2. Digital marketing Flashcards
DEFINITION: WHAT IS
MARKETING?
Marketing is the activity, set of institutions,
and processes for creating, communicating,
delivering, and exchanging offerings that
have value for customers, clients, partners,
and society at large.
Marketing (Management) …”is the art and
science of choosing target markets and
getting, keeping and growing customers
through creating, delivering and
communicating superior customer value.”
(Philip Kotler)
WHAT IS MARKETING?
Marketing (Management) =
* the art and science of choosing
target markets…
- and getting, keeping and growing
customers… - through creating, delivering and
communicating superior customer
value.” (Philip Kotler)
Marketing = market-oriented management
Who are my customers?
What do they need/want?
What are they doing/where are they?
WHAT IS DIGITAL
MARKETING?
”Achieving marketing
objectives through applying
digital media, data and
technology.”
APPLYING…
Digital technologies which form online
channels…
TO…
Contribute to marketing activities aimed at
achieving profitable acquisition and retention of
customers…
THROUGH…
Improving customer knowledge, then delivering
integrated targeted communications and online
services that match their individual needs.
What is digital marketing strategy framework?
Source: Kannan & Li 2017
- Environment
- Company
- Outcomes
- Market research
- Marketing strategy
WHAT IS DIGITAL MARKETING CAPABILITIES AND
FIRM PERFORMANCE?
Source: Homborg & Wielgos (2022)
Digital Marketing Capabilities (DCM) contribute to firm profitability beyond
the influence of Classical Marketing Capabilities (CMC).
- There is an interaction effect between DCM and CMC – both can jointly hurt
or benefit firm profitability, depending on moderating contingencies. - The simultaneous employment of DMCs and CMCs has a positive effect on
firm profitability if customer orientation is high and a negative effect of
customer orientation is low. - Competitor orientation lowers the deployment of DMCs and CMCs resulting
in lower firm profitability - The simultaneous deployment of DMCs and CMCs is particularly valuable
when firms face rapid changes in dynamic environments.
What is the marketing mix
4 P’s
- Product
- Price
- Place
- Promotion
What happens when products go to platforms?
- Products produce a single revenue stream, while
platforms can generate many. - Great platform starts with a great product (critical
mass of customers and provides enough value to
keep them from defecting to competitors). - The product must also attract enough frequent
users to make the potential platform appealing to
third parties.
What are the 6 steps in traditional price setting?
- Selecting the pricing objective
- Determining demand
- Estimating costs
- Analyzing competitor’s costs, prices, offers
- Selecting a pricing method
- Selecting the final price
What is price policy?
Price Transparency
Price Framing
Showrooming
What are the price models?
- “For free”
- Freemium
- Subscription
- Dynamic pricing
What is the price model - “For free” ?
- activate latent demand for attracting new
consumers - attract more customers to generate
network effects - charge third parties and earn from
generated dataèreconsider value
proposition of your product - There are no free online products, you pay
with your data - Risk: if it is for free, it is not worth anything,
data privacy? - If it is free online, you are the product (data)
What is the price model - Freemium?
- Combination between for “free“ and
„premium“ - Users who are just interested in a basic
product or service receive it for free, if a
service with higher quality is preferred, the
user can opt for a subscription fee - Target more consumer segments, generate
cash-flow that finances the other segment - attract new customers, no costly advertising
campaigns are necessary - Also not paying users generate data
(understand the customer better and
improve product, monetarize data)
Example: Spotify
What is the price model - Subscription?
- Includes yearly or monthly
payment, not a completely new
form of pricing - Safety of capacity consumption
and/or product use, offers price
security - efficient for building customer
loyalty and especially interesting
for heavy users - entrance hurdle
Examples: Netflix, Disney+, HBO, HelloFresh
What is the price model - Dynamic pricing?
- firms charge varying prices for the same product
where the difference is based on customer, location
or product, these firms are said to practice the
strategy of dynamic pricing - prices can vary due to specific factors is not openly
communicated to consumers - Not primarily for new customer acquisition
- Typical examples: dynamic prices over time (e.g.,
airlines, hotels, car rentals, gas station), companies try
to improve their capacity utilization - More extreme example: personalized pricing, based
on individual browsing behavior,use the willingness
to pay of the consumer
What does “Place” mean in marketing?
Marketing channels:
Set of interdependent organizations participating
in the process of making a product or service
available for use or consumption
What is the omnichannel distribution policy?
Multi-channel management=
The design, development,
coordination, and evaluation of
channels to enhance customer
value through effecive customer
acquisition, retention, and
development (Verhoef et al. 2015).
Omni-channel management=
the synergetic management of the
numerous available channels and
customer touchpoints, in such a
way that the customer experience
across channels and the
performance over channels is
optimized (Verhoef et al. 2015).
What does “Promotion” mean in marketing?
- Promotion policy refers to how marketing
communications are used to inform
customers and other stakeholders about
an organisation and its products - Includes selection of the target markets
and positioning and integration of different
communication tools
What is communication policy?
You can either use traditional or digital communication
What are the different media types?
Paid media: Advertising
Owned media: Digital properties
Earned media: Partner networks
What is owned media?
=different forms of media controlled by a
company, central core of the digital
marketing strategy
Examples:
§ Websites/Webshop
§ Social Media Profiles
§ Corporate Blogs
§ Other media channels (e.g., video
channel,s, podcasts)
§ E-Mail Lists (e.g., clients, potential clients)
§ Newsletter
What is paid media?
= also known as bought media. A direct
payment occurs to a site owner or an ad
network when they serve an ad, a
sponsorhsip or pay for a click, lead or sale
generated
Examples:
* Social Media Ads
* Paid Search
* Banner Ads
What is the STP process?
Segmentation
- Identify and profile distinct groups of buyers who differ in their
needs and preferences.
Targeting
- Select one or more market segments to enter.
Positioning
- For each target segment, establish and communicate the
distinctive benefits of the market offering.
”A company discovers different needs and groups in the marketplace, it selects
those targets it can satisfy in a competitive way, and then positions its offering so
the target group recognises the company´s distinctive offering and image”
What is persona?
- Semi-fictional representations of your
ideal customers based on data and
research. They help a company to focus
on value propositions, guide product
development and align all work across
your organization - Focus on a specific customer segment,
identifying key aspects of that segment’s
typical customer’s needs and
experiences (Lemon and Verhoef 2016)
*User personas are often used in UX
design teams
What is PIU data and what are the 2 types?
Not only your online behavior can inform companies,
also sensors embedded in products (e.g. connected IoT
products, APPs) produce data in real-time
- Product view: How well is the product performing?
Important for improving the product - Consumer view: How is the user experiencing the
product?
What is ecosystem persona?
§ Connected world presents the opportunity of a
paradigm shift in customer relationships
§ Products as platforms: Most important touchpoint is
the product itself (or the point of service
consumption)
§ Understanding how the consumer is using the
product, helps companies to design a more relvant
product
§ Customer Relationship Management will improve if
the companys understand how the people really
use the products (experience)
§ Need to move towards the ultrapersonal persona
„Persona for One“
DEFINITION: WHAT IS CUSTOMER
EXPERIENCE?
“Customer experience is a
multidimensional construct
focusing on a customer’s
cognitive, emotional, behavioral,
sensorial, and social responses to
a firm’s offerings during the
customer’s entire purchase
journey.”
WHY FOCUS ON COSTUMER EXPERIENCE IN
DIGITAL MARKETING?
- Customers now interact with firms through myriad touch points in multiple channels and media, resulting in more complex customer journeys.
- Omnichannel-management because customers interact through myriad
touchpoints - More social: Customer-to-customer interactions through social media ècustomer
experiences are more social in nature, and peer customers are influencing
experiences as well - Integrate Business Functions: Explosion in potential customer touch points and the
reduced control of the experience require firms to integrate multiple business
functions, including information technology (IT), service operations, logistics,
marketing, human resources, and external partners, in creating and delivering
positive customer experiences
What is customer journey?
Customer Journey = the process a customer goes through, across all stages and touch points, that makes up the customer experience
Source: Lemon & Verhoef 2016
What are the customer journey touchpoints?
Brand owned = customer interactions that are designed and managed by the firm and under the firm‘s control
Partner owned = customer interactions during the experience that are jointly designed, managed , or controlled by the firm and one or more of its partners
Customer owned = customer actions that are part of the overall customer experience but that the firm and ist partners cannot control
Social/external = customer interactions during the experience that are influenced by social and external touchpoints
What is customer experience management (CXM) ?
Customer Experience Management (CXM): is the
cultural mindsets toward customer experiences,
strategic directions for designing customer
experiences, and firm capabilities for continually
renewing customer experiences, with the goals of
achieving and sustaining long-term customer
loyalty”(Homburg et al. 2015)
CXM:
- Customer Journey and Touch Point Design
- Partner and Network Management
- Internal Firm Perspective
What are 3 important trends in marketing?
- Decentralized marketing
- Metamodern customer experience
- Marketing automation
ETHICAL IMPLICATIONS AND ALGORITHMIC
BIASES
- The lack of diversity in programming communities may be
reflected in how algorithms are written and deployed - Algorithms may be trained with data sets that themselves
reflect existing biases - Algorithms that involve real-time data processing might pick
up on biased individual actions
What is dezentralized marketing?
- Driven by Web 3.0 technologies such as
blockchain - More democratized brands will center
on sustainability and innovative digital
products - Feedback of community (= customers)
gets more important - Firms are forced to rethink how, when
and why they engage with customers,
because Web 3.0 technologies offer a
wide array of information sharing
options - More brand transparency
- More data privacy
- Exciting digital offering (NFT)
What is metamodern customer experience?
- Augmented (AR), virtual (VR), and extended (XR)
combined with recent innovations in the metaverse,
provide grounds for metamodern customer
experiences, or hyperrealistic immersive brand
narratives that account for customer diversity - Bridging the gap between physical and digital
- Designing customer experiences across different
realities
