Thursday, October 9, 2008
More from Monday's Trade Show!
Online & Offline Synergies in Marketing
Companies both small and large are looking for new ways to reach customers. Increasingly organizations have begun putting more marketing resources online in an attempt to target their consumers. The use of e-marketing is effective when companies use best practices, target their audience, and make sure online and offline marketing efforts complement each other. The proper integration of online marketing and traditional marketing channels can create synergies that have a greater impact than any one individual medium.
To understand the way businesses use online and offline marketing to create synergies our group analyzed the fashion industry at all different price segment. The fashion industry is heavily driven by branding and marketing to create customer value. While nearly all fashion companies are using some type of online marketing to target customers each organization has different objectives based on their target customer profile. High-end retailers tend to use online marketing to push consumers into offline locations, while mid-level and economy brands use both mediums in combination to bring consumers increased value. Our analysis found some companies still struggling to execute the right balances, along with many companies that are using best practices to create marketing synergies. One best practice that our group found is Armani Exchange use of text messaging for improved relationship marketing. The use of text messaging is a marketing strategy that could be utilized by both corporations and small business in various industries.
Text Messaging as a Relationship Marketing Tool
The use of text messaging as a marketing tool has become increasingly popular as it allows businesses to stay in touch with its most important customers. One key advantage of using text messaging is that companies of all sizes can use the tool because the medium is relatively inexpensive. The best practice for using text messaging is to target current customers who already have a relationship with the business. Customers give their phone numbers to the business, and in return customers receive special promotions and deals by text message. These occasional special offers can be redeemed by using the message as an electronic coupon. The text message marketing system allows companies to build relationships with current customers, leverage “word of mouth” referrals from satisfied customers, and track the success of individual promotions.
The great advantage of text message marketing is that companies can directly market to their target customers, yet the strategy does contain some risks if not implemented properly. First, companies must be sure not to overuse text messages as it may alienate and turn away some customers. Second, the timing of text message marketing is very important for companies to consider. Strategically it is best to reach customers when they are least likely to be disturbed such as late on a Friday or Saturday afternoon. It is important that companies avoid texting people when they may either be at work or asleep. Most companies will have a good profile of their target customer and should design a strategy to best reach their clientele. If implemented properly, the use of text message marketing has the ability to build and strengthen relationships with customers.
See more of our Trade Show Presentation at my teammates blogs.
Terence Wang
MBA Candidate 2009 - International Business
Sauder School of Business at UBC
tcwang0210@gmail.com
http://bdcinternational.blogspot.com/
Annie Yu
MBA Candidate 2009 - International Business
Sauder School of Business at UBC
newvalleygirl@gmail.com
http://newvalleygirl.blogspot.com/
Companies both small and large are looking for new ways to reach customers. Increasingly organizations have begun putting more marketing resources online in an attempt to target their consumers. The use of e-marketing is effective when companies use best practices, target their audience, and make sure online and offline marketing efforts complement each other. The proper integration of online marketing and traditional marketing channels can create synergies that have a greater impact than any one individual medium.
To understand the way businesses use online and offline marketing to create synergies our group analyzed the fashion industry at all different price segment. The fashion industry is heavily driven by branding and marketing to create customer value. While nearly all fashion companies are using some type of online marketing to target customers each organization has different objectives based on their target customer profile. High-end retailers tend to use online marketing to push consumers into offline locations, while mid-level and economy brands use both mediums in combination to bring consumers increased value. Our analysis found some companies still struggling to execute the right balances, along with many companies that are using best practices to create marketing synergies. One best practice that our group found is Armani Exchange use of text messaging for improved relationship marketing. The use of text messaging is a marketing strategy that could be utilized by both corporations and small business in various industries.
Text Messaging as a Relationship Marketing Tool
The use of text messaging as a marketing tool has become increasingly popular as it allows businesses to stay in touch with its most important customers. One key advantage of using text messaging is that companies of all sizes can use the tool because the medium is relatively inexpensive. The best practice for using text messaging is to target current customers who already have a relationship with the business. Customers give their phone numbers to the business, and in return customers receive special promotions and deals by text message. These occasional special offers can be redeemed by using the message as an electronic coupon. The text message marketing system allows companies to build relationships with current customers, leverage “word of mouth” referrals from satisfied customers, and track the success of individual promotions.
The great advantage of text message marketing is that companies can directly market to their target customers, yet the strategy does contain some risks if not implemented properly. First, companies must be sure not to overuse text messages as it may alienate and turn away some customers. Second, the timing of text message marketing is very important for companies to consider. Strategically it is best to reach customers when they are least likely to be disturbed such as late on a Friday or Saturday afternoon. It is important that companies avoid texting people when they may either be at work or asleep. Most companies will have a good profile of their target customer and should design a strategy to best reach their clientele. If implemented properly, the use of text message marketing has the ability to build and strengthen relationships with customers.
See more of our Trade Show Presentation at my teammates blogs.
Terence Wang
MBA Candidate 2009 - International Business
Sauder School of Business at UBC
tcwang0210@gmail.com
http://bdcinternational.blogspot.com/
Annie Yu
MBA Candidate 2009 - International Business
Sauder School of Business at UBC
newvalleygirl@gmail.com
http://newvalleygirl.blogspot.com/
Wednesday, October 8, 2008
E-Marketing Trade Show!
Our Presentation focused on Online / Offline Synergies in the Fashion Industry, above is a picture of our display.
Thursday, October 2, 2008
Crest "Night-time" Toothpaste
This rant is not really related to e-marketing, rather just a marketing technique I picked up on while picking up toothpaste at Safeway a couple of days ago. Crest a dominate player in the toothpaste category, one thing the company is very good at is taking up large amounts of shelf space in stores. One of primary ways they do this is to have many different brand extensions all with little to no actually differences. The type that I normally buy is Crest Pro-Health, it is a "complete" toothpaste, though I'm sure its the same as every other one they sell. Anyway, at the store I noticed that Crest now has a night-time version of my toothpaste. As I began looking at the box I wondered how exactly is one toothpaste better at night than the other. After closely examining the box I began to realize that everything was exactly the same between the day and night-time toothpaste. Then I saw it! The Crest Night-time toothpaste provides a "unique night-time flavour." Night-time flavour! The exercise made me think of the thin lines we as marketers walk between differentiating, persuading, and downright misleading the consumer. The front of the packaging would have you believe the toothpastes are different in function, when in reality the only difference is flavour. Just something to think about.
Groundswell Awards
Forrester Groundswell is running an online contest and review of social technology websites. One major benefit of this contest is that a number of good websites are able to get exposure to interested users. The overall categories seem to be quite broad and can overlap which creates some category confusion. The other issue with the awards is that all the websites are self-submitted. This practice take some of the quality out of the awards since all the awards are given to websites that nominated themselves. Other websites that are unaware of the Groundswell awards are left out, which means that the best websites for "Listening" may be left out of the awards process. I think the idea is great, but Groundswell may need to re-consider the process of awarding websites.
"I'm a PC"
After taking a beating from Apple over the past few years Microsoft appears to be pushing back. The success of the PC vs. Mac commericals have helped build the Apple brand and position PC as old, business types, un-stylish, and out of touch. The new ads from Microsoft are attempt to change that image by featuring people from all walks of life to say "I'm a PC." In particular, the commericals use stars like Pharrel Williams of the Neptunes to connect with younger users and push back on Mac's claim that PC is not stylish. I think its a good campaign because it reminds consumers that you can have a PC and still be hip and cool, PC's aren't just for Excel spreadsheet nerds!
Monday, September 22, 2008
E-Commerce Article Review
Article Review
Journal of Consumer Psychology, 2003
“E-(Embodied) Knowledge and E-Commerce: How Physiological Factors Affect Online Sales of Experiential Products” by Jose Antonio Rosa and Alan J. Malter
The commercial success of online business is here to stay, but while some industries have been able to easily move from offline to online retailing, it has become apparent that other industries are still struggling to market online. In particular, goods such as books, airline tickets, and computers can easily be sold using a two-dimensional interface that offers little more than pictures and descriptions. Many products have been significantly more challenging to market online, especially products that require high amount of embodied knowledge (i.e. touch, body movement). Products such as sports equipment, clothing, cosmetics, and automobiles have struggled to utilize the online experience to facilitate online purchases, rather many consumers research these products online, but purchase offline. In this article, Rosa and Malter explore the problems e-marketers face attempting to sell products online that require high levels of embodied knowledge, offer some possible solutions, and advocate that more research is needed on how embodied knowledge influences consumer behaviour.
The fashion and apparel industry has long struggled to sell online because of the perceived risks (sizing, fit, fabric texture) associated with online clothing shopping. The industry has also been vulnerable to higher rate of return for clothing items purchased online, and the company must often pay for the return process to ease customers concerns about purchasing clothing online. Part of the problem is that consumers know that industry sizing “is subject to deliberate and accidental misrepresentation, which leads to unavoidable size variations between manufacturers and sometimes between items from the same” company. In a brick and mortar store consumers resolve this problem by “trying clothes on.” Unfortunately, consumers are not able to receive this embodied knowledge as easily online. This problem has created challenges for e-marketers to better provide embodied knowledge through the online medium.
Valuable information on consumer behaviour can help e-commerce sites better understand its customers. For instance, it is known that men and women tend to have different views on the importance of different body parts when purchasing clothing. This knowledge allows marketers to design the appearance of clothing differently for the two sexes by accentuating features that are desired, while diminishing the parts that are more sensitive. The goal of marketers is not just to improve the appearance of products online, but to also provide an experience online that closer aligns with the experience of shopping at brick and mortar store. Since consumers cannot actually “try on clothing” online, retailers must find better ways to engage embodied knowledge factors. The clothing company “Land’s End” uses a “virtual model” tool that allows customers to create a mannequin that reflects their shape, size, and gender to virtually “try on clothing.” The model is 3-Dimensional and rotates allowing the customer to get a better “feel” for how that clothing fits. As technology improves e-marketers will be able to created programs that can put the models into motion (i.e. sitting, walking) to give the consumer a more realistic feel for the products. The use of this technology to engage consumers with products in a more physical experience can help firms drive down costs and increase value in the online channel.
While the article goes into to detail on possible improvements for the online apparel industry, the solutions for products such as automobiles, bicycles, and tennis rackets are not quite as clear. The article goes into great detail about consumer psychology, and the impacts and challenges facing e-commerce. In particular, the article goes into great depth on the affects body image and body schema has on the consumer experience. One example where consumer behaviour affects online retailing is in the case of tennis rackets. A consumer shopping online may be able to view different rackets and assess the quality by reading descriptions, yet consumers still desire to “try out” the rackets. When a consumer puts the racket in their hand they are able to “feel” the difference between rackets that have virtually the same properties. The difference in “feeling” is often how consumers make decisions, yet most people have a difficult time explaining this “feeling.” According to Rosa and Malter, the difference in “feeling” is combination of proprioceptive knowledge with other type’s knowledge into mental simulations of owning the product. Similar processes are involved when purchasing items such as fishing poles, baseball bats, work tools, and bicycles. Great challenges remain in these product categories, and additional research and new technology will be required to provide a better online experience.
Overall, the article provides a detailed analysis of how various psychological factors affect the purchase of products that require a physiological experience. The authors willingly acknowledge that the challenges are large for many product categories, but state that it is important that managers understand the importance of embodied knowledge in online shopping and continue to search for ways to provide a better experience. This article is very interesting for marketers interested in consumer psychology and the affects of different types of knowledge on e-commerce. Most importantly, the authors stress the need for marketers to understand the importance embodied knowledge to influence customers both offline and online.
Journal of Consumer Psychology, 2003
“E-(Embodied) Knowledge and E-Commerce: How Physiological Factors Affect Online Sales of Experiential Products” by Jose Antonio Rosa and Alan J. Malter
The commercial success of online business is here to stay, but while some industries have been able to easily move from offline to online retailing, it has become apparent that other industries are still struggling to market online. In particular, goods such as books, airline tickets, and computers can easily be sold using a two-dimensional interface that offers little more than pictures and descriptions. Many products have been significantly more challenging to market online, especially products that require high amount of embodied knowledge (i.e. touch, body movement). Products such as sports equipment, clothing, cosmetics, and automobiles have struggled to utilize the online experience to facilitate online purchases, rather many consumers research these products online, but purchase offline. In this article, Rosa and Malter explore the problems e-marketers face attempting to sell products online that require high levels of embodied knowledge, offer some possible solutions, and advocate that more research is needed on how embodied knowledge influences consumer behaviour.
The fashion and apparel industry has long struggled to sell online because of the perceived risks (sizing, fit, fabric texture) associated with online clothing shopping. The industry has also been vulnerable to higher rate of return for clothing items purchased online, and the company must often pay for the return process to ease customers concerns about purchasing clothing online. Part of the problem is that consumers know that industry sizing “is subject to deliberate and accidental misrepresentation, which leads to unavoidable size variations between manufacturers and sometimes between items from the same” company. In a brick and mortar store consumers resolve this problem by “trying clothes on.” Unfortunately, consumers are not able to receive this embodied knowledge as easily online. This problem has created challenges for e-marketers to better provide embodied knowledge through the online medium.
Valuable information on consumer behaviour can help e-commerce sites better understand its customers. For instance, it is known that men and women tend to have different views on the importance of different body parts when purchasing clothing. This knowledge allows marketers to design the appearance of clothing differently for the two sexes by accentuating features that are desired, while diminishing the parts that are more sensitive. The goal of marketers is not just to improve the appearance of products online, but to also provide an experience online that closer aligns with the experience of shopping at brick and mortar store. Since consumers cannot actually “try on clothing” online, retailers must find better ways to engage embodied knowledge factors. The clothing company “Land’s End” uses a “virtual model” tool that allows customers to create a mannequin that reflects their shape, size, and gender to virtually “try on clothing.” The model is 3-Dimensional and rotates allowing the customer to get a better “feel” for how that clothing fits. As technology improves e-marketers will be able to created programs that can put the models into motion (i.e. sitting, walking) to give the consumer a more realistic feel for the products. The use of this technology to engage consumers with products in a more physical experience can help firms drive down costs and increase value in the online channel.
While the article goes into to detail on possible improvements for the online apparel industry, the solutions for products such as automobiles, bicycles, and tennis rackets are not quite as clear. The article goes into great detail about consumer psychology, and the impacts and challenges facing e-commerce. In particular, the article goes into great depth on the affects body image and body schema has on the consumer experience. One example where consumer behaviour affects online retailing is in the case of tennis rackets. A consumer shopping online may be able to view different rackets and assess the quality by reading descriptions, yet consumers still desire to “try out” the rackets. When a consumer puts the racket in their hand they are able to “feel” the difference between rackets that have virtually the same properties. The difference in “feeling” is often how consumers make decisions, yet most people have a difficult time explaining this “feeling.” According to Rosa and Malter, the difference in “feeling” is combination of proprioceptive knowledge with other type’s knowledge into mental simulations of owning the product. Similar processes are involved when purchasing items such as fishing poles, baseball bats, work tools, and bicycles. Great challenges remain in these product categories, and additional research and new technology will be required to provide a better online experience.
Overall, the article provides a detailed analysis of how various psychological factors affect the purchase of products that require a physiological experience. The authors willingly acknowledge that the challenges are large for many product categories, but state that it is important that managers understand the importance of embodied knowledge in online shopping and continue to search for ways to provide a better experience. This article is very interesting for marketers interested in consumer psychology and the affects of different types of knowledge on e-commerce. Most importantly, the authors stress the need for marketers to understand the importance embodied knowledge to influence customers both offline and online.
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