DISSERTATION DISSERTATION REPORT REPOR T ON THE CONSUMER BEHAVIOUR TOWARDS DIGITAL MARKETING
SUBMITTED BY RAMBABU SHAH Roll No. 141327002
UNDER THE SUPERVISION O! PRASHANT SE"ENA KR
In Partial Fulfillment for the award of POST GRADUATE DIPLOMA IN MANAGEMENT
2015-2016
GREATER NOIDA INSTITUTE O! TECHNOLOGY
Plot No. 53, Knowledge Park , !reater Noida- 201306 201 306
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CERTIFICATE
This is to certify that this project work done on project entitled “Consumer Behaviour towards Digital Marketing” is a bonafide work carried out by
This project report is submitted for the requirement of the degree of the award award of This This work work has not been submitt submitted ed anywher anywheree else for any other degree / diploma.
Date Date:: ____ _____ _ lace: !"#$T#" !"#$T#" %&'D$ FACULTY GUIDE
(
DECLARATION
') , hereby declare that this project report entitled “Consumer Behaviour towards digital Marketing” is written and submitted by me.
The findings and interpretations in the report are based on both primary and secondary data collection. This project is not copied from any source or other project submitted for similar purpose.
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AC!"#$ED%EME!T
' am thankful to all the for their +aluable guidance and support at all time and pro+iding me the proper guidance to carry out summer internship effecti+ely and efficiently. ' would like to thanks to all those people who pro+ided me all the necessary information directly or indirectly throughout this project report completed at time.
,
&REFACE
The project titled) Consumer Behaviour towards digital Marketing, aims to find out the beha+iour of consumers for online transactions towards three websites +ia. Redi''()om, C*#+ungama, and Fa-mart(
'n today-s technology dri+en world) a new fast paced online economy is emerging. 'n the near future) it wouldn-t be surprising to see that there are companies that eist only inside computer networks. ost business transactions will be made electronically) directly from the producer to the consumer) bypassing the supply chain.
The project thus aims to pro+ide an insight on the modes of online transactions and changing trends in online marketing.
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TAB$E "F C"!TE!T.
CA&TER I/ I!TR"D0CTI"! CA&TER II/ $ITERAT0RE RE1IE# *(2( Digital MARETI!%
(.11. #+olution of arketing (.1(. hanging patterns of arketing (.1*. !rowth of 'nternet usage and #2commerce (.1,. &+er+iew of the 'ndian 'nternet 3sers (.10. 4 5s of arketing on the 'nternet (.16. 'nternet arketing Tactics (.14. $d+ertising on the 'nternet: emerging issues (.17. Targeting imperati+es (.18. &nline onstraints
*(*( "!$I!E C"!.0MER BEA1I"0R (.(1. 3nderstanding the 'nternet onsumer
(.((. onsumer 9eha+iour (.(*. 9lack bo model (.(,. actors affecting consumer beha+ior (.(0. The #+ol+ing ;alue ropositions (.(6. ritical
CA&TER III/
RE.EARC MET"D"$"%3
CA&TER I1/
A!A$3.I. "F DATA
"ediff.com (> ? @ungama abmart
.0%%E.TI"!. + RECC"ME!DATI"!. C"!C$0.I"! BIBI$I"%RA&3 6
40E.TI"!!AIRE I!TR"D0CTI"!
The internet as we know it took off during the early 188=s) when the >orld >ide >eb A>>>B protocol was in+ented) and has since then become incorporated as the backbone of ad+anced economies such as %orth $merica and major parts of #urope and $sia. $round 1.* billion people were estimated to use the 'nternet at the end of (==4 A'nternetworldstats) (==7B. 'n relation to the world-s population) this gi+es (= C as a total amount of the world-s 'nternet users. >hile the less de+eloped countries show a +ery low percentage) the de+eloped countries ha+e shown a 1(= C annual growth in 'nternet use during the past se+en years.
#+er since the creation of the 'nternet) the world of business has changed greatly with a redefinition in areas like marketing and customer relations. This medium opened up the doors for the conditions of conducting business through electronic methods. The growth of the internet e+entually lead to hundreds of thousands of companies setting
up
shops online)
gaining
millions of consumers worldwide as their
customers. 'n the early days) the a+erage computer user might not ha+e been able to use the 'nternet as we use it today. >ith the arri+al of easy2to2 use web browsers) this medium went from being an ad+anced) tet2oriented) and specialied application into a massi+e multimedia tool on a global scale.
Fotler et al
A(==0B point
out arketing
as a process in
understanding and
satisfying customer needs. 'n the pre2industrial era) this process was achie+ed through
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"elationship arketing) during which a close relationship was created between the customer and the company. The customers made their e+eryday purchases locally and a natural bond was created between the seller and the buyer. @owe+er) with the introduction of the industrial age) the focus on marketing went from indi+idual2 to mass marketing. The company-s attention turned to reaching out to as many consumers as possible. This method was dominant during the past decades) but with the birth of the commercial 'nternet) companies ha+e disco+ered the possibilities of recreating relationship marketing. 9y keeping the information flow of their products and ser+ice a+ailable online) companies can create suited offerings to customers while satisfying their needs. This sort of marketing method is considered
to be more
acceptable) and at the same time more effecti+e.
@owe+er) a web site purely presenting the business will not add any +alue for the potential consumer. $ccording to ronin A188,B) traditional marketing e.g. sending out raw ad+ertisements through e2mail accounts)is not the online way of reaching out to the customers. &nline marketing is just like its regular offline counterpart about sales promotion) public relations and direct marketing to customers) mainly through ad+ertising. &nline ad+ertising has the crucial role of persuading and informing consumers of the a+ailable selection of products and ser+ices A!oldsmith and Eafferty) (==(B. During the past decade) companies ha+e learned this procedure to be difficult without information about the consumers. Through the use of +arious customer databases and the location of surfing habits) firms ha+e been able to e+ol+e their marketing strategy) becoming more customied and personalied for each user. $s a result) they are adapting products and messages through the study and analysis of each user-s demographics) preferences and purchases Aaclaran and atterall) (==(B. $ great knowledge of the clients is of essential use for a firm-s success.
.I%!IFICA!CE "F .T0D3 $t any gi+en time there are millions of people online and each of them is a potential customer for a company pro+iding online sales. Due to the rapid de+elopment of the technologies surrounding the 'nternet) a company that is interested in selling products
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from its web site will constantly has to search for an edge in the fierce competition.
$nalying
consumer
beha+ior
is
not
a
new
phenomenon.
The renowned
marketing epert hilip Fotler has published se+eral works on the topic of consumer beha+ior theories. These theories ha+e been u sed for many years not only to understand the consumer) but also create a marketing strategy that will attract the consumer efficiently. @ence) understanding and identifying the consumer is closely related to the directions a company will take with their marketing strategy. These theories can also be applied to identify the online consumer @owe+er) some
distinctions
must still
and to create certain consumer segments. be made when considering
traditional
consumer beha+ior and online consumer beha+ior.
.C"&E "F .T0D3 $s companies are trying to make their ad+ertising more effecti+e in terms of acceptance among consumers) we consider it important to find out if consumers ha+e a greater acceptance towards marketing in familiar or liked sites such as blogs and communities compared to non2focused web sites. 'n addition) some companies are using more tailored ads to achie+e their goals) and we will eamine this issue in relation to user-s attitudes towards customied ads. oreo+er) there has been no consensus in pre+ious research concerning the difference between men and women in these cases. 9logs and communities are mostly created by pri+ate consumers) for specific causes. >hile some sites ha+e a majority of male +isitors) others are more popular among women.
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$ITERAT0RE RE1IE# E1"$0TI"! "F MARETI!% $t the beginning of the century) social life was mostly local. 't was followed by a period in which commodities were produced on a mass scale. onsumer arketing operated on mass marketing principles and business primarily concerned itself with how to build the best sales force. $t the end of the century) there is an emerging global culture. The major dri+er of these changes is technology. Technological change has mo+ed steadily back focusing on the indi+idual. These changes shape the possibility and conduct of business. arketing is especially tied to communication and transportation re+olution. $s the tools and reach of marketing increase) the job and responsibilities of marketers ha+e e+ol+ed with them. Fotler formalied this e+olution with his book Garketing anagement.G @is key stages are production) sales and brand management. #ach of these is strongly moti+ated by technological opportunities) which permit new methods and new opportunities. $ fourth stage) a focus on the indi+idual customer) is also important. $s the new technology of the 'nternet de+elops) it reinforces the new marketing emphasis 2 which in many ways is a return to business at the turn of the century.
'n today-s technology dri+en world) a new fast paced digital economy is emerging. 'n the near future) it wouldn-t be surprising to see that there are companies that eist only inside computer networks. ost business transactions will be made electronically) directly from the producer to the consumer) bypassing the supply chain. 'n the digital marketing en+ironment) the consumer becomes an integral player in the de+elopment of the product. 'n fact) a consumer might build the product himself from a wide array of parts pro+ided by the company. 't is e2commerce that is changing the way products and ser+ices are concei+ed) manufactured) promoted) priced) distributed and sold. The reason being that it is much cheaperH it allows +ast co+erage and helps in ser+ing the customer better (
1=
CA!%I!% &ATTER!. "F MARETI!% Traditional Marketing 15s digital Marketing arketing o+er the years more so recently has started being used interchangeably with ad+ertising. %ow since the eplosion of the internetH ad+ertising paradigms ha+e been constantly changing.
The first >eb ad+ertisement was placed on the @ot >ired web site in &ctober 188,. $T?T) ')
Traditional Advertising :
Traditional ad+ertising is static.
The proportion of ad+ertising to editorial is high sometimes 0=:0=.
Does not e+oke immediate action.
"esponse to the action is not immediate.
$d+ertisements are passi+ely recei+ed.
$d+ertising does not always target a much focused audience.
$d+ertisements are ubiquitous.
#hereas Internet Advertising :
't is dynamic with multimedia2 supporting tet and graphics +ideo sound all together.
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$ web page would be 81C editorial and 8C ad+ertising.
'n+okes immediate action as you at2least need to click on the ad.
irst response is immediate as when the user clicks) the person is directed to other web page with more details.
The user has high attention le+el and concentration while using the net) and hence they notice the ad. Aplease refer the chapterB
This can be much focused.
$d+ertisements catch users when they are on the lookout for some thing. or eample the search is for tra+el on a search engine there are ads of tra+el agents on the net.
Thus we see that ad+ertising is changing and so are the rules for ad+ertising on the internet. .o while designing or 'ormulating an6 advertising strateg6 'or a -rand on the internet a manager has to take in to a))ount 'a)tors like/ 7
1. The 'nternet has made a huge impact on ad+ertising. ompanies should be careful as regards joining the 'T bandwagon. They should not ad+ertise on the net just to project themsel+es as a techno sa++y company or maybe because their competitor is doing the same thing. 't should be a well2planned campaign full of specific information and attention catching.
(. The 5net5 charges are on the higher side Athough there has been a steep decrease in the rates in the last few monthsB. @ence people would be wary of the fact that ads consume a lot of online web time and hence they a+oid clicking on a+erage ads. Therefore) ad+ertises should be designed in such a fashion that they attract attention and induce people to click on the net.
*. &ne more thing would be to generate 5search5 specific ad+ertising. This would mean that if ' gi+e a search for books on the search engine) the ads displayed would be related to the books.
1(
,. !enerally) people percei+e the ads to be time consuming and full of unwanted information. are should be taken to design the ads in such a way that the information they pro+ide or the hyperlinks they pro+ide to a site gi+es adequate and specific information. 0. The ads and the subsequent information on the web site should be constantly updated and highlighted in the ads and thus induce repeated clicks on the ad.
6. East but not the leastH the ads should be designed so as to attract attention of maimum number of people and inducing them to click) failing to do so the ad+ertiser ends up defeating his own purpose.
%rowth o' Internet usage and E7)ommer)e/ $ccording to the research report of !oldman
or 9usiness2to29usiness transactions) 'ndian industries are epected to reach online penetration of (C by (==* and 7C by (==7.
1*
E''e)tiveness o' the !et in Rea)hing "ut to the Masses
The reach of 'nternet may not yet be as wide as that of other mass media) but gi+en its unique ad+antages) it is undoubtedly the communication medium of the future. arketers around the world ha+e from time to time tried to reach their target audiences through +arious media.
Eet us first take a quick look at the audience that this medium is trying to reach. The top 7 metros of the country) the scope of the 'nternet as a medium to reach out to a large number of people is presently limited. @owe+er) some of these limitations can be addressed. 1. 'nternet is a+ailable in regional languages also. #+en today this medium is largely confined to only those who are literate in #nglish. ;arious initiati+es of companies like 'T and @EE like #2choupal and i2
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T;) print and cinema ha+e penetrated the most. 'nternet in the media terms is epected to make an impact and show its true caliber) but is yet not taken as a serious medium. Does that mean that 'nternet is not an effecti+e tool for reaching out to peopleJ &r is it likely to work +ery well under certain conditionsJ To understand this better) let us compare 'nternet and other traditional media) first from the customer-s point of +iew. urrent media options ser+e two broad benefits to the customer: 1. 'nformation (. #ntertainment The reach or popularity of any media is related to 1. The etent of benefits percei+ed to be deli+ered (. The cost of acquisition of the media itself 'n short) the reach is related to the net +alue percei+ed by the customer about that particular medium. &n the basis of the abo+e clarification) 'nternet appears to ha+e a comparati+ely higher cost of acquisition. @owe+er) 'nternet has brought with it a +ery high degree of control to the media user. %ot only are there a plethora of sites catering to e+ery imaginable need) there is also a high degree of fleibility in what the user is able to do. $ll of this makes 'nternet a highly interacti+e media but also an epensi+e one. 'f the internet is treated and used eactly like any other medium) it is unlikely to yield major benefits to the marketer. 'ts effecti+eness is dependent not only on the target audience one is talking to) but also largely on the ability of the marketer to make use of the real ad+antages of the %et like interacti+ity) fleibility) ability to monitor and the like.
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%et) one can also e+aluate 'nternet as a media from the marketers- point of +iew by way of a similar classification. 'f e+aluation as per the abo+e classification is done) the 'nternet does not appear to be a +ery ad+antageous option either in terms of reach or in terms of cost2effecti+eness. 9ut 'nternet has +arious other ad+antages o+er the traditional media which cannot be neglected. These stem mainly from the ability of this medium to allow a far more focused targeting as compared to other media. To quickly summarie the ad+antages of the 'nternet as seen from the point of +iew of the user as well as the marketer:
T" TE 0.ER/
'nternet gi+es more control in choosing content. 't offers customiation of the content) the way the user wants to +iew it. 't offers a +ariety of options for information and entertainment. 't offers a wide range to choose from for the user. 't offers tremendous con+enience to the user not only in deli+ery of information) but also in allowing him to transact K often in a seamless manner. The best eample of gi+ing control of content is the y Lahoo MM ser+ice offered by the 'nternet giant) Lahoo 'nc. 't gi+es the user the choice of content for +arious topics ranging from news to stock options to entertainment to sports and just about e+erything. To the marketer/
The 'nternet offers se+eral options to a marketer trying to target a particular community 't ser+es not only as a channel of information) but also of product distribution 't offers a highly interacti+e medium that sometimes Ae.g. chats) forums) ;o'B is almost equal to one2to2one interaction with the audience. 't offers a higher le+el of identification of the user to the marketer.
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't allows the marketer to actually link his spends to action) and pay only on action This action could be a click on the banner or e+en product purchased or just a banner impression or per 1=== impressions. 'n this ability 'nternet is) in fact) unlike any other media. !i+en the payment options and high interacti+ity) the 'nternet offers a medium for high le+el of eperimentation at a low cost. This can be elaborated a little more by answering the following questions: 1. >ho are the people who can be reached through the 'nternetJ (. >hich are the products that can possibly benefit from marketing on the 'nternetJ *. >hat are the options a+ailable to the marketer to reach out more effecti+ely to their audiencesJ ,. $re there ways for monitoring effecti+eness of this medium in order to control it betterJ AD1ERTI.I!% "&TI"!. A1AI$AB$E "! TE I!TER!ET
The 'nternet offers a +ariety of options for the marketer to ad+ertise her/his products/brands. These include 1. 9anner ads and their +ariations (. #2mailers and their +ariations *.
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'n 'ndia) banners still remain the most popular option. @owe+er) wider options are now a+ailable to the marketer which) e+en at the cost of being intrusi+e) ser+es to enhance the +isibility and effecti+eness of the banner The 1ariants o' Banners in)lude /
1. 9anner $d 2 a graphical web ad+ertising unit) typically measuring ,67 piels wide and 6= piels tall Ai.e. ,676=B. (. 9eyond the 9anner 2 online ad+ertising not in+ol+ing standard !' and N#! banner ads. *. 9utton $d2 a graphical ad+ertising unit) smaller than a banner ad. ,. @TE banner 2 a banner ad using @TE elements) often including interacti+e forms) instead of Aor in addition toB standard graphical elements. 0. 'terstitial 2 an ad+ertisement that loads between two content pages. 6. op2up $d 2 an ad that displays in a new browser window. 4. op 3nder $d 2 an ad that displays in a new browser window behind the current browser window. 7. "ectangle $d 2 any one of the large) rectangular banner sies suggested by the '$9. 8. "ich edia2 new media that offers an enhanced eperience relati+e to older) mainstream formats. 1=.
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1*. ;ertical 9anner 2 a banner ad measuring 1(= piels wide and (,= piels tall. !i+en the highly interacti+e nature of the 'nternet) and the also fact that unlike other media it offers a higher le+el of identification of the user) simple direct marketing tools such as email can also be used more effecti+ely. or eample) a high2end car seller can today easily send an offer to persons earning o+er "s (0=== per month at a +ery reasonable cost and within a +ery short period. Then again there are sponsorships) which can be effecti+ely used to increase brand salience and e+en change image. The other tool on the web with enormous potential) and which has possibly not been used to its optimal le+el yet by marketers in 'ndia) is the search engine. arketers can own either popular keywords or make use of meta2tags Athese are similar to the keywords which the search engines uses to catalogue +arious websites/productsB in order to go higher on the search lists. The abo+e is used by the search engine giant !oogle.com and it has reaped profits so much so that it is now being +iewed as a threat by the computer giant icrosoft 'nc.
8 &9. "F MARETI!% "! TE I!TER!ET The 'our &9s 7 &rodu)t, &ri)e, &la)e and &romotion ha+e long been associated with
marketing) but things ha+e changed on the 'nternet.
1. The &rodu)t on the 'nternet usually changes form online) and the user eperiences it electronically) in the form of tet) images and multimedia. hysical goods are usually presented in the form of a detailed online catalogue that the customer can browse through. Technology allows the user to +irtually touch and feel the product on the 'nternet 2 rotate it) oom in or oom out and e+en +isualie the product in different configurations and combination. The eample of the abo+e can be seen at dell.com where the company offers the user to +irtually feel
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e+ery aspect of their product before they go into a buy decision. Content and software are two a+atars of digitied products that can be e+en distributed o+er the 'nternet. &n the 'nternet) #2marketing will be based more on the product qualities rather than on the price. #+ery company will be able to bring down the cost of its products and hence competition will not be on price. 't will rather be on the uniqueness of the product. To be able to attract the customers and retain them) the company will ha+e to pro+ide nou+elle and distinct products that forces the net users to purchase and come back for more.
(. The &ri)e has been drastically changed o+er the 'nternet. 't lets the buyer decides the price. $lso it gi+es the buyers information about multiple sellers selling the same product. 't leads to best possible deal for the buyers in terms of price. $ website named riceline.com is etremely popular as its compares the price of many airlines and offers the least price to the buyer. The +ery famous baee.com now known as ebay.in follows the same principles. ricing is dynamic o+er the 'nternet.
*. The &la)e re+ol+es around setting up of a marketing channel to reach the customer. 'nternet ser+es as a direct marketing channel that allows the producer to reach the customer directly. The elimination of the intermediate channel allows the producer to pass the reduced distribution cost to the customer in the form of discounts. Dell omputers ha+e used this strategy +ery effecti+ely and hence they ha+e been able to reduce their prices of their laptops drastically and reaped huge profits.
,. &romotion is etremely necessary to entice the customer to its website) as there are currently more than one billion web pages. romoting a website includes both online and offline strategies. &nline strategies include search engine optimiation) banner ads) multiple points of entry) +iral marketing) strategic partnership and affiliate marketing. resently) the cyberspace is already cluttered with thousands of sites probably selling similar products. or the customers to know of the
(=
ompany-s eistence and to garner information on the kind of products or ser+ices that the company is offering) promotion has to be carried out. There can be traded links or banner ad+ertisements for the same. $lso the traditional mediums like print) outdoor ad+ertising and tele+ision can be used to spread awareness. #mail campaigns and spamming the hat rooms on almost e+ery ser+er has been eploited to the maimum for the cause of promoting their website.
0. &resentation The presentation of the online business needs to ha+e an easy to use na+igation. The look and the feel of the web site should be based on corporate logos and standards. $bout 7=C of the people read only (=C of the web page. Therefore) the web page should not be cluttered with a lot of information. $lso) simple but powerful na+igational aids on all web pages like search engines make it easy for customer to find their way around. The principle of F.'.<.< A Feep it simple stupid B is the most important factor that has to be considered while presenting the online business
6. &ro)esses ustomer supports needs to be integrated into the online web site. $ sales ser+ice that will be able to answer the questions of their customers fast and in a reliable manner is necessary. To further enhance after sales ser+ice) customers must be able to find out about their order status after the sale has been made. or e.g. ed# Awww.fede.comB) the o+ernight ourier ompany allows its customers to keep track of the parcel and they are well informed about the present whereabouts of their package.
4. &ersonali:ation 3sing the latest software from 9road2;ision and others) it is possible to customie the entire web site for e+ery single user) without any additional costs. The mass customiation allows the company to create web pages products and ser+ices that suit the requirement of the user. $ customied web page
(1
does not only include the preferred layout of the customer but also a pre selection of goods the customer may be interested in. or e.g. LahooM Awww.yahoo.co.inB entered the 'ndian cyberspace and started its personalied ser+ices.
I!TER!ET MARETI!% TACTIC. There are man6 di''erent te)hnologies to 'a)ilitate 6our Internet marketing strateg6( .ome o' the most )ommon and e''e)tive tools are/
.ear)h Engines and Dire)tories/
finding web sites) second only to following links on web pages. eb directories/search engines are information) gateways that ha+e high traffic and are good for displaying ad+ertisement banners. They are used to find 'nternet information and for this reason) appeal to broad target groups.
E7:ines A&nline magainesB: These publications are focused on specific topics and may
be a way to reach a target audience interested in that subject. ebsite resh in ;isitors5 inds
((
E7mail/ E7mail/ #thical methods of gathering e2mail addresses are through on2line registration
built into your corporate >e >eb b sites) or requests for information forms that request submission to your opt2in lists. $n altern alternati ati+e +e is to purcha purchase se lists lists of custom customer er e2mail e2mail address addresses es indeed indeed by specia speciall interests from a pri+ate company such as 5ostmaster Direct5. &nline &nline custom customers ers are becomi becoming ng increa increasin singly gly select selecti+e i+e about about their their relati relations onship hips) s) the brands they trust) and what they consider rele+ant. >hile most marketers are aware of pri+acy issues and the risks of
$ffilia liate te arket arketing ing enables enables you to increa increase se online online sales sales by A''il A''iliat iatee Marke Marketin ting/ g/ $ffi promoting your products and ser+ices through a network of $ffiliate $ffiliate sites on a payment2 by2results basis.
't also pro+ides the opportunity to generate additional re+enue by eploiting your site5s own content to promote the products and ser+ices of other online erchants.
$ erchant recruits content sites to partner with them as $ffiliates in echange for commissions. $ common third party pro+ider p ro+ider such as ommission Nunction can be used. The erchant pro+ides their ad+ertising ad+ ertising banners and links to their $ffiliates and assigns a commission for each click2through to their site) subscription to their ser+ice) or purchase of their products that is generated from those links.
$ffiliates place the tracking code for these ads and links on their >eb sites. This allows click trough-s to be tracked online and commissions to be calculated. 'f a product or ser+ice is purchased) the customer pays the erchant directly and the $ffiliate is paid a commission for that transaction. The dating giant adultfriendfinder.com has used this strategy to the maimum and has earned millions of dollars by proper implementation of this strategy.
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Banner Advertisin Advertising/ g/ 9anner ad+ertising can play an etremely important role within
your website strategy. &ne can use banner ad+ertising as a means of promoting it-s own products and ser+ices) raising awareness) or as a way of generating re+enue by selling ad+ertising space on your own website.
&ur) &ur)has hasing ing Adverti dvertisin sing/ g/ There There are are curre current ntly ly two two wide widely ly reco recogni gnied ed meth method odss of
purchasing banner ad+ertising. The rates for these are usually quoted on a cost per thousand thousand basis or AB. AB. The rates you pay can +ary tremendousl tremendously y as there is currently no standard price model 2 so be prepared to negotiateM
&a67&er7Im;ression/ This method of purchasing banner ad+ertising is based on a
char charge ge for for the the number number of time timess some someon onee sees sees your your bann banner er.. Ther Theree are are no guarantees as to how many +isitors will come to your site as a result of seeing your bannerH you are simply paying for the number of times your banner is disp display layed ed.. >ebsit bsites es that that offe offerr such such progr program amss incl include ude paypop paypopup up.c .com om and and adclicksor.com
&a67&er71i &a67&er71isitor/ sitor/ This method of purchasing banner ad+ertising is based on a
charge for the number of times someone +isits your site as a result of clicking on your banner. This is a better method of purchasing banner ad+ertising as you are only paying for results) although epect to pay a premium.
re+enue model of the 'nternet giant google.com google.com has its +ery &a67&er7Cli)k/ The re+enue own ser+ice which offers certain share of the profit that it makes by the click2thru that a website generates from its ad sense codes. The re+enue model is known as google adsense and almost e+ery successful website uses this model to make profits. The !oogle adsense ads can be seen on websites like Times of 'ndia) oneyc oneycont ontrol rol.com .com)) anage anagemen menta tarad radise ise.com .com and a lot many other other repute reputed d websites.
Branding . >hile T" and cost per sale relate to direct marketing objecti+es)
another way of looking at banner ads is as GbrandingG tools. They create brand awareness) and a brand image in the +iewer5s mind) whether or not the +iewer clicks on the ad. 9randing is +ery difficult to measure) but can be +ery powerful.
(,
There The re are are a nu numm-er er o' ke6 ke6 issues issues that that must must -e )onsi )onside dere red d when when desig designin ning g a su))ess'ul -anner/
't must ha+e an attention2grabbing headline.
't must be simple and get your point across.
't must in+oke action Ai.e.: Glick hereGB
't must download quickly.
't must be placed effecti+ely on a web site) Eocation) Eocation) Eocation
$ny campaign is limited by the amount of ad+ertising you can do depending on the sie of your budget. Therefore it is important that you target your market carefully so as to maimie ad+ertising spend on effecti+e banner campaigns.
Eookin ing g for for ways ways to make make onli online ne ad+e ad+ert rtis isin ing g more more Ri)h Ri)h Medi Media a Adver dverti tisi sing ng// Eook compelling) and hopefully thereby more acceptable) marketers ha+e increasingly been turning to streaming ad+ertising. 'n effect another kind of rich media ad+ertising) streaming ad+ertising comes in two basic forms. irst) it can either be part of a streaming audio or +ideo program on the web. >ith many people now listening to web radio or watching web broadcasts) this makes perfect sense. $fter all) e+eryone is accustomed to getting commercials on their T; or car radio. The other channel for streaming ad+ertising is essentially an infomercial. onsumers can download a streaming clip for a product p roduct or ser+ice from a marketer5s website. Two new studies recently released suggest that the streaming ad+ertising market is going to boom now and in the years to come. The giant ad selling company media turf uses this method for pro+iding content to ad+ertisers
Con'eren)es/ 9y their nature conferences are organied for special interests. $d+ertising
in confere conference nce litera literatur ture) e) print print and electr electroni onic) c) is an ecelle ecellent nt way to contact contact target target markets.
(0
Colla-orative Marketing/ Team up with other business to:
ross2promote 2 e.g. setting up links from one corporate >eb site to another or offering special promotions in partnership with complementary goods or ser+ices.
$d+ertise 2 share ad+ertising.
articipate in joint sponsorship of e+ents) initiati+es) informational >eb sites) mailing lists) bulletin board systems) directories) etc.
Eink echange with trade/professionals associations to support credibility of firm) pro+ide further market information to customers) build their awareness and prepare them for the action of purchasing.
.ales &romotion/ #mploying methods to stimulate sales through immediate or delayed
incenti+es to the customer. 'f the incenti+e is attracti+e) the price: +alue ratio is adjusted fa+ourably enough to affect a sale. This strategy should integrate with the o+erall marketing mi to balance etra sales with long2term profit moti+es. #amples of sales promotion strategies are:
.am;ling 2 offering product samples) electronically.
Bonus o''ers 2 offering additional goods or ser+ices when making single purchases
Ae.g. buy2one2get2one2freeB.
$imited time o''ers 2 attracting +isitors to return to a >eb site.
%ames with ;ri:es/ 3seful to keep people coming back to >eb sites.
Cross7;rodu)t sam;ling/ >hen a customer makes a purchase they ha+e an
opportunity to try out another company-s product/ser+ice. $lso) the customer may ha+e the opportunity to try out more than one company-s product/ser+ice while testing another. 3seful for complementary products/ser+ices.
Feature ;ri)ing/ pro+iding special pricing to those that order electronically.
Cross7;romotions with other )om;anies< ;rodu)ts5servi)es 2 9uy a company-s
product/ser+ice and get a coupon for another company-s product/ser+ice.
(6
&u-li)it6/ The goal of publicity is to ha+e others talk about the small business or its
products. 't can be inepensi+e or e+en free and it may ha+e the potential to generate far more in sales than e+en a well eecuted ad+ertising plan.
&romotional &u-li)ations/ acilitate customer education) with the intention of building
corporate image and e+en brand awareness) the small business may sponsor and/or publish its own electronic magaine on the >eb) e2mail) etc. These are useful in fields where the customer needs information to de+elop sufficient knowledge for mo+ement through the first three stages of the sales process of awareness) interest) and desire . $lthough time consuming) they replace or complement the print +ersions of newsletters/corporate magaines/flyers.
.u-s)ri;tions/ 9usiness marketers may use their >eb sites to encourage +isitors to
subscribe to recei+e regular email messages from the company. These messages are called digests or newsletters) and are a cle+er way for marketers to push product news to willing customers.
Controlled7a))ess #e- ;ages/ le+er business marketers may use their >eb site to
attract new customers. They might publish a >eb page that allows customers to download a free trial +ersion of a software application that epires after a time if not paid for. &r) customers might recei+e an e2mail message in+iting them to +isit a pri+ate >eb page on the company-s intranet) and gi+ing them a password. The company) as a way of encouraging a sale) offers customers who +isit the page a prie or enticement of some sort.
&u-li) Forums/ These are often community2based or interest2based sites that allow
+isitors to communicate with one another. $n opportunity for small businesses to reach to their intended target group +ia these forums is by posting messages or by sponsoring such a forum. #2mail based forums appeal to a wider audience due to the greater use of this application o+er >eb2based forums. >eb based forums are ad+antageous for their superior display of ad+ertising images/messages
(4
Resellers/
companies that host these sites may ha+e in+ested significant resources in making them attracti+e to the target audience a small business is interested in attracted. 9y piggybacking on another company-s efforts) cost2efficiencies may be realied by engaging in a reselling arrangement.
E7mail $inks/ ;isitors to a site should ha+e the opportunity to correspond with the host
of that site) especially if out of the telephone area or time one. #2mail links may be strategically placed throughout the site to elicit response from +isitors for at +arious points. These are also useful for feedback on site maintenance problems.
"n7line .urve6s/ 'nformation may be collected on the +isitors to a >eb site through
registration forms) on2line sur+eys) or through tracking of areas of site they +isit. These websites also offer referrals wherein if you refer someone to their site and the person becomes a member then you are paid commission on that.
1irtual Malls/ >eb based sites that allow companies to post their products or ser+ices
for sale long with other companies. These may be product specific) may be arranged by complementary products) or may ha+e products that are not related ecept by their companies- desire to attract a similar target audience.
Measurement/ The 'nternet has the unique ability to pro+ide marketers with detailed
information about the success of their >eb marketing programs. ompanies can track +isitors to their site and collect information about them from their Ocookies)P then process this information using >eb site analysis software. ookies are a type of digital identification) which is read e+ery time the user connects to a public >eb site. The >eb site can collect some +ery basic information about the user Ae2mail address) time of day the site was accessed) which pages were +isitedB and use it to create +isitor profiles. ;isitors can then be identified as OoldP or OnewP when they +isit the site.
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AD1ERTI.I!% "! TE I!TER!ET/ EMER%I!% I..0E. Internet might -e a )at)h6 advertising medium( But, there are =uite a 'ew issues that need to -e sorted out(
$d+ertising on the %et is slowly catching on. 'n de+eloped economies) ad+ertising on the %et accounts for anything between se+en and 4.0 per cent of the total ad+ertising cake. ine) how large is online ad+ertising in 'ndiaJ ;arious estimates put the sie of online ad+ertising in 'ndia between "s (, crore and "s (8 crore) which is much less than one per cent of the total ad+ertising cake. >hy is online ad+ertising so small in 'ndiaJ >hy aren5t the ad+ertisers putting their money on %et ad+ertisingJ or instance) @industan Ee+er-s ad+ertising budget is upwards of "s 4== crore and out of thisH the company spends not more than "s (0 lakh on online ad+ertising. 's this because %et penetration in 'ndia is not deeperJ Les) to an etent. .low Motion
@owe+er) this might not be the case for long. or) initiati+es are on to increase the number of 'nternet users. 't is estimated that 'nternet subscribers will increase to around *0 million by (==7 from the current figure of one million. %ot only that) a dri+e is on to make 'nternet more affordable. or instance) the "eliance group is planning to set up 4)7== cyber kiosks in adhya radesh and 9<#< is planning to put up 1)=== cyber kiosks in 9ombay. $nd the 3F2based >orldTel) in partnership with the "eliance group) is working at building 1)=== community 'nternet centres in Tamil %adu. There is a question here) howe+er. 'f numbers are the only factor) then how that %et ad+ertising is has picked up in @ong Fong) which boasts of 1.7 million %et users compared to some *.0 million in 'ndia.
(8
&ne such reason is this: there is no official organiation in 'ndia that monitors and regulates the online ad+ertising industry. $nd there is no mechanism a+ailable for tracking +iewer ship of ad+ertisements. hile tele+ision has two people meter ser+ices) Tam A'"9B and 'ntam A&"!2$"!B) there is no possible mechanism to enable working out optimied schedules on the basis of ad +iewer ship rather than programme +iewer ship.G True. &nly such a mechanism can help to track ad +iewer ship patterns much more accurately and monitor tele+ision ad+ertisements effecti+ely. The +ery reason that ad +iewer ships in online ad+ertising are not monitored and audited is making quite a few corporate ad+ertisers go slow in latching on to the 'nternet medium.
TAR%ETI!% IM&ERATI1E. $ccurate targeting is another strategy to eliminate wastages in online ad+ertising. urrently) such targeting based on parameters such as geographic location and search keywords is possible. Les)
*=
lists can offer profiles of users. 9ut the question is how many sites in 'ndia ha+e a large base of registered usersJ erhaps "ediff.com has a base of eight lakh registered users and Nobsahead.com has a base of about 1.0= lakh users.
"!$I!E C"!.TRAI!T. $s efforts to eliminate wastages in online ad+ertising take offH efforts are also needed to eliminate the attendant constraints. 'n online ad+ertising) one can stream audio and +ideo technologies together with faster bandwidths and deli+ery channels in a bid to present the same idea with the use of sound) music and +isual imagery and make interactions with the banner possible. 9ut) this is not possible in 'ndia) thanks to the eisting bandwidth problems. @owe+er) soon bandwidth will cease to be an issue. Despite the bandwidth constraint) the oco2ola tele+ision commercial is being aired in Ieenet.com. This initiati+e has been taken by ediaturf and a 9angalore2based software programmer) who ha+e found a way to use the %et to air commercials with the dial2up mode and thus o+ercoming the bandwidth constraint. $nyway) with massi+e in+estments coming in bandwidth) there could be a glut soon.
*1
ONLINE CONSUMER BEHAVIOUR
%ow to be able to use the se+en -s effecti+ely in order to achie+e the predefined goals of any organiation it is imperati+e to understand the customers. ustomiation will only be truly effecti+e if we understand our customers and their true needs. 9efore adapting marketing practices to the 'nternet) the marketer needs to understand the characteristics of the online customers. The %et users can be classified into fi+e categories depending upon their intention of using the 'nternet.
The 'ive )ategories o' users are/ →
Dire)ted In'ormation .eekers/ They require specific) timely and rele+ant
information about the products and ser+ices being offered. →
0ndire)ted In'ormation .eekers/ These users require something interesting and
useful.
Bargain unters/ They are of two kind. &ne who look for free items on the
internet and other who are seeking better deals) higher discounts etc. →
Entertainment .eekers/ they see the >eb as an entertainment medium of +ast
breath and potential and want to eplore the medium before the mass gets there. →
Dire)ted Bu6ers/ They want to buy something 2 now. They are sure what they
require and just log on to the >eb to purchase the item.
Consumer Behaviour Consumer -ehaviour is the study of when) why) how) and where people do or do not
buy products. 't blends elements from psychology) sociology) social anthropology and economics. 't attempts to understand the buyer decision making process) both indi+idually and in groups. 't studies characteristics of indi+idual consumers such as demographics and beha+ioural +ariables in an attempt to understand people5s wants. 't
*(
also tries to assess influences on the consumer from groups such as family) friends) reference groups) and society in general. ustomer beha+iour study is based on consumer buying beha+iour) with the customer playing the three distinct roles of user) payer and buyer. "elationship marketing is an influential asset for customer beha+iour analysis as it has a keen interest in the re2 disco+ery of the true meaning of marketing through the re2affirmation of the importance of the customer or buyer. $ greater importance is also placed on consumer retention) customer relationship management) personalisation) customisation and one2to2one marketing.
B$AC B"> M"DE$ E!1IR"!ME!TA$ FACT"R.
B03ER9. B$AC B">
Marketing
Environmental
Bu6er
De)ision
.timuli
.timuli
Chara)teristi)s
&ro)ess
B03ER9. RE.&"!.E
roblem recognition #conomic
$ttitudes
'nformation
roduct choice
roduct
Technological
oti+ation
search
9rand choice
rice
olitical
erceptions
$lternati+e
Dealer choice
lace
ultural
ersonality
e+aluation
urchase timing
romotion
Demographic
Eifestyle
urchase
urchase
%atural
Fnowledge
decision
amount
ost2purchase beha+iour
**
The black bo model considers the buyers response as a result of a conscious) rational decision process) in which it is assumed that the buyer has recognied the problem. @owe+er) in reality many decisions are not made in awareness of a determined problem by the consumer.
Consumer ;ur)hases are in'luen)ed strongl6 -6 'ollowing 'our 'a)tors/ 2( Cultural Fa)tor *( .o)ial Fa)tor ?( &ersonal Fa)tor @( &s6)hologi)al Fa)tor( 2( Cultural Fa)tor /7 •
ultural factor di+ided into three sub factors AiB ulture AiiB
o
ulture:2
The set of basic +alues perceptions) wants) and beha+iours learned by a member of society from family and other important institutions. ulture is the most basic cause of a person-s wants and beha+iour. #+ery group or society has a culture) and cultural influences on buying beha+iour may +ary greatly from country to country.
o
$ group of people with shared +alue systems based on common life eperiences and situations.
*,
#ach culture contains smaller sub cultures a group of people with shared +alue system based on common life eperiences and situations.
o
$lmost e+ery society has some form of social structure) social classes are society-s relati+ely permanent and ordered di+isions whose members share similar +alues) interests and beha+iour.
*( .o)ial Fa)tors /7 •
$ consumer-s beha+iour also is influenced by social factors) such as the AiB !roups AiiB amily AiiiB "oles and status
o
!roups :2
Two or more people who interact to accomplish indi+idual or mutual goals.
$ person-s beha+ious is influenced by many small groups. !roups that ha+e a direct influence and to which a person belongs are called membership groups.
o
amily:2
*0
amily members can strongly influence buyer beha+iour. The family is the most important consumer buying organiation society and it has been researched etensi+ely. arketers are interested in the roles) and influence of the husband) wife and children on the purchase of different products and ser+ices.
o
"oles and
$ person belongs to many groups) family) clubs) organiations.
The person-s position in each group can be defined in terms of both role and status.
or eample. ? OQP plays the role of father) in his family he plays the role of husband) in his company) he plays the role of manager) etc. $ "ole consists of the acti+ities people are epected to perform according to the persons around them.
?( &ersonal Fa)tors /7 •
't includes iB $ge and life cycle stage AiiB &ccupation AiiiB #conomic situation Ai+B Eife
o
$ge and Eife cycle
eople changes the goods and ser+ices they buy o+er their lifetimes. Tastes in food) clothes) furniture) and recreation are often age related. 9uying is also shaped by the stage of the family life cycle.
o
&ccupation :2
$ person-s occupation affects the goods and ser+ices bought. 9lue collar workers tend to buy more rugged work clothes) whereas
*6
white2collar workers buy more business suits. $ o. can e+en specialie in making products needed by a gi+en occupational group. Thus) computer software companies will design different products for brand managers) accountants) engineers) lawyers) and doctors.
o
#conomic situation :2
o
$ person-s economic situation will affect product choice
Eife
Eife
i.e. acti+ities A>ork) hobbies) shopping) support etcB interest Aood) fashion) family recreationB and opinions Aabout themsel+es) 9usiness) roductsB
o
ersonality and
#ach person-s distinct personality influence his or her buying beha+iour.
ersonality
refers
to
the
unique
psychological
characteristics that lead to relati+ely consistent and lasting responses to one-s own en+ironment. @( &s6)hologi)al Fa)tors /7 •
't includes these actors. iB oti+ation AiiB erception AiiiB Eearning Ai+B 9eliefs and attitudes
•
oti+ation :2
*4
o
oti+e Adri+eB a need that is sufficiently pressing to direct the person to seek satisfaction of the need
erception :2
•
o
The process by which people select) &rganie) and interpret information to form a meaningful picture of the world.
Eearning:2
•
o
hanges in an indi+iduals beha+iour arising from eperience.
9eliefs and attitudes :2
•
o
9elief is a descripti+e thought that a person holds about something
o
$ttitude) a erson-s consistently fa+orable or unfa+orable e+aluations) feelings) and tendencies towards an object o r idea
CRITICA$ .0CCE.. FACT"R. I! E7MARETI!%
@a+ing obser+ed the e+ol+ing paradigms of business in the 'nternet era) there are fi+e critical success factors that the #2arketer has to keep in mind. →
Attra)ting the Right Customer is the first crucial step. "ising digital penetration
would mean that the number of customer +isiting particular sites would ine+itably go up. >hile the number of eyeballs or page +iews has so far been con+eniently used as a satisfactory measure by most web sites) it would be foolish to cater to the whole spectrum of digital +isitors. ontent has to be +ery target specific. The digital company has to select its target segment by finding out which section of customers are the most profitable in terms of re+enue transactions and who are the customers who generate the maimum number of referrals. @ere again it is important to note that the majority of online customers are not seeking the lowest price. "ather they are seeking con+enience abo+e e+erything else. The power of customer referrals has ne+er been so enormous) since word of the mouse spreads
*7
faster than word of the mouth. #29ay attracts more than half of its customers through referrals. %ot only do referred customers cost less to acquire than those brought in by ad+ertising or other marketing tools) they also cost less to support since they use their friends who referred them for ad+ice rather than using the companies- own technical desk.
→
Delivering Content 1alue to engage the user
importance in retaining customer participation. This is because content ser+es as a powerful differentiator. ontent would include roduct enhancements A
→
Ensuring E7$o6alt6 is +ital to the success of any online +enture. This is because
acquiring customers on the 'nternet is enormously epensi+e and unless those customers stick round and make lots of repeat purchases o+er the years) profits will remain elusi+e. ontrary to the general +iew that >eb customers are notoriously fickle) they in fact follow the old rules of customer loyalty. >eb customers stick to sites that they trust and with time consolidate their purchases with one primary supplier to the etent that purchasing from the supplier-s site becomes part of their daily routine. The issue of trust is integral to the issues of pri+acy and security. ompanies like $maon.com) which command amaing le+els of consumer trust) ha+e used a +ariety of encryption tools ad simple ethical decisions like not accepting money for publishers for independent book re+iews to maintain the trust of its customers.
→
E7$earning to 'a)ilitate ;ersonali:ed intera)tions with customers has been the
biggest contribution of the >eb to the marketing strategists. ustomers in
*8
traditional bricks2and2mortar stores lea+e no record of their beha+ior unless they buy somethingKand e+en then the date might be sketchy. 'n the digital marketplace) howe+er technology has made the entire shopping eperience a transparent process. or eample) if the customer eits the web2site when the price screen appears) he is a price sensiti+e consumer.
&roviding Digital value to the evolving )onsumer through his li'e )6)le has
become possible because of customied interactions and emerging business models. These models ha+e often disturbed the traditional status quo and created new rules of business. The sectors where new business models will emerge or ha+e emerged are the music industry) the financial ser+ices industry) the tra+el industry) the relating segment and the publishing segment. Digital +alue is deli+ered to the consumer by promising him con+enience) allowing the customer to feel his ownership of the >eb eperience) and gi+ing the customer a sense of belonging that tra+erses the physical boundaries.
,=
The Channel .trategies 'or delivering Digital 1alue to )ustomers/
The 'nternet era has shown that companies ha+e risked damaging relationships in their physical chain to compete in the electronic channel. The ubiquity of the 'nternet the fact that cross2linkages are possible to any degree) has meant that companies ha+e usurped the role of other +alue pro+iders in the +alue chain to gain competiti+e ad+antage. >hen companies pirate the +alue chain of the industry they are essentially eliminating layers of costs that are build into the current distribution system. @owe+er pirating the +alue chain does not mean that the number of intermediaries in the whole process would necessarily decrease. The emerging economic structure of #lectronic ommerce would mean that profits would lie in the intermediate transactions rather than in the final sale of the good. ompanies would aim at cutting down their traditional margins Agi+e up the cost plus pricing structureB and aim at high in+entory turno+er. 'n retailing profitability is primarily.
The )hallenge will lie in managing these multi;le )hannels o' e;erien)e/ 't is likely that most companies will find that they will ha+e to integrate se+eral distribution channels to pro+ide the customer with a seamless purchase process. The key challenge is thus to ensure that the personalied nature of the eperience is not much different across channels. an an 'nternet bookseller allow its customers to eperience the same ambience on the net as it does in the bookstore or +ice2+ersaJ 'f it cannot then companies will face friction among the alternati+e distribution channels and the already established physical channel might complain about its profitability being affected by digital purchases. This may be typified by friction between +ehicle dealers and the company o+er orders trough an auto company-s >eb site. omplementary to the problem of managing multiple channels of distribution is the de+elopment of infrastructure needed to support such a distribution network. The billing system and pricing strategies ha+e to be properly frames and eecuted
,1
Building Brands "nline &nline has always taken a back seat to offline in brand building. Let online offers the best options for building a meaningful brand) options that didn5t eist only a few years ago. ompanies without a solid digital brand strategy are literally being left b ehind as leaders build new digital brands. "eflecting on the current state of online ad+ertising) the majority of online marketers are doing a terrible job of building their digital brands. $d+ertisers are fighting tooth and nail to produce the world5s worst ad+ertising) actually destroying their eisting offline brands in the digital realm. 'n one industry after another) aggressi+e 'nternet upstarts are putting established brands at risk) creating +ery strong brand recognition and enjoying eplosi+e +isitor growth. The reason may ha+e less to do with the established brands themsel+es than with their managers.
'n one industry after another) aggressi+e 'nternet upstarts are putting established brands at risk) creating +ery strong brand recognition and enjoying eplosi+e +isitor growth The reason may ha+e less to do with the established brands themsel+es than with their managers.
Colla-orative Tools
They facilitate word of mouth) or what might be called Gbranded person2to2person communicationsGKfor instance) the ratings that buyers offer sellers on e9ay) the Eands#nd Gshop with a friendG feature) "aging 9ull-s discussion boards) and ert-s +iral marketing Awhich encourages consumers to e2mail their friends instructions for obtaining free ert lus samplesB. ollaborati+e tools such as consumer ratings) though essential for content2 and community2oriented digital brands) are underutilied.
&ur)hase7;ro)ess .treamlining Tools
They eliminate such physical2world constraints as the need to walk into a store to purchase a product. $maon-s one2click ordering system) for eample) eases transactions
,(
by sparing repeat customers the incon+enience of inputting transaction data. eapod-s shopping lists sa+e consumers time by recording the products they purchased pre+iously. The fact that most e2shoppers drop out of the buying process during the last clicks suggests that impro+ements along these lines might be +er y worthwhile. .el'7servi)e Tools
They allow customers to obtain answers and results without the delays and inconsistencies that more often than not characterie human efforts to pro+ide assistance. eb2 based tools with legacy systems) the tools are indispensable for ban ks) retailers) and other e2businesses that handle large +olumes of transactions.
Do7it76oursel' ;rodu)t design tools
They allow consumers to customie products and ser+ices) either with the help of configuration options or from scratch. Dell omputer) for eample) lets customers design their own systems on2line by choosing from a range of optionsH customers of usic.com and Eisten.com can download the music of +arious artists onto a single compact disc. 9ut the need to create manufacture2to2order systems to capture the potential of these tools may make them uneconomical in industries that) unlike software and music) are not based on information.
D6nami)7;ri)ing tools
They o+erthrow the tyranny of the fied retail price) allowing prices to fit the particular circumstances of indi+idual transactions.
,*
they go on2line to shop) and that) coupled with fear of on2line fraud) is what stops many consumers from e+en considering digital transactions.
Building Trust 9ringing the si elements of trust to your 'nternet +alue proposition) though) does not automatically lead to deep) trusting relationships. That comes through a step2by2step process in which the consumer and marketer echange +alue. #ach time the consumer +olunteers some personal information) the marketer rewards the consumer with a more personalied ser+ice. This mutual gi+e2and2take e+entually leads to an ad+anced collaboration based on trust. The research has identified four stages of trust building: Attra)tion
$t the first stage) the consumer browses the site and e+en makes a transaction. %o real relationship eists between the marketer and the consumer) and none may be warranted. The best strategy is to pro+ide the consumer with information) without demanding any in return. $t first blush) this may seem like an imbalance between what marketers gi+e and what they get back. 9ut what the consumer is gi+ing the marketer is something quite +aluable: time and attention) along with a +iew of how the site is tra+ersed. The time and attention translates into the Gmind shareG needed to create a brand preference. The a+erage consumer on "alston urina-s Dog how >eb site) which offers no product for sale) spends more than si minutes per session learning how to care for pets. That-s far more timeKand concentrationKthan consumers de+ote to a *=2second T; ad. 0ser7Driven &ersonali:ation
$t the second stage) consumers start shaping >eb pages to their specific tastes. or eample) D2now customers can personalie their home pages with fa+orite artists and wish lists. The company shows that it is willing to deli+er some +alue to the consumer ,,
before gaining financially. harles
'n the third stage) marketers begin using insights pro+ided by consumers to beam information back to them. Thus) D2now uses its knowledge of consumersKde+eloped at the earlier stages of trustKto suggest products they might like which consumers then rate as either on2 or off2target. $s the process continues) D2now learns consumers preferences and eroes in on what they really like. 't is worth emphasiing that marketers should rein in their urge to make immediate use of data and personaliation technologies. This approach takes patience) a trait lacking at many marketing organiations. Too often they bombard consumers with promotional offers as soon as they get their hands on an e2 mail address. >e suggest a gradual approach) as nothing aggra+ates many 'nternet users more than unsolicited e2mail. $ best practice is to let the user set the pace of personaliation and contact from marketers. 3ser2dri+en personaliation should precede marketer2dri+en offers. "ecent research by rofessor Loungme oon of the @ar+ard 9usiness eb
,0
RE.EARC MET"D"$"%3 'n this chapter we will present how we will conduct our research in order primary data and
reach
the objecti+e of
the dissertation.
to
collect
>e will also be
discussing which different types of methodologies that were used.
Resear)h design 't is a eploratory research study. >e come up with a questionnaire to understand the on line consumer beha+ior..
."0RCE. "F DATA &rimar6 data/ 4uestionnaire to stud6 the -ehavior regarding online marketing .
The primary data is after all the raw effort which is put by an indi+idual to get the opinion) beha+ior and attitude from a sample population by filling up questionnaires and which gradually accumulates to become the backbone of the data of online marketing.
.e)ondar6 data /
,6
A!A$3TICA$ T""$./ @ere ' collected case studies of three different companies which can represent my whole report in the real life scenario. 't gi+es useful insight of m y project report. Do)umentar6 o-servation/
9ooks) annual report) website) published and unpublished materials. Field o-servation/
' did etensi+e study of +arious blogs) communities and online consumer to obser+e the online marketing operation performed by the organiation.
,4
CA&TER I1/ A!A$3.I. "F DATA >e ha+e the interpretation and analysis f data collected from the questionnaires.
CA.E .T0DIE.
Redi''()om
C*# + ungama
Fa-mart
Case .tud6 Redi''()om Redi''()om is one of the premier worldwide online pro+iders of news) information)
communication) entertainment and shopping ser+ices for 'ndians. Fnown for being one of the first with news and pro+iding accurate and trustworthy information) "ediff.com pro+ides an ideal platform for 'ndians worldwide to connect with one another online fast. "ediff.com is committed to offering a personalied and a secure surfing and shopping en+ironment. "ediff.com additionally offers the 'ndian $merican community one of the oldest and largest 'ndian weekly newspaper) 'ndia $broad. ounded in 1886) "ediff.com is headquartered in umbai) 'ndia with offices in %ew Delhi and %ew Lork) 3<$ Redi''()om is the leading online network targeting 'ndia and 'ndians worldwide. They
pro+ide original and third2party branded content through interest2specific channels)
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etensi+e >eb2based community features such as free e2mail) chat) personal home pages and an 'ndia adapted search engine) and the largest e2commerce platform in 'ndia. They ha+e designed their >eb2site offerings by keeping the slow access speed a+ailable to most 'ndian 'nternet users in mind. "ediff belie+es that it has created the online network of choice for 'ndian 'nternet users) as well as created a highly desirable ad+ertising and e2 commerce platform for ad+ertisers and merchants respecti+ely. They belie+e that their success to date is attributable to the following key success factors: 2( Fo)us on India + Indians #orldwide/ They ser+e the online needs for 'ndian
'nternet users and people of 'ndian origin worldwide and ha+e de+eloped their product offerings based on the demands and the requirements of their user base. They ha+e been in business since 1886) and hence ha+e a large archi+e of 'ndian focused content. "ediff pro+ides their users with: 9road range of community offerings such as) chat) singles channel and personal
homepages that allows users to interact with other 'ndians with similar interestsH
rele+ant content as top searches for queries by usersH hannels that are rele+ant to 'ndian interest) e g @oroscope) ricket)
finance) 'ndian music and 'ndian mo+iesH 3p2to2date news focused on 'ndia) constantly updated by their in2house editorial staff)
featuring inter+iews with se+eral leading 'ndian politicians) mo+ie stars) and celebritiesH $irline and train schedule and a+ailability) thereby eliminating the need for 'ndian users
to queue up in airport and train stationsH $n easy to understand interface that strikes the right balance between an attracti+e
+isual appearance and fast down2load times for people accessing the site with low speed modems.
,8
*( Com;rehensive online o''ering/ "ediff belie+es that it is Gone2stop2shopG for 'ndian
'nternet users by satisfying all their online requirements. 9y pro+iding them with locally rele+ant content) community functionality) and ability to shop online) it has been able to attract and retain users on its site for etended periods. They belie+e that their etensi+e offerings coupled with their aggressi+e branding program ha+e made them the most recognied 'nternet brand in 'ndia. To help ad+ertisers reach the "ediff audiences) they help them build their sites) design their banners and sponsorships and lead them through a comprehensi+e ser+ice to assist their marketing efforts on the net. ?( $eading e7)ommer)e ;lat'orm/ "ediff has created the "ediff arketplace which
pro+ides 'ndian merchants a guide and effecti+e way to mo+e from being merely ad+ertisers/sponsors on their site to selling their goods and ser+ices online. To demonstrate the +alue of this proposition they created a "ediff 9ook
0=
&R"M"TI"!A$ .TRATE%IE.
"ediff generally belie+es advertising in mass media like Tele+ision) %ewspaper etc. $part from these general means of ad+ertising it also belie+es in promoting the site through we- ;romotion. The best e2commerce site in the world is worthless if no one can find it. 9ut) too often) ecommerce start2ups use shotgun marketing) simply ad+ertising e+erywhere) to e+eryone) in the hope that a fraction of a percent of those who see the ads will respond.
ajority of the "ediff customers come through search engines) such as Lahoo) !oogle) $lta;ista and others.
"ediff also belie+es in #ord o' Mouth policy) an offline strategy. This can be done only if they pro+ide inno+ati+e products and ser+ices to its customers and to see that what the made by them is being fulfilled) more the number of people +isiting their site more is the awareness made by them to other people.
For E(g( "ediff offers "ediff 9logs- a ser+ice that allows a user to publish their thoughts
and ideas directly on the web. "ediff.com is the first 'ndian website to offer 9logs to 'ndians worldwide using the latest in the internet technologies.
$ 9log or a web log is a personal or con+ersational website updated frequently with +iews) links) commentary and such other information rele+ant to a particular topic. This could comprise of links and commentary from other websites on topics of interest such as writing diaries) poetry) uploading photos) pro+iding project updates) news about a company) a person or an idea and e+en fiction. This ser+ice enables the user to epress his opinions) be heard and make friends on "ediff.com.
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The process of setting up and updating a blog is +ery simple. $ll a user needs is a "ediff.com account. Thereafter a blog can be set up in three simple steps) starting with entering a subject) choosing a template and making an entry into the blog. Building Trust
&nline users epect certain things from the ser+ice pro+ider i.e. easy to use and trouble free procedures like while creating a new "ediffmail account) the information asked by "ediff to the online user is +ery specific and up to the point. $ccording to them trust is an ongoing job) at no point can they afford to loose a +aluable customer. &n its website they ha+e got a "ediff arketplace option wherein a customer can buy the products online. "ediff has got this system whereby if a customer after shopping is not satisfied with the product purchased from "ediff) they can return the goods back to "ediff e+en if they ha+e used the product. "ohit ;arma) hief arketing &fficer said that it is these small things that one has to take into consideration and which can create a sense of trust in the minds of the customers.
C*# + ungama
The first full2fledged website in the 'ndian market to start broadcasting to cater to this need was ontest(>in Awww.contest(win.comB) now simply c(w.com) keeping in mind the impatience le+els of users online. (> edged its way slowly but steadily into the minds and onto the fingertips of 'ndian users by striking barter deals which in+ol+ed their 3"E A'nternet addressB being mentioned in traditional media in echange for hosting contests and promotions on their site. >ith enthusiasm that ran deep) but pockets that didn5t) $lok Fejriwal) #&) did not spend on the traditional ad+ertising and " channels from the time they went li+e in %o+ember 1887. &n the other hand) @ungama.com took the other route) li+ing upto its name when it launched in arch 88. &nline ad+ertising) professional ") and attracti+e promotions in prominent net2sa++y community hangouts like night clubs and cyber cafes in 9ombay) 9angalore and Delhi all went towards literally raising a ungama about this new website in almost no time at allM
0(
The business model of sites like (> and @ungama is simple 2 they belie+e in the 'nternet maim: G)ontent is king G. $nd they keep that content fresh. &f course) content for them is not news and features) but contests) promotions and incenti+es rewarding users for spending time on their sites. $nd there are four steps in+ol+ed in making this business model pay off for them: Creating Content
9oth @ungama and (> ha+e aggressi+e teams that interact with +arious brand and marketing managers to get more brands on their sites) with hundred of big brands like hilips) @EE) 3D; and
(> has emblaoned its brand 2 their 3"E 2 into the minds of current and potential members by cross promotion in traditional media like outdoor) print) tele+ision) and e+en on product packaging. @ungama chose to storm the market and create an identity and brand through physical contact in the real world where their target audience cannot miss them.
9y constantly adding new contests and promotions to their sites) (> and @ungama ensure that their +isitors keep coming back. @ungama.com has e+en gone to the etent of gi+ing away pries e+ery hour) by the hour) with o+er 1== pries being distributed daily from their officeM
0*
.elling E6e-alls
Today) (> has a database *0)=== strong Agrowing at *0C per monthB) all with authentic registration details 2 after all fake details means that your prie may ne+er reach you. @ungama) though a recent entrant) is fast catching up. $s these numbers grow) these eyeballs will attract ad+ertisers to the sites) bringing in ad+ertising re+enue) either for banners or for paid promotions. (> already has 'ntel ad+ertising on their pages) while the @ungama pages are still banner2free. The Future
(> has already finalised plans for an $sian reach) and are looking for strategic partners for the $merican and #uropean market) to become the world5s contest portal 2 a one2stop site for contests and promotions. GreeG seems to be a four lettered f2word for %eeraj "oy) #&) and @ungama.com who emphatically states that his site is not a contest freebie site 2 it is e2promotions sites that will continue helping brands get their message to online customers through incenti+es. >hate+er tag you put on them 2 be it freebies) incenti+es) contests) promotions) or brand2building eercises in cyberspace) there are more eyeballs being attracted) and slowly but steadily) more brands being attracted by these eyeballs.
Fa-mart
abmart is one e2tailer) which keeps hitting the headlines often) as much for its new initiati+es) as well as for reports that say that "upert urdoch and Dhirubhai $mbani ha+e looked at equity stakes in the e2tailer. hat followed were days of struggle when the store sur+i+ed on minimal transactions. 9ut shoppers kept trickling in) and there was no day when abmart failed to attract at least one request. The store now registers about (0= transactions a day) with the a+erage transaction amount ho+ering at around "s (==.
0,
F0$FI$$ME!T &R"CE..
't-s easy to lose an online customer. or him to prefer an online store to a neighborhood shop would ha+e been a difficult decision in+ol+ing a fundamental beha+ioral change. $nd the e2tailer just cannot disappoint the customer in ser+ice or deli+ery. 'n fact) abmart is to shortly introduce an online call center Ali+e chatB where a customer can get instant feedback on his/her queries. abmart-s fulfillment process can be broadly classified into:
( o u r ) in g
% r d e r & o n ' o l id a t i o n
" e l i# e r $
Fa-mart C Ful'illment &ro)ess
The store is still able to meet the deli+ery commitment within 4( hours typically. abmart claims to ship about 80 per cent of its orders within ,7 hours) a feat it can achie+e because of its rapport with the big book and music companies in 'ndia. abmart also has a se+en2day) no questions2 asked return policy under which customers can return any
00
items) with a small note stating the reason for dissatisfaction) and abmart bears all shipping epenses.
The &a6ment Me)hanism
The "etailer has put in place two kinds of security mechanisms R one for de bit/credit card transactions and the other for confidentiality of personal details. abmart and itibank launched what they thought as the world
Fa-mart
abmart-s ad+antage may be that it is a pure e2commerce +entureH ad+ertisement re+enues are not counted upon. 'n fact) the store does not welcome ads) ecept those relating to books and music. $ny a+ailable +irtual real estate is used for in2shop promos. >ith initial ; funding of about "s 0.0 crore) the online store recently mopped up another "s (0 crore with second round funding from +enture capitalist >ith a registered customer base that is likely to grow) the store is confident about re+enue flow) and ;aitheeswaran says abmart hopes to break e+en by its third year when it epects business turno+er to touch "s ,0 crore.
$ jewelers store was launched recently) while a grocery shop is on the an+il) with the ultimate aim to emerge as a focused +irtual superstore. The jewellery store) which went online in Nune with about 0)=== items) targets the impulsi+e buyer. $nd jewelers transactions are epected to dri+e up the a+erage +alue of an online transaction. The grocery shop will attract online customers for need2based purchases. abmart-s aim is to
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achie+e a mi in customer demographic profile R with both impulsi+e and need2based consumers. abmart would also need to gear up for competition from players such as
>ith a customer base of o+er (0)===) abmart hopes not too many will switch loyalties. The e2tailer hopes to consolidate further in the time that competitors will take to adapt to the dynamics of the %et business.
04
GRAPHICAL DATA INTERPRETATIONS
Illustration 7 I @ow frequently the consumers use the internetJ
Daily; 24% occasionaly; 39%
Frequently; 37%
Inter;retation
rom the chart it is clear that *8C respondents use internet occasionally.(,C of respondents use internet daily. finally *4C of respondents use internet frequently. Anal6sis *8CU0=S18.0V18 respondents use internet occasionally. (,CU0=S1( respondents use internet daily. *4CU0=S17.0V17 respondents use internet frequently.
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Illustration 7* or which purpose consumers use the internet.
Column1
Professional; 51%
Personal; 49%
Illustration
01C of respondents use internet for professional use and ,8C of consumer use for personal use. Anal6sis
01CU0=S(0.0V(0 respondents use for professional purpose. ,8CU0=S(,.0V(, respondents use for personal use.
08
Illustration7? >hat among these websites the consumers +isit the mostJ
Fa&art; 3!% Redi.co; 4!%
c2"#$unaa; 3!%
Illustration
*=C of respondents are in fa+our of abmart)while ,=C suggested "ediff.com and *=C for (>?@ungama. Anal6sis
*=C =f 0=S10 respondents for abmart) ,=C of 0=S(= respondents go in fa+or of "ediff.com)while *=Cof0= 210 in fa+or of (>?@ungama.
6=
Illustration7@ >hich website is most user2friendlyJ
Fa&art; 3!% Redi.co; 4!%
c2'#$unaa; 3!%
Illustration
*(C customer considers that abmart is userfriendly) and ,(C customer considers that "ediff.com is user friendly) and (6C customer considers that (>?@ungama is user2 friendly. Anal6sis
*(CU0=S16 respondent go for abmart) and ,(CU0=S(1 respondent go for "ediff.com) and (6CU0=S1* respondent go for (>?@ungama.
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Illustration >hich web site pro+ide speedy transactionJ
Fa&art; 3!% Redi.co; 4!%
c2'#$unaa; 3!%
Illustration ,=C respondents suggest that "ediff.com pro+ide speedy transactions)while *=C each for abmart and (>?@ungama respecti+ely.
Anal6sis7 ,=Cof 0=S(= respondents for "ediff.com. *=Cof 0=S10 respondents for(>?@ungama. *=C=f 0=S10 respondents for abmart.
6(
Illustration >hat is satisfaction le+el of "ediff.comJ
35% 3!% 25% 2!% 15% 1!% 5% !%
()cellent
*ery +ood
+ood
,atisfactory
Poor
Inter;retation7
*0C rate it ecellent)(0C rate it +erygood)(=C rate it good)10 C rate it satisfactory and 0C rate it poor.
Anal6sis7
*0 C of 0=S 14.0V14 respondents for ecellent) (0C of 0= i.e. 1(.0V1( for +ery good)(=C of 0= i.e.1= for good)10Cof 0= S4.0V4 for satisfactory)0Cof 0=S(.0V( for poor category.
Illustration 8
6*
>hat is the satisfaction le+el of abmartJ
3!% 25%
2!% 15% 1!%
5% !%
()cellent
*ery +ood
+ood
,atisfactory
Poor
Illustration7
(=C rate it ecellent.(0Crate it +erygood)10C rate it good)*=C rate it satisfactory)1=C rate it poor. Anal6sis7 (=Cof 0=S1= respondents)10Cof 0=S4.0V4respondents)*=Cof 0=S10 respondents)1=Cof 0=S0 respondents)(0Cof 0=S1(.0 V1( respondents.
6,
Illustration G >hat is the satisfaction le+el of (>?@ungamaJ
45% 4!% 35% 3!% 25% 2!% 15% 1!% 5% !%
e)cellent
-ery ood
ood
satisfactory
oor
Illustration
10C of respondents rate it ecellent ) ,=C rate it ;ery good ) (=C rate it good ) 1=C rate it satisfactory ) while 10C rate it poor. Anal6sis
10CU0=S4.0V4 respondents for ecellence. ,=CU0=S(= respondents for +ery good. (=CU0=S1= respondents for good. 1=CU0=S0 respondents for satisfactory. 10CU0=S4.0V4 respondents for poor.
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.0%%E.TI"!. + RECC"ME!DATI"!. REC"MME!DATI"!. The 'ollowing are a 'ew things an internet marketer )an do to maimi:e the ;otential o' his we-site/ 7 →
Domain Fault Re;air R This function directs the web +isitor to the right site after
she/he potentially may ha+e typed in the wrong 'nternet address. →
.ite Customi:ation/ 2 &ne of the web2based " most important ad+antages is the
+olume of information a+ailable to the browsing customer. 3nfortunately) the sheer +olume of information can be one of the weaknesses of web2based " design. hen properly customiable on the first +isit) the customer on a net entry can choose to see only his/her own preferences. A#ample: yahoo.comH my yahooB →
Alternative Channels R Different ways to contact the company are offered) for
instance) #mail) a toll2free numbers) ostal $ddress) all back button and ;oice o+er '. →
$o)al .ear)h Engine R $llows the +isitor to search on key words to quickly locate
specific answers on the website. →
Mem-ershi; R The +isitor can request a password. >ith this password he can
continue surfing on password protected web pa ges within the website. →
Mailing $ist R To recei+e more information) the +isitor can add his/her email address
to a list to recei+e automated emails. .ite tour R The +isitor can follow a tour through the website. →
.ite Ma; R This is a hierarchical diagram of the pages on the website) also called a
site o+er+iew) site inde) or site map. →
Introdu)tion 'or First7Time 0sers R ;isitors) who enter the site for the first time)
can surf to an introduction page. This page contains information about O@ow to use the site most efficientlyP
66
→
Chat R $ main ad+antage of the 'nternet is its self2generating ad+antage. 9y allowing
+isitors to interact with each other and with the site) they create content for the site. $ll this will help build a relationship with the customer and it will ultimately help the marketer to achie+e his objecti+es. 'nternet has opened up new a+enues for reaching the consumer. 't is true that there is ne+er a fied way or strategy that a marketer can use to market its products and ser+ices on the internet but it is still +ery much an arena where creati+e thinking can take the company reach new heights. Thus we can say that marketing has not changed its shape. 't is the same) unpredictable) unusual and creati+e field that needs constant change and open inputs that can work wonders for the company.
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ADVANTAGES OF INTERNET MARKETING 'nternet arketing is a hot topic especially in these days of instant results. The reason why i2marketing has become so popular is because they pro+ide three major benefits to potential buyers: 2(
Convenien)e/ ustomers can order products (, hours a day where+er they are.
They don-t ha+e to sit in traffic) and a parking space) and walk through countless shops to find and eamine goods. *(
In'ormation/ ustomers can find reams of comparati+e information about
companies) products) competitors) and prices without lea+ing their office or home. ?(
Fewer hassles/ ustomers don-t ha+e to face salespeople or open themsel+es up
to persuasion and emotional factorsH they also don-t ha+e to wait in line.
Internet Marketing also ;rovides a num-er o' -ene'its to marketers/ 2( 4ui)k adHustments to market )onditions/ ompanies can quickly add products
to their offering and change prices and descriptions. *( $ower )osts/ &n2line marketers a+oid the epense of maintaining a store and the
costs of rent) insurance) and utilities. They can produce digital catalogs for much less than the cost of printing and mailing paper catalogs. ?( Relationshi; -uilding/ &n2line marketers can dialogue with consumers and learn
from them. @( Audien)e si:ing/ arketers can learn how many people +isited their on2line site
and how many stopped at particular places on the site. This information can help impro+e offers and ads.
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C"!C$0.I"! 't is concluded that the marketers are adding on2line channels to find) reach) communicate) and sell. '2marketing has at least fi+e great ad+antages. irst) both small and large firms can afford it.
The 'nternet is a powerful tool for strengthening relationships. 9y offering customers content and time +alue) #2arketing has opened new +istas for marketers. The greatest feature of the digital economy is that it enables the #2arketer to eradicate man traditional barriers before entering new markets. These barriers include economies of scale and geographic positioning. The innate strength of an #2arket comes not from the seamless flows of goods and ser+ices from the producer to the customer but in the geometrically increasing returns from con+erging ideas and technological change the strength of online communities has ne+er been so great) and companies ha+e used them to de+elop new markets. %otice how Einu distributed free on the %et has been able to build up a faithful customer base. 3ltimately here also the marketer has to realie that nothing sells as well as a good product. 9ut the beauty of the 'nternet is that it offers constant opportunities for product enhancement based on continuous customer feedback. ompanies who ha+e tuned their business processes to incorporate these customer responses ha+e been able to le+erage the power of the >eb to gain competiti+e ad+antage.
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/0/0+RP$ B"". •
arketing anagement R hilip Fotler
•
&nline arketing 2 $ ustomer Eead $pproach 2 9y. "ichard !ay / E.%. harlesworth ? "ita #sen.
•
The &nline ustomers: %ew Data ining and arketing $pproaches 2
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arketing "esearch 2 9 y .". Fothari) ;ikas ublications.
9y Linghui Lang.
#EB.ITE. •
www.consumerbeha+iour2online.com
•
www.onlineconsumers.com
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www.web2onlineconsumers.org
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www.domain2b.com
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www.rediff.com
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www.hungama.com
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www.fabmart.com
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www.ticworks.com .
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www.yahoo.com
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www.alta+ista.com
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www.kuldeeponline.com
•
www.google.com
•
www.sur+eys.com
4=
40E.TI"!!AIRE
2( @ow frequently you use the internetJ
$. Daily 9. requently . &ccasionally *( or which purpose you use internet moreJ
$. ersonal use 9. &fficial purpose ?( >hich among these websites do you +isit the most for online transactionsJ
$. "ediff.com 9. (>?@ungama . abmart @( >hich website is most user friendlyJ
$. "ediff.com 9. (>?@ungama . abmart ( >hich website pro+ides speedy transactionsJ
$. "ediff.com 9. (>?@ungama . abmart
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