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Blog 5- The internet has changed the marketing mix element among the retail industry

5a. The internet has changed the marketing mix element among the retail industry

Image source: (Chaffey, D. & Ellis-Chadwick, F. (2019). *Digital Marketing*. England: Pearson.)

Retail industry as one of the biggest industry sectors which are actively presented among all nations, more opportunity is found for marketers to maximize their profit as the demand increased. In order to develop a well-designed marketing strategy, the impact of the internet and digital technologies on the marketing mix of the retail industry should be discussed.

Product

Retail industry sells fine goods not only for consumption, but also creates the uniqueness to satisfy different needs. The internet has changed the product variable on how firms provide products and services which increase options for offering digital products such as subscription via email or website, customers are surrounded by digital technologies that can be reached easily (Nicasio 2018). The improvement on the quality and the variety of products are beneficial for branding, as the feature of the core product and extended products are enriched, firms can attract more potential customers. Feedback or responses can be received quickly by conducting online research or questionnaire which accelerates the speed of new product development, it also leads to a market expansion and a greater profitability.

Price

Price is a crucial element which not only shows the value of the product, but also reveals the competitiveness between rivals. The internet has impacted price variable by increasing price transparency which means customers are able to compare price from one to the other, a firm who has the lower price is more attractive to customers. Moreover, it helps the retail industry to do positioning and adjust their price strategy based on the purchasing power of the target market and the influence of competitors. The change on payment method can also be mentioned that digital technologies enable more ways to checkout online.

Image source: (https://www.davidtan.org/wp-content/uploads/2009/01/retail-product-code-marketing-550×315.png)

Place

Digital technologies have increased trade channels which help retailers to minimize the cost of transporting and inventory through distribution activities, customers can purchase products through website or apps rather than going to a physical store in a fixed location. The internet can be used to define different segment channels, resources can be managed in a more effective way and localization has enriched the function of a site to satisfy various needs. Place of purchase has increased which from a seller-controlled to a buyer-oriented among the virtual marketplace such as eBay and Amazon (Chaffey 2019).

Promotion

The internet offers more ways for the retail industry to implement marketing communication tactics, which include personal communication, direct marketing, PR and advertising (Chaffey 2019). It becomes easier for marketers to inform customers about their products and special offers, social media channels are used for marketing promotion. Digital technologies have simplified the process of purchasing, customers can just click ads to visit the shopping site. Customized information is sent to customers by referring to their previous purchasing list or searching history, the innovation in technology which helps retail industry to build a good customer relationship and social network.

People

When digital technologies have involved in the operation of business, the transformation on how to train staffs to provide service can be seen. Firstly, mastering both hard and soft skills become vital in the digital setting, employees in the retail industry are required not only to manipulate the internet expertly, but also to connect themselves to customers by communicating efficiently online to solve problems. Secondly, the development of technology has expanded the market internationally which changes the standard of recruitment to become multi-cultures (Renner 2018). Employees from different nations are hired to fit in the various needs among different target markets.

Process

Process in the retail industry refers to the methods firms use to achieve marketing functions, which include R&D, product development and customer service, digital technologies help it to restructure its channel structures in order to have a significant business outcome (Burkhardt 2017). The average time for responding and resolving problems via chat box or email has been reduced, the quality of customers service is improved. The satisfaction customer feels which contributes to customer retention, brand loyalty as well as cost reduction.

Image source: (http://theconversation.com/the-hidden-costs-of-online-shopping-for-customers-and-retailers-109694)

Physical evidence

Physical evidence is a variable which may influence the overall performance of a brand, everything tangible is taken into account (Chaffey 2019). With the help of the internet, retail industry has improved its online experience by creating an easy and concise layout of the website which makes their products accessible for various types of customers. The design of product packaging with more creative ideas which inspire customers and improve the overall experience during the purchasing, brand image and reputation can be known by more people because of the use of the internet.

All in all, the development of the internet has assisted the retail industry to perform well in the era of digital technologies, the impact on every element of the marketing mix cannot be ignored which are all contributed to the possibility of a success.

5b Social media marketing tactics for my friend’s online sport shop

Image source: (https://www.flaticon.com/packs/sport-equipment-5)

Social media marketing helps online business increase sales and gets valuable feedback by interacting actively with customers. I would suggest my friend to use social media marketing tactics in a product and customer base for her online sport store. Here are the following suggestions:

Post products frequently on social media channels

A high engagement and presence in the public which will help audiences to recognize the brand and be familiar with its products. By using all the social media channels available to post products which can not only to maximize the influence, but also to create an opportunity to understand customer preference. As the world is shifting to a real time base, live updates can also be used in the post which allows customers to see how it looks like by using your sport gear and equipment (DeMers 2016).

Use social review

This can be the evidence to show sport equipment is value for money. Positive feedback or a good rating result could influence the purchasing decision among potential buyers.

Use an influencer campaign

Having an influencer campaign can be a smart choice to increase brand awareness. By using a celebrity or influencer to promote the brand with hashtags can create a greater influence than you run an advertisement by yourself.

Image source: (https://mangodigitalmedia.co.uk/wp-content/uploads/2016/08/Capturewebsiteimage.jpg)

Improvement on website design

A concise and simple layout can create a better customers experience which contributes to customer satisfaction and brand loyalty. Making product catalogue accessible will help customers to find their desire products easily, general information such as product introduction, shipping fee and return policy are listed in detail to prevent misunderstanding.

Development on customer service

Timely responses and effective problem-solving skill through either email or telephone can increase the favorability among customers. For example, chatbots are used as an effective tool in the online business to ask questions and solve problems (Standberry 2019).

Enable a ‘shop now’ button on social media channels

By enabling a ‘shop now’ button under the posts which provide a convenient shopping experience for customers, they can click the link on social media to transfer them to the purchasing site. It simplifies the process of re-searching products, which also create a shortcut to generate revenue.

References

Burkhardt, F. (2017). Retail: An Industry in Transition. Retrieved from Trade & Industry Development site: https://www.tradeandindustrydev.com/industry/retail/retail-industry-transition-13204

Chaffey, D. & Ellis-Chadwick, F. (2019). Digital Marketing. England: Pearson.

DeMers, J. (2016). 6 Social Media Marketing Tactics That Give the Best Bang for Your Buck. Retrieved from Entrepreneur site: https://www.entrepreneur.com/article/274522

Nicasio, F. (2018). 6 Retail Marketing Strategies to Help You Get New Customers. Retrieved from Vend site: https://www.vendhq.com/blog/retail-marketing-strategies-help-get-new-customers/

Renner, E. (2018). What is retail marketing. Retrieved from Repsly site: https://www.repsly.com/blog/consumer-goods/what-is-retail-marketing

Standberry, S. (2019). 10 Social Media Marketing Tactics That Make a World of Difference. Retrieved from Lyfe marketing site: https://www.lyfemarketing.com/blog/social-media-marketing-tactics/

Blog 4 (Part b)-Business & Revenue model- Airbnb

Airbnb as one of the largest accommodation providers which establish an online platform between travelers and local house owners to rent houses. It was firstly founded in 2008 and then grew rapidly which now worth $26 billion this year (Yale 2018). A well-designed business and revenue model help Airbnb to maximize the profit and expand wider markets internationally.

Business model:

Customer segment

Airbnb divides its segment into two catalogues which are travelers and the hosts, both of them are able to complete a deal through the online booking system. Travelers are the people who are interested in exploring new things and show their acceptance of sharing living space with strangers; Hosts are willing to rent their apartment to make money. In addition, it is reported that experience providers can also be a customer segment, which refers to people are paid to share their living experience with fine photographs of the house (Sherwood 2019).

Value proposition

Airbnb enables a new way of renting without occupying any properties, which helps travelers to find suitable living space with an affordable price than hotels. For the hosts, they have chances to meet people from different countries and earn money by sharing available living space. Choices are made between two parties, the hosts have rights to choose tenants as travelers do which bring fairness and satisfaction of the process (Nath 2019). Airbnb creates value for its customers by providing a chance to understand various cultures from different people.

Key partners

The main partners of Airbnb can be investors and regulators who all want to gain profit from the operating of the firm.

Core activities

Airbnb is involved in various business activities which include regulation and maintenance as well as marketing and promotion activities (Sherwood 2019). It regulates the business by setting a review system to establish trust in the community and prevent frauds. Also, Airbnb may deal with concerns from customers which need it to adjust its strategy or to balance the price of the hosts in order to get a positive response in the future. Moreover, marketing activities such as advertisement, promotional offers, word of mouth and posts from social media can be mentioned.

Channel

Customers can either use its app to make a booking or log in to the official website to manage their accommodation.

Revenue model- So how Airbnb generates revenue?

Obviously, Airbnb earns profit from its two main segments which are the hosts and the travelers. It is stated that Airbnb will charge travelers 10% to 12% of the booking fee and the hosts need to pay 3% for every successful booking (Nath 2019). Furthermore, Airbnb charges a valued-added tax or a service tax based on the political requirement of the market in different countries (Nath 2019).

To conclude, Airbnb use a creative approach to operating business which is beneficial for multi-parties; however, customers retention and safety concerns are still the problems it should be aware of.

References

Chaffey, D. & Ellis-Chadwick, F. (2019). Digital Marketing. England: Pearson.

Nath, T. (2019). How Airbnb Makes Money. Retrieved from Investopedia website: https://www.investopedia.com/articles/investing/112414/how-airbnb-makes-money.asp

Sherwood, H. (2019, May 5). How Airbnb took over the world. The guardian. Retrieved from: https://www.theguardian.com/technology/2019/may/05/airbnb-homelessness-renting-housing-accommodation-social-policy-cities-travel-leisure

Yale, A. (2018). 10 Years After Airbnb, Real Estate Developers See The Money In Home-sharing. Retrieved from Forbes website: https://www.forbes.com/sites/alyyale/2018/10/17/multi-family-developers-are-leveraging-the-short-term-rental-fad-heres-how/#2007bd5338e0

Blog 4(Part a)-A superior innovation in the business model -Amazon

By following the rapid trend in the change of e-business, firms are required to innovate their business model to fit in the environment and capture value. Amazon is one of the biggest online retail stores which were established in 1994, it gained a net sale of $64 billion in the second quarter of this year (Statista 2019). Amazon started its business for selling books at the beginning, but the growth of technology forces it to transform into a diverse business base.

The innovation of Amazon can be seen from many aspects by referring to the four actions in business model innovation, which is eliminate, raise, create and reduce (Crawford 2018). To begin with, Amazon increases its products types which include electronics, commodities and clothes. The need among various customers can be satisfied, which increases its customer segments to expand a bigger market. Secondly, advanced technology is used as the key resource for Amazon to compete in the market, Kindle, Alexa and cloud service are launched as a first mover advantage in the online setting.

Thirdly, it simplifies the supply chain by eliminating intermediators that the distribution channel and the purchasing process are easier than the past. Finally, Amazon realizes a superior firm cannot be restricted by one business approach, B2B and B2C can be all involved in the process. On the one hand, it provides Amazon Prime which offers exclusive benefit such as free shipment and discount only for subscribed members (Frankenfield 2019). This can be a way for customer retention which also related to the revenue model that Amazon charges subscription fee as a profit source. On the other hand, it uses current online platform to do advertisements for other firms, the acquisition has also shown its effort for generating profit (Frankenfield 2019).

All in all, these aspects have successfully assisted Amazon to keep ahead from its competitors and increase its market share. The adjustable business model enhances the capability of Amazon which from a book store to ‘the biggest selection on the earth’ (Montgomery 2016). The development of customer experience and relationship can still be crucial for Amazon to enhance its competitive advantage through this innovation.

References

Chaffey, D. & Ellis-Chadwick, F. (2019). Digital Marketing. England: Pearson.

Crawford, K. (2018). Amazon Innovates With Its Business Model, Not Drones. Retrieved from Wired website: https://www.wired.com/insights/2014/01/amazon-innovates-business-model-drones/

Frankenfield, J. (2019). How Amazon Makes Money. Retrieved from Investopedia website: https://www.investopedia.com/how-amazon-makes-money-4587523

Montgomery, S. (2016). How Amazon Innovates to Stay a Step Ahead. Retrieved from business website: https://www.business.com/articles/how-amazon-innovates-to-stay-a-step-ahead/

Statista. (2019). Amazon: quarterly net revenue 2007-2019. Retrieved from Statista website: https://www.statista.com/statistics/273963/quarterly-revenue-of-amazoncom/

Blog 3- Social Media (A analysis is based on SMMF)

Social media plays a crucial role in the era of digital marketing, which can be a valuable tool to help marketers to promote their online business. The extent of how well digital macro-environment can be managed which leads to a higher profitable possibility and a long-term success of the business. In this blog, I will analyze two examples which are Kylie Jenner’s cosmetics and financial services by using Social Media Marketing Framework (SMMF).

1a Kylie Jenner’s cosmetics

Scope

Kylie’s cosmetics has a collaborative approach for its scope. Her popularity on Instagram shows her success of understanding the trend among the young generation and fully utilized them to create value for her cosmetics (Bova 2018). Brand awareness is enhanced during the process of posting cosmetic products or make-up videos from Kylie. For example, the hashtag of the brand enables a new way of recognizing goods which may attract potential buyers in the future. The reciprocal interaction helps Kylie’s cosmetics to communicate with followers by knowing the demand and feedback of products, this method can also be called as an explorer.

Culture

Modernism can be seen from the case of Kylie’s cosmetics, which refers to a more open and flexible way to promote her products. It creates high involvement between the brand and customers by using suitable advertising slogans to attract attention. Unlike the traditional advertisement, Kylie knows how to interact with customers as friends. They are encouraged to post photos with Kylie’s cosmetics and share their experience, people are expected to be selected by Kylie to comment or repost (Forbes 2018).

Structure

The structure of Kylie’s cosmetics can be decentralized that everyone in the team can be involved in the social media. To be a celebrity and boss in the public, Kylie’s company requires to constantly evolvement in order to follow the trend. Therefore, a network method is used to come up with more creative ideas, which means everyone has chances to say something online to contribute to the development of the brand.

Governance

Anarchy occurs in the way of managing her company which means there has no restriction for sharing things on social media platform. Due to the powerful presence of Kylie and her family, she has created a path of self-promotion. As long as products are responded positively by her audiences, rules and guidance is not the priority for the management of the company. In other words, the nature of all these activities on the social media is to gain profit and create a long-term economic growth for Kylie’s cosmetics. Of course, she did well!

2a Financial services industry

By using SMMF to understand the situation among financial services industry, the effort they have putted to social media platform can be seen. Firstly, it changes its scope which from a defender to an explorer. It transforms itself from a one-way communication approach of sending notifications to a collaborative way on social media to interact with customers because of the trend of digital marketing. Customers are able to know more stories from the service providers and the company can build a positive customer relationship with trust by using social media channel (Dopson 2018). Due to the sensitivity of personal information, it is important to keep them private and safe for their clients. The style will be a more traditional mass-marketing channel as conservatism which is different from the example of Kylie cosmetics.

Moreover, employees can be controlled by a centralized approach which also called as a hierarchy of decision making. In order to meet the standard of a formal company and the preciseness of the industry requirement, financial industry has clear rules and guidance on posted photos or videos to ensure the company operates properly and prevent the mistakes. What can say and what cannot say on the social media somehow may restrict the democracy of information, which influences the result of social media marketing. Because of the imperfection of marketing strategy which relates to social media among financial services industry, it still needs to be aware of customer mindshare may be conceded by other firms.

In conclusion, every company has its own strategy to deal with social media channel, but the fittest one is the most successful one!

References

Bova, T. (2018). How Kylie Jenner Built One of the Fastest-Growing Beauty Brands Ever. Retrieved from Entrepreneur website: https://www.entrepreneur.com/article/317001

Chaffey, D. & Ellis-Chadwick, F. (2019). Digital Marketing. England: Pearson.

Dopson, E. (2018). Social Media Marketing for Financial Services. Retrieved from Sendible Insights website: https://www.sendible.com/insights/social-media-marketing-for-financial-services

Forbes. (2018). How 20-Year-Old Kylie Jenner Built A $900 Million Fortune In Less Than 3 Years. Retrieved from Forbes website: https://www.forbes.com/sites/forbesdigitalcovers/2018/07/11/how-20-year-old-kylie-jenner-built-a-900-million-fortune-in-less-than-3-years/#115e2f1faa62

Blog 2- My online shopping experience with Lancôme

Nowadays digital marketers are seeking ways to improve customer online experience in order to build a positive relationship in the long- term operation. According to Rose and Hair (Chaffey & Ellis 2019), there have eight antecedents which may influence customer feeling and purchasing behavior. In this blog, I will use this framework to analyze my own experience at Lancome.com.au.

Information processing (IP): Overall the home page of Lancôme is clear to see all the information, which includes not only online exclusive offers, but also a recommendation section that shows its best sellers. This site provides detailed information on what this brand has without creating overwhelming message.

Perceived ease of use: Products are classified into different category which gives a concise overview for new visitors, it expands more types of goods for various uses by clicking the button. Searching section and the category occur at the top of the website which is easy for customers to find their desire products.
Perceived usefulness: Lancôme provides a good range of products which from cosmetic to skincare product as well as perfume. I am satisfied that it fits my need for the daily life. This also helps Lancôme to retain customers on its site because of the positive experience they have during online purchasing.

Perceived benefits: The site offers non-scheduled sale and promotion activity and a welcome discount for new registered users. Moreover, a bonus of three sample gift for each order which encourages customers to conduct purchase at Lancôme to get these benefits.
Perceived control: Personal information such as shipping address and products in the carts are recorded which simplify the process of re-searching products and making payment. For those who may be unfamiliar with the website, Lancôme has a section called ‘Need help?’ which provides FAQ and other relevant answers to reassure customers. You can also chat with an online shop assistant if you need, which is a really humanized design.

Skill: The more frequently I visit the website the easier I could navigate it because I get familiar with the setting and purchasing steps. The possibility for purchasing may also increase since customers are fully engaged.
Trust and risk: Information disclosure is one of the biggest concerns in online shopping, Lancôme has secure payment guaranteed which prevents this kind of incident and reduce risks. Orders are processed quickly, staffs are able to solve problems in patience, so I trust this brand via this purchasing method which makes me become a frequent buyer.

Enjoyment: I have positive online experience with Lancôme that I really enjoy it!

All in all, my positive shopping experience at Lancome.com.au creates satisfaction which leads to a subsequent behavior for re-purchasing. Micro-environment is the controllable one for marketers which require them to research deeper on the improvement of customer satisfaction and customers retention.

Reference

Chaffey, D. & Ellis-Chadwick, F. (2019). Digital Marketing. England: Pearson.

(Image source: Lancome.com.au)

Wait!!!! You can also check out my youtube video for this week ^^

Blog 1 (Digital Marketing)

1a The concept of digital marketing

Image source: (https://oceanwp.org/blog/enjoy-the-power-of-versatile-and-targeted-digital-marketing-with-salesforce/)

Digital marketing can be defined as achieving business objectives by using various digital technology and platforms as well as data (Chaffey & Ellis 2019).

When it is connected to traditional marketing, I think digital marketing is also a way of observing, identifying and satisfying customer needs in order to success among business. Therefore, the nature of digital marketing is to create customers value and gain profit among this process.

1b Case study- Discuss how eBay has had to evolve its online brand proposition and communicate it to Achieve continued growth.

The key success of eBay cannot be separated from the evolution of its brand proposition on both the buy side and the sell side of electronic commerce, which has established a great example of E-business (Chaffey & Ellis 2019). eBay focuses not only on self-inspection such as setting clear strategy and mission, but also has an effort on adjusting these strategies based on particular circumstances.

Image source: (https://startups.co.uk/setting-up-an-ebay-shop/)

eBay aims to provide a better customer experience by building trust as well as creating value during and after the purchasing. Firstly, eBay improves its software and using AI which become ‘fabric’ that penetrates into the daily life of mobile using in order to follow the trend of technology. For example, the development on search engine of eBay enables customers to find the most suitable deal based on customized data on their cell phones which saves time and consolidate valid information (eBay 2019). Moreover, it implements experiments and setting feedback section to get opinion from users, comments from various aspects which help eBay to communicate with customer need and satisfy them by restructuring strategy. The convenience customers feel during the shopping which helps eBay to retain loyal customers and attract more potential customers. Furthermore, the perfection of profile and safety system among buyers assists eBay to prevent fraud in the online market. It is shown that its website has a detailed explanation on how to avoid seller fraud (eBay 2019).

Image source: (https://ecommerceinsiders.com/3-types-digital-marketing-outreach-refresher-6313/)

In addition, eBay evolves its proposition from the seller aspect which includes to expand new markets by using a cost-effective approach to sell products in a customer base. It analyzes the preference among customers and then manage its inventory in a reasonable and costless way. Knowing customers purchasing behavior which helps eBay to increase its conversion rate and build a good brand image of reliability, distribution and marketing activity are all develop effectively. Also, eBay has an emphasis on observing its competitors in order to enhance competitive advantage and retain its outstanding status. For example, the acquisition eBay had which not only has strengthened its financial capability to a greater influence among the industry, but also to enrich its product feature in a broader range. Therefore, eBay has responded to the four stages of digital marketing communication well to improve overall performance, which are reach, act, convert and engage (Chaffey & Ellis 2019).

In conclusion, eBay has shown its evolution during the journey of operating online market, but online business is full of opportunity and challenges which requires continuous adaption and adjustment to survive in the final.

References

Chaffey, D. & Ellis-Chadwick, F. (2019). Digital Marketing. England: Pearson.

eBay. (2019). Avoiding seller fraud. Retrieved from Name of Web site: https://www.ebay.com.au/help/buying/resolving-issues-sellers/avoiding-seller-fraud?id=4024