E-Marketing/6E Chapter 2

Lecture 3Strategic E-Marketing

Instructor: Hanniya Abid

E-MarketingE-MarketingObjectives2-2After this lecture, you will be able to:Explain the importance of strategic planning, strategy, e-business strategy, and e-marketing strategy.Identify the main e-business models at the activity, business process, and enterprise levels.Discuss the use of performance metrics and the Balanced Scorecard to measure e-business and e-marketing performance.E-MarketingE-Marketing2The Amazon Story2-3Founded in 1995 as an online retailer.Did not become profitable until Q4 2001.In 2009, generated $24.5 billion in net sales, $902 million in net income.

Leveraged its competencies into different e-business models.Established e-commerce partnerships with Target, Macys, and others.Provided developer services.Created the first affiliate program.E-MarketingE-MarketingThe Amazon Story2-4Amazons success is based on selection, lower prices, product availability, innovative technology, and better product information.

CEO Jeff Bezos is not interested in expanding to the physical world.

Which of Amazons core competencies do you think will drive its strategy in the future?E-MarketingE-MarketingStrategic Planning2-5A managerial process to develop and maintain a viable fit between the organization and its changing market opportunities.Process identifies firms goals forGrowthCompetitive positionGeographic scopeOther objectives, such as industry, products, etc.

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ESP: Environment, Strategy, and Performance2-6The e-marketing plan flows from the organizations overall goals and strategies.

The ESP framework illustrates the relationships among environment, strategy, and performance.

A SWOT analysis of the business environment (E) leads to the development of strategy (S) and the measurement of performance (P).E-MarketingE-MarketingESP Framework2-7

E-MarketingStrategy2-8Strategy is the means to achieve a goal.E-business strategyStrategy that deploys enterprise resources to reach performance objectives, competitive advantages.E-marketing strategyStrategy that capitalizes on information technology to reach marketing objectives.E-MarketingE-MarketingBusiness Models2-9A business model is a method for long-term survival and a value proposition for partners, customers, and revenue.E-business models include the use of information technology to achieve long-term goals.Firm selects one or more models as strategies to accomplish enterprise goals.

E-MarketingE-MarketingSelecting a business model2-10A firm will select one or more business models as strategies to accomplish enterprise goals.Components of business model selections:

Customer valueScopePriceRevenue sourcesConnected activitiesImplementationCapabilitiesSustainabilityE-MarketingE-MarketingLevel of Commitment to E-Business2-11

Both online and offline(Dell and most retailers)e-mail, blogPure dot-com(Amazon, MySpace)E-MarketingE-MarketingActivity-Level E-Business Models2-12Online purchasingOrder processingE-mailContent publishingBusiness intelligence (BI)Online advertising and public relations (PR)Online sales promotionsPricing strategies Social media communicationE-MarketingE-MarketingBusiness Process-Level E-Business Models2-13Customer relationship management (CRM)Knowledge management (KM)Supply chain management (SCM)Community buildingAffiliate programsDatabase marketingEnterprise resource planning (ERP)Mass customizationE-MarketingE-MarketingEnterprise-Level - E-Business Models2-14E-commerce

Direct distribution

Portal

Social networking

Online brokersOnline exchangeOnline auctionB2B exchange

Online AgentsSelling agentsManufacturers agentsPurchasing agentsE-MarketingE-MarketingPure Play2-15Pure plays are businesses that began on the internet.They represent the final level of the pyramid.Pure plays face significant challenges.They must compete as new brands.They may need to take customers away from established businesses.Some pure plays have redefined industries: Yahoo!, Twitter, and eBay.

E-MarketingE-MarketingPerformance Metrics Inform Strategy2-16Performance metrics are specific measures designed to evaluate the effectiveness and efficiency of operations.Performance metrics:Provide measurable outcomes.Must be easy to understand and use.Must be actionable.Can motivate employees to make decisions that lead to desired outcomes.E-MarketingE-MarketingWeb Analytics2-17Web analytics is the e-marketing term for the study of user behavior on Web pages.

Metrics measure activities such as:Click throughs from advertisingPage viewsNumber of comments posted on a blogNumber of fans on a company Facebook pageConversions to sales

Web analytics software helps companies analyze data on server logs for marketing purposes.E-MarketingE-MarketingData Collection2-18Data for web analytics are collected in several ways:Website server logsCookie filesPage tags

E-MarketingE-MarketingOnline Marketing Measurement Tool Use2-19

E-MarketingThe Balanced Scorecard2-20The Balanced Scorecard provides a framework for understanding e-marketing metrics.

The Balanced Scorecard provides 4 perspectives. Customer perspectiveInternal perspective Learning and growth perspectiveFinancial perspective

E-MarketingE-MarketingThe Balanced Scorecard: Customer Perspective2-21The customer perspective scorecard includes ways to measure goals such as customer loyalty and retention, engagement, satisfaction, etc. Loyalty and satisfaction measures may include percentage of visitors who return to site, time between visits, and shopping cart abandonment.Customer engagement could include the number of comments, photos or videos posted.Exhibit 2.7 provides a list of customer goals and measures.E-MarketingE-MarketingThe Balanced Scorecard:Internal Perspectives2-22The Internal perspective scorecard includes ways to measure goals related to the quality of online services and measures for the entire supply chain.Number of customers who use serviceNumber of complaints in social mediaAmount of time to answer customer e-mailNumber of website updates per dayExhibit 2.8 provides a list of internal goals and measures.

E-MarketingE-MarketingThe Balanced Scorecard: Learning And Growth Perspectives2-23The learning and growth perspective scorecard includes human resources, product innovation and continuous improvement of marketing processes.Number of new products and featuresNumber of customer complaints and fixesConversions from online leads

Exhibit 2.9 provides a list of learning and growth goals and measures.E-MarketingE-MarketingThe Balanced Scorecard:Financial Perspectives2-24The financial perspective scorecard includes ways to measure financial goals such as sales, profit and return on investment.Sales growth and market shareReturn on invested capitalAverage order valueIndividual customer profit

E-MarketingE-MarketingSummary2-25Strategic PlanningE-Business modelsPerformance metricsE-MarketingE-MarketingOh, one more thing.2-26Visit: www.rozee.pk

Write down what you think companys goals are for its website.

Then make a list recommending relevant performance metrics from each of four perspectives.

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