Internet is a Direct-response medium
why? 2way dialogue marketer/prospective customer
customers gets a seamless purchase process
marketer’s can fine tune marketin programs.
Interactivity – direct communications, two way communication
ffers, tracking response, surveys.
Information driven – every action a visitor makes is a piece of data for makbase
Immediacy is fostered by the web, marks can reply to custs,
they can construct offers that are triggered for an event.\
Involving – attracting by using video and games in Iadvertising to involve more customer.
a good direct response offer incites prospects to take action(request info or on the spot purchase)
soem marketers can combine brand marketing with direct response marketing
(cheer free – example)
basic direct response strategy
3 marketing strategies that parallel a basic customer life cycle
1 a customer is aquired
acquisition stage, the customer has made a single purchase, not yet commited
conversion, prosp converts to a customer (2-3 purchases to from a habitat pattern)
Retention, behavioral loyalty
CUSTOMER LIFETIME VALUE important to Retain
the net present value of a future stream of net revenue from an identified customer.
some critycal strategy elements are the offer (product prise positioning)
the list – targeting vehicle, the media used which is the understanding that any medium can be a direct response medium with proper implementation of cours, thrid the creatve execution which theds to pla a secondary role in this action oriented context
Service and sypport are long recognized as a key element in this environment where the shopping experience and sensory stimuli are not present/
the first rule of direct marketin is that the initial offer must include a call to action.
an internet marketing program has three action objectives to keep the visitor on the site,
get the visitor to remain on the site longer, to entice visitors to request additional information about a produc tor service, “filling out a form to get info is a good tradeoff)
making the saleis the final generic direct response objective
incentives encourage immediate purchase
front end all the marketing and promo activities that happen b4 a sale is made.
Back end, the act that r required to satisfy the cust after a sale is made.
net customer revenues minues cogs/gm minues cost of servicing/customer revenue times cost of capital/netpresent value of customer revenue stream.
5nkchapitre
You want to upsell, you want them to buy more from you.
You also want to cross sell
Internet business model
Direct response medium
critical ___ element
Customer lifetime value
Test
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Last time, What are different business models?
Amazon, what is it?
Business Model
• Traffic agregator (what do you see? you just see books? whats on the toolbar? everything!) They want your eyeballs!
• Their business model is an aggregator
commission associates, Adverising
Times – information , they PROVIDE CONTENT, they are a CONTENT provider, Subscription
there’s a difference between a revenue model and a business model. Subscription.
The more information you have, the more opportunity.
how to make additional revenue sources?
THE BUSINESS MODELS chart here.
How does it capture data?
information intense, it has involvement,
what’s a direct response bottom line, a call to action.
whats the internet provide you when you log on?
Information based, information
How come you stay on for hours, some sort of involvement in the process, some sort of process.
Anything you want you can get, its interactive, information intense, immediate, and your involvement.
customers: you aquire them, you ___, and then you retain them
blank blank blank
TESTIMONIALS, if it works for me it works for you.
Thinking about cars.
Broadly general,
Aston marting to a camery
Country where its made, income , they can be criteria
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Media a big player in marketing at what you get?
is media robust?
Back office is critical, any 1 of these fail, lets say you get the wrong audience, you don’t have a n invitation offer, something thats compelling and you cant deliver, you are in trouble in the process.
when people log on your ste, you want them to stay on.
if they are on your site, they are not on someone else site.
their involvement goes, up, it says your content is the best deal in town.
Sales leads, stickiness, targeting could be community, like curing cancer
think of differetn landing pages, what is a landing page? a home page.
______
Let’s see!
were going to see this over and over again,
supply chain, etc front end black end.
CLV
customer lifetimes value, loyalty, brand recognition
It’s cheaper to keep a customer than to find new ones, 4 to 5 times more.
omce you get a customer, you want to keep the, you want to satisfy them, customer service
base case sceneraio, how you would increase this customer retention, how much can you get by making them happy.
a trusted company that you believe that you continally buy products from, P&J does a good job.
Those re key concepts that you need.
Something to actor in, thats a very important conept.
Switching costs
email address, internet providers,
trustworthiness calculated over time.
it becomes a business model, because of the rating process.
So switching costs are _____
if you work through the calculations, theres a supermarket example, 50 weeks, not 52 weeks.
It’s imoirtatn you know general concept.
__
what the dfference betweena test and market research? what are the things ud like to do in an online testif you are an advertiser, maybe price color banner add, conceptuallly what do you have to do? one banner add vs the other, you just have to have 2 products, who your targeting, target market.
the offer, the email list, the service and support, the media , the creative exe… easier,
product research tells you waht peple are thinking, testing gets behind what people do.
if you engage in the practical statistical stuff, blah blah, ou have info at the end of the day, yes absolutely.
can you give one coupon to one set of customers, look at what they do over a two onth period. stimulate increase,
focus on one thing, theres a chart you should look at,
TESTING PRCESS CHART 4-4