The Evolution of Internet Marketing Efforts
Generally speaking, Internet marketing efforts have traditionally followed a pattern of development similar to other media. The purpose of this lab is to examine these patterns as part of our Internet marketing efforts.
Though every Internet communication effort is different, a pattern in the evolution of Internet communication has become evident that helps us plan and create such efforts. The use of the Internet by companies and other organizations generally involves a hierarchy of six stages of development. These six stages are discussed next.
Level I-Advertisement.This entry level is the use of the World Wide Web (WWW) to display a home page and a few associated or linked pages. Most companies putting up an initial Web page have overly enthusiastic dreams of being overwhelmed by new business inquiries. The truth is that having a home page on the WWW is like putting a billboard in your basement. The home page may have emotional value for the company owners, but users don't know about or gain any value from this type of effort. The typical home page is usually linked to information like pictures of the company building and a message from the president complete with his or her picture. Useful information for a targeted audience is not included. Often a phone number is listed for contact with the company.
Level II-Promotion.The relative ease of developing static Web pages has led to extensive conversion of existing brochures and promotional materials from desktop publishing applications (electronic format) to WWW electronic pages. This caused an explosion in the number of pages on a Web site without increasing the relative value of the communication effort for the user. Often called brochureware, this expansion of the number of pages in the company site added to the personal pleasure of owners and managers but, like the first level, did nothing to generate additional business inquiries, supply useful information exchange, or increase relationships. Though they may provide a minimal amount of direct communication via e-mail links, these sites don't respond to this communication quickly. While promoting the company was the intent of this phase, it can more aptly be called the time-wasting phase for end users who dig around a Web site searching for needed information and end up frustrated and feeling like they should have just called or gone to the retail shop instead. These types of communication efforts may cause more harm than good.
Level III-Interaction.This phase of Internet use is the first that provides value for a prospect or customer by offering meaningful information exchange. Visitors to the Web site can receive information about something that is of concern to them and not information about the company. Once prospects or customers have located your Web site, they can learn about your products, capture information about a solution, and even determine how to purchase a specific solution to their problem. A customer can access the company site to download appropriate information that was previously available only from customer service. Using database-enabled presentations, this interactive level allows prospects or customers to provide information to the Web site and gain desired information when they want it with no delay or hassle. The interactive level satisfies customer wants, needs, and desires and lowers costs by reducing demands on customer service. One example, the Federal Express Web site, allows a customer to determine the status of an overnight delivery. Customers, using their air bill number, can access the location of the package, delivery status, and even the name of the person who signed the delivery receipt. In essence, the overnight delivery company has hired its customers to perform their own customer service.
Level IV-Transaction.At this level the prospect or customer can initiate action and complete transactions beyond information exchange over the Internet. The prospect can respond to and accept an offer made by the company in another media. For example, a space ad may carry a Web site address for response. That Web site address is specifically targeted to that offer and captures customer contact information to complete the transaction on-line. The customer can order a product or request a technical support visit from your company at this level of interaction. Customers or prospects may be able to order on-line using some form of credit, or customers may have a preestablished relationship and receive a bill for their purchase. At the transaction level the company can significantly reduce selling costs for acquiring new customers and improve customer service for current customers. Interactions in traditional media, including mail, phone, and personal, are moved onto the Internet. L.L. Bean still mails catalogs, answers the phone when customers call, and operates retail stores. But in this example, the availability of the Internet communication channel has moved customer transactions into a less expensive model and increased customer service in the process. The effect on return on investment (ROI) can be substantial, with decreased costs and increased revenue.
Level V-Transformation.At this level the relationship between the company and its markets has moved from traditional to electronic. In addition, the use of this communication has affected the internal operations of the company or organization. The Internet is not used occasionally but has become the accepted and preferred form of communication between the company and its customers. Because it does not operate in any other model, amazon.com has transformed a certain audience of media buyers into customer relationships. In the early days of Internet communication you might have had to call someone to tell them you had sent them an e-mail. Most of us have now transformed far enough that we no longer call to make e-mail notification. We send the e-mail in lieu of calling or any other form of contact.
Transformation can have a disruptive effect. It can cause the realignment or restructuring of the relationship between a distribution channel and its markets. For example, a manufacturer can eliminate one or more channel levels, opting to use the Internet to sell directly to an end user. When a manufacturer like Dell Computer Inc. sells PCs directly over the Internet, then the chain stores like Comp USA sell less. We don't yet know the impact of amazon.com on local or national chain booksellers.
Level VI-Community.At this highest level of Internet progression a group of people with common interests are bound together by emotional involvement. The emotional connection can range from personal commitment to a subject, like a health issue, to a professional group supporting each other through information transfer. The community is a group of people with common interests in a topic or issue who may not otherwise come together. Generally speaking, communities encourage audience members to communicate with each other as well as with the organizing body. Communities can be based on Web site presentations and then use mailing lists (e-mail subscription), collaboration forums, bulletin boards, chat rooms, IRC (Internet relay chat), or any combination of these to communicate among members. Many affinity groups have successful communities over the Internet. Clubs, organizations, religious groups, political organizations, and hobbyists with every variety of interest have established international communities over the Internet. A company or organization can set up a community, but expecting it to flourish may be problematic. The energy of the community comes from the participants. It can be fostered or supported by a sponsoring company, but it will only be successful if it is of emotional value to the members. Many commercial Web sites have some type of forum or bulletin board; most are unused. Software user groups supported by the development company are a good example of a commercial community. The America Online audience that communicates internally is also a very large community. The efforts by amazon.com to solicit and publish individual reviews is an effort in this direction, as are companies that build e-mail lists of active customers and use them to foster communication.
As we mentioned earlier, many companies evolve in their use of the Internet and seem to follow the progression just described. Evaluating expansion on the Internet within your company or organization is another part of the planning process. Consider where you are today and where you would like to go in the future, utilizing the flexibility and communication opportunities the Internet can provide.
Exercises
Understanding the Evolution of Internet Marketing Efforts
To build a further understanding of this evolution process, let's examine communication efforts in the off-line world. Describe real-life or traditional media examples of these Internet communication evolution levels:
| a) | Advertisement |
| b) | Promotion |
| c) | Interaction |
| d) | Transaction |
| e) | Transformation |
| f) | Community |
Answers
To build a further understanding of this evolution process, let's examine communication efforts in the off-line world. Describe real-life or traditional media examples of these Internet communication evolution levels:
| a) | Advertisement |
| Answer: | Your answers will vary. An example of this type of communication is bulk mail pieces that are sent to current resident address contacts, including flyers from the local dry cleaner or optometrist. Another could be general advertising space advertisements in untargeted publications with varying distribution. Many mass media television ads are also an example of this type of communication. This type of advertising is not appropriately targeted to any audience. It provides no offer or response device or useful information for a customer or prospect. It is not useful or cost effective for most marketing activity. Some companies do see value in traditional, mass media advertising. Millions are spent every year on television, other broadcasting, billboard, and space advertising efforts. But these efforts are successful due to massive size and reach. And their goals are generally based on building brand awareness, not direct relationships with customers. The Internet is not a mass media. It is a direct media. Putting up a home page is like putting a billboard in a dark jungle. It will only be seen if found and gives no reason for end user involvement. A lot of Web sites start out at this level: a few pages acting as a billboard in cyberspace. They accomplish little except possibly frustrating prospective communicators. |
| b) | Promotion |
| Answer: | Your answers will vary. A great example of this type of marketing effort is the colorful collateral material sent as part of sales packages or picked up at trade shows. This brochure-oriented material is big on flowery language and four-color artwork but not useful for the customer or prospect. Vague assurances about total solutions and industry-leading positions do not fulfill wants, needs, and desires. Often these types of materials are more useful in making internal management feel good about glossy pictures than in building relationships with customers. Too many Web sites have been developed at this level of communication. Though some value can be seen in providing information to the end user via the Web, many of these sites lack the details that would make them useful for the customer. These cluttered Web sites have little audience targeting and few response mechanisms. They also tend to be full of broad information and graphics, using up development dollars and looking good for management without providing solutions for customers or prospects. And they may even frustrate these users. |
| c) | Interaction |
| Answer: | Your answers will vary. An example of this type of communication in traditional media is a direct marketing letter package that provides an immediate response device. A donation solicitation from a nonprofit group requesting money and providing a self-addressed, stamped envelope (SASE) for response is a good model. A personalized business letter package with a toll-free response number is another. These both provide direct one-to-one communication of an offer to a targeted audience chosen from a database. Both also provide an easy way to answer the sender. In this way, a resolution of some type is available using the communication method. Web sites designed at this level are better targeted to specific audiences and might provide different content areas based on audience needs. They also provide forms or e-mail options for users to communicate with the company or organization. Requests for detailed response or specific data may be made on-line and answered in a asynchronous model, hopefully within 24 hours but maybe on the next business day (depending on geography). A Web site that provides detailed product information with a toll-free number to call and order and a form for requesting a catalog would be a good example. |
| d) | Transaction |
| Answer: | Your answers will vary. A traditional example of this level of communication would be a consumer or business catalog. All of the elements required to complete a transaction are present. A targeted group of products, prices, and details about them are available. A complete set of ordering instructions and a written and telephone response option for contact, product, and payment information are immediate usable by the consumer. Shipping details and other information are also involved. Web sites with on-line ordering and other transaction options have been developed at this level of communication. Sites like this usually access databases for information capture and transfer to the end user. These Web sites enable end users to complete transactions on-line, fulfilling wants, needs, and desires immediately without additional human interaction from the company or organization. |
| e) | Transformation |
| Answer: | Your answers will again vary, but an excellent example of this level of communication is the regular use of e-mail in the workplace today. A year or two ago, most people did not use e-mail regularly. Some researchers or technical people did, but the general business population did not use e-mail as a primary means of communication. This situation is now completely different. Many people use e-mail as a primary means of communication for internal purposes, often replacing the internal traditional memo process. Many people also use this communication method for personal and social reasons and stay in better contact at significantly lower cost than using phone or mail. E-mail has transformed how people communicate with each other. It is cheaper and more efficient than other methods and has become a standard way to operate as business and personal communicators. Once we begin using the Internet and Web for operational purposes, we are transforming our communication methods to a new level. Often, this new Internet-based method becomes the primary means of communication and replaces older ways of doing business. Web sites functioning at this level of evolution provide detailed information to targeted audiences. These efforts use interactive methods, giving end users access to databases of information and providing a high level of functionality to facilitate their use. Web marketing efforts at this level are replacing traditional marketing communication channels and transforming the way customers do business with the company. The growth and use of on-line stock trading and on-line travel bookings is an excellent example of this level of communication. |
| f) | Community |
| Answer: | Again, your answers will vary, but a good example of community in traditional communication is the gathering of professional or social affinity groups at trade shows, conferences, and events. In these settings a number of people with common interests meet to further their mutual goals. At trade shows manufacturers, suppliers, vendors, and customers all interact for business and social reasons. The same type of community exists at conferences and other events. All participants put effort and money into attendance, and all achieve some type of benefit for doing so, usually by strengthening relationships of some kind. Though this level of communication is difficult to achieve for a very large or broad audience using the Internet, smaller segments and audiences may get involved if they see benefits. And any mutually dependent audiences, including suppliers and manufacturers or even regular customers, may be interested in such an opportunity to communicate. Parties building on-line transactions systems with each other and other groups already involved in building relationships over the Internet are further examples of this level of communication. |
Self-Review Questions
In order to test your progress, you should be able to answer the following questions:
| 1) | What is the first level of Internet communication that provides value to the end user?
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| 2) | All Internet marketing and communication efforts must progress through each of these levels.
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| 3) | Which is an example of Internet communication transforming a traditional communication model?
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Quiz answers appear inAppendix A, Section 2.2.
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