, digital or e-marketing activities include e-commerce marketing, social media marketing, display advertising, mobile marketing (m-marketing), search engine optimization, search engine marketing, influencer marketing, content automation, campaign marketing, e-books marketing, optical disc and games, and many others.
4. M-marketing: The use of mobile phones linked to internet to conduct marketing activities which include shopping (buying), selling, making and receiving payments, advertising, prospecting, and so on. M-marketing is facilitated through Wireless Application Protocol (WAP). WAP is more or less a web browser for mobile devices. Nowadays, mobile computers, phones, tablets and iPad are predominantly used by customers for shopping, banking, and purchases. This is made possible because GSM service providers now provide internet services at competitively affordable prices. Also, most private and public organizations (international hotels, banks, tertiary institutions) have Wi-Fi internet services which give authorized people access point (AP) to internet. However, for security reasons, most organizations prefer to use desktops for all forms of e-marketing.
5. E-commerce: This refers to the business of buying and selling products and services using internet and other digital information and communication technologies. Business organizations engage in e-commerce when they source for supplies and logistics from other business entities, and when they perform selling activities in order to translate products to cash sales. Customers are involved in e-commerce when they take necessary steps to buy goods on line. Example of e-commerce or online-shopping platforms/websites in Nigeria are Jumia (www.jumia.com.ng), Konga (www.konga.com), Kaymu Nigeria (www.kaymu.com.ng), Taafoo (www.taafoo.com), DealDey (www.dealdey.com), Wakanow (www.wakanow.com), Adibba (www.adibba.com), Shopaholic (www.shopaholicng.com), Buy Correct (www.buycorrect.com), Mall for Africa (www.mallforafrica.com), and Yudala (www.yudala.com).
6. M-commerce: Commercial transactions facilitated by mobile devices linked to internet. Marketers, especially sales people, should be acquainted with m-commerce in order not to lose business, as customers transact all day and all time using mobile gadgets.
7. E-business: This is the use of intranet and ICT to carry out day-to-day internal operations of an organization in a more coordinated, organized, effective and efficient way. E-business enables marketing department to relate electronically with finance department in terms of funding, purchasing department in the areas of needed raw materials and logistics, research and development department in the aspects of customer data and desired new products, and human resource department in terms of desired sales people, PR officers, advertisers, and training requirements.
Types of Products that can be purchased and sold online (types of e-marketing products)
1. Virtual products (downloadable products): These are products that can be purchased and delivered online. Examples are music, movies, games, computer software, accounting software, statistical software, news services, phone applications, electronic journal (e-journals) and electronic books (e-books).
2. Transactional-related products: These are service goods that can be purchased on-line but the actual consumption of the goods take place off-line. Examples are purchase of airline tickets and car rentals online. After purchasing airline ticket, customers have to appear physically in the airport for ticket confirmation, issuing of boarding pass, and actual boarding.
3. Physical products (soft and hard goods): This refers to tangible goods such as plastic containers, utensils, textiles, and electronics. Textiles and fashion wears are called soft physical products, while metal and plastic products are called hard physical products. Physical products can be purchased and paid for online, but deliveries are made via traditional mediums like shipping, postal, rail, and sales rep.
E-marketing techniques
1. Affiliate marketing: ‘Affiliate’ means the source of traffic. ‘Traffic’ means the number of internet users that visit a company’s websites for information, enquiries, or ordering. Internet users can be directed from third party’s website to a particular company’s site through pop-ups, newsletters, social networks, and blog. Thus, affiliate marketing is an online marketing technique in which a marketing company contracts or engages other companies (called affiliates) to help direct web visitors or internet user to the marketing company’s website for a fee or commission.
Affiliate marketing can also be regarded as an agreement between two websites, in which one site (the affiliate) agrees to features content or an advert designed to drive traffic to another site, and in return, the affiliate receives a percentage of sales or some other form of compensation generated by that traffic.
2. Referral marketing: Slightly different from affiliate marketing in the sense that the affiliated websites/companies are not paid commission. Referral marketing is operated on the basis of trust between two companies.
3. Search engine marketing/advertising (SEM/SEA): Millions of people search for products, services, places and organizations online, therefore, it is important for a business organization to not only seize this opportunity to be present on web by creating a website, but to make it easier for the prospective customers to locate the organization’s site and its product in few seconds. Search engines (SE) lead prospecting customers to websites of companies that provide a particular service by simply typing the service desired (keywords such as “cheap hotels in Ikeja, Lagos) and clicking to obtain search results.
By definition, SE is a program that does searches on the internet; that is, a program that generates different sources of information for further direct contact. Example of SE are Google, Yahoo, Blog, Goto, Lycos, Bling, Baidu, Ask.com, Excite, Yandex, MSN, Munax, Qwant, DuckDuckGo, Exalead, and Gigablast.
Precisely, SEM/SEA can be defined as the process of attracting and acquiring customers online by purchasing adverts on search engines. In other words, SEM/SEA involves the promotion of a company’s website by increasing its visibility and easy accessibility in Search Engine Result Page (SERP). SEM/SEA operates with Search Engine Optimization (SEO) and Price-Per-Clique (PPC) adverts. SEO allows a company to earn traffic through unpaid free search listing. PPC allows a company to buy traffic through paid search listings.
4. Search engine optimization (SEO): As the name implies, SEO is a search engine technique that enable a particular firm’s website or address to appear first on SERP. SEO may be regarded as the process of elevating websites ranking in the unpaid results of search engine. The technique is simply aimed at improving a website’s ranking in the natural search results.
SEO is a free and most effective internet marketing technique that leads internet users to any company’s website they are interested in visiting. SEO work effectively with keyword or keyword phrases. A keyword is a search terminology that an internet user input into a search engine to identify or locate a website of interest. Different but related keywords should be employed when using SEO approach. For example, a user looking for literature on “importance of social media marketing” can type in keywords like “advantages of social media marketing”, “benefits of social media marketing”, “significance of social media marketing”, and “pros and cons of social media marketing”. Important elements of SEO are the keywords, contents, page title, meta tags, and page rank.
5. Email marketing (email newsletters): The process in which marketers obtain email addresses (mailing list) of prospects, and thereafter advertise product(s) directly to each customer’s email via internet. The recipients of email adverts can respond to the sender (the marketer); thus, it is interactive in nature. Email adverts or newsletters are expected to be very appealing to the target customers; hence, it should be designed with colorful texts, graphics, and pictures.
6. Web-site advertising: Literally, a website is the storefront of an organization on the net. Each website has unique web address or identity used in locating an organization on the net and obtaining information about it in terms of its mandates, functions, objectives, products, staffs, branches, annual events, and other vital information. Such information are contained in several pages (web pages) joined together (hyperlinked) as a page. Thus, web-site advertising is the use of web-sites to market a company’s offers. For example, a click on a marketing related subject (e.g. products) on the home page of an organization will open a webpage showcasing the company products with prices, vendors, retailers, incentives, after-sales services, accessories, and other product benefits. An informed consumer may respond to the stimuli by placing order (filling and submitting order forms online).
Millions of people who visit internet daily may be unaware about a particular company’s website advertising. To overcome this challenge, marketers use different techniques (pop-up, pop-down, banner, and email) to attract and build web traffic of web users or visitors, influence ‘call-to-action’ after going through the adverts on the website, and persuade customer to take decision on either to ‘book now’ (place order) or simply ‘sign up’ (give personal information). Customers that sign up can be targeted again using varieties of internet marketing techniques in future. A web traffic is the amount of data sent and received by visitors to a web site.
7. Social media marketing (SMM): Unlike traditional media that uses television, radio, newspapers and magazines to provide one-way static communication from a firm or a marketer to the public, social media uses internet to provide two-way interactive and dynamic communication between the firm or marketer and the public. By definition, social media is an internet-based tool or a website that facilitates sharing of views, opinions, articles, contents, and information; it also enables interaction and engagement with prospects.
Marketers use social media platforms (Facebook, YouTube, Twitter, WhatsApp, LinkedIn, Goggle+, Instagram, MySpace, Pinterest, Reddit) and website to promote a product or organization to the target prospects. Social media marketing helps companies in generating exposure to a business, generating traffic or increasing number of subscribers, generating leads, building new business partnership, selling more products and services, and reducing marketing communication and distribution expenses. Social media marketing is indispensable to both small and large companies given the size of the users (e.g. almost 3 billion people use Facebook globally as at 2023), reach (e.g. global coverage), speed (instant delivery of messages), word-of-mouth (customers redirecting messages to their friends), and response/interaction.
It is important to note that social media are communication vehicles, and each social media platform has its capabilities and limitations. Some permit text messages of limited character, while others permit videos, photo and audio clip of limited duration or size. Table 14.1 below shows a list of some social media platforms with their corresponding capabilities.
Table 14.1: Capabilities of the Social Media Applications
SOCIAL MEDIA | CAPABILITIES |
YouTube | Video sharing |
Text sharing | |
Text, pictures, audio, and video sharing | |
Text, video and photo sharing | |
Vimeo | Video sharing |
Photo and video sharing | |
SoundCloud | Music sharing |
8. Social media participants: Social media participants, otherwise called the social media ladder, can be classified into seven, namely in-actives, spectators, joiners, collectors, critics, conversationalists, creators.
i. The in-actives: This refers to non-users of social media. They are neither on Facebook nor any social media platform. Social media marketing will not be effective for this group.
ii. Spectators: This refers internet users that do not have social media account, but consume social media contents such as reading others’ tweets, watching YouTube video from friends, and reading blogs. Marketers can target this group via ‘joiners’, ‘collectors’ or ‘critics’.
iii. Joiners: This refers to internet users that are connected to social media websites, and consume the social media contents. The internet user maintains a profile with a social media site. Marketers can target members of this group directly since they are connected to a social network.
iv. Collectors: Internet users that organize contents for themselves and others. Collectors may be helpful in helping marketers circulate product promotion to many users of social media.
v. Critics: Internet users contribute to discussion on the online social media forum, and edit articles. Members of this group are quite knowledgeable and like to respond to issues via social media. Marketer can maintain constant interaction with this group; get product development ideas, and covert them to regular customers.
vi. Conversationalists: Social media users that like to update their profile periodically and communicate their opinion or views on product or brands to consumers, businesses and friends.
vii. Creators: Individuals that create social contents used by others. Members of this group are proactive instead of reactive. They share product experience with others on the social media even when the product has not been advertised to them.
9. Display advertising (DA): As the implies, DA is a type of online marketing that combines texts, images (logo, photographs, pictures), flash, audio and video elements to promote a product, idea or organization. In fact, banner adverts, text adverts and pop-ups are examples of display advertising.
10. Banner advertising (BA): Popularly called banners, BA literally means a rectangular piece of cloth with promotional inscriptions usually hung in a public place. However, banner advertising is a special advert that appears on the web-page, aimed at informing public about a company’s offers and on-going sales promotions that customers can participate in. It appears horizontally on top or bottom of a computer screen with a rectangular shape and dotted with graphic designs, animation, and slogans. A browser (customer) can be directed to the advertiser’s web site to view more information after clicking on the banner.
11. Pop-ups/pop-under advertising: Pop-ups advertising are forms of online adverts intended to attract web-traffic or capture email addresses as data base for future contact. The adverts pop-up or suddenly appears immediately or few moments after a web user accesses a particular website or opens a web page. That is, a dialogue-box-like menu that appears on a screen when one is working on a particular webpage.
Pop-under advertising is slightly different in the sense that the advert window or page is hidden behind the web-page and only became visible when the browser/prospect closes or minimizes the web-page.
12. Interstitial adverts: These are online adverts that appear on the screen between the periods when the user start to download a document to the time when the download is complete. In other words, they are web-page adverts that are displayed before the requested content page fully appears or while the content page is loading.
13. Overlays: A type of internet advertisements that appears above a content and removable by clicking on a close button.
Advantages of e-marketing
1. Real time: Electronic/Internet/online marketing services are available all day and all time (24/7). For example, online shopping is opened 24/7.
2. Convenience: It is convenient to use by customers because it eliminates geographic barriers. In traditional marketing, a customer has to transport himself/herself from his/her house to the market when there is need for shopping.
3. Efficiency: It is cost effective to both marketers and customers. Marketers incur lesser cost in online advertising as compare to television and radio advertising. Customers incur lesser cost of searching and buying goods online; they only pay for internet access or connectivity services (data bundle) which is cheaper compare to the cost of visiting a market place.
4. Global reach and visibility: It facilitates global coverage such that both small and large companies can target and serve customers globally with greater sales revenue and profit. Prior to the advent of internet market, global advertising on the traditional mass media was undertaken by large multi-national corporations because is very expensive.
5. Direct communication: It facilitates direct communication with individual customers. That is, it facilitates one-to-one communication between a firm and each of its customers.
6. Mass communication: It also facilitates mass communication in forms of one-to-many or many-to-many. One promotional message can be targeted at many prospective customers.
7. Audio-visual message: Online adverts are very appealing to customers because it shares some features of radio, television, newspaper, and poster advertisements.
8. Mail listing: Email newsletters can be targeted at specific customers through mail listing.
9. Timeliness: It provides immediate delivery of messages.
10. Interactive: It facilitates interaction between the marketers and prospective customers. Marketers send promotional messages to the customers, while customers give feedbacks or respond to the promo; vice-versa.
SELF-ASSESSMENT QUESTIONS
1. Define E-Marketing
2. Highlight the new market trends
3. Explain key terms associated with e-marketing
4. Identify and explain types of products that can be purchased online
5. Explain the e-marketing techniques
6. Explain the advantages of e-marketing