E-Branding

INTRODUCTION - CHANGING TIMES, CHANGING TECHNOLOGIES
Many companies have started using new customer-facing technologies to complement their classic marketing communications techniques (e.g. TV, radio, press advertising, sponsorship) and their direct marketing techniques (database marketing, direct mail and questionnaire techniques). This e-business technology also enables companies to share their knowledge and initiatives with intermediaries, and with their own staff. The result is that it is achieving the same status within the company as classic marketing management information. Moreover, the Web, together with pervasive (i.e. access anywhere) technology (such as the mobile telephone), provides new ways for companies to use direct marketing to reach and interact with potential customers.

At first, marketing management used branded websites and search engines, and now they are beginning to use the Web along with other channels for integrated marketing campaigns. The Internet is especially relevant where customers actively use the Internet to gather information about products and services. This has led to the rise of a new breed of intermediary, which specializes in providing online comparisons of products and services, and then provides intermediary services to the end customer.

Customers' desire for information also allows marketers to integrate i-TV (interactive television) with on-line selling. i-TV allows marketers to broadcast detailed product information and electronic application forms to set-top boxes prior to an advertisement appearing on the television. When consumers' interest is aroused by the advertisement, they can interrogate their set-top box to find out more information and complete an application for the product or service. This application can then be sent electronically immediately to the company, thus capturing new business while interest is still high.

ISSUES - CHANGING EMPHASIS
Due to the interactive nature of the Internet, the flow of data from individuals has exploded in volume. New types of advanced analytical techniques have been developed so that marketers can now maximize the use of this data. Click-through analysis, for example, enables marketers to evaluate how many potential customers have actively responded to an online ad. Sophisticated business intelligence techniques such as IBM's Enterprise Customer Analytics now enable online campaign design and real-time attuning of responses, plus collaborative filtering. However, these types of analysis will take a long time to be integrated alongside other more traditional marketing techniques and processes. For example, advertising processes are under pressure to change to the availability of new ways of analysing customer responses.

Advanced analytics are resulting in companies rethinking how they segment their markets. Many companies have defined their target market in very broad terms e.g. by income and social standing, geography, age and risk. Customer segmentation is now moving beyond demographic variables and is starting to include response and behavioural data. However, when segmenting their customer bases, marketers should bear in mind the distinction between tactical and response-based segmentation and strategic segmentation. For example, it is now easier for marketers to interact with customers who express an interest in their products, as online data gathering and interpreting is more straightforward than traditional paper or telephone-based research. However, marketers must be careful how they use the wealth of available consumer online data, and be mindful of data protection requirements.

Many companies are uncertain as to how they should change their processes. The Internet enables marketers to create a dialogue with potential customers and to form a greater bond with them. Companies ignoring the Internet as a way to create and sustain loyalty run the risk of falling behind, as this interactivity can create a greater "hold" on the consumer. What may seem like small erosions in market share may translate into significant gains in the longer term, as potential customers will be less likely to switch loyalty. One customer segment that is being targeted very strongly for loyalty is the fairly recently defined "young affluent" segment. This segment has money to spend on many products and services. They also expect to be able to use technology to spend it, whether by Internet, i-TV, WAP phone or other emerging technology. A company that does not have a multi-channel proposition may risk the loyalty of this segment and lose the opportunity to market to them through specific channels.

To obtain full benefit from these new technologies, marketers should examine how companies have created and implemented new processes as they have transformed into e-businesses. Other markets that have embraced new technologies can help companies learn how e-business has changed their market environment and how it might be applied to their market.

New technologies have:

• Reduced costs
• Increased responsiveness - speed and appropriateness
• Enhanced focus on customers
• Enhanced delivery of service
• Allowed competitors to gain entry
• Improved knowledge of customers

However, a major problem for companies is that most have not updated their approach to knowledge management to take into account learning from new channels of communication. This is key to understanding behaviour of potential customers and how to respond to them effectively through these new channels.

THE BROADENING ARMORY
E-business and consumer databases are significantly broadening the options available for marketing managers within the marketing mix. Traditionally, when a marketing manager launched a new product, the options available were limited, as shown in Table 1. In addition to these traditional media, marketing managers can now use interactive options, and also leverage their own and third party databases for more personalized approaches, as shown in Table 2. These additional options mean that marketers can select from a classic mass-marketing campaign down to an almost individually targeted approach - the funnel of messages to the consumer is getting increasingly narrow and "direct" marketing now really means direct.

To exploit the marketing opportunities brought by new technology, companies will need to change how they think about marketing today, un-freezing the traditional marketing paradigm, and translating it into a new paradigm. They must allow for the continuing evolution of technology, which will bring with it major changes in level of detail, speed, the degree of customer control, and end-to-end process management. They will also need to distinguish between three discrete levels of marketing process:

• Micro-processes (e.g. managing individual customers)
• Macro-processes (e.g. strategic segment management)
• Highest level of processes - brand, overall customer management, channel management

THE MARKETER'S DILEMMA
Marketing managers are overwhelmed with choice now the marketing mix contains so many additional interactive options. Many marketing managers are trained in traditional mass marketing methods, and are struggling with how to integrate new e-business and database enabled marketing options into their day-to-day marketing management practices. However, marketers cannot afford to ignore the Internet in their marketing activity. Creativity is no longer the main skill requirement for a successful marketing manager. There is no established "best practice" for using e-marketing and database techniques within marketing management. There is instead considerable experimentation, some of which is not very well justified. Typical reasons for using interactive techniques include:

• "I need to be seen doing this because it's the hot thing to be in at the moment and I'd like it on my CV"
• "All my competitors seem to be doing this type of activity, so there must be something in it"
• "I can try it out to see what benefit it brings!"
• "The agencies are very keen on proposing interactive options in campaigns, so I should be doing this as they know more than I do about this area"

Interactive agencies and marketing managers are learning together as they start to integrate e-marketing techniques into campaigns. As long as agencies can stay ahead of marketing managers in terms of knowledge of this area, they will be perceived as the experts. Understanding how to partner effectively with agencies and other third parties will be increasingly important for marketers.

GLOBAL EXPECTATIONS LOCALLY MET
Customer expectations may be global, but companies should think in terms of meeting needs at a local level. With the growth in global brands, marketers need to consider the global implications of interactive marketing using the Web. Global companies quoting their customer service telephone lines on the web should not purely use US call centres with US hours of availability, or US address formats on their site. Of course marketers need also to consider using multiple languages on their site, and not just English, if they wish to appeal to a global audience. A further complication in some industries e.g. financial services, telecommunications, is that regulatory and compliance issues can arise if individuals in certain countries are allowed to purchase products from a global website hosted in a specific country. Disclaimers on the Home page are unlikely to be sufficient. It is another headache for marketing managers - they now need to manage customers to whom they cannot legally market.

LOSS OF CONTROL
The Internet means that marketing managers have less control over the company's image. Traditionally, marketing managers acted as custodians of a company's image in the marketplace, and as such, could largely control all communication about the company in the public domain. With the growth of consumer to consumer websites, users can voice their own opinions about a company on the web, without involving the company at all, and these opinions may contradict the company's own messages to the public.

PERFORMANCE MEASURES POSE A PROBLEM
Traditional performance measures for marketing managers do not normally encourage consumer needs-driven (customer want and needs) marketing. Many marketing managers have yet to see the value of needs-driven marketing. Marketing managers are focused on their individual product sales alone rather than on whether the needs of particular types of customers are met. A shift in traditional behaviour and attitudes of marketing managers requires new business performance measures e.g. a balanced scorecard. This framework specifically seeks to incorporate measures that assess the progress made in developing the value of a portfolio of potential customers over time (e.g. relative economic value of individuals over time) together with traditional product-level measures. If marketing managers worked more closely with third parties, this would facilitate them contacting potential customers as their needs are changing and being pro-active with promotional materials and information.

MANAGEMENT PROCESSES
Various marketing processes involve many approvals, both internally and with third parties. Effective use of intranets and extranets to make processes become transparent would reduce "bottlenecks" in the process and save time and resource. Effective use of intranets/ extranets could also simplify complex marketing processes by facilitating heightened levels of collaboration (within the company and with distributors and business partners) through improved communication and sharing of information. Intranets and extranets would also enhance competitive advantage. The company that can provide an accurate and timely understanding of potential customer demand in a way that drives purchase behaviour for their products is the one that will secure the competitive high ground. Understanding purchase behaviour through 'whole life' monitoring is one approach to this, although the constraints of the data protection act need to be taken account of when sharing information.

CONCLUSION
There are a various e-business areas that senior marketing management should focus on if they are to enhance their competitiveness and the efficiency of their efforts. However, it is also clear that progress depends not on technology alone, but also on changes to the way people work and to the processes by which they work.

Table 1: New launch support

New Launch Support: Product Driven

· TV · Radio · Press · Sampling · Sponsorship · Vouchers · Direct Mail using own bought lists/ own databases · PR

Table 2 Interactive marketing options

New Launch Support: in partnership with third parties (agents, brokers, IFAs)

· Point of sale · Leaflets · Early sign-up discounts · Third party specific discounts · Third party direct mailing

 

Additional Marketing Options - Product driven Additional Marketing Options with third parties

· Promotional Websites · E-mail marketing · E-sampling · E-discounts · Online competitions · Banner ads · Buttons/ interstitials · Interactive TV · SMS Messaging/ Mobile · Sponsored content/ banners on agent and broker sites · E-promotions on broker and agent sites · E-mail marketing via broker and agent databases (within the constraints of the data protection act) · Targeted one-off direct mail via broker and agent databases - could include video, CD-ROM · Discounts only available via third party web-sites and e-mails · Targeted advertorials in segment specific consumer loyalty clubs e.g. frequent flier, wine club, etc.