Lecture 5 Title: Marketing an E-Business

1. By: Mr Hashem Alaidaros MIS 326 Lecture 5Title: Marketing an E-Business

2. Main points • Introduction to Marketing • eMarketing Methods • Advantages of Online Marketing • Search engines • SEO • SEM • Online Advertising • Affiliate Marketing • How it works • How do affiliates promote merchants • Different types of commissions • Affiliate tracking - Cookie • Affiliate Network

3. Marketing • Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to satisfy customers • Marketing is more than sales; it is those set of activities that • Grabs a potential customer • Encourages them to buy your product • Actually gets them to purchase your product • Makes them a repeat customer

4. Brand • The first step in any e-Marketing strategy is to create a brand, the message that the company draws in everything it does. • It is important to promote your Web site on your Web site. This can be achieved through: • The domain name; use the company’s name • Negotiate reciprocal links, i.e. other Web sites linking to your site

5. Web Site Naming • People with established brands want to name their Web site after their brand • Companies other buy more than one domain name, just in case the person misspells it (e.g. Yahoo.com owns Yahow.com) • In some cases the Web site domain is owned by some one else (e.g. virginatlantic.com -> viginatlantic.com) • Domain names can be expensive, e.g. Altavista.com cost $3.3 million

6. Web Market Segmentation • The design of the site can immediate appeal to different market segments, for example: • For the young fashion-conscious buyer you may have a site with a wide variety of typefaces, bold graphics and bright color product photos • For the older more established buyer you may have a more muted conservative style

7. Web Market Segmentation • Companies can offer a form of one-to-one Marketing by allowing customers to customize the retailer’s Web site • One example of this is Dell.com • Offers each customer its own Web site • Allows individual employees of its customers to create their own personalized pages

8. How to e-Market a web site? • Several methods of promotion are in use today: • Banner ads • Pop-up ads • Email Marketing • Affiliate Marketing • Viral Marketing • Search engines and directories • Blogging and Podcasting

9. Cont. • Traditional media: • local newspapers, • radio programs and • mass mailing campaigns

10. 1. Banner Ads • Most Web advertising uses banner ads • It is a small rectangular object normally at the top of the Web page which displays stationary or moving graphics • These ads are created using animated GIFs, or objects created in Shockwave, Java or Flash

11. Cont. Pay a site to display the banner ad • Use a banner advertising network who acts as brokers between advertisers and Web sites that carry ads • They often broker space on large Web site like Yahoo, which has high traffic volumes and are therefore expensive Measuring Cost for Ads • Cost per thousand clicks (CPM) • The cost per one thousand clicks may range from $1 to $50.

12. 2. Pop-Up ads • The pop-up ad is an ad that appears in its own window when the user opens or closes a page • The pop-behind ad is a pop-up ad that is behind the existing browser window • Ad-blocking software prevents these ads from displaying

13. 3. E-Mail Marketing • Internet Mailing List: • A group of people with similar interests who discuss their favorite topics via email • Some of the ways that email has been used for Marketing are: • Permission Marketing is the sending of emails to people who request further information on a product or service (for example) • Combining content (e.g. articles or news stories that are of interest to the target market) with advertising messages

14. Cont. • A mass email promotion to an untargeted list is called spam and is disapproved by the online community • Email marketing is very cost effective and with good results, i.e. 5-15% response rate • What is different between Junk and spam mail?

15. 4. Affiliate Marketing • In affiliate Marketing a Company’s Web site includes products or services offered for sale by another company in exchange for a commission • Example: • Amazon.com has over 800,000 affiliate sites

16. 5. Viral Marketing • Viral Marketers rely on non-customers being told about products or services by existing customers • An example of a viral Marketing campaign is Blue Mountain Arts • When an electronic greeting card is sent to a person, a link to Blue Mountain is included which they click on to read the card; they are now more likely to send a card themselves

17. 6. Search Engine • Search-engine ad: an advertisement tied to a specific keywords in a search engine. • When selected keywords are typed in a search box, an appropriate ad is displayed.

18. 7. Blogging and podcast • Blog: Short for web log. • It is an online digital diary or forum where text, photos, video, and other material can be posted and made available to the public. • Podcast: A recorded audio program available online for download in a file format that can be easily transferred to an MP3 player

19. Benefits of online marketing

20. Other Benefits of Online Marketing • Speed of launching advertising campaigns. Advertising banners or textlinks can be created quickly and placed on websites within hours. Compare this to creating a magazine, radio or television ad which could cost thousands and take weeks to create. This also allows you to change messages on the fly if you need to. Try doing that on TV or Print • Tracking. Advertising campaign performance can be tracked with such precision that one can see exactly how many people are viewing your ad, responding to it and ultimately buying your product. This information can be viewed on an hourly basis if needed. Advertising messages can also be delivered based on website visitor preferences or behavior.

21. e-Business, e-Commerce, and e-Marketing in the Internet Age e-Business Involves the Use of Intranets, Extranets & the Internet to Conduct a Company’s Business e-Commerce Involves Buying & Selling Processes Supported by Electronic Means E-Marketing “e-selling” side of e-commerce

22. Search Engines

23. Search Engines

24. Introduction • A search engine helps users find the things they're looking for online. • The user types a word or phrase, called a query, into the search engine, which then displays a set of results that are relevant to the query. • Most search engines provide two types of results listings in response to the same user query: • organic (also called "natural" or "free") listings, and • paid listings (i.e., advertisements and adwords)

26. How search engines rank the results? • Most search engines rank the results within each type of listing • in other words, they determine in what order to show the listings on the results page -- according to how relevant the result is to the user's query, with the most relevant appearing at the top of the page. • Each search engine calculates relevancy in a different way for each type of result (organic and paid). This is one of the main differences between one search engine and another, and it's a factor in many users' decisions about which search engine to use.

27. Search engine optimization • Search engine optimization (SEO) involves building new websites, or changing existing websites, so that they rank highly in a search engine's organic listings when users search on terms that are related to the site's content.

28. Search engine marketing • Search engine marketing (SEM) is the process of promoting and marketing a website through paid listings (advertisements) on search engines.  • In order to create an ad for a given search engine, you need to create an account with the advertising product or branch of that search engine. • For Google, this product is AdWords. • After creating an account, you then create your ad and enter a list of user search queries -- called "keywords" -- that can trigger your ad to be shown.

29. Cont. • Ads on most search engines operate on some common pricing models: • pay-per-click (PPC) model, meaning that you pay only when a user clicks your ad, and not for the ad impression (the instance in which the ad appears on the page). • cost-per-thousand impressions (CPM), in which you pay per impression, not for any clicks on your ad. • Cost-per-action. How? • ?????

30. How Online Advertising Works • Although SEM refers to placing ads just on search engines, online advertising as a whole is much broader. • The possibilities of online advertising include placing ads on nearly any type of website or page a user might browse, such as news, blogs, reviews, entertainment, online magazines, and marketplaces.

31. Cont. • Ads on online advertising can be in a number of formats, such as basic text ads, graphical image ads in a variety of sizes, audio streams, or interactive and video ads. • You can also choose many different targeting options for your ads: whether defining the user's device (a computer or a mobile phone) you'd like your ad to show on, or specifying the user's location, language, or demographic.

32. Online advertising goal • Online advertising goals generally fall into one of two categories: • direct response or • branding

33. Direct response • If your goal is direct response, you'd like a user to perform an action after clicking through your ad to your website: make a purchase, sign up to a newsletter, or request a quote, for instance. The completion of your desired action by the user is called a conversion • To manage your online advertising strategy and costs, it's useful to define a cost-per-acquisition (CPA) that you'd like to achieve per conversion. You'll then be able to monitor the performance of your ads to ensure that they're meeting your CPA goals.

34. Branding • If your advertising goal is branding, your main reason for advertising online is to raise awareness and visibility of your product, service, or cause. • To achieve this, you'll want to aim to place your ads in front of as many people as possible within your target audience

35. Affiliate Marketing

36. What is Affiliate Marketing? • Affiliate marketing: is a marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate's marketing efforts.

37. How it works • An affiliate refers potential customers to a merchant's website • Some of those customers performs a desired action • The merchant rewards the affiliate for each desired action resulting from the affiliate’s referral

38. How do affiliates promote merchants? • The basic aim of an affiliate is to send targeted traffic (that means customers who are very likely to perform the desired action) to a particular merchant’s web site. • Affiliates may promote as many merchants in as many industries with as many tactics as they wish, but usually affiliates will start to specialize.

39. Cont. • Affiliates use a number of means to promote merchants. These include: • Personal web sites, • Content and niche sites, • Email lists, • Loyalty sites (points or cash back or charitable donations), • Coupon and promotions sites, • Comparison shopping (see also PPC advertising), and • Search affiliates (search arbitrage)

40. Different type of Commissions • There are different types of commission, based on the merchant’s industry: • CPA: Cost per Action. Paid when a certain action is performed by a user. • Revenue Share: Commission structure where the affiliate earns a percentage of a sale. • CPC: Cost per Click. Paid when a link is clicked upon.

41. Tracking • The most essential element to affiliate marketing is tracking. • Tracking software places a cookie on a user’s browser when that user clicks on an affiliate link. Affiliate tracking software collects information even if no action is completed. • This is vital to the affiliates and to the merchants to see where they can optimize their campaign. Information collected includes: • Impressions • Clicks • Conversions

42. Cookies • A cookie is a small text file that is sent to your computer via your web browser when you visit some websites. • These cookies are used to store information about you for the next time you visit that site - information like where you went on the site and what you did. • Cookie files are a great way for a website to remember you when you next visit, but if you want to surf the net without worrying about your privacy or security being threatened, you might want to stop them being sent.

43. Cookies What they do? Cookies have a variety of different functions: • remembering purchasing information • recording your viewing preferences • storing scores for online quizzes. • All of which can be useful if you repeatedly visit the same sites time and again. • A cookie from a particular website will sit on the hard drive of your computer and wait until the next time you visit that site.

44. Affiliate Networks • As well as the affiliate and the merchant, there is a generally a very important third party in the affiliate marketing mix – the affiliate network. • Affiliate networks are often used as an intermediary between affiliates and merchants. • Affiliate networks provide tracking solutions, reporting and support to both affiliates and merchants.

45. Affiliate Networks