Consumer Behaviour

1. DIGITAL/INTERNET MARKETING STRATEGY

1. Introduction

An Internet marketing strategy is needed to provide consistent direction for an organisation’s e-marketing activities so that they integrate with its other marketing activities and supports its objectives. Internet marketing strategy has many similarities to the typical aims of traditional marketing strategies, in that it will include following aspects:

1. Provide a future direction to internet marketing activities,
2. Involve analysis of the organisation’s external environment and internal resources to inform strategy,
3. Articulate internet marketing objectives that support marketing objectives,
4. Involve selection of strategic options to achieve internet marketing objectives and create sustainable differential competitive advantage,
5. Include strategy formulation to include typical marketing strategy options such as target markets, positioning and specification of the marketing mix, and
6. Specify how resources will be deployed and the organisation will be structured to achieve the strategy.

An internet marketing strategy is a channel marketing strategy which defines how a company should set channel-specific objectives and develop a differential channel-proposition and channel-specific communications consistent with the characteristics of the channel and consumer usage of it. The internet marketing strategy determines the strategic significance of the internet relative to other communications channels which are used to communicate directly with customers at different customer touchpoints.

So the focus of internet marketing strategy is decisions about how to use the channel to support existing marketing strategies, how to exploit its strengths and manage its weaknesses and to use it in conjunction with other channels as part of a multi-channel marketing strategy. This multi-channel marketing strategy defines how different marketing channels should integrate and support each other in terms of their proposition development and communications based on their relative merits for the customer and the company.

Following three phases are required for effective internet marketing strategy formulation:

Situation Analysis

Objective Setting

Strategy Formulation

1. Situation Analysis

The situation review or analysis is best known as a marketing audit of the current effectiveness of marketing activities within a company together with environmental factors outside the company that should govern the way the strategy is developed. These principles can be readily applied to review online marketing effectiveness and internal capabilities. Strategic analysis or situation analysis involves review of:

1. The internal capabilities, resources and processes of the company and a review of its activity in the marketplace.
2. The immediate competitive environment (micro-environment) including customer demand and behaviour, competitor activity, marketplace structure and relationships with suppliers and partners.

The wider environment (macro-environment) in which a company operates, which includes economic development and regulation by governments in the form of law and taxes together with social and ethical constraints such as the demand for privacy.

1. Internal Analysis

The internal audit will review the existing contribution that the internet marketing channel is currently delivering in relation to other channels and in relation to the resources used.

Following aspects are involved in internal analysis:

1. Assessing the Current Contribution of the Internet to the Organisation: To assess the contribution and the effectiveness of internet marketing involves the company in reviewing how well its online presence is meeting its goals. So this activity overlaps with that on strategic goal setting. Assessing effectiveness also requires a performance measurement or web analytics system to collect and report on data effectiveness.
2. Resource Analysis: The internal audit will also include a resource analysis. This involves assessing the capabilities of the organisation to deliver its online services. Aspects that can be reviewed include:

1. Financial resources,
2. Technology infrastructure resources,
3. Human resources,
4. Structure, and
5. Strengths and weaknesses.

1. External Analysis

External audits consider the business and economic environment in which the company operates. These include the economic, political, fiscal, legal, social, cultural and technological factors usually referred to by the SLEPT acronym. The external audit should also consider the state of the market in terms of customers and competitors. Pertinent factors for the internet include demand analysis, competitor analysis, intermediary analysis and channel structure. These are described below:

1. Demand Analysis: A key factor driving e-marketing and e-business strategy objectives is the current level and future projections of customer demand for e-commerce services in different market segments. Demand analysis indicates the scale of opportunity for making or influences sales online and this, in turn, should govern the objectives defined and resources allocated to online channels.
2. Qualitative Customer Research: It is important that customer analysis is not restricted to quantitative demand analysis. Qualitative research provides insights that can be used to inform strategy. It suggests using graphic profiling, which is an attempt to capture the core characteristics of target customers – not only demographics, but also their needs and attitudes and how comfortable they are with the internet.
3. Competitor Analysis: Competitor analysis or the monitoring of competitor use of e-commerce to acquire and retain customers is especially important in the e-marketplace due to the dynamic nature of the internet medium. This enables new services to be launched and prices and promotions changed much more rapidly than through print communications.
4. Intermediary Analysis: Situation analysis will also involve identifying relevant intermediaries for a particular marketplace and look at how the organisation and its competitors are using the intermediaries to build traffic and provide services. The other aspect of situation analysis for intermediaries is to consider the way in which the marketplace is operating.

1. Competitor Analysis Online

Companies of all sizes compete every day for business opportunities and new qualified leads. Brand awareness, online reputation, and the never-ending desire to communicate and stay in touch with audience require more and more refined approaches. The ongoing desire to get ahead of the competition and to uncover their strategies and tactics creates an urgent need for professional competitive research and analysis as the foundational intelligence for a digital marketing plan.

A competitor analysis is an in-depth review of a wide range of web data and its interpretation that reveals online competitors and their digital marketing strategies and tactics, as well as their strengths and weaknesses in comparison to own products or services.