Session 6 - E-marketing and e-advertising

Consumer Behaviour

A social science discipline that attempts to model and understand the behavior of humans in a marketplace.

Clickstream Behavior

The digital trait that consumer establish as they move about the web.

Customer experience

The totality of experiences that a customer has with a firm, including the search, information about, purchase, consumption, and after-sales support for its products, services, and various retail channels.

Online Advertising

A paid message on a website, app, or other digital medium.

Ad targeting

The sending of marketing messages to specific subgroups in the population

Search Engine Marketing (SEM)

The use of search engines to build and sustain brandsA

Search Engine Advertising

The use og search engines to support direct sales to online consumers

Organic Search

Inclusion and ranking of websites based on a more or less unbiased application of a set of rules imposed by the search engine.

Pay-per-click (PPC) search ad

The primary type of search engine advertising. Allow advertisers to bid on specific keywords or phrases that they want their ads to appear for in search engine results.

Keyword Advertising

Merchants purchase keywords though a bidding process at search engines, and whenever a consumer searches for that word, their advertisement shows up somewhere on the page.

AdSense

Publishers accept ads placed by Google on their websites and recieve a fee for any click-throughs from those ads.

Search Engine Optimization (SEO)

Techniques to improve the ranking of web pages generated by search engine algorithms

Voice Search

Uses artificial intelligence technologies such as natural language processing to help people search for information through spoken voice commands rather than through typing.

Visual Search

Uses artificial intelligence technologies, such as machine learning and computer vision, to help people search for information based on visual images rather than through text search.

Click Fraud

Occurs when a competitor click on search engine results and ads, forcing the advertiser to pay for the click even though the click is not legitimate.

Content farms

Companies that generate large volumes of textual content for multiple websites designes to attract visitors and search engines.

Link Frams

Groups of websites that link to one another, thereby boosting their ranking in search engines.

Display ads

Include banner ads, rich media ads, video ads, sponsorships, native advertising, and content marketing.

Banner ad

Displays a promotional message in a rectangular box on the screen of a desktop/laptop computer or mobile device

Rich media ad

Ad employing interactive features that engage users, animations, ad expansion, video play.

Video ad

TV-like advertisement that appears as an in-page video commercial before, during, or after content.

What are types of video ads?

linear video ad, nonlinear video ad, in-banner video ad, in-text video ad

Linear Video Ad

Pre-roll; takeover; ad takes over video for a certain period of time - used: before, between, or after video.

Nonlinear Video Ad

Overlay; ad runs at the same time as video content and does not take over full screen - used: during, over, or within video.

In-banner Video Ad

Rich media; as is triggered within banner, may expand outside banner - used: Within web page, generally surrounded by content.

In-text video Ad

Rich media; ad is delivered when iser mouses over relevant text - used: Within web page, identified as a highlighted word within relevant content.

Sponsorship

A paid effort to tie an advertiser´s name to information, an event, or a venue in a way that reinforces its brand in a positive yet not overtly commercial manner.

Native Advertising

Advertising that looks similar to editorial content

Content Marketing

Creates a content campaign for a brand and then attempts to secure placement on a variety of websites.

Advertising Networks

Connect online marketers with publishers by displaying ads to consumers based on detailed customer information.

Ad Exchanges

Auction-based digital marketplace where ad networks sell ad space to marketers

Programmativc Advertising

Automated, auction-based method for matching demand and supply for display ads.

Real-Time Bidding (RTB) Process

Used to match advertiser demand for display ads with publisher supply of web page space.

Ad Fraud

Falsifying web or mobile traffic in order to exchange advertisers for impressions, clicks, or other actions that never actually occurred.

Ad Blocking

Like a firewall.

Direct E-Mail Marketing

E-mail marketing messages sent directly to interested users.

Spam

Unsolicited commercial e-mail

Affiliate Marketing

Commissions paid by advertisers to affiliate websites for referring potential customers to their website (Amazon Associates)

Lead Generation Marketing

Uses multiple e-commerce presences to generate leads for businesses that later can be contacted and converted into customers.

One-to-one Marketing (personalization)

Segmenting the market based on a precise and timely understanding of individuals´ needs, targeting specific marketing messages to these individuals, and then positioning the products vis-a-vis competitors to be truly unique (AMAZON - register users by name, recommend purchases, expedites checkout procedures based on prior purchases).

Behavioral targeting (interest-based advertising)

Involves using online and offline behavior of consumers to adjust the advertising messages delivered to them online.

Retargeting (remarketing)

Showing the same or similar ads to individuals across multiple websites or apps.

Contextual Advertising

Attempts to deliver relevant ads by matching characteristics of the ad with characteristics of the content adjacent to the ad placement.

Customization

Changing the product, not just the marketing message, according to user preferences

Customer co-production

Takes customization one step furter by allowing the customer to interactively create the product.

Frequently Asked Questions (FAQ)

A text-based listing of common questions and answers

Real-Time Customer Service Chat System

A company´s custoemr service representatives interactively exchange text-based messages with one or more customers on a real-time basis.

Automates Response System

Sends e-mail order confirmations and acknowledgements of e-mail inquiries.

Law of One Price

With complete price transparency in a perfect information marketplace, there would be one world price for every product.

Pricing

Putting a value on goods and services

Demand Curve

The quantity of goods that can be sold at various prices.

Fixed Costs

These are costs that do not change with the level of production or sales volume. The cost of building the production facility would be considered a fixed cost, but fixed costs can also include ongoing expenses like rent, property taxes, and insurance. Once a facility is built, these costs remain constant regardless of how much or how little is produced.

Variable Costs

These are costs that fluctuate with production volume. Labor is often a variable cost if it's tied to production levels (e.g., wages for production line workers). However, other variable costs include raw materials, energy consumption, and shipping expenses. Essentially, as production increases, variable costs rise.

Marginal Costs

The incremental cost of producing one additional unit of a product. It includes both the variable costs associated with that extra unit and any additional costs incurred.

Price Discrimination

Selling products to different people and groups based on their willingness to pay.

Freemium

A cross-subsidy pricing strategy in which users are offered a basic service for free but must pay for premium add-on services.

Versioning

Creating multiple versions of information goods and selling essentially the same product to different market segments at different prices—for example - Airline (Economy vs Business), or Newspapers (digital subscriptions, more stories).

Bundling

Offers consumers two or more goods for a reduced price.

Dynamic Pricing

The price of the product varies, depending on the demand characteristics of the customer and the supply situation of the seller (auctions, yield management).

Auction

Flexible and efficient market mechanism for pricing unique or unusual goods as well as a commonplace goods such as computers, cameras, and othe electronic devices.

Yield Management

Manages set prices in different markets, appealing to different segments, in order to sell excess capacity - Airlines - every few minutes during the day, they adjust prices of empty airline seats to ensure that at least some of the 50,000 empty airline seats are sold at some reasonable price - even below marginal cost of production.

Surge Pricing

Dynamic pricing is used by Uber. prices increase temporarily in response to high demand or limited supply. Rise during peak hours or in areas with high demand to balance supply and demand.

Flash Marketing

A promotional strategy that offers products or services at significant discounts for a short, limited time. The goal is to create urgency and drive quick sales. Flash sales often take place online and are typically promoted with countdowns to encourage immediate purchases.

Long tail effect

A business strategy that focuses on selling a large number of niche products with low demand rather than relying on a few bestsellers. In digital markets (like Amazon or Netflix), offering a wide variety of niche items can collectively generate significant revenue. (Amazon $2.99 books).

No matter how much content you put online, someone, somewhere will show up to buy it, thanks to online search, social networks, and recommendation engines.

Marketing and E-markting

Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitability", and E-marketing is any use of digital technology to achieve marketing objectives.

Cost per thousand (CPM)

Pricing model - Advertisers pays for impressions in 1000 unit lots

Cost per click (CPC)

Pricing Model - Advertisers pays prenegotiated fee for each click ad recieves

Cost per action (CPA)

Pricing Model - Advertisers pays only for users who perform a specific action

Cost per Lead (CPL)

Pricing Model - Advertisers pays only for qualified leads or contacts

Barter

Pricing Model - Exchange of ad space for something of equal value.

Hybrid

Pricing Model - Two or more fo these models used together

Sponsorship (Pricing Model)

Term-based; advertiser pays fixed fee for a slot on a website.

E-commerce Technology Dimension: UBIQUITY

Marketing communications have been extended to the home, work, and mobile platforms; geographic limits on marketing have been reduced. The marketplace has been replaced by “marketspace” and is removed from a temporal and geographic location. Customer convenience has been enhanced, and shopping costs have been reduced.

E-commerce Technology Dimension: GLOBAL REACH

Worldwide customer service and marketing communication have been enabled. Potentially hundreds of millions of consumers can be reached with marketing messaged.

E-commerce Technology Dimension: UNIVERSAL STANDARDS

The cost of delivering marketing messages and recieving feedback from users is reduced because of shared, global standards of the internet.

E-commerce Technology Dimension: RICHNESS

Video, audio, and text marketing messages can be integrated into a single marketing message and consuming experience.

E-commerce Technology Dimension: INTERACTIVITY

Consumers can be engaged in a dialogue, dynamically adjusting the experience to the consumer and making the consumer a co-producer of the goods and services being sold.

E-commerce Technology Dimension: INFORMATION DENSITY

Fine-grained, highly detailed information on consumers´ real-time behaviour can be gathered and analyzed for the first time. “Data mining” Internet technology permits the analysis of terabytes of consumer data everyday for marketing purposes.

E-commerce Technology Dimension: PERSONALIZATION/CUSTOMIZATION

This feature potentially enables product and service differentiation down to the level of the individual, thus strenghtening the ability of marketers to create brands.

E-commerce Technology Dimension: SOCIAL TECHNOLOGY

User-generated content and social networks, along with blogs, have created large, new audiences online, where the content is provided by users. These audiences have greatly expanded the opportunity for marketers to reach new potential customers in a nontraditional media format. Entirely new kinds of marketing techniques are evolving. These same technologies expose marketers to the risk of falling afoul of popular opinion by providing more market power to users, who now can “talk back”.

Transaction log

Records user activity at a website.

Registration forms

Gather personal data on name, address, phone, zip code, e-mail address, phone, and other optional information on interests and tastes.

Shopping cart database

Captures all th eitem selectio

First-party tracking

A website or app collects data directly from its own users or visitors. This data is used for purposes like improving user experience or personalizing content. It is considered more transparent and is often compliant with privacy regulations.

Third-party tracking

Third-party tracking is when external companies, not directly related to the website a user is visiting, collect data about the user through cookies or scripts. This data is often used for targeted ads and tracking across multiple sites, raising privacy concerns due to its lack of transparency.

Cookie

Small text file that websites place on visitors´ computers that allows the website to store data about the visitor on the computer and later retrieve it.

First-party cookie

Placed on the user´s company by the same domain name as the page the user is visiting

Third-party cookie

Operates similarly to first-party cookies but enables advertising platforms to track user behavior across websites and devices.

Web Beacon

Tracking methods that uses a tiny (1-pixel) graphic file embedded in e-mail messages and on websites.

Profiling

Uses a variety of tools to create a digital image for each consumer.

Database

A software application that stores data in the form of fields, records, and files.

Relational Database

Represents data as a two-dimensional table organized in columns and rows; data within different tables can be flexibly related as long as the tables share a common data element.

Database Management System (DBMS)

A software application used by organization to create, maintain, and access databases. S

Structures Query Language (SQL)

Industry-standard database quesry language used in relational databases.

Nonrelational (NoSQL) database

Uses a more flexible data model; designed for managing large sets of structures and unstructured data that are difficult to analyze with traditional SQL-based tools.

Zero-party data

Collected from a user who actively opts into sharing data, for example, by filling out a registration form, as opposed to data that is collected from a user who is just browsing a site.

Data Warehouse

A database that collects a firms transactional and customer data in a single location for offline analysis.

Data Mart

A subset of a data warehouse in which a summarized or highly focused portion of the organization´s data is placed in a separate database for a specific population of users.

Data Lake

A repository of raw, unstructured data or structured data.

Data Mining

A set of analytical techniques that look for patterns in the data of a database or a data warehouse or that seek to model the behavior of customers.