Internet marketing strategy

• ‘The key question is not

whether to deploy Internet
technology – companies have
no choice if they want to stay
competitive – but how to
deploy it.’

Porter, M. (2001) Strategy and the

Internet, Harvard Business review,
March 2001, 62–78.
Internet marketing strategy

To provide consistent direction

for an organization's e-
marketing activities, so that
they can integrate with other
marketing activities
 E-marketing strategy essentials
• E-marketing strategy is a channel strategy.
• Objectives for online contribution %
– sales, service, profitability should drive our strategy.
• E-marketing strategy defines how we should:
1. Communicate benefits of using this channel
2. Prioritise audiences targeted through channel
3. Prioritise products available through channel
4. Hit our channel leads & sales targets
– Acquisition, Conversion, Retention.

• Channel strategies thrive on differentials.

• BUT, need to manage channel integration.
Influences on e-marketing strategy
 Retention

conversion

Acquisition
 Problems if no E-marketing strategy
Underestimated demand for online services
Market share loss
Resource duplication
Insufficient resource
Insufficient customer data
Efficiencies available through online marketing
Opportunities for applying online marketing tools
Changes required to internal IT systems
Inadequate tracking
Senior management support limited
Stages in Internet development
Stage model

full interactive web site

User interactive web site

Simple interactive web site

Static web site

web name

No web site
Stage models (Quelch and Klein (1996))
 E-business strategy model
1. Web presence 2. E-commerce 3. Integrated 4. E-business
e-commerce

Services available Brochureware or interaction with Transactional e-commerce on Buy and sell-side Full integration between all
product catalogues and customer buy-side or sell-side. Systems integrated with ERP or internal organisational
service often not integrated legacy systems. processes and elements of the
Personalisation of services value network

Organisational scope Departments acting Co-ordination through steering Cross-organisational Across the enterprise and
independently, committee or beyond (extraprise)
e.g. marketing department, IS e-commerce manager
department

Transformation Technological infrastructure Technology and new Internal business processes Change to e-business culture,
responsibilities identified for e- and company structure linking of business processes
commerce with partners

Strategy Limited Sell-side e-commerce strategy, E-commerce strategy E-business strategy

not well integrated with integrated with business incorporated as part of
business strategy strategy using a value- business strategy
chain approach
 Internet marketing benefits

Intangible benefits
• Corporate image communication
• Enhance brand
• More rapid, more responsive marketing
communications including PR
• Improved customer service
• Learning for the future
• Meeting customer expectations
• Identify new partners, support existing partners
• Better management of marketing information and
customer information
• Feedback from customers on products
Tangible benefits
• Increased sales from new sales leads giving rise to
increased revenue from:
• new customers, new markets
• existing customers (repeat-selling)
• existing customers (cross-selling)
• Cost reductions from:
• reduced time in customer service
• online sales
• reduced printing and distribution costs of
marcomms
 Example objectives
• Achieve 10 per cent online revenue contribution within two
years;
• achieve first or second position in category penetration in the
countries within which we operate (this is effectively online
market share and can be measured through visitor rankings
such as Hitwise (Chapter 2) or better by online revenue share;
• cost reduction of 10 per cent in marketing communications
within two years;
• increase retention of customers by 10 per cent;
• increase by 20 per cent within one year the number of sales
arising from a certain target market, e.g. 18–25-year-olds;
• create value-added customer services not available currently;
• improve customer service by providing a response to a query
within two hours, 24 hours per day, seven days a week;
• all other objectives to be achieved profitably giving a return on
investment in a three year period.