Internet Marketing Second Edition Overview of Chapters Chapter Introduction to by ramhood17


									  Internet Marketing, Second Edition — Overview of Chapters

Chapter 1—Introduction to Internet Marketing. Internet marketing can be broken

down into seven main activities, and we use these steps as divisions for this book. This

chapter provides an overview of the seven parts of Internet marketing and gives a

roadmap for the concepts and frameworks that will be discussed thoroughly in later


Part I: Framing the Market Opportunity

The first task of the Internet marketer is to assess new market opportunities. Chapter 2

provides a detailed explanation of the process that marketers use to evaluate the viability

of opportunities from the perspective of the individual firm. An analysis of marketing

opportunities should use rich data on the competitors, customers, and industry.

Chapter 2—Framing the Market Opportunity. “Where will the business

compete?” This is a fundamental question any firm must address. Ideally, location is

chosen according to where customer needs are, where there are few or no competitors,

where there is a large financial opportunity, and where the company is well positioned to

fulfill the customer need. Obviously, it is very difficult to find all of these elements in one

locale. Hence, a firm should follow a rigorous approach—such as the six-step process

outlined in this chapter—to isolate market opportunities.
Part II: Formulating the Marketing Strategy

The second stage of an Internet marketing program is to specify strategy. This process

consists of a careful assessment of how the potential marketing strategy reinforces

corporate and business-unit strategies. Hence, this section begins with a discussion of the

components of corporate and business-unit strategy and then looks at how marketing

strategy must be aligned with the business strategy. Chapter 3 examines two marketing

strategy formulation pathways: one for pure-play online firms and one for integrative

firms with both online and offline distribution channels. A discussion of segmentation,

target-market choice, and positioning sets the stage for the design of the marketing

program in Part III.

Chapter 3—Marketing Strategy in Internet Marketing. Three components of

marketing strategy—segmentation, target-market selection, and positioning—still apply

in the online environment. However, is it also clear that developing an overall

online/offline marketing strategy is more complicated for bricks-and-mortar firms

because they have the added issue of integrating an offline business with an online

business. This chapter concentrates on how business-unit strategy is connected to and

drives marketing strategy by describing the basic concepts of marketing strategy, then

comparing the marketing strategy process of pure online firms with traditional bricks-

and-mortar firms that have decided to move online. The conclusion highlights the ways in

which the marketing strategy process is influenced by four key forces in the online


Part III: Designing the Customer Experience
Once the firm has decided upon a positioning of its offering, it must decide on a

corresponding customer experience. The customer experience articulation process can be

viewed a bridge between the high-level positioning strategy and the tactics of the

marketing program.

Chapter 4—Customer Experience. This chapter explores the concept of customer

experience by discussing its seven key attributes, then defining the four stages that

customers travel through during their relationship with a firm and its website: functional,

intimate, internalized, and evangelical. Because the evangelist group is such an important

one, particular attention is paid to how firms can leverage this customer group in the

marketplace. The chapter concludes with a discussion on how a firm can best design a

winning customer experience.

Part IV: Crafting the Customer Interface

This section of the book focuses on website design and, in particular, the seven basic design

variables (the 7Cs) that can be used to build an online customer experience. It is important to

recognize that this chapter focuses on online design considerations; some marketing programs

may choose to integrate a discussion of both online interfaces and traditional bricks-and-

mortar design considerations at this point.

Chapter 5—Customer Interface. This chapter introduces the concept of a

technology-mediated customer interface. This interface can be a desktop PC,

subnotebook, personal digital assistant, cell phone, WAP device, or other Internet-
enabled appliance. Within a technology-mediated customer experience, the user’s

interaction with the company shifts from the traditional face-to-face encounter to a

screen-to-face encounter. As this shift from people-mediated to technology-mediated

interfaces unfolds, it is important to consider the types of interface design considerations

that confront senior management. What is the look-and-feel, or context, of the site?

Should the site include commerce activities? How important are communities to the

business model? These design considerations are captured in the 7Cs Framework. The

7Cs are a rigorous way to understand the interface design choices that confront senior

managers as they implement their business models.

Part V: Designing the Marketing Program

This section covers the heart of the Internet marketing program. A comprehensive

discussion of building and nurturing customer relationships (Chapter 6) precedes an in-

depth description of the Internet marketing mix’s six components: product, pricing,

community, communication, distribution, and branding (Chapters 7–12). In Chapter 13,

the Marketspace Matrix is introduced as a way to integrate a firm’s supply-side choices

(e.g., the six elements) and the demand-side requirements of target customers (e.g., the

four stages). Chapter 13 also introduces several principles for the design of an integrative

marketing program. Finally, Chapter 14 discusses how the Marketspace Matrix applies to

the successful online (and offline) marketing of the blockbuster film The Lord of the

Rings: The Fellowship of the Ring.

Chapter 6—Customer Relationships. This chapter introduces a customer-centric

approach to Internet marketing, emphasizing how firms can use the Internet to increase
customer awareness, encourage customers to explore and expand the depth of

client/company interaction, and create customers committed to the firm and its products.

The circumstances under which the firm may want to dissolve or end its relationship with

some customers are discussed next. An illustration of how interactivity and

individualization—the 2Is—are fundamental to building close buyer/seller relationships

leads to a discussion of how eBay develops online relationships.

Chapter 7—Product. Recognizing that a broad body of knowledge about products

already exists, the purpose of this chapter is to explain how the Internet affects the

development and marketing of products today. As appropriate, additional networked-

economy technologies such as customer databases and computer telephony integration

are noted. Also discussed are the details of developing products, the marketing levers

available to manage the offering, and how some of these levers can further customer


Chapter 8—Pricing. This chapter examines the wide assortment of new and

established pricing tools available to firms. It also provides a framework to help

managers decide which pricing strategy is best for their products. The effects of the 2Is

on traditional pricing levers, as well as the role of the 2Is in creating a new category of

pricing called dynamic pricing, are also discussed. A key section of the chapter shows

how various pricing levers can be used to move consumers through each of the four

consumer relationship stages. Lastly, the chapter discusses eBay’s pricing levers.
Chapter 9—Communication. Consumers are rapidly adopting hybrid shopping

models—they might research a product via one channel, purchase via another, and

request product support through a third. Therefore, firms must develop communication

methods that are integrated across channels and that work together with synergy to move

customers from awareness toward commitment. The key market communication levers

that companies can use to create customer relationships are introduced in this chapter.

This is followed by a discussion of how the 2Is of the Internet encourage the progress of

relationships between firms and their customers.

Chapter 10—Community. The values of online community are easy to recognize. For

instance, members typically benefit from the increased ability to share resources and

information. But what of the benefits for the firm that sponsors a community? How else

is value specifically created and transferred throughout a community? More important,

how can community be built to create committed members and, ultimately, committed

customers? These questions are explored in Chapter 10.

Chapter 11—Distribution. One fundamental debate in the networked economy is

whether the Internet is simply another channel of distribution or a business revolution in

and of itself. On one hand, it seems unlikely that all consumers will eventually buy

personal computers, clothing, books, and groceries over the Internet. Some segment of

consumers will always want to touch, feel, hear, smell, or taste the merchandise before

they buy. Therefore, the Internet channel will never be attractive to every single customer

in every single segment of the market. Yet while the Internet might not replace traditional

commerce, it is impossible to overstate the impact it will have (and, indeed, has already
had) on distribution. The purpose of this chapter, then, is to review the impact of the

Internet distribution channel, review the levers that are available to Internet marketers,

and discuss how distribution choices can affect the movement of target customers

through each of the four stages.

Chapter 12—Branding. The chapter begins with some fundamental issues—namely,

the definition of brand and a discussion of what types of brands exist. The effects of the

2Is on branding are also examined, as is the concept of brand equity, how it is measured,

and how it can be created. Then, a seven-stage process is introduced to guide firms in the

development of strong brands. Finally, the principles of branding developed within the

chapter are applied to the strategies of competing entities: Citibank Online versus Bank

of America Online Banking, and CBS versus

Chapter 13—Designing the Marketspace Matrix. Chapter 13 begins with an

integrative summary of the design of the marketing program. The Marketspace Matrix is

then introduced as the integration tool that enables marketers to visualize an entire

marketing program. With this visual display, the marketer is able to observe allocation of

resources, the timing of individual levers, the sequencing of levers, and overall program

consistency. This chapter also introduces 15 principles that help guide the development

of the overall integrated program.

Chapter 14—Design of the Marketing Program for The Lord of the Rings. This

chapter reviews a highly successful interactive marketing campaign: the marketing

campaign for New Line Cinema’s 2001 film, The Lord of the Rings: The Fellowship of

the Ring. The campaign integrated offline and online levers to produce a creative,
interactive campaign that propelled a large segment of people through the relationship

stages and into the commitment stage. The campaign used a wide variety of creative

interactive marketing levers, and also created a thriving online community.

Part VI: Leveraging Customer Information Through Technology

This section shows how firms can use technology to better understand and leverage their

customers through market research, database marketing, and customer relationship


Chapter 15—Customer Information Systems. This chapter focuses on three key

situations that customer-centric marketers face: (1) deciding which markets they should

pursue, (2) learning more about their customers and how to activate key customer

segments, and (3) understanding the long-term profitability of their customers (which

customers should they better serve, which customers they should weed out, etc.). These

decisions are often fraught with uncertainty; however, the chapter offers some insight

into how marketers can use technology to make better informed decisions.

Part VII: Evaluating the Marketing Program

How well did the marketing program do? Did it deliver on its objectives? This section

introduces new metrics that can be used to track the success of the online marketing

program. These metrics reflect customer actions as well as critical financial metrics that

need to be assessed.
Chapter 16—Metrics. This chapter proposes an approach to measuring both customer

and business performance metrics for online firms. It begins with a review of traditional

offline customer metrics, and then introduces a new model of online customer metrics.

This model emphasizes the importance of capturing the cross-platform behaviors that are

observed by customers. With this in mind, some of the challenges, complexities, and

pitfalls of tracking customer behavior across channels are examined. The chapter

concludes by applying its key concepts to the online auction website eBay.

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