©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Chapter 17 Electronic Marketing: Internet Marketing, Database Marketing and Direct Marketing

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens “Computers in the future may weigh no more than 1.5 tons.” - Popular Mechanics, 1949 ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Chapter Objectives Describe the relationship between Internet marketing, database marketing, and direct marketing Evaluate a company’s Web site and comment on its marketing potential ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Chapter Objectives Describe how to set up an effective database Discuss the growth of marketing Understand how databases can be used to develop direct marketing campaigns ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Major Forces Shaping the Internet Age Digitalization and Connectivity The Internet Explosion New Types of Intermediaries Customization ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Digitalization and Connectivity Digitalization consists of converting text, data, sound, and image into a stream of bits that can be dispatched at incredible speeds from one location to another Connectivity involves building networks and expresses the fact that much of the world’s business is carried over networks connecting people and companies ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Types of Networks Intranets connect people within a company Extranets connect a company with its suppliers and customers The Internet connect users to an amazingly large “information superhighway.” ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens The Internet Explosion Useful as a sales outlet and it provides a medium for communication between a company and its customers The number of Web surfers worldwide has reached 1 billion and is expected to approach 1.5 billion by 2007 ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens New Types of Intermediaries With the birth of dot-com sites such as Expedia.com, Priceline.com, and Travelocity.com the hospitality industry has had to change how they do business ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Customization Technology has been useful in assisting companies in understanding their customers and potential customers on an individual level and developing marketing to their specific wants. ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens E-Business, E-Commerce & E-Marketing E-business involves the use of electronic platforms to conduct a company‘s business E-commerce involves buying and selling processes supported by electronic means, primarily the Internet E-marketing is company efforts to communicate about, promote, and sell products and other services over the Intranet ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Benefits to Buyers Convenient Easy and private Greater product access and selection Offers comparative information Immediate and interactive ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Benefits to Sellers Builds customer relationships Reduces costs Quick and efficient Reduces communication costs ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens E-Commerce Domains B2C (business to consumer) B2B (business to business) C2B (consumer to business) C2C (consumer to consumer) ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Types of Web Sites Corporate Web Sites are designed to build customer goodwill and to supplement other sales channels Marketing Web Sites engage consumers in an interaction that will move them closer to a direct purchase or other marketing outcome ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Designing Attractive Web Sites The key is to create enough value and excitement to get consumers to come to the site, stick around, and come back again ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Content Convey what the company is and what the company has to offer Project brand image Easy to navigate Attractive Have a “contact us” page Ask permission to send information on specials Able to purchase products online ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Legal and Ethical Issues Online Privacy and Security –Online privacy is perhaps the number-one e-commerce concern –Identification theft and commercial espionage are security fears of consumers and companies alike ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Marketing Database System A marketing database is an organized collection of data about individual customers, prospects, or suspects that is accessible and actionable for such marketing purposes as lead generation, lead qualification, sale of a product or service, or maintenance of customer relationships ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Using a Database to Create a Competitive Advantage Provide the guest with a better experience –If on a prior visit a guest requests a certain type of mineral water, the mineral water is placed in the guest’s refrigerator on returning visits –If a guest had a problem, all departments in the hotel are notified, and everyone works to regain the guest’s confidence and loyalty ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Direct Marketing Direct marketing is an interactive system of marketing that uses one or more advertising media to affect a measurable response and/or transaction at any location ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Reasons for Growth of Direct Marketing Precision targeting Personalization Privacy Immediate results Measurability ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens The greeting should be personalized and other persons being sent the same message should not be listed The name of the company should be identified The subject needs to be relevant to the reader s need to be short Text message is the preferred format ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Direct Marketing Builds Relationships Direct marketing allows companies to develop a strong relationship with their customers, which helps prevent them from switching to competitors It costs four to seven times as much to bring in a new customer as it does to maintain an existing one ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Integrated Direct Marketing A more powerful approach: execute a multiple-vehicle, multiple-stage campaign Paid Ad with a Response Channel Direct Mail Mechanism Outbound Tele- marketing Face-to-Face Sales Call ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Best Practices Huli Tribe, Papua New Guinea Saunders Hotel Group Vail Associates, Brennan’s of Houston Royal Caribbean Cruise Lines ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Key Terms E-commerce: –B2B (business to business) –B2C (business to consumer) –C2B (consumer to business) –C2C (consumer to consumer) ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Key Terms Corporate Web site Customer database Data warehouse Direct-mail marketing ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Key Terms Direct marketing Disintermediation E-business E-commerce ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Key Terms E-marketing Extranet Integrated direct marketing Internet ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens Key Terms Intranet Marketing Web site ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ Kotler, Bowen, and Makens