1. Copyright © 2004 Pearson Education, Inc. Slide 8-1 Chapter 8 EC Marketing Communications modified 2007 - jmd E-commerce Marketing Communications

2. Copyright © 2004 Pearson Education, Inc. Slide 8-2 Learning Objectives major forms of online marketing Understand the costs and benefits Ways to use a Web as a marketing communications tool

3. Copyright © 2004 Pearson Education, Inc. Slide 8-3 ESPN Motion: TV Ads to the Internet ESPN Motion: Leading-edge multimedia form of advertising System sends packets of video at slow bit rate; when entire video has been downloaded, it is playable Enables delivery of very high quality video over Internet Also delivers 15-20 second advertising clips either before or after video Higher quality than streaming video, causes less Internet congestion http://www.imediaconnection.com/content/1163.asp See it: http://espn.go.com/motion/download.htmlhttp://espn.go.com/motion/download.html

4. Copyright © 2004 Pearson Education, Inc. Slide 8-4 ESPN Motion: TV Ads to the Internet Page 441

5. Copyright © 2004 Pearson Education, Inc. Slide 8-5 Marketing Communications create strong brand expectations Promotional sales communications: Suggest consumer “buy now” and make offers to encourage immediate purchase Branding communications: Focus on extolling differentiable benefits of consuming product or service

6. Copyright © 2004 Pearson Education, Inc. Slide 8-6 Online Advertising Advantages:  Ability to target ads to narrow segments and track performance in almost real time  Provide greater opportunity for interactivity Disadvantages:  Concerns about cost versus benefit  Concerns about how to adequately measure results

7. Copyright © 2004 Pearson Education, Inc. Slide 8-7 Forms of Online Advertisements 1. Banners, pop-ups and rich media ads (These can have sponsorship and affiliate relationships.) 2. Website for Marketing: Search engine marketing: Paid search engine inclusion and placement

8. Copyright © 2004 Pearson Education, Inc. Slide 8-8 Banners, Pop-ups and Rich Media Ads Banners: Display promotional message in a rectangular box at top or bottom of computer screen Pop-ups: Appear on screen without user calling for them Pop-unders: Open underneath user’s active browser window and do not appear until user closes active window Rich media ads: Employ Flash, DHTML, Java, streaming audio and/or video Interstitials: Provide way of placing a full-page message between current and destination pages of user Superstitials: Rich media ad that is pre- loaded into browser’s cache and does not play until fully loaded and user clicks to another page What types of ads does the ESPN site use?

9. Copyright © 2004 Pearson Education, Inc. Slide 8-9 Online Advertising Placement Methods Banner swapping: Arrangements among firms allow each firm to have its banners displayed on other affiliate sites for no cost Banner exchanges: Arrange for banner swapping among firms Advertising networks: Act as brokers between advertisers and publishers, placing ads and tracking all activity related to the ad

10. Copyright © 2004 Pearson Education, Inc. Slide 8-10 Search Engine Marketing: Paid Search Engine Inclusion and Placement Search engine marketing one of fastest growing and most effective forms of online marketing communications Paid inclusion – firms pay for inclusion in search engine index Paid placement – firms pay for a guarantee that it will appear prominently in results of relevant searches Overture.com and Google leaders in this technology

11. Copyright © 2004 Pearson Education, Inc. Slide 8-11 Search Engine Policies on Paid Placement and Inclusion Table 8.2, Page 453

12. Copyright © 2004 Pearson Education, Inc. Slide 8-12 Sponsorships and Affiliate Marketing Sponsorship: Paid effort to tie an advertiser’s name to particular information, event, venue in way that reinforces brand in a positive, yet not overtly commercial manner  Advertorial a common form Affiliate relationship: Permits a firm to put its logo or banner ad on another firm’s Web site from which users of that site can click through to the affiliate’s site  Sometimes called tenancy deals  Amazon/ToysRUs an example  Customer hijacking an issue

13. Copyright © 2004 Pearson Education, Inc. Slide 8-13 Direct E-mail Marketing and the Spam Explosion Direct e-mail marketing: E-mail marketing messages sent directly to interested consumers who “opt-in” or have not “opted-out” Spam: Unsolicited commercial e-mail  Spam is exploding out of control – March 2003, 45% of all Internet e-mail purportedly was spam  Efforts to control spam:  Filtering software (only partly effective)  Self-regulation by industry (ineffective)  Government regulation (no legislation yet)

14. Copyright © 2004 Pearson Education, Inc. Slide 8-14 Spam Categories Figure 8.6, Page 459

15. Copyright © 2004 Pearson Education, Inc. Slide 8-15 Spam at HiM: Type of Spam Ref.: 80-20 rule study by Kristian Kristoffersen (2004)

16. Copyright © 2004 Pearson Education, Inc. Slide 8-16 Spam at HiM: Source of Spam Ref.: 80-20 rule study by Kristian Kristoffersen (2004)

17. Copyright © 2004 Pearson Education, Inc. Slide 8-17 Other Forms of Online Marketing Communications Online catalog: Provide equivalent of paper- based catalog Online chat: Provides equivalent of help from sales representative Public relations: Involves communicating with target audiences, or publics, using methods other than advertising

18. Copyright © 2004 Pearson Education, Inc. Slide 8-18 Beval’s Online Catalog Figure 8.8, Page 461

19. Copyright © 2004 Pearson Education, Inc. Slide 8-19 Mix Online and Offline Marketing Figure 8.9, Page 463

20. Copyright © 2004 Pearson Education, Inc. Slide 8-20 Insight on Business: The Very Rich are Different From You and Me: Neiman Marcus, Nordstrom and Tiffany & Co. Online luxury retailers have had a difficult time translating their brands and look and feel of luxury shops into Web site that masses will see Cases in point: Nieman Marcus /Kate Spade and John Hardy Web site boutiques; TiffanyNieman Marcus Tiffany In contrast, Nordstrom seems to have found right mixNordstrom

21. Copyright © 2004 Pearson Education, Inc. Slide 8-21 Marketing Metrics Lexicon Table 8.3, Page 467

22. Copyright © 2004 Pearson Education, Inc. Slide 8-22 An Online Consumer Purchasing Model Figure 8.10, Page 470 – Do Project Question 1. page 495.

23. Copyright © 2004 Pearson Education, Inc. Slide 8-23 Web Site Activity Analysis Figure 8.13, Page 475

24. Copyright © 2004 Pearson Education, Inc. Slide 8-24 How well does online advertising work? Table 8.4 – p.474 – how they use tracking data. Table 8.5 very low click-through rates. Figure 8.12 – click-through rates decline over 6 year study. E-mail is still highest. Table 8.6 – ROI is highest for telephone, e-mail, other-mail, …respectively. Table 8.13 – JC Penny customers that use multiple channels spend much more money than other customers.

25. Copyright © 2004 Pearson Education, Inc. Slide 8-25 Clickthrough Rates by Format Figure 8.12, Page 472

26. Copyright © 2004 Pearson Education, Inc. Slide 8-26 Forms of Online Advertisements 1. Banners, pop-ups and rich media ads 2. Web Site for Marketing: Search engine marketing: Paid search engine inclusion and placement - this is more important – more holistic approach…

27. Copyright © 2004 Pearson Education, Inc. Slide 8-27 Web Site as Marketing Communications Tool Web site can be viewed as an extended online advertisement Domain name: First communication an e-commerce site has with a prospective customer Search engine optimization:  Register with as many search engines as possible  Keywords have been abused – have appropriate words in the Sports Management  Page-In Links get you positioned higher. Link site to as many other sites as possible.  http://en.wikipedia.org/wiki/PageRank http://en.wikipedia.org/wiki/PageRank  In early 2005, Google implemented a new value, "nofollow", for the rel attribute of HTML link and anchor elements, so that website builders and bloggers can make links that Google will not consider for the purposes of PageRank — they are links that no longer constitute a "vote" in the PageRank system. The nofollow relationship was added in an attempt to help combat spamdexing. rel

28. Copyright © 2004 Pearson Education, Inc. Slide 8-28 Spamdexing – to obtain higher page ranking Keyword stuffing: placement of keywords within a page to raise the keyword count, variety, and density of the page. Older versions of indexing programs simply counted how often a keyword appeared, and used that to determine relevance levels. Most search engines can now determine whether the frequency is consistent with other sites created specifically to attract search engine traffic. Meta tag stuffing: Repeating keywords in the Meta tags, and using keywords that are unrelated to the site's content, believed to be ineffective as of 2005 onwards. "Gateway" or doorway pages: Creating low-quality web pages that contain very little content but are instead stuffed with very similar key words and phrases. They are designed to rank highly within the search results, but serve no purpose to visitors looking for information. A doorway page will generally have "click here to enter" in the middle of it. Scraper sites: Scraper sites, also known as Made for AdSense sites, are created using various programs designed to 'scrape' search engine results pages or other sources of content and create 'content' for a website. The specific presentation of content on these sites is unique, but is merely an amalgamation of content taken from other sources, often without permission. These types of websites are generally full of advertising, or redirect the user to other sites.

29. Copyright © 2004 Pearson Education, Inc. Slide 8-29 Web Site Functionality – a face to your business Factors affecting effectiveness of a software interface: 1. Utility 2. Ease of use Factors in credibility of Web sites: 1. Design look 2. Information design/structure 3. Information focus 4. Responsiveness  Visit the JC Penny website: http://www.jcpenney.com/jcp/default.aspxhttp://www.jcpenney.com/jcp/default.aspx  How would you rate this site on the above factors?  What web features do they have to support customers?  What marketing tools do they use on the website?  Which of these do you think is more effective in generating sales?

30. Copyright © 2004 Pearson Education, Inc. Slide 8-30 Factors in the Credibility of Web Sites Table 8.14, Page 480

31. Copyright © 2004 Pearson Education, Inc. Slide 8-31 Site Design Features that Impact Online Purchasing Table 8.8, Page 482

32. Copyright © 2004 Pearson Education, Inc. Slide 8-32 Case Study: Adware, Spyware, Ad Bombs, Ambush Marketing, Customer Hijacking (p488) Ad bomb (Ad-ware): Any computer program that is surreptitiously downloaded on a client computer for the purpose of calling for unwanted advertising without the user’s consent or intervention Ambush advertising: Gator.com’s mini-billboard Customer hijacking: self-executing programs downloaded onto client computers that permit a company to “hijack” customers of affiliate marketing sites, and redirect affiliate commission to hijacker Visit http://www.netrn.net/spywareblog/. According to this page, what are some effective approaches for opposing spyware?http://www.netrn.net/spywareblog/