Internet marketing

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INTERNET MARKETING

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Internet Marketing Chandrasekhar Ilindra California Miramar University

Author Note
Chandrasekhar Ilindra, California Miramar University. Chandrasekhar Ilindra is now pursuing M.B.A degree from California Miramar University. Correspondence concerning this article should be addressed to Chandrasekhar 9750 Miramar Rd, San Diego, CA 92126. USA Contact: [email protected]

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Table of Contents

1. 2. 3. A. B. C. D. E. F. G. 4. A. B. C. D. E. F. G. H. I. J. K. 5. 6. 7. 8.

Abstract ................................................................................................................................................. 3 History on Internet Marketing............................................................................................................... 4 Types of Internet Marketing ................................................................................................................. 5 Web marketing .................................................................................................................................. 5 Email marketing ................................................................................................................................ 5 Search engine marketing (SEM) ....................................................................................................... 5 Referral marketing ............................................................................................................................ 5 Content marketing ............................................................................................................................. 5 Video marketing and ......................................................................................................................... 5 Social media marketing..................................................................................................................... 6 Internet marketing Business Models ..................................................................................................... 6 Affiliate Marketing ........................................................................................................................... 6 Selling Your Own Product ................................................................................................................ 6 Local Business Consulting ................................................................................................................ 6 Website Flipping ............................................................................................................................... 6 The Membership Model .................................................................................................................... 7 Lead Generation ................................................................................................................................ 7 Joint Venture ..................................................................................................................................... 7 Webinars ........................................................................................................................................... 7 Web Domains.................................................................................................................................... 7 Providing Services ............................................................................................................................ 7 Online Auctions ................................................................................................................................ 8 Advantages of Internet Marketing ........................................................................................................ 9 Problems of Internet Marketing .......................................................................................................... 10 Current Trends in Internet Marketing ................................................................................................. 11 References ........................................................................................................................................... 18

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1. Abstract

Internet or Online marketing refers to sell/advertise goods or services using Internet through email or website. Now most of the companies are utilizing the internet marketing and online advertising efforts in conjunction with traditional types of advertising like television, newspapers, radio, magazines, Banners, Door-to-Door, Flyers etc. In this paper I wished to seek answers for the following questions with the help of secondary data obtained from online surveys/articles, Books, email/social media surveys and web. Electronic exchanges or Internet marketing has had its greatest success in business-to-business marketing, although it accounts for only about 10 percent of business-to-business commerce. In the business-to-consumer market, electronic exchange is the fastest-growing type of non-store retailing.

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2. History on Internet Marketing Online advertising began in 1994 when Hotwired sold the first banner to several companies.

It started with email The history of the internet as a marketing channel started in 1983 when Compuserve launched the first commercial internet email product. Before, email messaging has been available only to the Defense personal (military, navy and air force) and universities. The Web (HTML) After few years a browser was invented by a National Center for Supercomputing Applications, was soon followed by a more household name, the Nestscape Navigator. This was the birth of the Web. eCommerce In 1995 Amazon.com launched a ecommerce website, business analysis though that this model of business would flop as consumer would never use their credit card online. Search engine marketing The next moment in the internet history was Google adwords; it was launched in 2003. Mobile Applications In 2007 the rules changed again. Mobile content consumption, previously tightly controlled by the carriers, was suddenly controlled by device manufacturers as Apple launched the iPhone. Open Graph The most radical impactful marketing innovation yet is the Open Graph, a Facebook technology launched in April 2010.

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3. Types of Internet Marketing
Internet marketing typically broken down into more specialized areas such as…

A. Web marketing
Web marketing is the marketing and promotion of products or services over the Internet media. This marketing service was started in 1994 when Hotwired sold the first banner ads to several advertisers. The main advantage of web marketing is the immediate publishing of information and content to the broader audience with minimal expenses.

B. Email marketing
Directly marketing a commercial message to a group of people through electronic mail. Example: Hotmail, Yahoo mail, Gmail etc.

C. Search engine marketing (SEM)
Promoting companies websites by increasing their visibility in search engine results pages through the user of either paid placement, paid inclusion, contextual advertising, or through the use of free search engine optimization techniques. Example: Google, Yahoo, Microsoft etc.

D. Referral marketing
It is a method of promoting products/services to a new customer through referral, usually word of mouth. Such referrals often happen spontaneously but business can influence this through appropriate strategies.

E. Content marketing
The process of creating specialized content such as info graphics, ebooks and blog articles to attract more customers.

F. Video marketing and
Promoting strategies developed by companies to promote products/services by using short video films. The main advantage of video marketing is the message will be communicated to the targeted audience through visual demonstration it consumes less time and customer understand the message quickly. Example: Youtube etc.

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G. Social media marketing
The process of gaining traffic or attention through social media websites. Example: Facebook, Twitter, LinkedIn etc.

4. Internet marketing Business Models
Internet marketing has several business models, most popular internet marketing business models are… A. Affiliate Marketing Affiliate marketing is basically where you are a 'commission only' sales person and it is the best place to begin online. Most websites will have a link at the bottom of their website where you can sign up and begin to sell their products for them. They give you your own special link and all you do is build a website (don't worry it's very simple) and when somebody visits your website and clicks your link it will take them to the vendor's website. If that person then makes a purchase, you get a commission. There are many Internet marketers making over a million dollars per year from this business model. B. Selling Your Own Product This is where you already have your own product or website established. This is the next step up from affiliate marketing, it's not as easy as just selling somebody else's product. You have to do the market research and create the product, you will need to sort out how you are going to deliver the product, and also be responsible for customer service. There is a lot more work involved in selling your own products, however this is ultimately where you want to get to. C. Local Business Consulting Local business consulting is one of the fastest ways to build a 6-Figure business, however it's not for the complete beginner. Local business marketing or local business consulting is where you take over a local business' online marketing for a monthly fee. It is a great way to quickly build up a strong passive income but you will need to have a solid understanding of business, marketing and Internet marketing strategies first. Once you have another business model up and running it is a fantastic way to double your current business income in a very short space of time. D. Website Flipping Building and developing websites is very similar to buying and selling property. Online it is known as 'Virtual Real Estate'. Again this does require some previous knowledge of Internet marketing to know exactly what to look for and knowing the process of developing a website in order to sell. Website flipping is a great way to earn quick capital. After you have bought and sold your first couple of websites you will have a much better understanding as to how to get the maximum profit from this business model.

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Membership sites are one of the best ways to create a massive amount of passive income. You are more than likely already a part of somebody else's membership model. Do you currently pay for Internet on a monthly basis? Do you have a mobile phone? It is basically where you have your customers pay for a service once a month on a paid subscription. The amount of money that can be made with this business model per month is staggering. In internet marketing it can come from being part of a training forum or from a monthly members email newsletter. F. Lead Generation Lead generation is where you set up a website that collects the contact details of visitors and then you sell them on to companies. The amount that you get will vary from industry to industry however there is good money to be made with this method. Lead generation is a good opportunity because in many markets you are competing against regular business owners who do not fully understand how to get their website on to the top of the search engines. G. Joint Venture Joint venturing is where you can find an expert and create a 50/50 split in which they have the product or service and you simply market it for them online. This business model has so much potential because there are so many experts out there that may have the best products in the world but they have no idea about how to market and sell them online. All you need to do is to put the Internet marketing skills you have to use and help the business owner sell them. There is an abundance of 'broke' experts out there and a shortage of good Internet marketers. H. Webinars Even today 9/10 people do not even know what a webinar is. Webinars are basically seminars that you can do from the comfort of your own home. You do not need to pay for travel and fly to another country and pay for hotel rooms like you would for a normal seminar. You simple bring together your target customers on an online platform where you get to deliver value and solve the problems for them in a very intimate and productive environment. Webinars are going to be big! I. Web Domains The website domain is simply the website's address. Domaining is similar to website flipping where you as the business owner can build, buy and sell premium domain names. Two word domains are being bought and sold every day for tens and hundreds of thousands of dollars. It is still going to be 10-15 years before the general public even realises that this exists, which again creates a massive opportunity for you to learn this stuff now and be ready to profit. J. Providing Services Being a service provider is a slightly more advanced method however it is tremendously leveraged which brings with it tremendous profit. The beauty of it is that you build a

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team that provides the service, you have commission only sales people who sell the service and you get to keep the profit. It is the ultimate business model where the business runs itself and you bank the profit. K. Online Auctions Online auctions worked in essentially the same way as traditional auctions, the only difference being that the auction process occurred over the Internet rather than at a specific geographic location with buyers and sellers physically present.

There are three basic categories of online auctions 1. Business-to-business auctions 2. Business-to-consumer 3. Person-to-Person Example: ebay.com

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5. Advantages of Internet Marketing
Internet marketing is a big advantage for a small company that wants to get into a market and compete for business with less capital. However, for large, established companies, this is less of an advantage since they have the capital to invest; low-entry barriers create more competition for them from smaller companies. Here are some of the major advantages for marketers…  Reduce the need for stores, paper catalogs, and salespeople; can be cost efficient.  Allows good visual presentation and full description of product features and benefits.  Allows vast assortments of products to be offered efficiently.  Allows strategic elements, such as product offerings, prices, and promotion appeals, to be changed quickly.  Allows products to be offered globally in an efficient manner.  Allows products to be offered 24 hours a day, 365 days a year.  Fosters the development of one-on-one, interactive relationship with customers.  Provides and efficient means for developing a customer database and doing online marketing research.

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6. Problems of Internet Marketing For many companies Internet marketing has not met the growth expectations, it is an established alternative for marketing some products and services. It does provide customers with a wealth of product information and product assortments that are readily available.

 Strong price competition often squeezes profit margins.  Low entry barriers lead some e-marketers to overemphasize order-taking and not develop sufficient infrastructure for order fulfillment.  Customers must go to the web site rather than having marketers seek them out via salespeople and advertising; advertising their web sites is prohibitively expensive for many small e-marketers.  Limits the market to customers who are willing and able to purchase electronically; many countries still have a small population of computer-literate people.  Not as good for selling touch-and-feel products as opposed to look-and-buy products unless there is strong brand/store/site equity (Dell computers/WalMart/Amazon.com) or the products are homogeneous (books, CDs, flight tickets, etc.).  Often less effective and efficient in business-to-consumer markets than in business-to-business markets.

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7. Current Trends in Internet Marketing
Successful marketing depends upon addressing a number of key issues. Traditionally these considerations were known as the 4Ps – Product, Price, Place and Promotion. As marketing became a more sophisticated discipline, a fifth P was added - People. And recently to more Ps were added - Process and Physical appearance.

Price Product Marketing Mix Physical appearance

Place

Promotion

Process

People

1. Product To satisfy the needs and wants of the target market There is no point in developing a product or service that no one wants to buy, yet many businesses decide what to offer first, and then hope to find a market for it afterwards.  The perfect product must provide value for the customer. This value is in the eye of the beholder- The company must give customers what they want, not what we thing they want.  The product does not have to be tangible – an insurance policy can be a product  Beware going too far with product quality. Don’t try to sell a BMW when the customer wants a Toyota Car.

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2. Place
To make the product conveniently available to the target market consistent with their purchasing patterns. The product must be available in the right place, at the right time and in the right quantity, while keeping storage, inventory and distribution cost to an acceptable level. Place also means ways of displaying your product to customer groups. This could be in a shop window, but it could also be via the internet.

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3. Promotions
Promotion is the way a company communicates what it does and what it can offer customers. It includes activities such as  Branding  Advertising  PR  Corporate identity  Sales management  Special offers and  exhibitions Good promotion is not one-way communication – it paves the way for a dialogue with customers.

4. Price
To make the product affordable to the target market and reflect the value of benefits provided. The price also need to be competitive, but this does not necessarily mean the cheapest; the small business may be able to compete with larger rivals by adding extra services or details that will offer customers better value for money. Pricing strategy must provide profit to the company. It is only the element of marketing mix that generates revenue – everything else represents a cost. Price positions you in the marketplace – the more you charge, the more value or quality your customers will expect for their money. Existing customers are generally less sensitive about price than new customers.

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5. People
They are the target consumers of the company. The reputation of your brand rests in people’s hands. They must, therefore, be appropriately trained, well-motivated and have the right attitude. It is essential to ensure that all employees who have contact with customers are not only properly trained, but also the right kind of people for job.

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6. Physical Appearance
Physical appearance is the first distinction of a product. A product could be easily recognized by its appearance.

7. Process
The process of the product is essential in marketing. This determines the capability of the product to supply the demand of the consumers. The process of giving a service and the behavior of those who deliver are crucial to customer satisfaction. Issues such as waiting times, the information given to customers and the helpfulness of staff are all vital to keep customer happy. Customers are not interested in the detail of how your business runs. What matters to them is that the system works. Process is the one of the P’s that is frequently overlooked. A customer trying to reach your company by phone is a vital source of income and returning value; but so often customers have to stay on hold for several minutes listening to a recorded message before they are able to get through. Many of these customers give up, go elsewhere and tell their friends not to use your company- just because of the poor process that is in place.

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r the Internet Customers

Now to be able to use the seven P’s effectively in order to achieve the predefined goals of any organization it is imperative to understand the customers. Customization will only be truly effective if we understand our customers and their true needs. Before adapting marketing practices to the Internet, the marketer needs to understand the characteristics of the online customers. The Net users can be classified into five categories depending upon their intention of using the Internet. The five categories of users are: Directed Information Seekers: They require specific, timely and relevant information about the products and services being offered. Undirected Information Seekers: These users require something interesting and useful. Something that can give them an edge, advantage, insight or even a pleasant surprise. Bargain Hunters: They are of two kinds: One who look for free items on the internet and other who are seeking better deals, higher discounts etc.

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They see the Web as an entertainment medium of vast breath and potential and want to explore the medium before the mass gets there. Directed Buyers: They want to buy something - now. They are sure what they require and just log on to the Web to purchase the item.

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8. References

Peter/Donnelly, Jr. Marketing Management Knowledge and Skills, Ninth Edition http://www.webopedia.com, An IT Business Edge Site Wikipedia, http://en.wikipedia.org/ http://blog.socialintent.com/2011/04/the-history-of-internet-marketing/ www.cim.co.uk/marketing resources

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