Essential of E-Business Chapter 3: Digital Marketing

Digital Marketing
The promotion of products or brands via one or more forms of electronic media. For example, advertising mediums that
might be used as part of the digital marketing strategy of a business could include promotional efforts made via the Internet,
social media, mobile phones and electronic billboards, as well as via digital and television and radio channels.

What it is and why it matters

Digital marketing, the promotion of products or brands via one or more forms of electronic media, differs from traditional
marketing in that it uses channels and methods that enable an organization to analyze marketing campaigns and understand
what is working and what isn’t – typically in real time.
Digital marketers monitor things like what is being viewed, how often and for how long, sales conversions, what content
works and doesn’t work, etc. While the Internet is, perhaps, the channel most closely associated with digital marketing,
others include wireless text messaging, mobile instant messaging, mobile apps, podcasts, electronic billboards, digital
television and radio channels, etc.
Why digital marketing is important
Digital media is so pervasive that consumers have access to information any time and any place they want it. Gone are the
days when the messages people got about your products or services came from you and consisted of only what you wanted
them to know. Digital media is an ever-growing source of entertainment, news, shopping and social interaction, and
consumers are now exposed not just to what your company says about your brand, but what the media, friends, relatives,
peers, etc., are saying as well. And they are more likely to believe them than you. People want brands they can trust,
companies that know them, communications that are personalized and relevant, and offers tailored to their needs and
preferences.
Manage customer relationships across all channels
Digital marketing and its associated channels are important – but not to the exclusion of all else. It’s not enough to just know
your customers; you must know them better than anybody else so you can communicate with them where, when and how
they are most receptive to your message. To do that, you need a consolidated view of customer preferences and expectations
across all channels – Web, social media, mobile, direct mail, point of sale, etc. Marketers can use this information to create
and anticipate consistent, coordinated customer experiences that will move customers along in the buying cycle. The deeper
your insight into customer behavior and preferences, the more likely you are to engage them in lucrative interactions.

Challenges facing digital marketers

 Proliferation of digital channels. Consumers use multiple digital channels and a variety of devices that use different
protocols, specifications and interfaces – and they interact with those devices in different ways and for different purposes.
 Intensifying competition. Digital channels are relatively cheap, compared with traditional media, making them within reach
of practically every business of every size. As a result, it’s becoming a lot harder to capture consumers’ attention.
 Exploding data volumes. Consumers leave behind a huge trail of data in digital channels. It’s extremely difficult to get a
handle on all that data, as well as find the right data within exploding data volumes that can help you make the right
decisions.
Three keys to digital marketing success
What does it take to do digital marketing right? Here are three keys to digital marketing success:
1. Manage complex customer relationships across a variety of channels – both digital and traditional.
2. Respond to and initiate dynamic customer interactions.
3. Extract value from big data to make better decisions faster.

EFFECTS OF E-BUSINESS TECHNOLOGIES ON MARKETING STRATEGY

The Internet has become an essential tool for today's businesses environments. Every business organization is using e-
business technologies in some way or in any other situation these days.
Marketing managers who fail to use the Internet in formulating their companies marketing strategy will be at a disadvantage
and cannot compete with the other company having similar or dissimilar products and services.
According to the American City Business Journal, small businesses that use the Internet have grown 46 percent faster than
those that do not.
Some of the major changes brought about by the Internet can be seen in the way we purchase products and services, obtain
information, and conduct our banking. Customers can quickly find product and price information and obtain advice from a
wide variety of sellers. Online visitors can check product availability, place an order, check the status of an order, and pay
electronically.
The role of the Internet in developing product, service, brand, distribution, and promotion strategies are discussed below:
Impact on Product and Brand Strategy
Internet-based technologies have significantly reduced the marginal cost of producing and distributing digital goods such as
software, news stories, music, photographs stock quotes, horoscopes sports scores and health tips, etc. For example, online
customers can purchase personal computers from the Internet in a variety of combinations by choosing the appropriate
features or music retailers can create CDs containing songs ordered by customers. E-businesses also guarantee that if the

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 1

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
customer information is abused, they will be responsible for ny financial losses that may occur. Usually, the personal
information provided to the e-retailer when an order is placed or an account is opened is secured using Secure Socket
Layers (SSL) encryption technology.
Branding is becoming important in Internet based businesses because online consumers prefer to buy from well known and
reputable e-business companies. Company such as Amazon.com is widely known, recognized, and trusted by online
consumers. Many consumers avoid purchasing online because of trust and privacy issues. Gaining people's trust is a major
challenge for Web based companies as many online visitors are reluctant to provide credit card information because they do
not trust the visiting site.
Traditional retailers with established names usually have an advantage over certain Internet only companies because they
have been known for years and enjoy a higher degree of trust by consumers.
The reputation and image of the website may have an impact on the offline business.
Impact on Pricing Strategy
Among the marketing areas that have been affected the most by the Internet is pricing. The Internet influences a firm's
pricing strategy in multiple ways, including providing consumers with more information, increasing competition, increasing
the number of suppliers, the establishment of various auction houses, and pricing research.
1. Increased information: One major effect of the Internet is the explosion of information that has resulted in more
competition among firms and lower prices. Many Internet-only companies offer substantially lower prices than
other retail or even mail order firms.
2. Interactive Shopping Agents: The Internet makes the search for the lowest price for products easy, quick, and at a
low cost, especially with the various interactive shopping agents which provide one-click access to price and
availability information about a relatively large number of online suppliers
3. Growth of Online Suppliers: The growth of Internet users and the entry of large numbers of electronic retailers,
which have provided online shoppers with a wide variety of choices further enhancing their bargaining power are
putting downward pressure on prices include. The number of suppliers has increased even further by the
elimination of the distance barrier, as people can now purchase from online vendors located anywhere in the world,
and the elimination of many traditional intermediaries has led to lower prices.
4. Auction houses: The various Internet auction houses such as eBay.com also affect the prices of products sold on the
Internet. Online auctions serve as powerful methods of real time pricing. One of the biggest problems with auctions
was bringing enough bidders together in the same place at the same time. The Internet has solved this problem, as
bidders no longer have to be physically present, decreasing the cost of participation in auctions, and increasing the
number of bidders.
5. Pricing research: Another impact of the Internet on pricing practices is that it offers marketers excellent new
pricing research and testing capabilities. In contrast to traditional retailing where pricing research is costly in terms
of time and money, the Internet allows marketers to research and test pricing decisions in real time and with low
costs. By making it easier to track
customer responses to prices, e-retailers can set prices with far greater precision and make appropriate price
adjustments when necessary.
Online pricing research makes available information from multiple sources such as customer buying history stored
in databases or in cookies created in customers' computers or click stream information. Such pricing information
can help managers segment their markets in new ways and uncover profitable customer groups.
Impact on Distribution Strategy
Electronic media are any that involve the use of the Internet as a means of reaching end users. The Internet is changing
distribution like no other environmental force since the industrial revolution because it breaks many of the assumptions on
which media are based, transforming or even eliminating media themselves in many cases, while giving rise to new forms of
media of
distribution. The Internet is in many respects both a retail store and a delivery medium.
The customer first locates a product such as computer software or airline ticket and then makes a purchase online. Once
credit card information is entered, the customer proceeds to download the software. For non-digital products, the seller
must arrange with a shipping company to have them delivered to the customers address
Impact on Promotion Strategy
The Internet has become an important component of a firm's promotion strategy as it provides a new way to reach people
and deliver the company's message What is the role of the Internet in a firm's promotion strategy? Marketers who use the
Internet as part of an integrated marketing communications mix must assess its role as an advertising medium and its
position in a firm's marketing communication mix.
A website can be seen as a mix between direct selling (as it can engage the visitor in a dialogue) and advertising because it
can generate awareness, provide information, and demonstrate the product. Also, a website may be viewed as
complementary to the personal selling effort by business to business suppliers and advertisers of consumer products.
Continued Connectivity
One of the draws of digital advertising is that offers an instant connection to customers. customer service issues can be
vesolved faster through soial media chats customer become aware of sales and promotions faster through social media
feeds, and ads can target users based on very specific needs and interests, helping them find solutions faster than before.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 2

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
New technology, like Al will offer continued connection from a company their client base. Al scripts have already created
apps that were developed help enhance online customer chat platforms. These programs can learn from customer
information and help them solve problems and find solutions on demand.
Increased connectivity is apparent in things like the Internet of Things technology, where customers can use an app from a
mobile device to control a product, as well as voice assistants like Alexa and Siri that can help answer questions on demand.
Al in marketing will help businesses learn and predict their customers' wants, needs, and interests better and are able to
learn from data that will help to guide marketers in creating the materials that influence the best marketing strategies and
will serve their audiences most effectively.
Personalized Experiences
Personalization is another way new technology will help businesses maximize their customer connections. Augmented
reality (AR) apps have already been developed that show customers how a product would look in their space or even
approximate it on their person to help personalize the shopping experience.
AR technology is a great marketing tool because it offers users an additional layer of understanding and experience when
engaging in a product. Rather than just reading a catalog description or seeing an ad, customers can engage in a unique-to-
them "try before you buy" type of experience.
Another form of digital personalization will likely be in the form of video. People are used to video advertising through
commercials, and while these are targeted, the internet and analytics help to narrow the focus even further. This means that
companies can develop more custom video content and target it to the customers who could benefit from it the most.
The impact of digital technologies on marketing strategies will continue to grow and develop marketing plans and projects
for all industries, helping to reach more customers with personalized messaging that will be even more relevant and useful
in connecting your client to your business.

Electronic Customer Relationship Management (E-CRM)

What does Electronic Customer Relationship Management (E-CRM) mean?
Electronic customer relationship management (E-CRM) is the application of Internet-based technologies such as emails,
websites, chat rooms, forums and other channels to achieve CRM objectives. It is a well-structured and coordinated process
of CRM that automates the processes in marketing, sales and customer service.
An effective E-CRM increases the efficiency of the processes as well as improves the interactions with customers and enables
businesses to customize products and services that meet the customers’ individual needs.

Techopedia explains Electronic Customer Relationship Management (E-CRM)

Electronic customer relationship management provides an avenue for interactions between a business, its customers and its
employees through Web-based technologies. The process combines software, hardware, processes and management’s
commitments geared toward supporting enterprise-wide CRM business strategies.
Electronic customer relationship management is motivated by easy Internet access through various platforms and devices
such as laptops, mobile devices, desktop PCs and TV sets. It is not software, however, but rather the utilization of Web-based
technologies to interact, understand and ensure customer satisfaction.
An effective E-CRM system tracks a customer’s history through multiple channels in real time, creates and maintains an
analytical database, and optimizes a customer’s relation in the three aspects of attraction, expansion and maintenance.
A typical E-CRM strategy involves collecting customer information, transaction history and product information, click
stream and contents information. It then analyzes the customer characteristics to give a transactional analysis consisting of
the customer's profile and transactional history, and an activity analysis consisting of exploratory activities showing the
customer's navigation, shopping cart, shopping pattern and more.
The benefits of E-CRM include the following:
 Improved customer relations, service and support
 Matching the customers' behavior with suitable offers
 Increased customer satisfaction and loyalty
 Greater efficiency and cost reduction
 Increased business revenue
Businesses that strategize and implement an E-CRM solution are able to align their processes around technology to
effectively deliver seamless, high-quality customer experience across all channels. Customers have the power to help
themselves through online personalized services that are made available on demand. The Internet provides a simple and
ideal medium where customers can get information from websites, buy products and find answers using FAQ sections,
forums or chat rooms.

Digital Strategies For Customer Retention

While attracting fresh customers and opening up new markets are essential to a business, it’s especially important to hold
onto the clients that you already have. Research estimates suggest that it can cost anywhere from five to ten times as much
to land a new customer than it does to retain an existing one. Furthermore, a 10% increase in levels of customer retention
may translate into an increase in value of 30% overall, for an enterprise.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 3

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
The Office of Consumer Affairs (a division of the White House in Washington D.C.) estimates that a loyal customer will spend
ten or more times the value of their initial expenditure, over the life of their relationship with a single company. Clearly then,
having an established base of loyal customers is a recipe for stability and long-term success.
So in a digital marketplace where the immediacy and glamour of promotion made possible through technology can sway
buyers in an instant, it’s crucial to adapt – and to develop strategies for using online marketing and digital technology to
encourage customers to stay, and for adding to your existing client base.
Know And Understand Your Audience
Market awareness needs to go beyond establishing a target demographic and developing promotional materials based on
their perceived needs. Information and observations from a number of sources will already exist: purchasing histories,
profile information from account registration or more public forums like social media, as well as monitoring and analysis of
browsing and online activities.
For the purposes of customer retention, you should be seeking evidence of how your existing clients view your organization,
and their dealings with it. Look for indicators of their satisfaction (or otherwise) with your product lines, customer relations,
and levels of service. Then take steps to maintain those aspects that seem to be meeting with approval – and to improve on
those issues that are causing concern.
Some proactive measures you can take to gain these types of insight include:
 Applying website traffic and behavioural analysis tools to your corporate site, blogs, e-commerce portals, and other
online presences to study visitor and customer behaviour
 Using phased email sequences as a follow-up to completed transactions, and inviting feedback and commentary
(This technique may also be used to increase customer engagement, as we’ll see below)
 Including questions in query, purchase, and after-purchase forms to elicit further feedback and comments
 Using feedback analysis tools to study customer conversations, commentary, and behaviours on social media
Create Conversations
Receiving their money and distributing your goods and services need not be the end of your dealings with the customer –
and it need not be an impersonal or passive process. Adding a personal touch to each transaction can go a long way toward
creating and maintaining a positive impression in the mind of a buyer.
To attract new customers in the first place and to keep them coming back, it’s necessary to engage them in some way – and
to provide reasons for them to continue interacting with your enterprise. Your aim should be to open up a line of
communication with your customers that simultaneously responds to their needs while reinforcing the fact that your
organization has something worthwhile to offer them.
Your pool of market research, transaction analysis and consumer profiling data may be used as a source of ideas for online
content that you can make available to enhance the customer experience, and to extend the reach of your brand. “Q & A”-
style decision making tools, online estimators and calculators, recommendation tools: these are the kinds of features that
can add value to a website or portal visit. And they add a level of interaction and dialogue to your dealings with a client.
Keep The Dialogue Going
Follow-up emails are a useful way of maintaining interest, after a purchase or site visit. Released in phases over several days,
messages may be tailored to provide information on products or services just acquired, as an avenue for technical support
and assistance, or as a promotional tool for related goods and updates.
Social media channels may be used as a platform for keeping your customers informed about developments in your
industry, new product releases, “How To” guides, and specialist advice or resources. It’s also possible to exploit the social
channel to create communities and forums, where customers can meet and share ideas with like-minded others. Creating a
solid link with your organisation (perhaps by having a staff member as group moderator) is another way of extending your
reach.
Automate And Bolster With Technology
There are a number of tools to help automate the processes of online content distribution – and more particularly for
crafting content that’s targeted and tailored for specific customer personas and demographics. Whether you use a marketing
automation platform or subscribe to a hosted service, the emphasis should be on intelligence gathering and analytics for
actionable insights, lead generation, conversion, and the integration of various channels in producing content that’s based on
customer needs and preferences.
Ensure Continuity
Continuity in this sense extends beyond your output of promotional material – though content ported across various
channels should be consistent in its message and branding, and formatted appropriately for the various devices and
operating systems that your customers will use to access it.
In enhancing the customer experience, continuity may be achieved by something as simple as configuring portals and
website forms to retain customer details and account information from transaction to transaction, keeping visitors logged in
between visits, or making preferred resources available to users offline.
Offer Incentives
When properly implemented, loyalty schemes really do inspire loyalty – so they’re well worth considering. Be sure to
provide a clear definition of the terms, and some method for customers to “keep score”. If a purchase or site visit merits a
certain number of points, include a visible counter on each customer’s account page, so they know how well they’re doing.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 4

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
Surprise bonuses and random gifts will always be welcome, and these may be awarded arbitrarily (“Prize Draw”) or on a
loyalty basis (time spent as a customer, number of purchases made, etc.).
And on a day to day level, convenience and exemplary service may provide incentive enough for customers to remain within
the fold.
Monitor And Manage
It’s an ongoing process, and market analytics may assist in establishing which parts of a campaign are working, and which
aspects require tweaking or an overhaul.
You’ll need to keep an eye on metrics that indicate customer response, such as Likes and Re-Tweets on social media,
numbers of followers or fans, referral traffic on websites, and click-through rates on links and advertising.
And your emphasis should always be to put the customer first, and to seek new ways of enhancing their experience with
you.
Customer retention refers to the activities and actions companies and organizations take to reduce the number of customer
defections. The goal of customer retention programs is to help companies retain as many customers as possible, often
through customer loyalty and brand loyalty initiatives. It is important to remember that customer retention begins with the
first contact a customer has with a company and continues throughout the entire
lifetime of the relationship.
Customer Retention Benefits

While most companies traditionally spend more money on customer acquisition

because they view it as a quick and effective way of increasing revenue, customer
retention often is faster and, on average, costs up to seven times less than customer
acquisition. Selling to customers with whom you already have a relationship is
often a more effective way of growing revenue because companies don’t need to attract, educate, and convert new ones.
Companies that shift their focus to customer retention often find it to be a more efficient process because they are marketing
to customers who already have expressed an interest in the products and are engaged with the brand, making it easier to
capitalize on their experiences with the company. In fact, retention is a more sustainable business model that is a key to
sustainable growth. The proof is in the numbers: according to studies done by Bain & Company, increasing customer
retention by 5% can lead to an increase in profits of 25% – 95%, and the likelihood of converting an existing customer into a
repeat customer is 60% – 70%, while the probability of converting a new lead is 5% – 20%, at best.
How to Improve Customer Retention

Obviously, established companies and organizations need to focus on customer retention. More important, companies are
finding that customer profitability tends to increase over the life of a retained customer, so employing customer retention
strategies is a worthwhile use of company resources. We have compiled some of the more successful customer retention
strategies and techniques and outline them here, for your convenience:
 Set customer expectations – Set customer expectations early and a little lower than you can provide to eliminate
uncertainty about the level of your service and ensure you always deliver on your promises.
 Become the customers’ trusted advisor – You need to be the expert in your particular field, so that you can gain
customers’ trust and build customer loyalty.
 Use relationships to build trust – Build relationships with customers in a way that fosters trust. Do this through
shared values and fostering customer relationships.
 Take a proactive approach to customer service – Implement anticipatory service so that you can eliminate problems
before they occur.
 Use social media to build relationships – Use LinkedIn, Twitter, and Facebook to connect and communicate with
customers and give them a space for sharing experiences with your company, so they can become brand
ambassadors.
 Go the extra mile – Going above and beyond will build strong relationships with customers and build long-term
loyalty by paying attention to their needs and issues.
 Make it personal – Personalized service improves customer experience and is something customers are expecting
and demanding. Make their experience personal to strengthen the bond with your brand.
Rather than try to manage customer retention with a mishmash of customer retention strategies, many companies
use customer retention software systems and targeted customer retention plans to improve customer retention. Some
companies offer customer experience management solutions that enhance customer retention rates.

Ways to Measure Digital Marketing Success

A positive return on investment is the goal of every digital marketing campaign.
However, while the endgame of digital marketing is to increase profits, not every campaign directly leads to dollars and
cents. Some campaigns raise awareness of your brand, while others might bring visitors to your blog — both help increase
profits in the long run, but short-term results can’t be quantified with monetary values.
This begs an important question: how do you know whether your digital marketing efforts are successful?

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 5

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
Here we’ll review nine ways to measure the success of your digital marketing campaigns. And to add further clarity to the
question above, we’ve split these methods into two categories: conversions and website behavior.

Conversions
Conversions occur when visitors or customers take specific actions as a result of your digital marketing. Unlike website
behavior, conversions are more directly linked to sales and revenues. Since your ultimate goal is increasing profits, making
sure your digital marketing converts is absolutely essential.
Here are five types of conversions that can indicate successful campaigns:
#1. Online sales
Online sales from your website are perhaps the simplest conversion for gauging success. Tracking your online sales is easy if
you use Google Analytics or another Web analytics platform.
After installing a small snippet of code on your website, you’ll be able to see which of your campaigns are driving the most
online sales. This is the most important conversion for strictly e-commerce business owners.

#2: Online-to-store sales

Not everyone who finds your business online will buy from your website. Local customers are likely to visit your store and
make in-person purchases. How do you measure these conversions?
Don’t worry, there are ways to gauge online-to-store sales.
For example, you can collect information from prospective customers on your website, such as email addresses, that can
later be compared with data collected at the cash register. Or, you can offer a special discount code on your website so when
customers redeem the discount you’ll be able to easily match it back to the marketing campaign.
Or, you can be really low tech and just ask customers whether they found your business online. Clarify how they found you –
such as via a PPC ad, Facebook or a Google search — and record their answers in a spreadsheet. Then you can see which
campaigns drive more in-store conversions.
#3: Leads from Web forms
Most websites have forms that customers can use to request services, schedule appointments or get more information. If
you’re using Google Analytics, you’ll be able to see which campaigns result in the most use of your various Web forms.
Any visitor who completes a Web form to request a quote could later convert into a customer. Therefore, marketing
campaign success can be measured by the number of leads (Web form submissions) generated.
#4: Leads and sales from phone calls
Tracking leads and sales from phone calls is also important for businesses that drive sales via the phone.
To track calls, you’ll need to set up dynamic number insertion (DNI), which shows visitors different phone numbers
depending on how they arrived at your website. You can then view your phone logs to see which campaigns result in the
most calls.
#5: Leads from live chats
Does your website offer live chat for visitors? If not, then you might consider adding it as another way to engage your
visitors.
Once you have chat installed on your website, then you need to track which marketing campaigns are driving the most
chats. This can be done using the built-in tracking in your chat program or by integrating Google Analytics into your chat
tool. In both cases, you’ll be able to see which campaigns are driving more leads for your business via live chat.
Now that we’ve covered 5 ways to measure conversions from digital marketing, it’s time to move on to tracking how visitors
behave on your website. Just because a visitor doesn’t convert right away, doesn’t mean she’s never going to. For that
reason, it’s not enough to only look at conversions. We must also review website behavior metrics to measure digital
marketing success…

Website Behavior
Here are four ways to determine digital marketing success based on website behavior:
#1: Website visits
This one is simple – which of your digital marketing campaigns are putting the most eyes on your website? Although this is a
rather shallow metric compared to e-commerce and web form conversions, it’s still important to measure visits per
marketing channel.
This is especially helpful when you view traffic trends over time. For example, you’ll want to measure traffic from Organic
Search (SEO traffic) over time so you know if your SEO efforts are working. Plus, you’ll be able to spot potential problems
early on if you see a sudden drop in SEO traffic.
#2: Page Views per visit
Website visits are important, but they don’t really indicate whether people are engaged by your business. What if nobody
who visits your sites clicks around to your various products and pages?
Fortunately, Google Analytics can show you how visitors click through your site while also providing average numbers of
page views per visit.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 6

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
Pay close attention to which webpages your customers are visiting most. You might find that online customers are more
attracted to certain aspects of your business or specific products in your inventory. If you’re promoting your blog, you can
also get ideas about the topics your visitors find most interesting.
#3: Time spent on the website
How much time are people spending on your blog or website, and which of your digital marketing campaigns is bringing in
the most engaged visitors?
Analytics can track this, too. Again, time spent on your website doesn’t directly lead to sales, but folks who spend more time
browsing are more likely to later buy.
#4: Bounce rates
In the world of digital marketing, bouncing is bad for several reasons.
If any of your campaigns have high bounce rates – meaning people hit their “back” buttons as soon as they land on your
website — then there’s probably a serious disconnect between your marketing strategy and your landing page. Just as bad,
though, Google might interpret websites with high bounce rates as low-quality or spam, resulting in an SEO penalty.
Use Google Analytics to measure your bounce rates over time to spot trends in each of your marketing campaigns.

MEASUREMENT OF DIGITAL MARKETING CAMPAIGNS

In an era of constantly evolving technologies and platforms, companies need a bulletproof game plan for measuring their
digital marketing programs. But standing in their way is a big challenge, according to Digital Impact: The Two Secrets to
Online Marketing Success, a new book written by eMarketer CEO and co-founder Geoff Ramsey and Vipin Mayar, EVP of
McCann Worldgroup.
“Digital marketers today are drowning in metrics, but they don’t know which ones are important or how to connect the dots
in a meaningful way that will drive marketing performance,” said Ramsey.
Marketers are desperate for a clear, comprehensive and effective set of metrics and measurement systems for driving
marketing performance.
Digital Impact makes a bold proposal: There are only seven metrics that are critical for performance measurement across
digital channels. While countless other metrics are available to marketers, these seven are the ones that marketers should
seek to master.
Qualified Reach, or Qualified Visits: Qualified Reach is the one critical metric that every marketer should use—specifically
because it captures two important dimensions that no other single metric does: both quantity (number of individuals) and
quality (the users have performed a desired interaction, which in turn suggests a degree of interest or intention on the part
of the consumer). Depending on the channel, the specific metrics marketers use will vary, but the emphasis is always on
actual behavior—a far different approach than typical measurements of raw reach and frequency.
Click through rates: Click through is the most commonly used metric by online advertisers. Although it is still relied on too
heavily, and in inappropriate ways, CTR should continue to be used as a diagnostic metric for direct response initiatives—
however, it should not be used as a primary metric.
Brand perception lift: This metric is calculated by determining the change in brand perception among defined audiences,
with the results compared to those of a control group that was not exposed to the messaging.
Engagement Score (ES): This is a special set of integrated metrics that captures the degree of magnetism of the content or
ad. Based on a flexible value point system, the ES works across all digital media, from videos and mobile apps to micro sites
and social community platforms.
End Action Rate: End Actions represent the action taken by a user; it is often also referred to as a conversion activity. An End
Action can be a sale, a lead generated, a download, a video view, a form completion, and so on. It is the end goal of the
content or advertisement and is a critical metric for determining the effectiveness of the campaign.
Efficiency metrics such as cost per click, impression, lead, order, engagement and so on: These metrics represent the
efficiency of a marketing program. Are goals achieved in a cost-effective manner?
Return on investment (ROI): ROI is a critical financial metric representing the value created by your marketing. Digital
Impact suggests ROI methodologies for each of six online channels that are built on the principle of instrumentality. This is a
forward-looking concept and especially helpful when determining ROI of new media. All marketing, whether it is offline or
online, should be measured to determine an incremental improvement in some critical consumer activity, such as
acquisition, retention, loyalty, key perceptions or sales.

What is Marketing Analysis?

The market analysis section of your e-business plan demonstrates that you know your customers—who they are, their
characteristics, and why they are likely to buy from your business. The process of writing the market analysis requires you
to define your target markets and analyze how you will position your product or service to arouse and fulfill their needs in
order to maximize sales.

In a full-scale business plan, the market analysis is part of the marketing plan section, which includes:

Market analysis: a definition and description of prospective customers, including target markets, size and structure of the
customer base, and growth prospects.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 7

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
Pricing strategy: setting the price of the product or service based on methods such as cost-plus pricing, demand pricing,
and competitive pricing; and the use of innovative pricing strategies such as penetration pricing, flexible pricing, and market
skimming.
Promotion plan: the communication channels you will use to make the customer aware of your product/service and
convince them to purchase (e.g., advertising, online demonstration videos, packaging). Promotion also includes tracking
your customers (e.g., confirming who your customers are and how they heard about you) and encouraging them to purchase
again.
Distribution plan: the distribution channel you will use to move the product or service to the customer (e.g., direct sales,
wholesale distributors, brokers) and, if necessary, back again (e.g., returns).
Demand forecast: estimates of product or service sales based on the market analysis and assumptions about the
effectiveness of the pricing, promotion, and distribution strategies.
A business plan tutorial for a marketing course would cover all these areas in considerable detail. However, the most
important section for e-commerce professionals is the market analysis so that is the focus of this lesson. If the scope of your
business plan assignment includes the other aspects of marketing planning, then your instructor will provide additional
instructions and resources to do so.
Dimensions of Marketing Analysis
Your market analysis not only provides an overview of your industry, but also the conclusions you were able to draw from
your market research findings. While there is no absolute method for including a market analysis, under most circumstances
you are going to want to include most or all of the following points as you create this valuable section of your plan:

1. Industry description and outlook. Regardless of how you decide to proceed with your market analysis, you will almost
certainly want to start this section of your business plan with a description of your company’s industry. Research your
industry’s growth and note its current scope. Then, discuss some of the business characteristics of your industry, such as its
projected growth rate. Include the major customer segments.

2. Target Markets
What Are the Target Markets? The first step in conducting a market analysis is to define your primary, secondary, and,
perhaps, tertiary target markets. Your target markets are based on segmentation characteristics within the total addressable
market. The segmentation is based on:
Demographic characteristics: specific, objective factors such as age, gender, race/ethnicity, education, occupation, and
income.
Geographic characteristics: location-based factors such as country, state, city, mobile workers, and lifestyle setting (e.g.,
rural versus urban).
Psychographic characteristics: personality traits such as attitudes, beliefs, life experiences, needs, and desires.
Consumer characteristics: customer-based factors such as loyalty, shopping frequency, and willingness to purchase from the
Internet.

3. Distinguish target customer characteristics. Next, describe the critical needs of your targeted customer base and to
what extent–and by whom–these needs are currently being met. This is also the place to detail the demographics of your
customer group. If there are cyclical purchasing trends, including seasonal buying, this is the place to note them as well.

4. Target market size and growth. You will also want to include additional details about the size of your targeted market.
Conduct sufficient research to provide data on total annual purchases within your targeted marketplace. In addition, do
sufficient research to create a reasonable forecast of market growth.

5. Market share percentage. Once you have described the size and potential growth for your targeted market, next identify
the market share percentage and number of customers you believe you will be able to gain within a defined demographic
area. Include justification for the numbers you come up with.

6. Pricing and gross margin targets. Explain your pricing strategy, gross margin levels and any special pricing schemes
you plan to use, such as discounts.

7. Competitive analysis. Finally, identify your competitors and their targeted markets. Also, make note of any indirect or
secondary competitors impacting your target markets. Include information on their current marketshare as well as what
you perceive as their strengths and weaknesses.

Digital Marketing Tools

To make it easier to navigate to the products you need we’ve added these jump links. Please note that the numbers were just
a way to organize the tools and are not indicative of preference; if we had the time we’d use them all.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 8

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing
1. Organic Social Media Tools
As of writing this post Facebook has 1.44 billion monthly active users, Twitter has 302 million and Instagram has 300
million. With so many people spending so much time on social, it’s becoming one of the most important channels for
brands to utilize in order to engage with their current and prospective customers. One of the best ways to do that is
with a social media management tool.
2. Paid Social Media Tools
Social media sites aren’t just great for organically reaching and engaging with your customers; they’re also effective for
paying to promote your brand to large groups of active users. The major social networks have so much data on their
users that targeting can become extremely granular and effective, which makes social an ideal place to pay for
impressions.
3. Email Marketing Tools
The first email was sent way back in 1971, so it’s kind of strange to think of how big a part email still plays in our
online marketing strategies. But even though it may be one of the oldest marketing channels, it is by no means one of the
most ineffective. In fact, it was predicted that email marketing would be the top target for increased investment in
2015, which is why you should look into email marketing software for your business.
4. Display Retargeting Tools
Have you ever gone to a website, left without purchasing anything, only to be followed around by that
company’s advertisements all around the web? These are retargeting ads, and even if you haven’t heard of them there’s
a good chance that you’ve been targeted by them in the past. This channel is incredibly efficient for getting customers
back to your site to make a purchase or become a lead.
5. Programmatic Advertising Tools
Programmatic advertising refers to the use of software to automate the purchase of media from both online and offline
channels. Two of the largest benefits of using programmatic media buying solutions are that you can reduce the time
you spend finding the best networks to advertise on, and you gain access to the plethora of data that most of these
companies have access to.
6. Website Testing Tools
The smallest changes can make the biggest differences when it comes to getting people to convert on your landing
pages. Changing the color of your call-to-action button can spell the difference between getting someone to start a free
trial of your product, and bouncing from your site. That’s why it’s important to use website testing tools to constantly
innovate your pages.
7. Video Hosting Sites
It seems like video has recently become the next big content powerhouse brands are taking advantage of, and with so
much effort needed to create videos it’s important to make sure you get as many eyeballs on them as possible. A solid
way to do that is to host them on some of the popular video sites which draw in large crowds of viewers.
8. Content Creation Tools
We all know that content is king, which is why it’s so important to start creating some of your own to share with your
fans and followers. With so many different content formats out there—infographics, blogs, videos–the biggest question
is which type of content can you create that will resonate with your audience. We’ve recently created a list of 36 free
image creation tools which includes a ton of different tools, but here are some of our favorites.
9. Content Curation Tools
We constantly need to fill our content calendars if we’re going to satiate the growing need to share actionable insights
with our fans and followers. However, we don’t always have the time to put together something unique for every post
we create. That’s why it’s good to have some content curation tools on hand to help you fill up those lulls in your
calendar.
10. Website Analytics Tools
Many tools out there come with their own performance analytics. For instance, Sprout Social has social media
analytics that show how your content performs on a variety of social platforms. However, it’s important to keep an eye
on the data about events that actually take place on your website.
11. Customer Service Tools
More than ever before customers are turning to online channels to reach out to brands with their inquiries and
complaints. If you’re not there to engage with these customers it reflects poorly on your brand, and you could lose their
business forever. Try one of these customer service tools to streamline your customer service process and to ensure
you’re responding to all of your inbound messages.
12. Search Engine Optimization Tools
SEO is a huge portion of most companies’ online marketing efforts, which explains why there are so many tools out
there to help brands take full advantage of the channel. These tools take something incredibly complicated and simplify
it, which is something we should all be thankful for.
13. Affiliate Marketing Tools
Affiliate marketing is the idea of having regular people advocate your brand to drive sales; all you have to do is pay them
a percentage of every sale that they generate. It’s an effective channel because people tend to trust friends and brand
advocates more than they trust a company when it comes to selling. Plus, you only pay for the sales that they generate.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 9

By: Bishnu Ram Ghimire
Essential of E-Business Chapter 3: Digital Marketing

Viral Marketing
Viral Marketing is a rather newer concept in the field of marketing and branding. It derives its name from the concept, ideas
spread like virus. A virus self-replicates, attaches itself to a host and spreads itself by minimum usage of resources, time and
processes. Similarly, marketers are now looking at spreading ideas and brand messages in a world where we are subjected
to more than 30, 000 messages per day, in a world where mass marketed goods rule the roost.
The media is cluttered with these messages, be it on television, radio, newspapers and movie placements, everywhere.
In 1996 – Tim Draper & Jeffrey Rayport proposed the concept: viral Marketing, during their tenure at Harvard. They
proposed that a person is given a message, and he ultimately shares the message with other people. The message is
ultimately spread and shared by the Network effect. The sharing occurs through multiple platforms i.e. mobiles, e-mail,
social networks etc. Its an effective way of reaching the primary target audience, that is people who are more likely to use
your product or services.
Seth Godin, a New Media Marketing Expert advises, for a viral marketing campaign to go successful,
1. Get the right people to spread your message. Highly networked and influential people, if associated with the
concept, the susceptibility of idea being shared among larger groups becomes much higher.
2. The message needs to be shared must have high interest value. If the interest value is high, the message would be
more easily spread.
3. Numbers do not mean a lot. It is better to have your correct target audience get the message than a huge number of
people who might not have anything to do with your brand.
Advantages of Viral Marketing
Viral Marketing can be simply described as word-of-mouth advertising that includes the efforts of your audience. Viral
marketing spreads your message to the people and helps you gain control over masses. It works incredibly well for
marketers in terms of improving the growth and success of their online businesses. Viral marketing, for sure, has many
advantages such as getting tremendous exposure, visibility, better traffic and increased sales revenue. Here are the 5 most
valuable advantages of viral marketing to be touched upon!

1) An Enhanced Customer List

Having a quality customer list is important for online marketing because your existing customers will show more interest in
your newly introductions than the potential customers. Hence, it can be said that it is not just about the quantity but also
quality of your customers that drives your business. Every loyal customer you have or gain in time adds to your customer
list and viral marketing works perfectly to enhance this list through word-of-mouth recommendations.
2) Lesser Time – More Growth
Viral marketing is contagious! Once viral marketing exposes a group of people, it gets spread everywhere and catch other
people as well. In return, your sales and profit increase because it drives people to your web site, which means higher traffic,
more clicks and more conversion.
3) More Credibility
Your credibility is increased among your audience, because viral marketing is basically based upon personal
recommendations. When you are recommended and shared by masses, you and your products get greater attention from
people. At the end, you get higher traffic and better comments because you gain more credibility as a result of one good
event leading to another good one.
4) Greater Exposure – Greater Visibility
One of the primarily aims of viral marketing is providing your brand greater visibility, needless to say. The more your
products and services are recommended, shared and commented upon, the more it leads to greater visibility.
5) Cheaper
Once you start to get enough visibility around the internet, your promotional costs will start to decrease because you will
not need to spend extra money for promoting your site. In addition, you can save your advertising money as well because
advertising will be done by being recommended by your existing loyal customers.

Elements of a Viral Marketing Strategy

Accept this fact. Some viral marketing strategies work better than others. Few work as well as the simple Hotmail.com
strategy. But below are the six basic elements you hope to include in your strategy. A viral marketing strategy need not
contain ALL these elements, but the more elements it embraces, the more powerful the results are likely to be. An effective
viral marketing strategy:

 Gives away products or services;

 Provides for effortless transfer to others;
 Scales easily from small to very large;
 Exploits common motivations and behaviors;
 Utilizes existing communication networks;
 Takes advantage of others’ resources.
 Let’s examine at each of these elements briefly.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 10

By: Bishnu Ram Ghimire
 Essential of E-Business Chapter 3: Digital Marketing
Types of Viral Marketing
1. E-mail:- It was first but it is still around and still used. It is, however, getting a little harder to use as more and more
government restrictions are placed on it. Still… it does work. E.g.: www.gmail.com
2. Newsletters:- This is an extension of e-mail but it a very effective tool. If you include enough timely and valuable
information, a good newsletter can drive up the number of visits to your website.
3. . Blogging:- Providing the tools on your website to enable bloggers to interact with one another is a terrific way to get
the message about your product of service out there and being talked about. Bloggers have their ears to the ground for
new products and services.
4. Chat Rooms:-A chat room on your website can and does encourage interaction among your customers and that can’t
be a bad thing. Also, you can use the chat room to schedule special events like having an expert available to answer
questions on a given day at a given time.
5. Tell-a-friend Script:- If you add this with a statement saying that e-mail addresses supplied will never be shared with
third parties, you can increase your potential customer list greatly.
6. Video Clips:- Including cool video clips on your website will keep the interest up and increase traffic.
7. Flash Games:- Although they are a little costly to start, they are an extremely effective tool to get your viral marketing
campaign going. Once they are launched, they require nothing more from you.
8. Buzz-Marketing:-This Involves celebrities Go ahead and replace it with discussing about products and experiences
with a hint of Controversy.
9. Types User Managed Database:-It refers to different5 database of prospects that clients generate themselves with the
help of online service providers.
Ethical Issues in Digital Marketing
While digital technologies offer organizations considerable benefits to customers such as greater access to information and
convenience, there are some ethical issues that are emerging due to its increased use:
 The Digital Divide: In the early days, Internet technologies were only used by experts for specialized purposes. Expansion
in channels of communication has made Internet technology more accessible to people around the world since the beginning
of the 21st century. However, the disparity in ICT adoption between developed and developing countries, referred to as the
Digital Divide, have continued to grow which has implications for public and private organizations. Those who lack access to
online resources in developing countries are immediately put at a disadvantage as they already have little access to other
socio-economic resources. The lack of access is a concern, especially for international organizations, who must acknowledge
that while networks reach around the globe, access is not equal. This lack of access affects the social and economic
development of the respective countries which can cause further lagging behind in terms of quality of life.
 Social Exclusion: Related to the Digital Divide is the issue of social exclusion which refers to individuals who cannot afford
digital devices such as broadband connection and 3G phones. In the era of digital, where basic IT skills are required for
entering the labour market, individuals without digital devices are unable to take advantage of learning opportunities and
engage in wider levels of social networking. Furthermore, these people are unable to access online public services such as
health & financial services and employment advice. The lack of access and lack of skills results in a lack of confidence to
learn as technologies continue to evolve, causing increasing levels of social exclusion.
 Privacy issues: As a result of the dot.com bubble and later the introduction of Web 2.0, new policies in terms of privacy and
protection of customer data are being introduced by governments. Online privacy policies must be continually updated
because of the evolutionary nature of Web 2.0 platforms. Concerns about security have grown in recent years and the
release of new government policies is something that must be anticipated by organizations.
The era of Big Data has afforded marketers to gain valuable insights into consumers leveraging complex and numerous data.
However, businesses must ensure the privacy of their consumers when collecting this information and analyzing it.
Furthermore, ensuring consumer privacy is considered a top challenge for cloud computing companies. For example, online
retailer Play.com received complaints from customers about leaking of personal information by a third party marketing
agency from the company’s database (see article from Marketing Week). In terms of specific digital technologies, the public
nature of social media is an arena where there are numerous opportunities for exposure of details that are not for
widespread consumption.
 Marketing to children: The final ethical issue in this list is using the Internet to market to children. Children have long
been known to be the one of the biggest advocates of Internet usage but they are vulnerable to the Internet in many ways.
For example, they may not realise that their every mouse click may be monitored, they may be unable to evaluate the
accuracy of information they view or be unable to understand the nature of the information they provide to advertisers.
To ensure the safety of children and ultimately avoid consumer backlash from children’s parents, companies should not
attempt to online hard sell to these children, do their best to involve the parents (e.g. ensure information from children
comes with express knowledge of the parents) and think of their website as a service, rather than an advertisement. Ethics
initiatives presented by the Children’s Advertising Review Unit and the Direct Marketing Association provide more
important guidelines that companies need to take seriously.

V.S. Niketan College, Minbhawan, for BBA 6th Semester Page 11

By: Bishnu Ram Ghimire