Digital Marketing Quiz 1

Digital Marketing

Data-driven marketing using online channels with real-time optimization

Framework for Digital Marketing

1. Outbound — company controls message and sends to consumer

2. Inbound — consumers pull the info and go to the company

3. Social media — consumers talk to each other, influencing their purchase decisions

4. Mobile technology — fast and constant loop bc consumers are always online

Outbound marketing

Firm initiates the messages and pushes it to the consumer

• involves sponsored links

• Inbound marketing

Consumer finds the firm and pulls it in

• involves unpaid/organic ads

Measuring effectiveness of outbound marketing

• Correlation vs causation

• Attribution problem

• Dynamics

• Online-offline interaction

• Customer lifetime value

RACE Model

• R — Reach —> build awareness & drive traffic; KPI: impressions, website visits, CTR

• A — Act —> encourage interaction; KPI: time on site, clicks, shares

• C — Convert —> convert visitors into customers; KPI: conversion rate, CPA, sales

• E — Engage —> drive loyalty & advocacy; KPI: repeat rate CLV, NPS

AIDA

• A — Awareness

• I — Interest

• D — Desire

• A —  Action

Omnichannel

Seamless experience across channels

Phygital

Physical + digital integration

CLV (Customer Lifetime Value)

Long-term value of a customer

CAC (Customer Acquisition Cost)

The financial efficiency of sales/ marketing efforts to attract and capture new customers

• CAC should be less than CLV

Paid Media

Ads a firm pays for

Owned Media

Channels a firm controls (website, email, app)

Earned Media

Reviews, sharing, word of mouth

Data Sources

1. First party: data that company collects directly from their customers

2. Second party: data that comes from trusted providers

3. Third party: data that comes from neither customer or company, it’s from external aggregators

• Retail Revolution

• never normal

• Phygital — the future is Omnichannel

• Data driven as competitive edge

• Sustainability no longer optimal

• New customer priorities shape retail

Online consumer behavior

study of how individuals search, evaluate, and purchase products in digital environments

• Pressures on consumer behavior

• Bounded rationality

• Procrastination and impulsivity

• Decision and shortcut heuristics

• Contextual dependency

• Peer and social influences

Bounded Rationality

decision-making limited by time, information, and cognitive capacity

Procrastination

delaying decisions or actions despite knowing it may cause negative outcomes

Impulsivity

acting quickly on immediate desires w/out considering long-term consequences

Decision heuristics

mental shortcuts people use to simplify complex choices

Shortcut heuristics

quick rules of thumb to make fast, often less accurate decisions

Contextual dependency

when choices are influenced by the surrounding environments or situation

Peer & social pressure

consumer decisions shaped by the opinions or behaviors of others

Information display

how the layout and presentation of content affect consumer interpretation

Visual bias in consumer behavior

tendency to be swayed by design, imagery, or aesthetics over substance

Anonymity in consumer behavior

when hidden identity online alters confidence, honesty, or risk-taking in purchases

Frames

the way information is presented that alters consumer perception and decision-making

Omnichannel

seamless consumer experience across multiple online and offline touch points

The screen effect

• Information display — what you show matters more than what you say 

• Visual bias — screens don’t eliminate bias, they intensify it

• Anonymity — lowers friction to act, 3x more likely to order decadence online

 I Want to Frames

• I want to know —> when buyer is seeking information about product/service

• I want to go —> when buyer is looking for a local business or service provider

• I want to do —> when buyer is seeking advice on how to use a product/service

• I want to buy —> when a buyer is ready to make a purchase

• Limitations:

  • Assumes consumer is already in a consumption frame of mind

    • Be careful when trying to tackle all four frames

    • We need to make sure we don’t over lift our offer

Personalization

Core of mobile marketing

Product (mobile)

• smartphones, wearables in addition to services

  • Over 60% of e-commerce happens on mobile

  • Apps drive daily social, shopping, and payments

Promotion (mobile)

• Personalized offers: time, location, environment, history

• Push notifications & mobile coupons —> higher redemption

• Context matters: weather, commuting, crowdness

Prediction (mobile)

• Algorithms predict customer intent, behavior, purchase stage

• Geo-similarity networks, trajectory tracking, copycat detection

• AI enables real-time personalization

Price (mobile)

• Freemium models (basic free, premium paid)

• Dynamic pricing via real-time supply/demand

• Geo-targeting & geo-conquesting pricing strategies

• Diff price sensitivities across cultures/markets

Place (mobile)

• Mobile as channel and location tool

• SMS, in-app ads, push notifications, AR/VR, livestreams

• Omnichannel: in-store + app-rooming behavior

3 advantages of mobile apps

1. Omnichannel experience

2. Customer loyalty

3. First party data

Mobile consumer traits

• Curious

• Demanding

• Impatient

Customer Acquisition Cost — CAC

total cost a company spends on sales and marketing to acquire one new customer

Search Engine Optimization — SEO

practice of optimizing a website’s content and structure to improve its visibility in search engine results

• the goal is to increase organic traffic

SEO Framework

1. High quality, intent-matching content

2. Content and search intent

3. Technical foundations & optimization

4. Authority & external signals

On-page SEO

optimizing content and structure of your own website pages so search engines can understand them and rank them higher

Off-page SEO

actions taken outside your website to improve your ranking on search engines by increasing your site’s credibility, authority, and trust

• Involves: Backlinks, social media marketing, guest blogging, linked/unlinked brand mentions, & influencer marketing

SEM — search engine marketing

Involves increasing website’s visiting in results through paid advertising, includes paid search advertising and SEO techniques

Quality score

Used to measure quality and relevance of keywords, ads, and landing pages

• it affects rank/position based on: expected/potential CTR, relevance to consumers, and landing page quality

• A higher quality score means lower CPC (cost per acquisition)

E-E-A-T

Experience — The content shows first-hand, real experience with the topic

(e.g., someone who has actually used the product, visited the place, done the task)

Expertise — The creator has knowledge or skill in the subject area

(formal knowledge, training, or deep understanding)

Authoritativeness — Other reputable sources recognize this site/person as a reliable source

(backlinks, mentions, reputation)

Trustworthiness — The site is honest, accurate, safe, and transparent

(clear info, no deception, secure site, factual content)

Organic Links

Unpaid search results that appear based on relevance and popularity (SEO), not because a company paid for placement

Paid Links

Sponsored search results that appear above organic links because a company paid to bid on keywords (SEM)

Branded Keywords

Search terms that include a specific company or product name; firms bid on these to protect their brand and block competitors

Generic Keywords

Broad, non-brand search terms used for discovery and awareness (e.g., “running shoes” instead of “Nike running shoes”)

CPC (Cost Per Click)

The amount an advertiser pays each time someone clicks on their search ad

CTR (Click Through Rate)

Clicks ÷ impressions
Measures how often people who see an ad actually click it

CPM (Cost Per Thousand Impressions)

The cost an advertiser pays for every 1,000 times a display ad is shown, regardless of clicks

Impressions

The number of times an ad is displayed to users

Conversion rate

The percentage of clicks that result in a desired action (purchase, sign-up, download, etc.)

CPA (Cost Per Acquisition)

The cost to get one customer to complete the desired action
Calculated as total ad spend ÷ number of conversions

NPS (Net Promoter Score)

A measure of customer loyalty based on how likely customers are to recommend the brand to others (promoters − detractors)