IT8005 EC Notes UNIT 4
IT8005 EC Notes UNIT 4
IT8005 EC Notes UNIT 4
UNIT- IV
4 Business Concepts
in E-Commerce
Syllabus
Digital Commerce Marketing and Advertising strategies and tools - Internet Marketing Technologies
- Social Marketing - Mobile Marketing - Location based Marketing - Ethical, Social, Political Issues
in E-Commerce.
Contents
4.1 Digital Commerce Marketing and Advertising Strategies and Tools
(4 - 1)
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automobile technology. The expectation that a website of Ford builds is, in case you
purchase a Ford you will get to experience latest technology in automobile industry
and the highest mileage.
Websites also works to anchor the brands digitally, acting as a central point where
all the branding messages which emerge from multiple online presence of firm, like
Twitter, Facebook, mobile apps, or email, come together at a single online location.
Alongside branding, websites also perform the typical functions of any commercial
establishment by informing customers about services and product of company.
Website, with their digital catalogs and associated shopping cart, are major
elements in online customer experience. Customer experience refers to the overall
experience that customer had with the company, including informing, search,
purchase, use and after sales support for the service or product. The idea of
customer experience is broader than the conventional idea of customer satisfaction.
The overall customer experience will include various retail channels. This means
that, in the mind of customer, the mobile site and apps, website, twitter feed,
Facebook page, television ad and physical store are all connected as part of their
experience with the company.
of customer about the brand, to support other similar ads and to provide support to
brand indirectly.
Search engines helps marketers with insights into search pattern of customer,
customer’s point of view about their product, trending keywords used for search,
and which keyword their competitors are using and the response of customer. For
instance, PepsiCo, company having products like Doritos and Pepsi, does not make
any sale on internet, but have various branding websites directed at investors,
consumers and stakeholders. Their focus is on developing, updating and sustaining
the Pepsi collection of branded consumer goods. A search on Pepsi will produce
various search results which link to marketing material related to Pepsi.
Search engine websites initially executed unbiased searches of the Internet’s large
collection of web pages and gets most of their revenue from banner ads. This type
of search engine results are known as organic search since the ranking ans inclusion
of sites is based on more or less unbiased application of an algorithm imposed by
search engine. After 1998, search engine websites have converted themselves into
online yellow pages, where company pay for getting included int search engine
index, pay for keyword to appeared up in search result, or pay for keyword to
appear in ads of other company.
Search Engine Claim that the payment made by companies does not affect the
organic ranking of their website in search result, just gets included in the search
results. However, it is the example in which page inclusion ads gets more hits and
the page rank gets appreciated, which causes the organic search algorithm to give
up ranking in the organic results.
Google claims that they does not allow companies to do payment for their rank in
organic search results, even though it does assign two to three sponsored links at
the top of their page, which are then labeled as “sponsored links”. Companies who
do not pay for the keyword or inclusion generally fall down on the search result list.
Pay-per-click (PPC) search ads are the key type of search engine advertising. In
keyword advertising, companies who buys keywords via a process of bidding at
search websites, and whenever a customer searches for that particular word, their
ad appears on the page, generally a small text based ad on the right side, but also as
listing on top of the page.
The more companies pay, the higher the rank and greater ad visibility on the web
page.
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product as Facebook Search, and providing keyword search feature which allows
users to find people, pages, posts, photos, videos and links on Facebook by
searching for keywords used in a post. Search results are ranked depending on
personalization algorithm based in part on the relation of user with the poster.
Search Engine Issues, while search engine have given significant advantage to
customers and merchants, they also present costs and risks. For example, search
engines have the capacity to crush smaller companies by positioning its ads on the
back pages of search results. For accessing digital marketplace which is dominated
by Google, merchants are at mercy of search engines. No one was aware of the
algorithm or techniques used by Google to rank one company over other. No one
had any idea about how rankings can be improved.
Factors which degrade usefulness and search engine results includes :
Link farms are set of websites which are link to each other, thus improving their
ranking in search engines which uses Page Rank algorithm to evaluate usefulness of
a website. For improving ranking in search result, some company hire search engine
optimization firm to create number of websites which are linked to their company.
JCPenney is one such company to do so, no matter what clothing item people are
looking for JCPenney used to come on top in search results. It is believed by experts
that this was one of the largest search engine fraud in history.
Content farms are set of firms which produce large amount of text content for
various websites which were designed to attract search engines and viewers.
Content farms generate profit by attracting large traffic to their websites and then
ads are exposed to them. The content usually is copied or summarized from valid
content websites.
Click fraud happens when a competitor clicks on ads and search engine results,
forcing the advertiser to make payment even if the click is not valid. Competitors
can hire third party company to carry out fraud clicks or hiring bots to automate
this activity. Click fraud can result in high bills for merchants and does not provide
any growth in sales.
Cost for many display and digital ad campaigns is taken on per click basis. Each
time a user clicks on your ad in search engine result, you will have to pay an
amount depending on your bidding policy.
Display ads can also be used for campaigns to retarget the user. This can be carry
out where the ads are displayed to the user who have already seen a particular
website. The objective is to retarget such users and motivate them to be back on
your website and take some action.
Banner Ads :
It is one of the oldest and conventional type of ad which generally displayed at the
top of website in banner format. Banner ads are most familiar display marketing
type. Banner ads are also low cost and less effective type of digital marketing.
A banner ads portray a promotional message in rectangular box at the top of
website on the screen of mobile or desktop. Banner ad is same as conventional print
media ads but with some additional advantages. When clicked on these ads, it bring
probable customers directly to the website of advertiser, and the website where the
ad is being displayed can monitor the behavior of user on the website.
The potential to recognize and track the user is an important feature of digital
advertising. Banner ads frequently contains video and various animations. Even
though the terms display ad and banner ad are frequently used interchangeably,
banner ads are just one type of display ad. In spite of being less effective,
advertisers still want to spend on banner ads.
Interstitial Ads :
An interstitial ad is a way of positioning a full-page message in between the current
page and destination pages of a user. Interstitial ads are generally placed within a
single website, and shown as the user navigates from one page to the another. The
interstitial is generally accommodated in its own browser window and moves
automatically to the page requested by user after permitting sufficient time for the
ad to be read. Interstitial ads can also be placed over an advertising network and
emerge as users move among websites.
Interstitial messages, such as TV ads, attempt to make the viewers a captive of the
message. Duration of normal interstitial ads are 10 seconds or less and force the user
to watch the ad for that duration. To entertain user, animated graphics and music is
used in ads. A good interstitial ads will also contain a stop or skip option for the
users having no interest to watch that message.
Video Ads
Online video ads are like TV commercials which is shown as in-page video ads or
during, before, or after a variety of content. The most widely used video ad format
is pre-roll in which users are forced to watch a video ad either in start, in the middle
or at the end of the video they have clicked on.
Even though from total spending point of view, online video ads ar still relatively
small when compared with the money spent on search engine advertising, but
video ads are one of the fastest growing online advertising format.
The higher growth rate in video ads is because of the fact that video ads are more
effective than any other form of display ad. For example, research has shown that
the click-through rate of video ads are 12 times than that of rich media ads and
27 times than that of conventional banner ads.
There are various advertising networks which are specialized in video ads, that run
video advertising campaigns for national advertiser and position these videos on
their respective website’s networks. Companies can also initiate their own television
and video sites to advertise their products. Retail websites are one of the largest
users of ad videos.
Sponsorship
A sponsorship is a paid attempt to tie name of an advertiser to an event, particular
information or a place in a way that reinforces its brand in a positive yet not
honestly commercial way. Spronsorships are generally are more regarding
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All businesses requires customers to increase every passing day and to get such
customers, businesses need to target potential customer first and get their attention.
This is the scenario where lead generation marketing is very useful.
These leads then passed to sales team in order to convert them into buying
customer. This usually includes adding them in mailing list for further nurturing.
And along with enhanced technologies, business intelligence tools can track
demand of your product and customer trend from the data captured through lead
generation marketing.
Steps for Marketing Lead Generation :
1. Capture leads via website forms
We can place a simple subscription form on your website and ask visitors who
are interested to fill the form in trade of valuable contents like, eBook,
infographics, white paper, checklist, case study, newsletter or how-to-do
video. The big concept is to mix lead capture form with your website design.
2. Generate leads via Google Ads
We can run targeted ads about main keywords on Google which capture
attention of potential lead while searching online for your business related
keywords. The user is later redirected to a landing page or your website,
where additional strategy is in place to capture the lead and the best thing is
you will only have to pay when user clicks on the ad. Google has helped
many companies to start of with lead generation marketing on Google.
3. Capture leads using direct emails
Direct emails send to customer no only contains announcement regarding new
product or service but it also provide user 20% promo code to use in order to
buy the product. This technique is proven to be effective in most cases
converting number of cases into potential leads for purchasing your product.
4. Capture leads using social media platform
Lead generation marketing should not always need to be hard, even easy but
effective techniques can lead to capture high quality, exciting lead prospects
for your company. Social media is one such platform. Nowadays, user pass
around five to six hours of their time on social media daily, by some or the
other ways. Social media platforms, such as Instagram, Facebook and Twitter,
are not only used for keeping in touch with our friends and family, but also
share individual’s point of view on different brands.
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This has provide business owner with the chance to hear out their existing
customer and engage with potential customers. Business can engage in lead
generation marketing in similar pages, groups or via direct messages. One
similar and popular method to capture information about potential lead is
though social media contests. Social media content contest can be organized in
trade of some type of giveaway. Users are often need to refer their friends,
upload photos or give answer to few simple question in order to enter into
contest. Creating fun way in order to engage with users of social media
platform is very effective process for owners of businesses to capture potential
leads.
User are tempted via various means to fill sign up or registration forms.
Registration forms collects personal data on name, contact number, address, pin
code, email address which are generally mandatory fields and other optional data
provided on users interests.
When user purchases something, they provide some addition information into
shopping cart database. The shopping cart database collects all the selected
products, purchase and payment related data.
For a website having millions of visitors every month, and where, on an average, a
visitor requests for around 15 pages on every visit, there will be around 15 million
entries in the log every month. These transaction logs combined with data from
shopping cart database and registration forms, represent a treasure of marketing
information for individual websites as well as online industry as a whole. Almost
all Internet marketing capabilities are dependent on these data collection tools.
For example, below are some interesting marketing questions which can be
answered by analyzing web transaction logs of website, shopping cart database and
registration forms :
o What are the major patterns of purchase and interests for individuals and
groups ?
o After the home page, where do most users go first ?
o What are the interests of particular individuals ?
o How we can make it simpler for visitor to use our website so that they can find
what they want ?
o How can we change the design of the site to motivate visitors to purchase our
high-margin items ?
o Where are visitors coming from ?
o How can we personalize our offering, messages, and products to individual
users ?
A cookie is small text file websites place on visitor’s computer each time they visit.
Cookies permit a website to store the information on visitor’s computer and then
retrieve it later. The cookie generally includes name, unique ID for every visitor
which is stored on visitor’s computer, a path, the domain, security setting which
provides information about whether the cookies can only transferred using secure
server, and an expiry date which is optional.
A cookie provides online marketers with a quick way of recognizing the customer
and understanding user’s history on the website. Website make use of cookie to find
out number of user visiting the website, whether they are repeat visitors or new
visitors, and how frequently they have visited the website, even though this data
might be 100% accurate since people share computers, they many times use more
than one computer, and cookies might be accidentally deleted. Cookies helps to
make quick checkout and shopping cart options possible by permitting the website
to keep track of the user as they add or remove products in shopping cart. Every
time new item is added to the shopping cart is stored in databse of website along
with unique ID of visitor.
With increasing privacy concerns, over the time many user have started deleting
cookies. The more cookies are getting delete, the web page and ad server
benchmark becomes less accurate., and less likely marketer will be able to know
visitors information or from where did that visitor came. As a result, advertiser
have found other ways. One such way is using Adobe flash software, which creates
its own cookie file, named as flash cookies. Flash cookies can be made in such a way
it never expires, and can store the information up to 5 MB as compared to 1 MB data
stored by normal cookies.
On mobile devices use of cookies has found to be less effective. Normal cookies on
mobile device are reset each time user closes browser and in-app cookies cannot be
shared between applications, making both of limited utility. However, as the
number of users increasing using mobile devices to access the Internet, it is of no
wonder that telecommunication companies started using tracking files.
Marketers cannot overlook the large number of users that social media network like
Facebook, Twitter, Instagram and Pinterest are gathering, which rival radio and TV
in size. There are majority of population who visits social media sites on daily basis.
It is found in a research that social media active user are more likely to discuss
about and suggest a product or company they follow on social network. Many of
the companies have started using social media platform for marketing purpose.
Many companies have also started giving sponsorship to celebrities to promote
their product on social media platform.
Social media platform provides all major type of advertising formats to advertiser
which includes banner ads, short pre-roll and post-roll ads related with videos, and
sponsored content. Having Facebook page of company is like a marketing tool for
brand just like web page. Many companies, like Coca-Cola, have shut down their
product specific web pages and started using Facebook pages for marketing.
Online games and blogs can also be used for social marketing. Blogs have been
around since very long and are part of the conventional online culture. Around 80
million user read blogs while 29 million people write the blogs. In online marketing
blogs have very important role to play. Even though many companies uses
Facebook and Twitter, they have not replaced blogs, and in reality frequently they
point to blogs for longer content. Advertising networks which are specialize in
blogs offers efficiency in displaying ads on the blog. There are blog networks
available which are collection of small number of famous blogs, that are
coordinated by central management team, and from such network content can be
delivered to larger number of users.
The online gaming marketplace is expanding at high pace continuously as the
number of users playing games on mobile, tablets, console and PC have increased.
The aim of game advertising is branding as well as driving customers to buy
moments at retail stores and restaurants.
If social marketing is used properly then it can become a great asset for marketing
industry. The favourable result of social marketing for any business can be
enormous, but one must keep in mind that it should be used in most efficient way.
Social marketing permits websites and businesses to acquire huge following over
the Internet by using various kind of social midea platforms available, like blogs,
photo and video sharing websites, social bookmarking websites and social
networking websites.
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4.5.1.1 Geotargeting
Geotargeting is used to find out location of the user, so as to deliver personalized
content depending on their current location. If customer have given permission to
app for accessing their location data, they might get push notification or in-app
messages depending on proximity to store or area.
Geotargeting is based on IP addresses. IP address is assigned to every connected
device to make them recognizable. IP address can later be matched with country,
pin code etc, in order to identify the current location of user.
The major benefit of geotargeting is to grow customer experience via
personalization. For instance, marketers can target users depending on needs
related to specific location, like local or weather news and events.
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4.5.1.2 Geofencing
Geofencing is building a border withing a particular region. When the targeted user
enters into that boundary, they automatically become a target of marketing plan.
This means that they will receive offers, content, or some other type of messaging
from the businesses. One example of the boundary is an area covering a famous
shopping mall in which company has a outlet.
Geofencing uses GPS technology to develop a border. At any point a target user
crosses that boundary, they receive a app notification or SMS.
Geofencing permits marketers to cover large area, like event places or malls. Using
this technique marketers can target all the users who are withing that particular
range.
Geofencing is dependent on real time location data, which permits marketers to
motivate users to engage with their products, or deflect users from engaging with
competitors product.
Retailers can use geofencing to target users nearby their shops to motivate them to
buy something from your shop. For instance, a user has been reviewing an item
online, they may get a alert about availability of that item in nearby store.
4.5.1.3 Beaconing
Beacons are connected devices which uses WiFi or Bluetooth to connect with
predefined applications which are functioning withing range or the beacon. Within
the range of smaller geographical area, beacons functions very well to target
existing customers.
Beacons send a sign to your device which alerts server to send content to your
device. This can be an email, push notification etc. For instance, assume a sports
stadium has encouraged the audience to download their app for concession, ticket
booking, etc. The venue will setup a beacon to identify when a device having their
app installed is in coverage area.
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User should subscribe and keep Bluetooth turned on so as to take advantage of this.
However, this channel of location based targeting provides you more direct
communication medium with customers.
Businesses can monitor users indoors in more accurate way. This not only permits
for more specific targeting, but also support marketers to get a more complete
knowledge of customer behavior.
Users don’t have to be online to receive these notifications.
Shops can place these beacons in passage around the shop to send offers as users
browse. For instance, a grocery store might use beacon to check at what point
customer is in the ice cream passage and then send offer to them on ice cream.
Internet can be used to accomplish social growth, and for the major part, this has
occurred. However, same technologies can be used to commit crimes, destroy the
environment, and threaten esteemed social values. Before the invention of
automobiles, interstate crime rate was less and very less federal jurisdiction over
crime. Same goes with Internet, before the Internet, cyber crime rate was very less.
Many companies and individuals are taking advantage from the commercial
development of Internet, but this development also demands a price from
companies, individuals and societies. These benefits and cost should be carefully
taken into consideration by those who want to make social and ethically responsible
decisions in new environment.
wrong courses of action. It is presume in ethics that individuals are free moral
agents who are in such place to make selections.
Extending ethics from individuals to business organizations and even complete
society can be challenging, but it is not impossible. Considering there is decision
making body or individual in place, then their decisions can be judged against
various ethical principles. If you know some basic principles of ethics, your
capability to reason regarding large political and social arguments will be
improved. In western countries, there are liability and ability principles which all
ethical schools of thoughts share: responsibility, accountability, liability.
Responsibility means as free moral agents, organizations, individuals and societies
are accountable for the actions they take. Accountability means that organizations,
individuals and societies must be help responsible to others for results of their
actions.
Liability extends principle of accountability and responsibility to the area of law.
Liability is a attribute of political systems in which a body of law is in place which
allows individuals to recover the harm done to them by other player, organization
or systems. Due process is a attribute of law governed societies and refers to a
process in which laws are understood and known. There is provision to appeal to
higher authorities to make sure that the laws have been implemented correctly
it bring probable customers directly to the website of advertiser, and the website
where the ad is being displayed can monitor the behavior of user on the website.
Q.4 What is display ad marketing? List various types of display ad marketing.
Ans. : Display ad marketing
Display ads are the way of attracting customers of websites, social media platform
or any other online medium to take particular action. These are frequently made
up of text-based, video or image ads which motivate the user to click-through to a
landing page and take some action like making a purchase.
Cost for many display and digital ad campaigns is taken on per click basis. Each
time a user clicks on your ad in search engine result, you will have to pay an
amount depending on your bidding policy.
Types of display ads :
Banner ads
Rich media ads
Interstitial ads
Video ads
Sponsorship
Q.5 What is email marketing?
Ans. : Email Marketing
Email marketing is when you send out commercial message via email to your
contacts who have subscribed to your mailing list and provided permission to
receive email communication from you.
Email marketing technique is used to drive sales, to give information and to build
a community around your brand. Current email marketing has improved from
being one-size-fits-all bulk mailing and rather than focused on segmentation,
consent and personalization.
Email marketing is low cost and somewhat invariant to the number of emails sent.
The cost for sending 1,000 mails are same as for sending 1 million. The primary
cost of email marketing is for buying the list of names whom the email will be sent.
Q.6 Describe affiliate marketing in short?
Ans. : Affiliate Marketing
Affiliate marketing is strategy for online sales which lets a owner of the product to
increase sales by permitting others targeting the same consumers i.e. affiliates, to
earn a commission by suggesting the product to others. Simultaneously, it makes it
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feasible for affiliates to earn money on sales of product without need to create their
own product.
Affiliate marketing includes referring a service or product by sharing it on social
media, blog or website. An affiliate earns commission every time someone makes a
purchase through the URL associated with their suggestion.
Q.7 Describe lead generation marketing in short.
Ans. : Lead generation marketing
In the online marketing world, a lead means a potential customer in your target
users who is interested in buying the service or product provided by you. So lead
generation is the process of attracting such potential customers for your business.
Various marketing companies makes use of various marketing strategy for
attracting potential customer which is referred as lead generation marketing. Lead
generation strategy includes contacting business directly, drive user to register for
something online by filling a form, or even walking into the shop.
All businesses requires customers to increase every passing day and to get such
customers, businesses need to target potential customer first and get their
attention. This is the scenario where lead generation marketing is very useful.
Q.8 Define cookies with its use.
Ans. : Cookies
A cookie is small text file websites place on visitor’s computer each time they visit.
Cookies permit a website to store the information on visitor’s computer and then
retrieve it later. The cookie generally includes name, unique ID for every visitor
which is stored on visitor’s computer, a path, the domain, security setting which
provides information about whether the cookies can only transferred using secure
server, and an expiry date which is optional.
A cookie provides online marketers with a quick way of recognizing the customer
and understanding user’s history on the website. Website make use of cookie to
find out number of user visiting the website, whether they are repeat visitors or
new visitors, and how frequently they have visited the website, even though this
data might be 100% accurate since people share computers, they many times use
more than one computer, and cookies might be accidentally deleted. Cookies
helps to make quick checkout and shopping cart options possible by permitting
the website to keep track of the user as they add or remove products in shopping
cart. Every time new item is added to the shopping cart is stored in database of
website along with unique ID of visitor.
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