1. Day 10 ELC 310

2. Copyright 2005 Prentice HallCh 1 -2 Agenda Questions? Assignment 1 Corrected – Some issues Assignment 2 posted. – ELC 310 assignment Two.docx ELC 310 assignment Two.docx – Internal Data  J.R. Bjerklie, Associate Director for Institutional Research http://www.umfk.edu/ie/stabstract/default.cfm?ref=6# – Due Oct 18 E-Marketing Research con’t Connected consumers online

3. E-Marketing/7E Chapter 6 E-Marketing Research

4. Chapter 6 Objectives After reading Chapter 6, you will be able to: – Identify the three main sources of data that e-marketers use to address research problems. – Discuss how and why e-marketers need to check the quality of research data gathered online. – Explain why the internet is used as a contact method for primary research and describe the main internet-based approaches to primary research. 6-4 ©2014 Pearson Education, Inc. publishing as Prentice Hall

5. Chapter 6 Objectives, cont. – Describe several ways to monitor the Web for gathering desired information. – Contrast client-side, server-side, and real- space approaches to data collection. – Explain the concepts of big data and cloud computing. – Highlight four important methods of analysis that e-marketers can apply to information in the data warehouse. 6-5 ©2014 Pearson Education, Inc. publishing as Prentice Hall

6. Nestlé Purina PetCare wanted to know whether their Web sites and online advertising increased off-line behavior. Nestlé Purina developed 3 research questions: – Are our buyers using our branded Web sites? – Should we invest beyond these branded Web sites in online advertising? – If so, where do we place the advertising? The Purina Story 6-6 ©2014 Pearson Education, Inc. publishing as Prentice Hall

7. The Purina Story, cont. Online and offline shopping panel data revealed: – Banner click-through rate was low (0.06%). – 31% of subjects exposed to Purina ads mentioned the Purina brand compared with 22% of the no-exposure subjects. – Home/health and living sites received the most visits from their customers. The information helped the firm decide where to place banner ads. 6-7 ©2014 Pearson Education, Inc. publishing as Prentice Hall

8. Data Drive Strategy U.S. marketers spend $6.7B annually on marketing research; global spend is $18.9B. E-marketers can generate a great deal of data by using surveys, Web analytics, secondary data, social media conversations, etc. Marketing insight occurs somewhere between information and knowledge. – Data without insight or application to inform marketing strategy are worthless. 6-8 ©2014 Pearson Education, Inc. publishing as Prentice Hall

9. Big Data Big data refers to huge data sets that are difficult to manage and analyze. 31% of marketers would like to collect Web data daily. 74% collect demographic data; 64% collect transaction data; 35% monitor social media. Purina, for example, sorts through hundreds of millions of pieces of data from about 21.5 million consumers to make marketing decisions. 6-9 ©2014 Pearson Education, Inc. publishing as Prentice Hall

10. From Data to Decision: Nestlé Purina 6-10 ©2014 Pearson Education, Inc. publishing as Prentice Hall

11. Knowledge management is the process of managing the creation, use, and dissemination of knowledge. Data, information, and knowledge are shared with internal decision makers, partners, channel members, and sometimes customers. A marketing knowledge database includes data about customers, prospects and competitors. Marketing Knowledge Management 6-11 ©2014 Pearson Education, Inc. publishing as Prentice Hall

12. The Electronic Marketing Information System A marketing information system (MIS) is the process by which marketers manage knowledge. – Many firms store data in databases and data warehouses, available 24/7 to e-marketers. The internet and other technologies facilitate data collection. – Secondary data provide information about competitors, consumers, the economic environment, technology, etc. – Marketers use the internet and other technologies to collect primary data about consumers. 6-12 ©2014 Pearson Education, Inc. publishing as Prentice Hall

13. Most Common Data-Collection Methods 6-13 ©2014 Pearson Education, Inc. publishing as Prentice Hall

14. Source 1: Internal Records Accounting, finance, production, and marketing personnel collect and analyze data for marketing planning. – Sales data. – Customer characteristics and behavior. – Universal product codes. – Tracking of user movements through Web pages. – Web sites visited before and after the firm’s Web site. 6-14 ©2014 Pearson Education, Inc. publishing as Prentice Hall

15. Source 2: Secondary Data Can be collected more quickly and less expensively than primary data. Secondary data may not meet e-marketer’s information needs. – Data was gathered for a different purpose. – Quality of secondary data may be unknown and data may be old. Marketers continually scan the macroenvironment for threats and opportunities (business intelligence). 6-15 ©2014 Pearson Education, Inc. publishing as Prentice Hall

16. Public & Private Data Sources Publicly generated data – U.S. Patent Office U.S. Patent Office – International Monetary Fund International Monetary Fund – The World Factbook The World Factbook – American Marketing Association American Marketing Association – World Bank World Bank – Federal Reserve Bank Federal Reserve Bank – US census US census Privately generated data – comScore comScore – Forrester Research Forrester Research – Nielsen/NetRatings Nielsen/NetRatings – Interactive Advertising Bureau Interactive Advertising Bureau – Market Research Market Research – Commercial online databases 6-16 ©2014 Pearson Education, Inc. publishing as Prentice Hall

17. Source 3: Primary Data When secondary data are not available, marketers may collect their own information. – Primary data are information gathered for the first time to solve a particular problem. Primary data collection can be enhanced by the internet: – Online experiments – Online focus groups – Online observation – Content analysis – Online survey research 6-17 ©2014 Pearson Education, Inc. publishing as Prentice Hall

18. Primary Research Steps 6-18 ©2014 Pearson Education, Inc. publishing as Prentice Hall

19. Typical Research problems for E-Marketers 6-19 ©2014 Pearson Education, Inc. publishing as Prentice Hall

20. Advantages & Disadvantages of Online Survey Research 6-20 ©2014 Pearson Education, Inc. publishing as Prentice Hall

21. Online Panels Online panels include people who have agreed to be subjects of marketing research. Participants are usually paid and often receive free products. Panels can help combat sampling and response problems, but can be more expensive than traditional methods of sample generation. 6-21 ©2014 Pearson Education, Inc. publishing as Prentice Hall

22. Ethics of Online Research Companies conducting research on the Web often give respondents a gift or fee for participating. Other ethical concerns include: – Respondents are increasingly upset at getting unsolicited e-mail requests for survey participation. – “Harvesting” of e-mail addresses from forums and groups without permission. – “Surveys” used to build a database. – Privacy of user data. 6-22 ©2014 Pearson Education, Inc. publishing as Prentice Hall

23. Other Technology-Enabled Approaches Client-side Data Collection – Cookies. – PC meter with panel of users to track the user clickstream. Server-side Data Collection – Site log software can generate reports on number of users who view each page, location of prior site visited, purchases, etc. – Real-time profiling tracks users’ movements through a Web site. 6-23 ©2014 Pearson Education, Inc. publishing as Prentice Hall

24. Following the Clickstream at FTC.gov 6-24 ©2014 Pearson Education, Inc. publishing as Prentice Hall

25. Real-Space Approaches Data collection occurs at off-line points of purchase and information is stored and used in marketing databases. Real-space techniques include bar code scanners and credit card terminals. Catalina Marketing uses the UPC for promotional purposes at grocery stores. 6-25 ©2014 Pearson Education, Inc. publishing as Prentice Hall

26. Real-space Data Collection & Storage Example 6-26 ©2014 Pearson Education, Inc. publishing as Prentice Hall

27. Marketing Databases & Data Warehouses Product databases hold information about product features, prices, and inventory levels; customer databases hold information about customer characteristics and behaviors. Data warehouses are repositories for the entire organization’s historical data, not just for marketing data. The current trend in data storage is toward cloud computing: a network of online Web servers used to store and manage data. 6-27 ©2014 Pearson Education, Inc. publishing as Prentice Hall

28. Cloud Computing 6-28 ©2014 Pearson Education, Inc. publishing as Prentice Hall Company Web server Tablet computer Mobile phone Computer Remote servers Data content

29. Data Analysis and Distribution Four important types of analysis for marketing decision making include: – Data mining – Customer profiling – RFM (recency, frequency, monetary value) analysis – Report generating 6-29 ©2014 Pearson Education, Inc. publishing as Prentice Hall

30. Knowledge Management Metrics Two metrics are currently in widespread use for online data storage: – ROI: total cost savings divided by total cost of the installation. – Total Cost of Ownership (TCO): includes cost of hardware, software, labor, and cost savings. 6-30 ©2014 Pearson Education, Inc. publishing as Prentice Hall

31. E-Marketing/7E Chapter 7 Connected Consumers Online

32. Chapter 7 Objectives After reading Chapter 7, you will be able to: – Discuss general statistics about the internet population. – Describe the internet exchange process and the technological, social/cultural and legal context in which consumers participate in this process. – Outline the broad individual characteristics, psychology, and consumer resources that consumers bring to the online exchange. – Highlight the five main categories of outcomes that consumers seek from online exchanges. 7-32 ©2014 Pearson Education, Inc. publishing as Prentice Hall

33. The Customer’s Story A typical one-hour adventure in the life of a 25- year-old professional, Justin: – Tunes his iPod to the latest Diggnation podcast while his TV is tuned to a soccer game and his smartphone and iPad tablet are within reach.Diggnation – Picks up iPad to find a blog mentioned during the podcast, sees a video on the blog, tunes it on his TV set and texts a friend about the video. – Justin searches for the video title on Google and finds a job posting on Vimeo, an online video-posting site.Vimeo 7-33 ©2014 Pearson Education, Inc. publishing as Prentice Hall

34. The Customer’s Story, cont. – He posts a link to the video and Vimeo site to his Twitter stream.Twitter Justin is the new consumer: a multitasker attending to different electronic media simultaneously. How can a marketer capture dollars from advertising online, selling music downloads, charging fees for social media subscriptions? 7-34 ©2014 Pearson Education, Inc. publishing as Prentice Hall

35. 85% of U.S. consumers used the internet in 2012. Less connected groups tend to be: – Older – Less educated – Hispanic – Lower income or disability – http://pewinternet.org/Trend-Data- %28Adults%29/Whos-Online.aspx http://pewinternet.org/Trend-Data- %28Adults%29/Whos-Online.aspx Consumers in the 21 st Century 7-35 ©2014 Pearson Education, Inc. publishing as Prentice Hall

36. Consumers in the 21 st Century, cont. Approximately 1.8 billion people have access to the internet, 32.7% of the global population. Top ten countries account for 60% of all users and adoption rates range from 10- 84%. internet usage in developed nations has reached a critical mass, leading marketers to ask more questions about consumer behavior on the internet. http://www.internetworldstats.com/stats. htm http://www.internetworldstats.com/stats. htm 7-36 ©2014 Pearson Education, Inc. publishing as Prentice Hall

37. Internet Reaches Maturity: 1995-2012 7-37 ©2014 Pearson Education, Inc. publishing as Prentice Hall

38. Consumer Behavior Online Many consumer behavior principles that describe offline buyer behavior also apply to online behavior. Exhibit 7.2 explains some consumer behavior theories for online buyer behavior. – Scarcity – Popularity – Affinity – Authority – Consistency – Reciprocity 7-38 ©2014 Pearson Education, Inc. publishing as Prentice Hall

39. Social Psychology of Social Shopping 7-39 ©2014 Pearson Education, Inc. publishing as Prentice Hall

40. Exchange is a basic marketing concept. – It refers to the act of obtaining a valued object by offering something in return. Exchange occurs within the following contexts: – Technological – Social/cultural – Legal The Internet Exchange Process 7-40 ©2014 Pearson Education, Inc. publishing as Prentice Hall

41. The Online Exchange Process Technological, Social/Cultural, Legal Contexts Marketing Stimuli Individual Characteristics Resources Internet Exchange Outcomes Connect Create Enjoy Learn Trade Give 7-41 ©2014 Pearson Education, Inc. publishing as Prentice Hall

42. Technological Context 66-77% of online Americans connect to the internet at home with broadband. Broadband users enjoy more multimedia games, music, and entertainment because they download quickly. The typical U.S. home has 26 different electronic devices for media and communication. Web 2.0 technologies are driving marketing strategies and tactics. 7-42 ©2014 Pearson Education, Inc. publishing as Prentice Hall

43. 2012 U.S. Daily Media Use (Minutes/day) 7-43 ©2014 Pearson Education, Inc. publishing as Prentice Hall

44. Social and Cultural Contexts Three cornerstones for attracting customers online: – Reputation: Brand image and reputation are based on the market’s perception. – Relevance: Consumers don’t like being interrupted with irrelevant communication. – Engagement: Marketers must provide relevant content or entertainment. 7-44 ©2014 Pearson Education, Inc. publishing as Prentice Hall

45. Engaging Customers With Relevant Content 7-45 ©2014 Pearson Education, Inc. publishing as Prentice Hall

46. In spite of the Can-Spam act the number of unsolicited emails was 71.9% in June 2012. When the recording industry sued illegal music file downloaders, consumer behavior was affected. – In 2002, 37% of online consumers shared music files, but the percentage has dropped. – The Recording Industry Association of America still claims $12.5B in annual losses from music piracy. Legal Context 7-46 ©2014 Pearson Education, Inc. publishing as Prentice Hall

47. Individual characteristics affect internet use. – Demographics such as age, income, education, ethnicity, and gender. – Attitudes toward technology. – Online skill and experience. – Goal orientation. Individual Characteristics & Resources 7-47 ©2014 Pearson Education, Inc. publishing as Prentice Hall

48. Consumer Resources Consumers perceive value as benefits minus costs. These costs constitute a consumer’s resources for exchange: – Money – Time – Energy – Psychic costs 7-48 ©2014 Pearson Education, Inc. publishing as Prentice Hall

49. U.S. Combined Home/Work Internet Usage 7-49 ©2014 Pearson Education, Inc. publishing as Prentice Hall

50. Exchange Outcomes There are 6 basic things that people do online: – Connect – Create – Enjoy – Learn – Trade – Give Each is ripe with marketing opportunity. 7-50 ©2014 Pearson Education, Inc. publishing as Prentice Hall

51. Connecting Online in the U.S. 7-51 ©2014 Pearson Education, Inc. publishing as Prentice Hall

52. Creating & Uploading Content in the U.S. 7-52 ©2014 Pearson Education, Inc. publishing as Prentice Hall

53. Entertainment Online in the U.S. 7-53 ©2014 Pearson Education, Inc. publishing as Prentice Hall

54. Top 10 Search Terms for 2011 GoogleYahoo!Bing RankTermRankTermRankTerm 1Rebecca Black1iPhone1Fauja Singh 2Google+2Casey Anthony2Katy Perry 3Ryan Dunn3Kim Kardashian3The cardinals 4Casey Anthony4Katy Perry4Harry Potter 5Battlefield 35Jennifer Lopez5Adele 6iPhone 56Lindsay Lohan6Rory Mcllroy 7Adele7American Idol7Japan Earthquake 8Tepco8Jennifer Aniston8Job crisis 9Steve Jobs9Japan Earthquake9Foreclosures 10iPad210Osama Bin Laden10Weather disasters 7-54 ©2014 Pearson Education, Inc. publishing as Prentice Hall

55. Learning and Getting Information 7-55 ©2014 Pearson Education, Inc. publishing as Prentice Hall

56. Trading Online in the U.S. 7-56 ©2014 Pearson Education, Inc. publishing as Prentice Hall

57. Giving Online Trendwatcher.com mentions “Generation Generosity” as one of the top global consumer trends. 25% of Americans made an online donation to charity in 2011. Kickstarter.com offers a Web platform for individuals seeking funding for creative projects. 7-57 ©2014 Pearson Education, Inc. publishing as Prentice Hall

58. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2014 Pearson Education, Inc. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 7-58