Module 1:

Introduction to E-Marketing: Landscape – Past – Today – Future – Internet Marketing Paradigm –

Internet Infrastructure Stack Business Models & Strategies: Strategic Planning – Strategy to
Electronic Planning – Strategic Drivers of the Internet Economy – Business Models to E-Business
Models – E-Business Models – Performance Metrics – The Balanced Scorecard

 After reading Module 1 you will be able to:

o Explain how the internet and information technology advances offer benefits and
challenges to consumers, businesses, marketers, and society.

o Distinguish between e-business and e-marketing.

o Explain how increasing buyer control is changing the marketing landscape.

o Understand the distinction between information or entertainment as data.

o Identify several trends that may shape the future of e-marketing.

o Explain the importance of strategic planning, strategy, e-business strategy, and e-

marketing strategy.

o Identify the main e-business models at the activity, business process, and enterprise
levels.

o Discuss the use of performance metrics and the Balanced Scorecard to measure e-
business and e-marketing performance.
 Introduction to E-Marketing
E-marketing is the use of information technology for the marketing activity, and the processes for
creating, communicating, delivering and exchanging offerings that have value for customers, clients,
partners, and society at large. More simply defined, e-marketing is the result of information
technology applied to traditional marketing

E- Business, e-marketing and e-commerce are internet applications. E-business is the optimization of
a company’s business activities using digital technology. E- Commerce is the subset of e-business
focussed on transactions that include buying/selling online, digital value creation, virtual
marketplaces and storefronts, and new distribution channel intermediaries.

Evolution of e-marketing

HOW HAS DIGITAL MARKETING EVOLVED?

Source: [Link]

 The internet is a global network of interconnected networks.

 E-mail and data files move over phone lines, cables, and satellites from sender to receiver.

 There are two special uses of the internet:

 Intranet: network that runs internally in an organization.
  Extranet: two joined networks that share information.

E-business is the continuous optimization of a firm’s business activities through digital

technology.E-commerce is the subset of e-business focused on transactions.E-marketing is
one part of an organization’s e-business activities.E-Marketing is Bigger than the Web. The
Web is the portion of the internet that supports a graphical user interface for hypertext
navigation with a browser. The Web is what most people think about when they think of the
Internet.

The Web Is One Aspect of E-Marketing

E-Marketing is Bigger than Technology

The internet provides individual users with convenient and continuous access to information,
entertainment, and communication. Communities formed around shared photos, videos, and online
profiles. The digital environment enhances processes and activities for businesses.

Societies are enhanced through more efficient markets, more jobs, and information access.
 E-Marketing Landscape- Integration of e-marketing and traditional marketing to create
seamless strategies and tactics

 The customer is CEO

 E- commerce
 Advertising online
 Search engine marketing
 Owned, paid, and earned media
 Mobile marketing
 User-generated content
 Social media communities
 Content marketing
 Local and location-based marketing
  Brand transparency
 Inbound marketing
 Metrics rule

Global Internet Users

E-Marketing’s Past: Web 1.0

 The Internet started in 1969 as the ARPANET, a network for academic and military use.
 Web pages and browsers appeared in 1993.
 The first generation of e-business was like a gold rush.
 Between 2000 and 2002, more than 500 internet firms shut down in the U.S.
 By Q4 2003, almost 60% of public dot-coms were profitable.

E-Marketing Today: Web 2.0

 Web 1.0 connected people to networks.
 Web 2.0 connected people with machines and each other.
 Web 2.0 is the second generation of internet technology and includes:
o Blogs
o Social networking
o Photo, video, and bookmark sharing
 The Future: Web 3.0
 The newest technologies allow marketers to focus on user:
 Engagement
 Participation
 Co-creation
 Online gaming represented over $1 billion in revenue and 15 million players in 2006.

Consumers Have More Control

 The internet provides a communication platform for individual comments, both positive and
negative.
 Comments can spread quickly and rapidly.
 New technologies such as digital video recorders (DVRs) will increase consumer control.
 New service Akimbo maintains a library of over 10,000 programs with access via the
internet, television, or other appliance.

Power Shift from Companies to Individuals


Wireless Networking Increases

 Cell phones, PDAs, and laptops connect to the internet via wireless modem worldwide.
o Starbucks
 o Hotels and airports
o Queen Mary II luxury liner
o Amtrak train stations

 Customers will have information, entertainment, and communication when, where, and how
they want it.

Appliance Convergence
 The receiving appliance is separate from the media type.
 Computers can receive digital radio and TV.
 TV sets can receive the Web.
 New types of “smart” receiving appliances will emerge.
 Internet refrigerator is many digital appliances in one.
 Global positioning systems (GPS) allow in-car communication and entertainment.

Semantic Web
 The Semantic Web will utilize a standard definition protocol that will allow users to find
information based on its type, such as:
 The next available appointment for a doctor.
 Details about an upcoming concert.
 Menu at the local restaurant.
 Represents the next huge advance: providing worldwide access to data on demand without
effort.

7 Online Marketing Trends That Will Dominate 2017

1. Ushered in by Pokémon Go, We’ll See the True Rise of Augmented Reality.

Few people would have predicted that Pokémon Go would have taken off as radically as it
did, earning $10 million a day in new revenue during its peak. Enthusiasm for it has largely died
down, but the app has had two main effects on the online marketing community; one, it’s shown
that users are ready for augmented reality (AR) experiences, and two, it’s given marketers a taste of
the earning potential here. You can expect to see more brands coming out with AR games, AR ads,
and attempts to capitalize on AR apps that already exist.

2. Live Video Streaming Will Fully Take Off.

Social media users are beginning to demand more in-the-moment content, giving them a vicarious
view into a world (or event) they’d previously been unable to access. Thanks to faster Internet and
the ubiquity of mobile devices, live video has become something of a trend on its own, with more
and more apps and platforms giving some kind of “live streaming” functionality; even this year’s first
Presidential debate was streamed live, drawing millions of viewers in. Live video has been on an
upward streak for the last few years.

3. Data Visualization Tools Will Greatly Expand, As Will The Need for Data Visualization.
As marketers, data is our lifeblood. We need quantitative information to tell us who’s buying what,
when, why, and what messaging is most effective for them. But even data analysts frequently have
problems understanding exactly what the data is saying; our brains weren’t made to process vast
amounts of raw numerical data this way. Now, technology is finally catching up to the
“interpretation” part of data analysis; there are dozens of data visualization tools on the market
already, but in 2017, every business is going to want to start using them – the ones who don’t will be
left at a significant disadvantage. The technology will be more sophisticated, and data analysis needs
will be greater than ever.

4. Native Advertising Will Explode in Popularity.

Yes, native advertising is one of the oldest trends on this list. It’s been used for years by brands
looking for an easy way to get natural-looking visibility. But native advertising is on an upward swing;
as consumers continue to condemn or ignore most forms of conventional advertising, native
advertising becomes a sneakier (yet effective) way to get those consumers’ attentions. We may also
see newer, more improved forms of native advertising offered by major publishers, or brands who
have previously opted not to offer this method of advertising.

5. Brands Will Increasingly Target Niche Markets Out of Necessity.

Online marketing is becoming more crowded; though the number of available consumers has
remained more or less steady, millions of new businesses have flooded into the space for a piece of
the pie. This is especially true in the content and social media marketing spaces. One of the best
solutions for this is to target a more specific niche, appealing to a narrower range of demographics
with a more specific topic. As a result, we’re bound to see more companies opting for more
targeted, almost personal-level content and campaigns.

6. We’ll See the Rise of ‘Immersive Experience’ Content Marketing.

Users are also craving more immersive experiences, giving them the feeling that they’re doing more
than staring at a phone or laptop screen. Augmented reality (AR) and virtual reality (VR) are two
technologies driving this mentality forward (and I’ve already mentioned AR), but don’t forget other
ways of providing this immersive experience. You can offer 360 videos to make your users feel like
they’re living in a moment, or host live webinars and workshops to get people to engage with you.
The key is to provide some level of interaction in a way that makes people feel like they’re a part of
something bigger.

7. ‘Dense Content’ Will Become Essential to Cut Through the Content Noise.
Attention spans have fallen to goldfish-like levels, and we’re only going to grow more impatient and
demanding as technology progresses. The potentially infinite scrolls of social media newsfeeds and
endless streams of content from almost every brand and individual we follow have forced us to filter
out the majority of messages we see as white noise. We skim articles. We skip posts. We share
articles after only reading the headline. In response, more marketers are going to learn that dense
content is key, making every line and every word count.

Benefits of E-Marketing
Analysis of the Amazon Business Model
Retailer, Service Provider, and Hardware Innovator
Known best as the largest internet retailer in the world, [Link] is not a simple case
study in terms of business model analysis. Even if we begin by looking at it's consumer retail
business, it quickly becomes clear that the company is anything but a traditional retailer.
While Amazon does sell products at a standard mark-up, it has also pioneered alternate
retail strategies by acting as the gateway for other retailers and a very robust marketplace
for used goods. But retail is only part of the picture when it comes to [Link].

Lines of Business

The company itself defines its lines of business in terms of product sales, service sales, AWS,
fulfillment, publishing, digital content subscriptions, advertising, and co-branded credit
cards. For our purposes, I'll define Amazon's lines of businesses as 1) online retail, 2) internet
services, and 3) the Kindle ecosystem.

1. Online Retail

The online retail line of business includes those products sold by Amazon as
a traditional retailer, most commonly as a low-cost retailer. Amazon claims to have
"Earth's Biggest Selection" of products available through its family of websites, sold
at the lowest cost at a small profit. The company started as an online book seller,
rapidly expanding into music and movies, and ultimately into electronics and
household goods.

But Amazon doesn't stock everything that is sold through its website. Another part
of its retail strategy is to serve as the channel for other retailers to sell their products
and taking a cut of every purchase. Amazon maintains its status as a destination
website, but does not have to maintain inventory on slower-selling products. This
strategy has made Amazon a leading long-tail retailer, expanding its available
selection without a corresponding increase in overhead costs.

Extending this long tail retail model further, Amazon introduced the sale of used
products through its seller marketplace. Originally developed to compete with eBay,
the seller marketplace provides another retail revenue stream for the company
without the need to stock products in its warehouses. Advertising and shipping are
handled exclusively by sellers, with Amazon taking a cut of every sale simply for
providing the channel.

2. Internet Services
Amazon's internet services cannot easily be discussed as a standalone line of
business because it is deeply intertwined with both its retail business and the Kindle
ecosystem. From the consumer perspective, Amazon has begun to provide services
like Amazon Prime, which provides free two-day shipping on retail purchases, on-
demand video streaming, and free access to the Kindle library, all for an annual fee.
Amazon Prime overlays the subscription and all you can eat business models with
the retail model to provide additional customer value.

Unknown to most Amazon customers, however, are the other internet services
provided by Amazon, referred to as AWS (Amazon Web Services). Originally
developed as a side business, Amazon decided to lease out its own server space to
other companies and individuals. While not a core part of the company's strategy,
Amazon found itself managing a large number of servers and internet services, and
it was a fairly small effort to manage those services for others.

3. Kindle Ecosystem
Amazon has expanded its business into manufacturing and distributing the family of
Kindle tablets. Originally designed as an electronic book reader (supplementing its
online book seller business), the Kindle has become a fully functional tablet and
media device. With the Kindle, Amazon serves as both manufacturer and traditional
retailer (and also wholesaler by selling the device through other retailers).

While the company does not admit as much, it is assumed that the Kindle devices
are sold at a loss, which would more correctly put this line of business into
the razors & blades category of business model. By selling the hardware at a loss,
Amazon is betting that customers will purchase enough electronic books, games,
and videos to justify the initial loss.

The Amazon Business Model Canvas

Alexander Osterwalder and Yves Pigneur, authors of Business Model Generation,
have developed the popular business model canvas. The canvas is described as "a
shared language for describing, visualizing, assessing, and changing business
models." It’s made up of nine building blocks that help focus attention on key
attributes of a business. What follows is an attempt at a business model canvas for
Amazon.
 

 What'sNextforAmazon?

Notable in the canvas above is that, regardless of line of business, Amazon keeps some
things consistent. Its value proposition remains price and convenience no matter the
product or service, and low prices can be sustained by ensuring its customer relationships
continue to be mostly automated and self-service. Expect the company to continue its
expansion into new areas while continuing to focus on these two buildingblocks.

Amazon Publishing is one of the company's more recent ventures, providing the tools for on
demand publishing and giving new (or established) authors access to the Amazon store. This
extends Amazon's roots within the publishing industry, likely disrupting the industry
permanently.

Another recent service that Amazon has launched is referred to as AutoRip. With AutoRip, a
customer's music purchases from the past become immediately available digitally and
through the cloud. Expect this service to be expanded to movies and books, allowing any
purchase of the actual product to translate to digital versions automatically.

The latest rumors surrounding Amazon revolve around same day delivery in some parts of
the U.S. It's a challenge that many e-commerce companies have tried and failed at, but
which Amazon may be able to execute on. It's likely that the service will be limited to the
 largest metropolitan areas or those areas in closest proximity to its warehouses. But same
day delivery would permit Amazon to conquer one more category that has yet to
successfully translate to the internet: the grocery business.

The Amazon value propositions of price and convenience hold true in all of its product
categories, allowing it to extend itself into new markets and deepen its customer
relationships. The company has dominated online retail with a fairly standard traditional
retail business model over the internet, using its buying power and financial resources to
dominate the marketplace.

This dominance will continue well into the future as Amazon continues to explore new
product and service categories. What we shouldn't necessarily expect out of Amazon are
unique business models. The company has developed clear expertise in e-commerce
innovation, which it has applied to a variety of traditional business models. The key lesson to
be learned from Amazon is that to thrive in the digital era, it's often better to execute your
business model well than to invent new business models from scratch.

 Amazon’s 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 Amazon’s core competencies do you think will drive its strategy in the future?

Business Models
 A 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.

Selecting a Business Model

 A firm will select one or more business models as strategies to accomplish enterprise goals.
 Components of business model selections:
Customer value Scope

Price Revenue sources

Connected activities Implementation

 Capabilities Sustainability

Level of Commitment to E-Business

Pure dot-com
Pure Pure Dot-Co m
Level of business Impact

Business Transformation
Play (Amazon,
(Amazon)
(competit ive advantage,
industry redefinition) Both online and offline
Click and Mortar
Enterprise (Dell and most
(eSchwab, mostretailers)
retailers)
Effectiveness
(customer Customer
retention) Business Process Relationship
Management
Efficiency e-mail, blog
(cost Activity Brochureware
reduction) E-Mail

Activity-Level Models
1. Order processing
2. Online purchasing
3. E-mail
4. Content publisher
5. Business intelligence (BI)
6. Online advertising and public relations (PR)
7. Online sales promotions
8. Dynamic pricing strategies online

Business Process-Level Models

1. Customer relationship management (CRM)
2. Knowledge management (KM)
3. Supply chain management (SCM)
4. Community building online
5. Database marketing
6. Enterprise resource planning (ERP)
7. Mass customization
Enterprise-Level Models
1. E-commerce, direct selling, content sponsorship
2. Portal
3. Social networking
4. Broker models
 Online exchange, hub
 Online auction
[Link] models
 Manufacturer’s/selling agents
 Shopping agent
 Reverse auction

*Note: Please refer page no- 39 to 44 in the text book for

description of each of the above-mentioned points of E-business
models

Pure Play Models

 Pure plays are businesses that began on the internet.
o They represent the top level of the E-Business pyramid.
 Pure plays face significant challenges.
o They must compete as new brands.
o They may need to take customers away from established businesses.
 Some pure plays have redefined industries: E*Trade, eBay, Yahoo!, MySpace.

Strategic Planning
 A managerial process to develop and maintain a viable fit between the organization and its
changing market opportunities.
 Process identifies firm’s goals for
o Growth
o Competitive position
o Geographic scope
o Other objectives, such as industry, products, etc.

ESP: Environment, Strategy, and Performance

 The e-marketing plan flows from the organization’s 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).

 ESP Framework
Legal-Ethical
 Technology Internet
E Com petition
OtherFactors
Markets
Strategy SWOT
 Strategy is the means to achieve a goal.
E-MarketingPlan
 E-business strategy
E-B usiness
S Stratethat
o Strategy gydeploys enterprise resources
E -M arketito
ngreach performance
E objectives,
-M arketingM ix
competitive advantages.
Strategy C R M
 E-marketing strategy

o Strategy that capitalizes on information technology to reach marketing

P objectives. Perform anceM etrics

Performance Metrics
 Performance 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 be utilized for employee evaluations.

Performance metrics, also called key performance indicators (KPIs), are specific measures designed
to evaluate the effectiveness and efficiency of an organization’s operations, both online and offline.
Web analytics is the e-marketing term for the study of user behaviour on Web pages.
Data is collected on -
Clicks, registration, purchase, site traffic( click-throughs or SEO), most often viewed pages, number
of comments posted on blogs, fans on a company Facebook page, conversion to sales, signing up for
an e-mail newsletter or response to new tactics like a new one-day shipping price or special
promotion on the site to increase sales

Web analytics are collected in several ways-

• Web site server logs record the user’s IP address, which browser the visitor is using, his or
her location before arriving at the company site, the time of the day, and every click-through
of the user while on the site. The IP address helps companies understand where users live

• Cookie files are small data files written to a user’s hard drive when visiting a site. They are
necessary for using shopping carts and other operations at a site. When customers return,
the cookie file data are retrieved and used to understand how many visitors are returning .
[Link] uses cookie file data to display the user name on its home page instantly.

• Page tags are one pixel on a page that is invisible to users ( a pixel is one dot of light on a
computer screen).Page tags activate a special script when users are on the page , providing
information such as when items are removed from the shopping cart. Tags can also be
activated based on cookie files on the visitor’s hard drive from a previous visit-creating data
about the return visit and what the user did.

• Geolocation uses many different technologies to locate an internet-enabled device at its

physical world address. For example WiFi, GPS,or IP addresses. Marketers can use this for
market segmentation when they observe consumer behaviour from various countries or
other more precise locations

Web Analytics
 Web analytics, commonly called metrics, is the study of user behavior on Web pages.
 Metrics measure activities such as:
o Click throughs
o Visitor patterns
o Length of time spent on a page or site
o Conversions to sales
 Web analytics software helps companies analyze data on server logs for marketing purposes.

Social Engagement Metrics
 Online measurement also includes metrics for evaluating Web 2.0 technologies.
 Social engagement metrics allow marketers to know how visitors participate, not just
whether they landed on a page.
o Time spent viewing a video, playing a game, or listening to music.
o Writing a comment on a blog.
 o Downloading a MP3 file, ring tone, or other content.

The Balanced Scorecard

The balanced scorecard was first introduced by accounting academic Dr. Robert Kaplan and business
executive and theorist Dr. David Norton. It was first published in 1992 in a Harvard Business Review
article

A balanced scorecard is a performance metric used in strategic management to identify and improve
various internal functions of a business and their resulting external outcomes.
It is used to measure and provide feedback to organizations.
The Balanced Scorecard provides a framework for understanding e-marketing metrics.

The Balanced Scorecard provides 4 perspectives.

1. Customer perspective

2. Internal perspective

3. Learning and growth perspective

4. Financial perspective

Customer Perspective
 The customer perspective scorecard includes ways to measure goals such as customer
loyalty, satisfaction, appropriateness of target markets, etc.
 Loyalty and satisfaction measures may include percentage of visitors who return to site and
time between visits.
 Transaction measures may include measurement of unique visitors, online sales abandoned,
etc.
Internal perspective
 The Internal perspective scorecard includes ways to measure goals related to the quality of
online services.
 Quality of online technical help such as amount of time to answer e-mail
 Web page loading time
 Inventory levels, inventory turns

Learning and Growth Perspectives

 The learning and growth perspective scorecard includes ways to measure goals related to
online service innovation and continuous improvement.
 Average time from concept to start
 Speed to match a rival’s site
 Time between site relaunches
Financial perspective
 The financial perspective scorecard includes ways to measure financial goals.
 Sales growth and market share
 Return on invested capital
 Average order value
 Individual customer profit
WHAT IS EARNED, OWNED & PAID MEDIA? THE DIFFERENCE EXPLAINED.
If you've been privy to the digital world you may have heard these buzzwords passed around, but
what is the difference between 'earned', 'owned' and 'paid' media and what does it mean for your
digital strategy?

Think of earned, owned and paid media like a tripod. Each element is an important part of the whole
and all contribute to a complete digital marketing strategy. The illustration above outlines each
element's role and how they work together to form a cohesive marketing mix.

Earned, Owned and Paid Media Defined

Earned media – If owned media sites are the destination then earned media is the vehicle that helps
people get there. What good is a website or social media site if no one is seeing or interacting with
it? That's where earned media comes in. Earned media is essentially online word of mouth, usually
seen in the form of 'viral' tendencies, mentions, shares, reposts, reviews, recommendations, or
content picked up by 3rd party sites. One of the most effective driving forces of earned media is
usually a combined result of strong organic rankings on the Search Engines, and content distributed
 by the brand. First page rankings and good content are typically the biggest drivers. Rankings on the
first page of the search engines place your owned media sites and content links in a position to
receive higher engagement and shares, which is why a good SEO strategy is crucial. When it comes
to brand content, interesting, informative content can come in all shapes and sizes. Whether it be a
blog, infographic, video, press release, webinar or e-book, the bottom line is that the content has to
be worthwhile in order to receive the valuable earned media; which is why a great content
strategy is also important.

Owned media - Owned media is any web property that you can control and is unique to your brand.
One of the most common examples is a website, although blog sites and social media channels are
other examples of owned media properties too. Channels like social media and blogs are extensions
of your website, and all three are extensions of your brand as a whole. The more owned media you
have, the more chances you have to extend your brand presence in the digital sphere.

Paid media - Paid media is a good way to promote content in order to drive earned media, as well as
direct traffic to owned media properties. Paying to promote content can help get the ball rolling and
create more exposure. Social Media sites like Facebook, Twitter and LinkedIn offer advertising that
could potentially help boost your content as well as your website. Another way to gain more
exposure for your content is to pay influencers to tweet or share your links, impacting the reach and
recognition your pieces receive. Using retargeting, Pay Per Click and display ads is an effective and
more direct way to drive searchers to your owned media sites like your website, to help increase
traffic and/or conversions.

Key Takeaways
 All three elements, owned, earned and paid are important to a digital strategy. It's up to you to
evaluate these three themes and decide where to allocate your resources to make the most sense
for your brand.

 Owned media sites are an extension of your brand and create additional avenues for people to
interact with your brand. When it comes to owned media, as long as you can keep up with the
maintenance, the more the merrier.

 Earned media is the equivalent of online word of mouth and is the vehicle that drives traffic,
engagement and sentiment around a brand. While there are different ways a brand can garner
earned media, good SEO and content strategies are the most controlled and effective.

 Paid media is a great way to promote content in order to generate more earned media and can also
be used to drive traffic directly to your owned media properties.

While each element has its own role, using all three together will make your digital media strategy
that much more effective.