Download Ch 3

Chapter 3:
E-Business Communication
For use with Strategic Electronic Marketing:
Managing E-Business
Copyright 2000 South-Western College Publishing
Chapter 3 Slide: 1
LEARNING OBJECTIVES (1)
• List the audiences with whom an e-business would
need to communicate.
• Compare and contrast a one-to-many and manyto-many communication model.
• Explain how the communication process works.
• Describe the role involvement plays in Web site
design.
• Relate hypermedia’s role in gaining audience
attention.
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Copyright 2000 South-Western College Publishing
Chapter 3 Slide: 2
LEARNING OBJECTIVES (2)
• Outline what should be done with a Web site to
gain audience interest.
• Explain how an e-business can develop desire
from its target market.
• List what is important in motivating an audience
to take action.
• Explain how e-business communication can be
used in industrial markets.
• Contrast the strengths and weaknesses of using the
Internet as an advertising medium.
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Chapter 3 Slide: 3
Vignette: Amazing Amazon.com
• Thinking Strategically
– Make a short list of what you know about
Amazon.com.
– Decide how much of that information comes from:
• Paid advertising, publicity, and from interacting with the
Web site.
– Evaluate the design of the Web site.
– Determine what in the Web site design would
encourage you to purchase.
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Chapter 3 Slide: 4
The Internet as a Communication
Medium
• The Internet is used to communicate to
constituencies or audiences both external
and internal to the e-business.
– External audiences include customers,
stockholders, the general public, and other
specifically targeted audiences.
– Internal audiences can include both
employees and suppliers.
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Chapter 3 Slide: 5
Hypermedia
• Hypermedia allow companies to deliver
targeted messages to specific audiences.
– Hypermedia environments are distributed
network that allow for hyperlinks and
nonlinear search and retrieval processes to
collect information.
• Examples: World Wide Web, interactive television,
interactive Web based cellular telephones, and other
portable devices.
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Chapter 3 Slide: 6
Linear Communication
• Traditional media often follow a one-tomany communication model where a
single promotion, such as a print ad or
television commercial, is sent by one source
and seen by many without the opportunity
for immediate feedback.
• Linear communication follows a scripted
flow.
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Chapter 3 Slide: 7
Non-Linear Communication
• Interactivity and hyperlinks allow for a type
of two-way communication between the ebusiness and its audience.
• Non-linear communication allows for a
free flow and exchange of information.
– Most conversations individuals have with
others are non-linear. Good sales presentations
are free flows of communication.
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Chapter 3 Slide: 8
What Is Promotion?
• Promotion is a communication
process consisting of advertising,
publicity, sales promotion, and
salesmanship.
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Chapter 3 Slide: 9
Figure 3.1: The Communication System
COMMUNICATION SYSTEM
SENDER
Encode
NOISE
MESSAGE
Media
Decode
NOISE
TARGETED
SEGMENT
FEEDBACK
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Chapter 3 Slide: 10
Many-to-Many Model (1)
• The many-to-many model places the
hypermedia in the center of the
communication process.
• Hypermedia become a meeting place where
anyone can communicate with anyone else.
• Both firms and customers can obtain and
deliver content.
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Chapter 3 Slide: 11
Figure 3.2: Many-to-Many Model
Fir
m
Custome
r
Fir
m
Content
Hypermedia
Content
Custome
r
Custome
r
Adapted from: Donna L. Hoffman & Thomas P. Novak, "Marketing in Hypermedia Computer-
Fir
m
Mediated Environments: Conceptual Foundations," Journal of Marketing, July 1996, Vol. 60, p. 53.
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Chapter 3 Slide: 12
Many-to-Many Model (2)
• The many-to-many model is also evident in
the use of chat or threaded discussion lists
at Web sites.
– Chatting online involves a number of
individuals who leave messages for others to
see.
• This can be placed in a repository or chat rooms for
viewing at later times or could be “live” in that
individuals write to others in real time.
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Chapter 3 Slide: 13
Many-to-Many Model (3)
• Threaded discussion lists allow individuals to
add to an initial message with successive
messages. This allows a newsgroup user to add to
a thread, or single conversation, by indicating
their response to the prior message. Messages are
available for other to read and are indented under
topics headings:
– Initial Post
• First response
– Second response
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Chapter 3 Slide: 14
Figure 3.3: Linear Communication
Thumbnails
Thumbnail: a quick sketch of a communication concept allowing
the creation of a large number of ideas in a short time period.
TV STORYBOARD
Scene
1
Scene
2
PRINT AD
HEADLINE
Sub-Heading
Scene
3
Scene
4
Body Copy
Body Copy
Body Copy
Body Copy
Scene
5
Scene
6
Logo
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Chapter 3 Slide: 15
Figure #4: Hypermedia
Connections to Multiple Pages
Home
Page
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Chapter 3 Slide: 16
Hypermedia Communication Goals
• A Web site can provide a little or a great
depth of information for a site visitor.
• A single site can be designed for goaldirected buyers as well as for those who are
net surfing and are looking only to
experience the site.
– The Web site can be designed to allow links to
other individuals who share the same interests.
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Chapter 3 Slide: 17
High Involvement (1)
• Individuals with high involvement for a
product or product category are:
– likely to see a topic as interesting or important
– attend to information more
– are more likely to comprehend complex messages
– may be willing to spend more time with a Web site.
• Involvement levels of individuals can be high when
they are goal directed, such as attempting to gather
information to make a purchase.
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Chapter 3 Slide: 18
High Involvement (2)
• Individuals can also have high enduring
involvement with products or product
categories, and engage in net surfing to
obtain high levels of interactivity with sites.
– Enduring involvement exists when an
individual has a high level interest in a topic
over and extended time period.
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Chapter 3 Slide: 19
From Public Relations to
Supporting Relationships
• Brochure sites are designed as an advertising or
public relations tool.
– May contain the same information as a business’ print
material.
– These sites are designed to make visitors aware of and
informed about a business's image or products.
– This can be seen as a simple extension of traditional
media campaigns.
– Brochure sites should be designed to enhance the
overall promotional campaign.
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Chapter 3 Slide: 20
The Public Face of a Business
• For non-brick and mortar pure-play Internet
businesses, the Web page may be the only
chance a customer has to interact with the
business.
• The Web page must project and protect the
image of the company.
• Protecting a company's image is a concern
on the Internet.
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Chapter 3 Slide: 21
Web Sites and Company Image
Some companies that have registered domain names
to prevent attack include:
Charles Schwab: !#%*schwab.com and
schwab!#%*.com.
BellAtlantic: Bigyellow!#%*.com
Chase Manhattan Bank: Chase!#%*.com
Cox Communications Inc.: Cox!#%*.com
Vail Resorts: vailresorts!#%*.com
Volvo Cars of North America: volvo!#%*.com
Playboy Enterprises: Playboy!#%*.com
!#%* represents a deleted offending word
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Chapter 3 Slide: 22
Relationship Sites
• Relationship sites target individuals who
may have higher levels of information
involvement.
– Sites can designed for individuals with high
levels of enduring involvement.
– They often contain games, chat groups, or other
interactive components to maintain
relationships with customers.
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Chapter 3 Slide: 23
Online Transactions Sites
• Customers can be taken from a stage with
little information to the process of engaging
in online transactions.
– Experienced salespeople can be key in
developing a relationship site.
– Salespeople identify the needs of their prospects
and then tailor, or encode, the communication to
meet the prospect's needs and answer any
questions the prospect may have.
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Chapter 3 Slide: 24
Case 3.1: In The Web Driving Seat
• Thinking Strategically
– Visit the BMW Web site (www.bmwusa.com).
– Determine if the site is only designed for current BMW
owners or if they are targeting potential owners as well.
– Decide if this site appeals to individuals with high or
low levels of automotive involvement.
– Visit another Web site for a single automobile or
manufacturer.
– Determine if those sites are designed to appeal to high
or low automotive involvement levels.
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Chapter 3 Slide: 25
Communication Goals
ATTITUD AIDA
E MODEL PROCESS
Cognition Awareness
(thinking)
Interest
Affect
(feeling)
Desire
Conation
(behavior)
Action
E-BUSINESS COMMUNICATION STRATEGY
Use offline media to make the audience aware of the Web
site. Use search engines to allow a Web site to be found in
searches. Use other Web sites as a media for advertising a
Web site.
Use customization and personalization techniques to meet
the individual’s needs. Use targeted e-mail and permission
marketing. Use push to send information to the audience.
Develop content and a design that appeals to the target
audience. Include relationship development components
that will keep the audience at the site.
Use promotions to entice actions.
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Copyright 2000 South-Western College Publishing
Chapter 3 Slide: 26
Media and Effects
A promotional mix includes the use of public relations and
publicity, advertising, personal selling, sales promotions, and
hypermedia such as Web sites.
PROMOTIONAL STRATEGY MATRIX
ATTENTION
INTEREST
DESIRE
ACTION
PUBLIC RELATIONS
ADVERTISING
PERSONAL SALES
SALES PROMOTION
WEB PAGE
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Chapter 3 Slide: 27
Gaining Attention (1)
• Traditional media gain attention by designing
messages with enough impact to gain and hold the
audience or the message can be repeated numerous
times.
• A Web site differs from traditional media in that
the receiver must actually use the Internet to link
to Web page content.
• An individual will not be exposed to the message
unless they participate in some active measure to
view a Web site.
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Chapter 3 Slide: 28
Gaining Attention (2)
• Steps to gain the audience's attention:
– Include a site's URL or address in other media.
• The Web address should be included in
advertising copy and layouts, business cards,
banner ads located in other Web sites, direct
email and other directed media.
• The use of URLs in print ads have increased
from around 10 percent of ads in 1995 to over
90 percent by 1998
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Chapter 3 Slide: 29
Search Engines (1)
• Search engines should also be used so the
business and its Web address will appear
when the Web user searches for topics
related to that business.
• Search engines are a cost-effective means of
making people aware of a site, but they do
not guarantee that a viewer will choose or
remember the site.
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Chapter 3 Slide: 30
Search Engines (2)
• Three types:
– Search directories require that Web site be submitted
for cataloging.
– Search engines use Web spiders or web bots to collect
information from sites.
• Web spiders are bots, or software robots, that
“crawl” through the Internet looking at Web sites.
– Metacrawlers use the databases of multiple major
search engines. These are good for power searches, but
combining multiple results can lead to repetitive hits.
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Chapter 3 Slide: 31
Hypermedia Hyperlinks (1)
• Gaining attention through Web sites:
– Banner ads
• Banner ads have not been highly effective in
achieving click-through, or having an individual
click on a linked banner to link to other sites.
– Sponsorship (or co-branded ads)
• Integrate a company's brand to the editorial content
of the Web site. For example, a firm may sponsor a
news site or community bulletin board
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Chapter 3 Slide: 32
Hypermedia Hyperlinks (2)
– Interstitials
• Automatically load and display content as Web
site content is brought up. This includes the use
of daughter windows that pop and freely float
to display ad content.
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Chapter 3 Slide: 33
Online Advertising
Interstitial
(daughter
window)
Banners and
Buttons
Sponsorships
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Chapter 3 Slide: 34
Interest
• The home page or the first page that a visitor sees
at a site.
– If a visitor has specifically tried to find the web site, or
they have high involvement with the company or
product, they may wait for the page to load and spend
time watching and interacting with the site.
– If the visitor is only browsing, they may zap the site
and move on if it takes too long to download or is not
interesting.
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Chapter 3 Slide: 35
Case 3.: Ride the Wild Mouse
• Thinking Strategically
– Consider what types of design elements would be of
interest to Six Flags’ customers.
– Visit the Six Flags’ Web site (www.sixflags.com).
– Determine the types of plug-ins that are required to use
the site.
– Decide how important having high bandwidth is for
users of this site.
– Evaluate the design elements.
– Determine what this site has that will get its target
audience to visit more than once.
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Chapter 3 Slide: 36
Web Site Goals
• Brochure or public relations sites
– The compelling reasons for the visitor to
remember and return to the site should be
communicated.
• Action oriented sites
– The communication should be focused around
the unique selling proposition of the firm or the
competitive advantage of the product over
competitive products
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Chapter 3 Slide: 37
Developing Effective Web Pages
Site
Address
Communication Www.comma
rts.com/index
Arts
.html
Web Pages that Www.webpa
gesthatsuck.c
Suck
om
www.invision
NewMedia
Invision Awards awards.com
Comments
Site for identifying design trends and
learning what works and what doesn't
on the Internet.
Gives examples of good and poor
Web page design.
Good examples of Web and
multimedia design. Shows past
awards winners.
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Chapter 3 Slide: 38
Desire
• The cost of obtaining a new Web customer
can average $34.
– Once this customer is found an e-business has
an incentive to keep that customer’s interest and
desire to come back to a site.
– This can be accomplished by effect message
design and communication strategies.
– Knowledge held by the sales force can be
tapped to outline the site’s information flow.
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Chapter 3 Slide: 39
Targeted E-Mail
• Targeted e-mail allows firms to directly
contact individuals.
– Targeted e-mail works best with individuals
who have already given their permission to
receive messages.
• Permission marketing is where the customer
ops-in, or signs in at a Web site and agrees to
receive email based direct marketing.
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Chapter 3 Slide: 40
Push and Personalization
• Hypermedia based promotion allows for
personalized messages and sending
messages to the individual using push
technology.
– Webcasting allows the user to have
information delivered to their "doorway" or
browser without requesting or searching for
information.
• Individuals can customize the homepages.
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Chapter 3 Slide: 41
Using Webcasting Technology
USER
COOKIE
Profile code:
132896
DATABASE
TARGETED WEB PAGE
Push
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Chapter 3 Slide: 42
Action
• E-business Action Goals:
– Have individuals visit a Web site
– Provide information for databases
– Obtain information for future
purchases
– Make online purchases.
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Chapter 3 Slide: 43
Key Attributes of
Successful Web Sites
1
Table 3.8: Reasons For Using Favorite Sites
1) Easy of use: 66%
2) Quick download: 58%
3) Frequently updated: 54%
4) Coupons and incentives: 14%
5) Favorite brands: 13%
6) Cutting-edge technology: 12%
7) Games: 12%
8) Purchasing capabilities: 11%
9) Customizable: 10%
10) Offers chat: 10%
NUA Internet Surveys, “Forrester Research: Strong Content Means A Loyal Audience,”
<http://www.nua.ie/surveys/index.cgi?f=VS&art_id=905354655&rel=true>, January 27, 1999.
1
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Chapter 3 Slide: 44
Case 3.: Which Media Helped the
Witch? (1)
• Thinking Strategically
– Decide who the target market was for The Blair Witch
Project.
– Determine what this target market would be most
interested in seeing at a Web site.
– Visit the Web site (www.blairwitch.com).
– Evaluate the content developed for the site.
– Determine what is the most compelling for individuals
interested in this movie.
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Chapter 3 Slide: 45
Case 3.: Which Media Helped the
Witch? (2)
• Thinking Strategically
– Consider what would need to be changed to keep
individuals returning to the site.
– Visit other movie Web sites.
– Determine their target markets and how they develop
relationships with their audiences.
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Chapter 3 Slide: 46
Industrial Markets
Industrial markets have traditionally relied more on
personal sales for communication while consumer
markets have been centered on advertising.
Table 3.5: Consumer vs. Industrial Markets
CONSUMER
INDUSTRIAL
ADVERTISING
PERSONAL SALES
WEB PAGE
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Chapter 3 Slide: 47
Communicating Through
Extranets and Internets
• Extranets and Intranets use the common IP
interface and have the same communication
considerations as Internet based Web
communication.
• Intranets use browsers, servers, and Internet
protocols, but are not open to unauthorized users.
– Bandwidth inside organizations is often higher than
home users allowing for the potential for
applications such as voice, video, and conferencing
online.
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Chapter 3 Slide: 48
Sales Force Automation
• Sales force automation (SFA) uses the
information power of interactive media to enhance
selling efforts.
– The basis for sales force automation is centered on
using Web based technology to aid in the sales process.
• SFA empowers the sales person by allowing them
to link to vital information from the companies
Web site.
– Provide inventory data, price information, and aiding in
sales presentations.
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Chapter 3 Slide: 49
Advertising (1)
• The Web allows for:
– Direct communication and interaction
with customers.
– Tracking a customer's media use.
– The development of customized ads and
placement.
– Facilitates actions such as purchasing.
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Chapter 3 Slide: 50
Advertising (2)
• The Internet is the fasting growing media.
– Taking only 5 years to reach 50 million users compared
to radio’s 38 years, television’s 13 years, and cable’s 10
years.
– Web surfers have shifted media habits away from
television watching.
• Problems with the Web media include:
– Narrow target markets, privacy concerns, limited
bandwidth, no effective measures of success, and hard
to prove returns on investments.
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Chapter 3 Slide: 51
Agencies
• Advertising agencies act as intermediaries by
providing the talent to help set promotional
objectives, create the content, place the promotion
in the media, and provide feedback on the results
of the campaign to the client.
• Agencies:
– DoubleClick (www.doubleclick.com)
– USWeb (www.usweb.com)
– Razorfish (www.razorfish.com)
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Chapter 3 Slide: 52
Timing
• Traditional promotional campaigns use a mix of
media to reach all of the AIDA goals.
– Using a combination of broadcast and print over
differing time periods.
• The Web allows advertisers to develop sites where
the target audience can visit whenever they want
and as often as they like.
– It is important that Web sites be refreshed to
encourage the users to return.
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Chapter 3 Slide: 53
Measuring Effectiveness
• Internet advertising has the potential for allowing
the advertiser to capture information such as who
sees which ad and for how long.
– Web servers are able to track every time an individual
moves from one linked page to another.
– Dead pages, or pages no one visits, can be updated or
deleted.
– This data can be collected from both the sending server
and the user's PC.
– Data from cookies may even provide an indication of
the profile of the user.
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Chapter 3 Slide: 54
Table 3.3: Measurement of
Hypermedia Advertising (1)
• Hit Counts: Early measure that looks at server
data for number of times a page is requested, but
not necessarily seen or displayed at the user’s
browser.
– Could include multiple hits counted for every click of
the mouse or page refresh.
– Records activity regardless of the viewer’s location
such as from workplaces, homes, schools, or from other
countries.
– Provides no information on users.
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Chapter 3 Slide: 55
Table 3.3: Measurement of
Hypermedia Advertising (2)
• Page Views: Tracks the number of individual
pages sent to Web viewers.
– Gives no indication of how many users receive or view
pages and no profile data on the user.
• Click-Throughs: Tracks the number of times an
online ad is clicked on.
– Gives no information about the customers.
– Customers who click through may dump a page before
it loads.
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Chapter 3 Slide: 56
Table 3.3: Measurement of
Hypermedia Advertising (3)
• Unique Visitors : Allows tracking by the IP
address of viewer.
– Multiple users may use the same IP address to access a
site.
• Reach: Measure of sampled group’s visits (if 25%
of sample has visited site has obtained 25% reach).
– Requires the use of surveys or panels may be narrow in
scope.
– This can pair information on the individual’s
background with individual behavior.
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Chapter 3 Slide: 57
Table 3.3: Measurement of
Hypermedia Advertising (4)
• New Measures: These could include linking
individuals by demographic data, loyalty, site
behavior, and other measures.
– These new measures may allow constant
measures of who visits a site and how long they
stay at a site.
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Chapter 3 Slide: 58
Ad Blocking
• Consumers can filter, or block ads from Web sites.
– This shifts power from businesses to the consumers.
• Filters look at the HTML code and checks files
and file types against a filter list to block ads,
interstitials, or animated banners.
– There is a stronger interest in this type of technology
inside of companies where blocking of ads can improve
speed and network performance.
• Some companies have retaliated by blocking users
who use ad blocking software
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Chapter 3 Slide: 59
Table 3.4: Web Site Ratings Indicators
PAYMENT
METHOD
CPM
MEANING
COMMENTS
Cost-per-thousand
CPC
Cost-per-click
Pay-per-action
Pay-perperformance
Per sales lead, per
download, per
purchase, etc.
Typical method used to
compare across media.
Cost of clicking through from a
hypermedia page.
Cost vary by company.
• In the first quarter of 1999:
– 43% of campaigns used cost per thousand, 6% used
performance based measures, and 51% used a
combination of measures.
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Chapter 3 Slide: 60
ALE 3.1: Evaluate Web Sites
AIDA
PROCESS
Awareness
Desire
Interest
Action
E-BUSINESS COMMUNICATION STRATEGY
Describe how offline media to make the audience aware of the Web site.
Use a search engine to see what search terms allow the Web site to be found.
How far from the top of the list does this business end up?
Determine if other Web sites as a media for advertising this Web site.
Describe how content is designed to appeals to the target audience.
How does this site attempt to develop relationship development with its
audience.
Evaluate if this site uses customization and/or personalization techniques to
meet individual’s needs.
Determine if the site uses targeted e-mail and permission marketing.
Investigate if the site use push to send information to the audience.
Decide what types of actions the site attempts to achieve.
Determine if the site uses promotions to entice actions.
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Chapter 3 Slide: 61
ALE 3.2: Determining
Advertising Rates
• Find pricing information on advertising rates from
media kit at Web sites.
– DoubleClick’s Business Rate Card:
www.doubleclick.com/advertisers/business/rate_card.htm
–
–
–
–
–
Evaluate how DoubleClick assigns its charges.
Visit another site and find its advertising rates.
How do these compare to DoubleClick’s.
Compare the target markets of the two Web sites.
Determine which Web site is the better value.
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Managing E-Business
Copyright 2000 South-Western College Publishing
Chapter 3 Slide: 62
ALE 3.3: Charting A Thumbnail
• Create a thumbnail of a TV ad by charting out the
flow of the major scenes.
• Find a Web site for that product or a similar
product.
• Contrast the differences in information flow.
• Consider which approach works best in moving
the audience through the AIDA process.
• Determine how each medium could support the
other in reaching communication goals.
For use with Strategic Electronic Marketing:
Managing E-Business
Copyright 2000 South-Western College Publishing
Chapter 3 Slide: 63
Active Learning Exercise #3.1: Soft
Drink Design
• Design a Web site for a new soft drink:
– Who is the target market?
– What is the main selling point?
– How will the market will decode the message?
– What other media will tie in with this site as part of a
campaign?
– How will the message encoded?
– How will the site be designed?
• How does this Web design compare to existing sites?
• How do these companies develop relationships with their
target audiences?
For use with Strategic Electronic Marketing:
Managing E-Business
Copyright 2000 South-Western College Publishing
Chapter 3 Slide: 64