Sales and Marketing

Sales and marketing is one of the many components of business that have been revolutionised by the World Wide Web. A new approach to cope with the introduction of the Web and the population going online was needed. The Internet is a new channel for providing services and new sales and marketing techniques were required. In this section the following topics will be reviewed:

• Sales & Marketing
  
• E-Marketing Strategy - Embracing New Technology
  
• SMEs Providing a Service
  
• Internet Demographics
  
• Website Design Methodology

Sales and Marketing
The traditional methods of advertising are still used but more businesses are opting to target customers online. The traditional methods consist of TV (about 36%), newspaper (about 35%), magazines (about 14%), and radio (about 10%). Traditionally, advertisements are seen on a mass production basis i.e. one ad is viewed by many people. There are limitations and advantages to advertising online as opposed to the traditional methods (Turban et al, 2000)

Traditional Methods of Advertising

• TV advertising is a highly effective but expensive method of advertising. The time duration for TV ads is limited, which compromises the advertiser's flexibility. On a more positive note, TV advertising reaches a mass audience and is very successfully aimed towards media buyers.
• Radio advertising also operates on a mass scale. It is essential to estimate what demographic categories are more inclined to listen to one station as opposed to another. Knowing what audience your products and services are aimed at determines what radio station you choose to advertise with. What time of day should your advert be played, will the customers that you want to reach be listening at that time; these are important elements that need to be researched.
• Magazines are a very effective method to target individual customers as opposed to TV and radio, previously mentioned. They give the advertiser scope to make the ad attractive and appealing for the readers to look at. Readers can take time to look at the ad as opposed to TV and Radio. There is a negative side whereby the reader may choose to ignore the advertisement. It is also difficult to estimate the percentage of people reading your ad. This is also the case with advertising in newspapers. In addition, print advertising is an expensive means of advertising. However, it is a good means of exposing readers to special offers etc.

The methodologies of advertising on the Internet are different in comparison to the traditional methods mentioned but the objective remains the same - enticing the customers to buy your products. Advertising is a very important aspect of online marketing and it gives the company a new channel to target prospective customers - a global window.

Online Advertising

Online advertising is a more cost effective, method for targeting your customers directly via one-to-one advertising, which will be explained in greater detail further on, as opposed to the traditional methods of radio & TV advertising. The Internet is the fastest growing medium in history and more and more people are choosing to go online. Having a presence on the Internet means that customers can now come to you as opposed to the traditional method of you going to the customer. The great advantage of advertising online is that the content can be updated immediately and this will entice your customers to return again and again. The Internet is available 24 hours a day, 365 days a year and the advertising cost is consistent regardless of the time or location of users. There are various methods for advertising online and targeting your audience. The following is a list of the various methodologies used to advertise online:

Banners:

Banners are a common method of online advertising; Fig 5.1 shows an example of a banner advertisement. Banner ads are constrained in size to ensure a fast download time. It is also necessary for banner ads to appear exciting and appealing. When a user clicks on a banner ad the user is either taken to the home page or a micro home page of the advertiser web site and the referring page is noted. The number of referrals has a bearing on the advertising costs charged. There are two types of banner, keyword banners and random banners.

Fig 5.1

• Keyword banners have keywords inserted into their background code and will appear if a user performs a search for those predefined keywords. This method of advertising is effective when narrowing down a target audience.
  
• Random banners are used for advertising new products, sales, promotions etc. and they are less focused than keyword banners.

Ads must be small but effective to attract viewers. Banner ads can be expensive to place on highly popular sites. Less expensive alternatives such as banner swapping and reciprocal linking exist. This entails two websites exchanging banners or linking to each other's sites. It is important to ensure that your ad will be seen.
There are several methods to determine how successful banner advertisements are:

• Click through: account of the number of times users click on banner adverts.
  
• Sales and Leads: Companies can determine if sales have increased due to customers accessing their web site via a banner advertisement by using different reference numbers for each banner.
  
• Cost per Thousand Impressions (CPM): Used to estimate how many viewers have seen the banner ad. Impression is defined as one view of the complete web page (including the banner).

A 1998 study by AOL showed that 9 out of 10 people responded favourably to banner advertisement and about 50 percent of the views recall ads immediately after seeing them (www.adage.com, 1998). HotWired's study reported that banners can still have significant branding impact without being clicked on although marketing managers still demand decent click through percentages to justify the money allocated to ad impressions.

Email:

Email enables companies to send out mass quantities of unsolicited mail that contain the same advertisement message e.g. "Spamming". Mass mailing has become very popular due to email lists being readily available and cheap. www.yesmail.com sells companies mailing lists of groups of people who have an interest in particular products or services. Companies may also develop their own database of customers, based on website statistics and membership.
GartnerG2 predict cost-conscious businesses will increasingly turn to the Internet in lieu of traditional direct mail campaigns and that e-mail advertising revenue by 2005 is forecast to total $1.5 billion. Direct mail 'will account for less than 50 percent of mail … by 2005' (Garcia, 2002) A study from AMR Research says E-mail marketing has proved to be one of the more resilient areas of the online advertising industry, but its clients are often undermining their success through bad business practices and missed opportunities.

Chat Rooms:

Chat Rooms can create a sense of community between users. Users can exchange information regarding common interests. Chat rooms can allow business to analyse what their customer's thoughts and feeling are on new products and current services and this information can be used to further improve current products and services. Sponsors can add chat capabilities to a web site e.g. http://www.multicity.com. This process entails putting a chat link on your site and the chat vendor takes care of the rest.

In a 1998 report, Montgomery Security estimated that by 2000 Internet chats were expected to generate 7.9 billion hours of online use, leading to $1 billion in advertising revenue. The advertisement in a chat room merges with the activity in the room and the user is conscious of what is being presented. The message of advertisers is reaching the audience. (Turban et al, 2000)

Splash Screens:

Splash Screens (or Popups) are small windows that automatically appear when a user enters a web site. They are usually smaller than a browser screen, and do not transport the user away from the original web site. Pop-ups are intrusive and can be annoying for users. It is essential to make them creative and good ads will usually have a better click through rate than bad ones.

Search Engines & Portals:

Search engines are the starting point for millions of web users and are a service that indexes, organises and often reviews web sites. Users can search for information by entering key words into the search engine. It is important that your site is ranked near the top of the search results for your key words and this can often be a matter of luck. A method of guaranteeing placement on Search Engines is to purchase an AdWord which is then displayed on the search result pages for the keywords you buy, and can be targeted by language and country. Major search engines include Google, Yahoo etc. Portals provide users with a themed structure and a sense of organisation, and typically offer search facilities, content, links to the best sites and email services e.g. http://www.ireland.com, Ireland.com is considered the main portal site for Ireland, it brings together information from multiple Irish sources, which provide 'one-stop surfing', cutting down on virtual travelling from site to site, and provide direct links to email, shopping, Irish life & culture, weather, news, Irish history etc.

Cookies:

The purpose of a cookie is to record personal details and registration for products and services, and show the information requested when a user returns to a website. Cookies only identify unique computers, as opposed to individuals unless a user leaves personal information with their browser. Cookies enable web sites to accumulate data on users based on past selection, which in turn provides excellent grounds for companies to target customers using one-to-one advertising. It should be noted that browsers can be set to accept or reject all cookies automatically, or to alert the user every time a cookie is offered (Davis, J, nd).

Advantages of Online Advertising

The advantages of online advertising as opposed to the traditional methods is that it allows companies to advertise more directly to individuals using one-to-one advertising which allows SMEs to customise ads to suit individual interests based on past selection. It allows companies to build profiles on customers using intelligent agents e.g. log-on registration, cookies, personalised email accounts, content and layout configuration, virtual storage etc. SMEs can use these intelligent agents to target their customers based on the profiles they have developed. When new products and services are released, customers who have selected the option of adverts being sent to them, will receive tailored ads notifying them of the latest news and promotions. This is called product brokering.

Online advertising allows for adverts to reach customers at a personal level. They should state clearly the products and services that are on offer and enable customers to identify the advantages of buying with your company as opposed to your competitors. Customers are in control when surfing the web, it is their choice to decide what sites they wish to browse and it is therefore essential to have a strategy in place to drive traffic to your site.

E-Marketing gives rise to opportunities, see fig 5.2 (Source: Datamonitor

Fig 5.2

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