Chapter 13:
Digital Marketing
Strategy
Chapter Objectives
• Explain how digital marketing strategy relates
to marketing strategy and digital marketing
execution.
• Determine the relative importance of demand
generation, demand harvesting, and
customer relationship management for a
company.
• Identify how to allocate marketing resources
effectively across available digital channels.
• Discuss how to engage in long-term, profit-
maximizing budget allocation.
Chapter Review
What Is Digital Strategy?
Strategy Framework
Producing Customers
Demand Generation
• Information-based
• Generic to brand-
directed
Demand Harvesting
• “Pick me!”
• Removing obstacles
Creating Customer
Loyalty
Loyalty communication
• Enhance customer
service
• Cost-efficient
Loyalty
• Purchase breadth
• Purchase frequency
• Purchase amount
Marketing Efforts
Resource Allocation
Cost Efficiency Formula
Cost Efficiency
Channel Cost per Exposure Customer Exposure
Concentration Effectiveness
Email Low Medium to High Medium to High
Search engine Varies Medium to High Medium to High
optimization
Paid search Medium to High High High
advertising
Social media Medium to High High High
advertising
Social media Varies Medium Low to Medium
posting
Display Low Medium to High Low
advertising
Cost Efficiency (Alt
Channels)
Channel Cost per Exposure Customer Exposure
Concentration Effectiveness
Conversion rate
optimization
Mobile application High Varies
Affiliate marketing Varies High High
Influencer Medium to High Low to Medium Medium to High
campaigns
Direct messaging Low to Medium High High
Email Scenario
● 5,000 email addresses ● Open rate: 30%
● $100 per month ● Click rate: 6%
● MailChimp (free) ● Website visits: 600
○ 2,000 email addresses ● Conversion rate: 10%
○ 10,000 emails sent ● Total conversions: 60
● Total profit: $1,500
Email Scenario 1
● 5,000 email addresses ● Open rate: 30%
● $10,00
$100 per month ● Click rate: 6%
0 New Software
● MailChimp (free) ● Website visits: 600
5,000 ○ 2,000 email addresses ● Conversion rate: 10%
300,00 ○ ●
10,000 emails sent Total conversions: 60
0 ● Total profit: $1,500
Email Scenario 2
10,000
● 5,000 email addresses ● Open rate: 30%
● $10,00
$100 per month ● Click rate: 6%
0 New Software
● MailChimp (free) ● Website visits: 600
10,000○ 2,000 email addresses ● Conversion rate: 10%
600,00 ○ ●
10,000 emails sent Total conversions: 60
0 ● Total profit: $1,500
Email Scenario 3
10,000
● 5,000 email addresses ● Open rate: 30%20%
● $10,00
$100 per month ● Click rate: 6%4%
0 New Software
● MailChimp (free) ● Website visits: 60024,000
10,000○ 2,000 email addresses ● Conversion rate: 3%
600,00 ○ 720
10,000 emails sent 10%
0 ● Total conversions:$18,00
60 0
● Total profit: $1,500
Optimizing Spend
Optimization Obstacles
• Limited investment levels
• Changing returns
• Measurement difficulty
• Cross-channel interactions
• Attribution inaccuracies
• Marketing strategy
implementation
Digital Marketing Tactics
• Conversion rate optimization
• Mobile application
• Affiliate marketing
• Influencer campaigns
• Direct messaging
Lecture
Applying the Framework
• Prioritize marketing
efforts
• Allocate resources
across channels
• Monitor and adjust
Example: Online Retail
Marketing Effort Priority
Resource Allocation 1
Resource Allocation –
Harvesting 1
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO Medium-high Long delay High Low, but
positive
Paid Search Medium-high Immediate Low Medium
Email Low Medium Medium-high Low
Social Medium-high Immediate Low High
Media Ads
Social Low-medium Medium Medium Low
Media
Posting
Display Medium Immediate- Low Medium
Advertising medium
Resource Allocation –
Loyalty
Building 1
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO Low Long delay High Low
Paid Search Low Immediate Low Low
Email High Immediate Medium- High
high
Social Media Low-medium Immediate Low Low
Ads
Social Media Medium Medium Medium Medium
Posting
Display Low-medium Immediate Low Low
Advertising
Monitoring
Metrics Monitoring 1
Channel Metric #1 Metric #2 Metric #3 Up/Down
Indicator
SEO Sessions Conversions First page Domain
keywords authority
Paid Search ROAS Conversion Sales Marginal
rate ROAS
Email Sessions Conversions CTR Marginal
CTR
Social ROAS Conversion Sales Marginal
Media Ads rate ROAS
Social Sessions Conversions Engagement Views per
Media rate post
Posting
Display ROAS Conversion Sales Marginal
Advertising rate ROAS
Example: Barrett
Furniture
Resource Allocation 2
Resource Allocation –
Harvesting 2
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising
Resource Allocation –
Loyalty Building 2
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising
Metrics Monitoring 2
Channel Metric #1 Metric #2 Metric #3 Up/Down
Indicator
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising
Example: K7 Analytics
Resource Allocation 3
Lead
Harvesting
Resource Allocation – Lead
Harvesting 3
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising
Resource Allocation –
Demand Generation
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising
Resource Allocation –
Loyalty Building 3
Channel Expected Timeframe Resource Allocation
Returns Intensity
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising
Metrics Monitoring 3
Channel Metric #1 Metric #2 Metric #3 Up/Down
Indicator
SEO
Paid Search
Email
Social
Media Ads
Social
Media
Posting
Display
Advertising