1. Background
Buyers get only those goods for which they feel requirement. Quiteoften the public subjects to criticism intensive advertizing campaigns thatthey ostensibly «force» consumers to get the firm goods. It isn't absolutelytrue – we will remember, for example, unsuccessful attempts of companyCoca-Cola to present to the market new soft drinks or originally negativereaction of consumers to a car model «Ford Sierra».
Two thirds of new production come to grief already on the firststeps on the market. Companies should consider requirements of consumers andthe market and to adapt for them the production
The purpose of sales consists in convincing the buyer to get anoffered product. Successful marketing provides presence of the necessaryproduct in a proper Internet place and proper time.
These are main principles of marketing – «as a result the consumersalways receive what they want».
Marketing is the process uniting possibilities of a company andneed of the consumer. So, the buyer satisfies the requirements, and the companyreceives the income of sold goods.
Global network Internet has made electronic commerce accessible tocompanies of any scale. The electronic show-window in World Wide Web gives thechance to any company to involve clients from every corner of the globe.Similar on-line business forms the new port for sale – «virtual», almost notdemanding material investments. If the information, services or production (forexample, the software) can be put through Web all process of sale (includingpayment) can occur on-line.
Therefore the given theme seems actual for consideration.
E-marketing introduces new features and advantages incomparison with the traditional marketing. Here some of them:
1) Key role transition from manufacturers to consumers
One of the most fundamental qualities introduced by theInternet in the world of modern commerce is key role transition frommanufacturers to consumers. The Internet has made a reality for the companiespossibility to draw attention of the new client of all for tens the secondsspent by it in front of the screen of the computer. However at the same time ithas given the chance to the same user to pass for some clicks of the mouse toany of competitors. In such situation the attention of buyers becomes the greatvalue, and the established mutual relations with clients the main capital ofthe companies.
2) Globalization of activity and costs decreasing
The Internet considerably changes spatial and time scalesof commerce conducting. It is the global communication medium which does nothave any territorial restrictions. Access cost to the information doesn'tdepend on remoteness from it, contrary to traditional means where thisdependence is directly proportional. Thus, electronic commerce allows even tothe smallest suppliers to reach global presence and to be engaged in businesson a global scale. Accordingly, customers also have global choice from allpotential suppliers offering the demanded goods or services irrespective of ageographical arrangement. The distance between the seller and the buyer plays arole only from the point of view of transport costs.
The time scale in the environment of the Internet alsoconsiderably differs from the usual. High efficiency of communicativeproperties of the Internet provides possibility of cutting-down of time forsearch of partners, decision-making, realization of transactions, working outof new production, and etc. Besides, its communicative characteristicspossesses the high flexibility allowing easily to make change of the presentedinformation, and, thereby, to support its urgency without a time delay andexpenses for distribution.
The effects above also lead to considerable cutting-down transactionalcosts, that is the costs connected with adjustment and maintenance ofinteraction between the company, its customers and suppliers. Thus cost ofcommunications, in comparison with traditional means, becomes minimum, andtheir functionality and scalability considerably increase.
3) Personification of interaction and transition to e-marketingto «one-one».
By using means of electronic interaction the companies canreceive the detailed information on inquiries of each individual customer andautomatically give products and the services corresponding to individualrequirements.
Developing e-marketing is especially important for the largecompanies. It doesn't mean that it is necessary for them to have own Internetshop. The companies should understand that the Internet means dialogue withclients. So, the social network can help with brand development, but also candestroy it, and for very short time. Investments into construction of system ofdialogue with the client represent an important component of all strategy as awhole. Recently miscalculations in strategy of some global brands, such asabsence of attention to opinion of clients and isn't enough efficient controlports of interaction with clients, have negatively affected reputation of thesebrands.
The most of research and practitioners agree that the need todevelop a comprehensive understanding of consumer behaviour and creating acompelling online environment are essential for effectiveness of e-marketing (KRISHNAMURTY,S. 2006, p. 3).
The other researchers suggest that effectiveness of e-marketingshould be based on total marketing communication of a company even itcontradicts with consumer behavior. Total marketing communication proposes thatall marketing activities for a company should be complementary to each otherand their total sum of efforts should be consistent with the company’s presentmarketing goals and objectives instead of analyzing consumer behavior (ZONGQINGZ., 2004, p. 94).
One of the most controversial question in this field is how tomeasure the effectiveness of e-marketing activity. Experts in e-marketing don'thave any unity on this question. So, a number of scientists – Zhivetin, V.V.,Samohvalov, V.L., Chernov, N.P., Feraponova I.A. (2008, p. 12) – considerthat efficiency of a e-marketing policy in relation to the concrete companydevelops of results of perfection of industrial-marketing activity in followingbasic directions: optimum use of potential of the market; increase of reliabilityof look-ahead estimations; a finding of a segment of the market of the givengoods, etc.
M. Tugan-Baranovsky, L.V. Balabanov (2006, p. 165) suggest toestimate efficiency of e-marketing in the following directions: buyers,marketing integration, adequacy of the information, strategic orientation,operative efficiency. But they don't define an estimation system and algorithm tocalculate the marketing effectiveness.
The majority of experts in American companies assert that theeffect of e-marketing activity consists in growth of sales volumes and profit.According to Jashevoj G. A (2007, p. 342), on the end results influence exceptmarketing and other components of potential of the enterprise – management,shots, production potentialities (the equipment, technology), the finance,therefore such estimation is too simplified.
G. Assel (2007, p. 230) suggests to estimate efficiency ofmarketing activity, as efficiency of expenses for marketing. Thus by means ofeconomic-statistical methods dependence between expenses for marketing andresult – sales volume or profit is investigated. It is clear to me that suchmethod of an estimation is an estimation of efficiency of expenses, instead ofthe most marketing activity.
M. MakDonald (2002 cited in Kotler, 2009, p. 39) asserts that theempirical approach is more preferable, than quantitative, based on statisticalcheck of narrow deductive hypotheses. The analysis of marketing efficiency shouldbe in the following directions: the internal relation of management of the companiesto marketing (its definition, a role and functions); the organization of thisactivity (involving in process of strategic planning, level of coordination andan information exchange between marketing functions); practical execution of marketingfunctions (use of marketing probes, planning, participation in working out ofthe new goods and etc.).
There is also an opinion that marketing doesn't submit to any rules.Therefore application of quantitative methods at planning or an estimation ofactual results of marketing action is complicated. Supporters of this opinionconsider that not all purposes can be formulated quantitatively.
Application of quantitative methods is limited due to thefollowing reasons:
- complexity of object ofstudying, nonlinearity of marketing processes, presence of threshold effects,for example, a minimum level of stimulation of sales, time logs (for example,reaction of consumers to advertizing often isn't carried out immediately);
- effect of marketingvariables interaction are interdependent, for example, the price, assortment,quality, release volume;
- complexity of measurement ofmarketing problems; it is difficult to measure reaction of consumers to certainstimulus, for example, advertizing, indirect methods of an estimation thereforeare often applied;
- instability of the marketinginterrelations caused by changes of tastes, habits, estimations, etc., relativeincompatibility of the personnel which is engaged in marketing and applicationof quantitative methods in its estimation. The first give a priority to theinformal methods, the second – to mathematical modeling.
The marketing expert, the professor of the London business schoolKenneth Simonds, notices that in marketing nothing ever repeats, all variouslyfor different situations. Marketing is focused on concrete buyers, and all buyersare different. The general rules – enemies of marketing. Therefore definitionof effect of marketing activity is, first of all, diagnosing, instead ofworking out of techniques, theories.
Nevertheless the benefits from e-marketing and a lot ofcontemporary literature about the ways to gather and analyze consumer behavioras the platform for creating an effective e-marketing strategy there is a hugegap in existing literature about an approach to link up strategy formulationwith empirical data (NANSI, S. and MURTHY, V.K., 2003 p. 321).
A huge job has been done in the field of researching effectivenessof e-marketing based on consumer behavior. One of the main works in this fieldis Contemporary research in e-marketing by KRISHNAMURTY, S. My researchproposal is about the ways to increase e-marketing effectiveness of PrintExpress Company based on gathering and analyzing data about consumer behavior.
In order to be able to propose ways to increase effectiveness ofPrint Express Company’s e-marketing we should discuss basic academic theoriesand concepts that explain the way of interaction between company and customers.
1. The industrial concept, or the concept of manufacture perfection.The company adhering to such concept, have mainly serial or a large-lotproduction with high efficiency and the low cost price, and sale of the goodsexhausted by them is made by means of numerous trade enterprises. It ispossible to carry the following to the basic preconditions of existence of thisconcept of steering of marketing activity:
– the most part of real and potential consumers have lowincomes;
– demand is equal or exceeds the offer a little;
– there is a fast drop of high production costs (usually onnew production) that leads to a gain большей market shares.
2. The concept of goods perfection is based on orientation toconsumers to surpass analogs in technical characteristics and by that bring morebenefits to consumers. Manufacturers thus direct the efforts to improvement ofquality of the goods, despite higher costs, and, hence, the prices.
3. The sale concept, or the concept of an intensification of Internetcommercial efforts, assumes that consumers will buy the offered goods insufficient volume only in the event that the company makes certain efforts on Internetadvancement of the goods and increase in their sales. The sale concept can beeffective for a long time that speaks following reasons: many buyers considerthat they in a condition to protect the interests; the buyers unsatisfied withpurchase, soon forget about the feeling of disappointment and will addresshardly probable with the complaint in a society protecting their interests; alwaysthere is enough great number of potential buyers.
4. The socially-ethical concept of marketing is based on the newphilosophy of business focused on satisfaction of reasonable, healthyrequirements of demand carriers. Its purpose consists in maintenance oflong-term well-being not only the separate enterprise, but also a society as awhole. The such orientation of image of firm also should involve buyers as thefactor of competitiveness of the given firm among the others.
The concepts above characterize the various periods and the basicsocial, economic and political changes which have occurred in the developedcountries in leaving century.
2. Industry Background
The last results have shown that using Internet technologies inmarketing can bring real economy and profit. It is connected with the bigbenefits and conveniences for both consumers and companies. In the approachingglobal computerization which approach is planned for the near future, the marketingrole in the Internet considerably will grow. It also causes an urgency of thetheme chosen by the author.
As object for this research proposal I chose Print Express Companywhich carries out its activity in Moscow since 1999.
The impact of these research is hoped to bethe conclusionabout the importance of application by the Russian companies of global network possibilitiesin marketing activity and increase of e-marketing effectiveness.
3. Research aim, researchquestions or hypotheses and objectives
The problem of e-marketing economic effectiveness pursues twoaims:
1. To prove efficiency of e-marketing activity at a working out ordecision-making stage.
2. Definition of final effectiveness of e-marketing activity afterthe termination of the certain period of time, proceeding from actually reachedresults.
Definition of economic e-marketing effectiveness is necessary toreveal also the factors influencing an indicator of e-marketing effectiveness,their interdependence, and character of their influence on an efficiencyindicator.
I need to research the following questions:
a) Is e-marketing an effectiveactivity compare to traditional way of marketing?
b) What are the ways toincrease effectiveness of e-marketing activity?
To define e-marketing effectiveness it is necessary to solve outthe next objectives:
1. To estimate the company’smarketing activity in the following directions: marketing probes, marketsegmentation and goods positioning, the analysis of the organization ofmarketing, e-marketing planning, e-marketing working out.
2. To define criteriaconcerning which process measurement in realization of e-marketing plan(control of e-marketing activity results) will be carried out.
3. Definition of the expensesconnected with carrying out of e-marketing strategy.
Directly indicator e-marketing effectiveness is defined bycomparison of the reached effect as a result of marketing activity (which moreoften, but it is not obligatory, is expressed in the form of profit or theincome) to the expenses which have caused this effect.
4. Research Methodology
In order to define effectiveness of Print Express Companymarketing activity it is necessary to carry out an estimation of marketingeffectiveness regularly.
At the considered company the complex estimation of marketingactivity was never carried out. Therefore within the limits of the givenproject I attempt to estimate quality of marketing activity of Print ExpressCompany in order to achieve my research objectives.
In order to estimate marketing activity effectiveness of thecompany named above I chose direct method of estimation by making aquestionnaire (the Appendix 1), containing 15 questions on performance offunctions. Each question has 3 options to answer which are estimated in pointsfrom 0 to 2. The Maximum quantity of points on each question is equal 2. On thebasis of the received answers the points estimating efficiency of variousdirections of marketing activity have been put (Appendix 2).
I carried out the research in Print Express Company Marketing andSales department directly.
Given results testify that despite lacking a system and structureof Print Express Company’s e-marketing activity.
1. Lack of e-marketing strategy. Delivering information is aservice that needs to be focused on definite market demand backed byappropriate product, strongly targeted customers and becoming pricing model.
2. Unadjusted product strategy. When Print Express Company waslaunching its product the market it was targeting was still in pregnancy, itwas nascent market. Established companies who really had understood theimportance of e-commerce in the future were focusing on in-house solutionsdeveloping. Growing companies hadn’t realized this importance yet, but thosewho had were open to experiment with simple and low-cost decisions. And thesetwo groups of customers were on the extreme edges of the market and makingdecision model.
3. Unjustified pricing model. Firstly, the price of the productfor the growing and still scaring market is too high. Secondly, the pricingmodel targets long-term partner relationships, that was to ealy for the nascentmarket that preferred short-term relationships.
4. Wrong target market. Customers that were mostly targeted by thecompany as a closer bunch to its well-established parents were generally notmaking as aggressive move to the Internet as were some of the smallerretailers. Moreover, the well-established the company’s product decision wastoo complex for usual users. Most virtual companies that really neededcompany’s product were less sophisticated from a business infrastructurestandpoint and did not yet see the need for an ERP-like system.
Thus, it is possible to establish that financial and economicindicators of Print Express Company would be much better if centralizemarketing functions, strengthen control over marketing activity and behind anexpenditure of budgetary funds. Proceeding from it we could recommend:
1) To enter the reporting on planning, organizing and controllingcarrying out of marketing actions. It will allow to simplify process of anestimation of marketing activity and to save money resources on carrying out ofinefficient marketing actions.
2) To begin working out of electronic information base forsimplification of work with clients, to create «the book of the client» inwhich to skid all nuances of work with the given customer.
3) It is obligatory to fix the reason on which the client hasaddressed Print Express Company services, and also – a source of the company’sinformation.
The ways to increase the effectiveness of e-marketing in PrintExpress Company.
1. Web site
As one of the most significant ways to increase the effectivenessof e-marketing at any company is to consider optimization of its communicativepolicy. The communicative policy is a course of actions of the company,directed on planning and realization of interaction of firm with all subjectsof marketing system on the basis of use of a complex means of Internetcommunications.
Marketing communications in the Internet can be divided into twokinds:
a) The communications connected with creation and perfection ofthe goods and its behavior in the market;
b) The communications connected with advancement of the goods.
The company Web-site usually acts as the central element of thecommunicative policy in the Internet. The Web-site gives the companies a widenumber of additional possibilities, in addition to accessible earliercommunication services. Their main feature consists that now the company cangive to users additional service: information, to sell the goods and services.
2. Application of Internet advertizing elements
Advertizing today is one of the most widespread tools of acommunicative policy. The Internet is an effective remedy of advertizing. It isconnected with the multimedia nature of its environment, allowing to use allpossible kinds of finishing to the information user. The Internet is theinteractive environment that gives to the advertiser an effective mode of thefocused influence on target audience and concrete users.
The Internet as the advertizing tool considerably differs fromtraditional advertizing means not only the properties, but also appliedapproaches.
3. Application of e-marketing elements
When the Internet only started to develop actively, the e-mailmarketing was usually used for advertizing only. But, gradually, thistechnology has started to draw attention of serious firms which considered itin the beginning as cheaper alternative compare to mail. With growth of Networkusers, many have started to realize e-mail marketing. Falling of efficiency ofthe banner advertizing caused by explosive growth of number of banners, andalso, not in the last instance, occurrence of effective programs.
Unlike banners which are used as a mode to draw attention ofpotential clients, the e-mail can serve variety of the purposes: sale ofproduction and services, by use of specialized mailings, a fast and convenientmode of dialogue with clients, especially if they live in other time zone.
Using electronic mailing makes possible:
a) to suggest the interested organizations to become your dealersor distributors;
b) to inform potential buyers on possibility to get party of yourgoods or to use services of your company;
c) to invite your partners and colleagues to exhibitions,meetings, seminars, banquets, presentations, press conferences;
d) to send the newsletters, press releases;
4. Creation marketing information system.
The majority of the companies have the representations inthe Internet (web-sites or easier pages) where the information on theiractivity, offers, requirements and so forth is presented. The Internet givesfine possibilities for carrying out marketing competitive investigation.
To survive in high competitive conditions Print ExpressCompany should trace all changes in the market: requirements of buyers, aparity of the prices, actions of competitors, creation of new products, andintroduction of new elements. In order to solve these marketing problems PrintExpress Company should possess system of reception, storage and the analysis ofthe marketing information that called marketing information system (MIS) –system of actions for gathering, sorting, and analyzing of the marketinginformation.
The basic advantages of using MIS: a) the organized gatheringof the information; b) wide coverage of the information; c) the prevention ofcrises in firm activity; d) coordination of marketing plans; e) high speedanalysis; f) representation of a quantitative results.
5. Timescale
Week 1 – Week 3 Choice of research topic and literature review
Week 4 – Research problem – clarification of specific question
Week 5 – Assumptions and hypothesizes
Week 6 – Identify concepts, constructs and models
Week 7 Data analysis
Week 8 Data analysis
Week 9 – Interpretation and conclusions about the research problem
Week 10 – Review and improvements in problem solving
References
marketingglobalization internet effectiveness
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2. KRISHNAMURTY, S.2006. Contemporary research in e-marketing. London: Idea Group Publishing.
3. NANSI, S. andMURTHY, V.K. 2003. Architectural issues of Web-enabled electronic business.London: Idea Group Publishing.
4. ZHIVETIN, V.V.,SAMOHVALOV, V.L., CHERNOV, N.P., FERAPONOVA I.A. 2008. E-marketing as the wayto increase profitability. Marketing. 36. p. 74.
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