Chapter 17
DIRECT, ONLINE, SOCIAL MEDIA, and MOBILE
MARKETING
MARKETING STARTER: CHAPTER 17
AMAZON.COM: The Poster Child for Direct and Digital Marketing
Synopsis
When you think of shopping online, chances are good that you think first of Amazon. The company sells everything
from books, music, electronics, tools, housewares, apparel, and groceries to loose diamonds and Maine lobsters.
From the start, Amazon has grown explosively. Its annual sales have rocketed from a modest $150 million in 1997 to
more than $107 billion today. What has made Amazon such an amazing success story? Founder and CEO Jeff Bezos
put it in three simple words: “Obsess over customers.” To its core, the company is relentlessly customer driven.
Amazon wants to deliver a special experience to every customer. Every decision is made to improve the
Amazon.com customer experience. Most regulars feel a surprisingly strong relationship with the company,
especially given the almost complete lack of actual human interaction.
Visitors to Amazon.com find a huge selection, good value, low prices, and convenience. But it’s the “discovery”
factor that makes the buying experience really special. Amazon.com has become a kind of online community in
which customers can browse for products, research purchase alternatives, share opinions and reviews with other
visitors, and chat online with authors and experts. That ability to share opinions and reviews builds relationships
with the company and with other customers. The personalized experience with recommendations enhances the
connection. Amazon Marketplace increases the product selection. Amazon Prime offers free shipping, video
streaming, and borrowing of e-books. Indeed, Amazon has become the poster child for companies that are
obsessively and successfully focused on delivering customer value.
Discussion Objective
An active 10-minute discussion of the Amazon.com story will help link students to key concepts around direct
marketing in its many forms. Amazon.com provides an excellent vehicle for illustrating the strengths of effective
direct, online, social media, and mobile marketing. It shows that good marketing is all about creating value for
customers and building strong customer relationships in order to capture value from customers in return. No
company does that better than Amazon.com.
Starting the Discussion
To start the discussion, ask the class, “Has anyone here purchased a product from Amazon.com?” It may make more
sense to ask whether there is anyone who has NOT purchased something from Amazon.com. Based on the show of
hands, ask for students to share their experiences. Was this a random purchase or are they die-hard Amazon
regulars? What is it about the customer experience that is so enticing?
Next, pull up the Amazon website. Working with students, search for a few random products that interest them.
Click on products and delve a bit further into each page. Together, note how each product search becomes its own
discovery process, complete with detailed product descriptions, expert opinions, customer reviews, purchase
alternatives, and even online chats with authors and experts. Be sure to review the “Get to Know Us” link at the
bottom. In what ways does Amazon’s obsession with customer service show through in every feature and detail?
You should be familiar with this website in advance so that you can move purposefully to keep the discussion
moving. But let the class discussion interactively guide the parts of the site that you explore, taking you deeper into
each page. Start with the first question below, and then ask other questions as the discussion allows. Throughout the
discussion, keep your objective firmly in mind: to emphasize that good marketing is all about creating value for
Copyright© 2018 Pearson Education
customers and managing customer relationships in order to capture value from customers in return. The final
question leads the class into Chapter 17 and the discussion for the day. Have fun with this one!
Discussion Questions
1. Let’s take a quick look at the “Get to Know Us,” “Make Money with Us,” and “Let Us Help You” links at
the bottom of the home page and see what we can learn about the company and how it operates. Just
looking at this web page, what stands out about Amazon.com? (The point: Everything on the site points to
Amazon’s obsession with its customers. It’s all about connecting the company and the customers.)
2. How has what we are seeing on this site contributed to Amazon’s performance? How has Amazon.com
been successful? (As pointed out in the Amazon.com story, thanks in large part to its obsession with
customer satisfaction and customer experience, the company has grown astronomically and profitably.
Even in a slow retail economy, Amazon’s sales have soared in recent years. Thus, by creating value for
customers, Amazon.com has captured value from customers in return.)
3. Why is Amazon an obvious choice for introducing the chapter on direct and online marketing? (Amazon
excels at creating direct, personalized relationships and satisfying online experiences between its users.
Many analysts view Amazon as a major model for direct marketing in the digital age. Use Amazon.com to
illustrate key direct marketing concepts throughout your discussion.)
CHAPTER OVERVIEW
Use PowerPoint Slide 17-1 here
This chapter looks at the final IMC element, direct marketing, and at its fastest-growing form,
online marketing.
In many ways, direct marketing constitutes an overall marketing approach—a blend of
communication and distribution channels all rolled into one.
Remember, although this chapter examines direct marketing as a separate tool, it must be
integrated with the other elements of the promotion mix.
CHAPTER OBJECTIVES
Use Power Point Slide 17-2 here
1. Define direct and digital marketing and discuss their rapid growth and benefits to customers
and companies.
2. Identify and discuss the major forms of direct and digital marketing.
3. Explain how companies have responded to the internet and the digital age with various online
marketing strategies.
4. Discuss how companies use social media and mobile marketing to engage consumers and
create brand community.
5. Identify and discuss the traditional direct marketing forms and overview public policy and
ethical issues presented by direct marketing.
Copyright© 2018 Pearson Education
CHAPTER OUTLINE
p. 486 INTRODUCTION
When you think of shopping online, chances are good that
you think first of Amazon. The company sells everything
from books, music, and electronics to tools, housewares,
and more.
From the start, Amazon has grown explosively. Its annual
sales have rocketed from a modest $150 million in 1997 to
more than $107 billion today.
To its core, the company is relentlessly customer driven.
Amazon wants to deliver a special experience to every
customer.
The Amazon “discovery” factor makes the buying
experience special.
Amazon is obsessively and successfully focused on
delivering customer value.
p. 487
Photo: Amazon
Assignments, Resources
Opening Vignette Questions
1 Many companies claim to be obsessed with
customer service. What sets Amazon apart from
the others?
2 What is Amazon really selling?
3 As an Amazon user, do you mind viewing
customized advertisements on Amazon? Explain.
4 Can you identify any possible limits to
Amazon’s seemingly limitless growth? What are
they?
p. 488
PPT 17-3
PPT 17-4
Define direct and digital marketing and discuss their
rapid growth and benefits to customers and companies.
DIRECT AND DIGITAL MARKETING
Direct and digital marketing involve engaging directly
with carefully targeted individual consumers and customer
communities to both obtain an immediate response and
build lasting customer relationships.
Companies use direct marketing to tailor their offers and
content to the needs and interests of narrowly defined
segments or individual buyers. In this way, they build
customer engagement, brand community, and sales.
The New Direct Marketing Model
Learning Objective
1
p. 488
Key Term: Direct
and digital
marketing
Copyright© 2018 Pearson Education
p. 488
PPT 17-5
p. 489
PPT 17-6
p. 489
p. 490
PPT 17-7
PPT 17-8
p. 490
Most companies still use direct marketing as a supplemen–
tary channel or medium.
For a growing number of companies, direct marketing
constitutes a complete model for doing business.
Firms employing this new direct model use it as the only
approach.
Rapid Growth of Direct and Digital Marketing
Direct marketing has become the fastest-growing form of
marketing.
U.S. companies spent almost $163 billion on direct and
digital marketing in 2016. Total digital advertising spending
now accounts for the largest share of media spending, even
more than television spending.
By 2019, mobile ad spending is expected to account for 29
percent of total U.S. ad spending.
Benefits to Buyers
For buyers, direct marketing is convenient, easy, and
private.
Buyers can interact with sellers by phone or on the seller’s
website or mobile app to create exactly the configuration of
information, products, or services they want and then order
them on the spot. Finally, for consumers who want it, digital
marketing through online, mobile, and social media
provides a sense of brand engagement and community—a
place to share brand information and experiences with other
brand fans.
Benefits to Sellers
Can target small groups or individual consumers
Low-cost, efficient, speedy alternative for reaching
their markets
Results in lower costs, improved efficiencies
Provides opportunities for building close customer
relationships
Offers greater flexibility to adjust prices and
p. 489
Ad: Priceline.com
p. 490
Photo: Dunkin’
Donuts
Copyright© 2018 Pearson Education
programs and engage in real-time marketing
Gives sellers access to buyers that they could not
reach through other channels
Review Learning Objective 1: Define direct and digital
marketing and discuss their rapid growth and benefits to
customers and companies.
Assignments, Resources
Use Discussion Question 17-1 here
Use Additional Project 1 here
Use Think-Pair-Share 1, 2, and 3 here
Troubleshooting Tip
Students have grown up with the internet, so few
concepts in this chapter will be totally new to them.
However, the vocabulary and terminology could be
new to them, so you will want to go through all the
Key Terms carefully.
p. 490
PPT 17-9
PPT 17-10
p. 490
Identify and discuss the major forms of direct and
digital marketing.
FORMS OF DIRECT AND DIGITAL MARKETING
The major forms of direct marketing are:
1 Face-to-face selling
2 Direct-mail marketing
3 Catalog marketing
4 Telemarketing
5 Direct-response television marketing
6 Kiosk marketing
Direct and social media marketing involves using digital
marketing tools such as websites, social media, mobile apps
and ads, online video, email, and blogs that engage
consumers anywhere, anytime via their digital devices.
The major forms of digital and social media marketing are:
1. Online marketing (websites, online advertising,
email, online videos, blogs)
2. Social media marketing
3. Mobile marketing
Review Learning Objective 2: Identify and discuss the
major forms of direct and digital marketing.
Learning Objective
2
p. 491
Figure 17.1: Forms
of Direct and
Digital Marketing
p. 491 Key Term:
Direct and social
media marketing
Assignments, Resources
Use Discussion Question 17-1 here
Copyright© 2018 Pearson Education
p. 491
PPT 17-11
p. 492
PPT 17-12
PPT 17-13
Explain how companies have responded to the internet
and the digital age with various online marketing
strategies.
Marketing, the Internet, and the Digital Age
Much of the world’s business today is carried out over
digital networks that connect people and companies. These
days, people connect digitally with information, brands, and
each other at almost any time and from almost anywhere.
The digital age has fundamentally changed customers’
notions of convenience, speed, price, product information,
service, and brand interactions.
Today, it’s hard to find a company that doesn’t have a
substantial online presence. Even companies that have
traditionally operated offline have now created their own
online sales, marketing, and brand community channels. In
fact, omni-channel retailing companies are having as much
online success as their online-only competitors.
Learning Objective
3
p. 492
Ad: Home Depot
p. 492
Key Term:
Omni-channel
retailing
Assignments, Resources
Use Discussion Question 17-2 here
Use Additional Project 2 here
Use Small Group Assignment 1 and 2 here
Use Think-Pair-Share 4 here
p. 492
PPT 17-14 ONLINE MARKETING
Online marketing is marketing using company websites,
online ads and promotions, email, online video, and blogs.
The marketing website engages consumers in an
interaction that will move them closer to a direct purchase
or other marketing outcome.
Brand community websites do not try to sell anything.
Instead, their primary purpose is to present brand content
that engages consumers and creates customer-brand
community. Such websites waste no time trying to turn the
inquiry into a sale, and then into a long-term relationship.
p. 492
Key Terms: Online
marketing,
Marketing website,
Brand community
website
p. 493
Photo: ESPN.com
p. 493
PPT 17-15
Online Advertising
As consumers spend more and more time online, companies
are shifting more of their marketing dollars to online
advertising to build brand sales or attract visitors to their
internet, mobile, and social media sites.
p. 493
Ad: Gillette
Copyright© 2018 Pearson Education
p. 494
p. 495
Online advertising has become a major promotional
medium. The main forms of online advertising are display
ads and search-related ads.
Together, display and search-related ads account for the
largest portion of firms’ digital marketing budgets.
Email Marketing
Email marketing remains an important and growing digital
marketing tool. “Social media is the hot new thing,” says
one observer, “but email is still the king.”
By one estimate, 72 percent of adults prefer that companies
communicate with them via email; 66 percent of all emails
are now opened on mobile devices.
Not surprisingly, then, a recent study found that 25 percent
of companies say that email is their top channel in terms of
return on investment. Worldwide, more than 200 million
emails are sent out every minute of every day.
Email marketing lets marketers send highly targeted,
tightly personalized, relationship-building messages. But
marketers walk a fine line between adding value for
consumers and being intrusive and annoying.
Spam is the unsolicited, unwanted commercial email
messages that clog up e-mailboxes.
To address these concerns, most legitimate marketers now
practice permission-based email marketing, sending email
pitches only to customers who “opt in.”
p. 493
Key Term: Online
advertising
p. 494
Ad: Warby Parker
p. 494
Key Term: Email
marketing
p. 495
Key Term: Spam
Assignments, Resources
Use Think-Pair-Share 5 here
p. 495
PPT 17-16
Online Videos
Online videos involve companies posting digital video
content on brand websites or on social media sites. Some
are made for the web and social media. Others are ads that
are used on TV and other media but are posted online to
extend their reach and impact.
Good online videos can draw audiences in the millions.
Marketers hope that some of their videos will go viral.
p. 495
Key Term: Viral
marketing
p. 495
Copyright© 2018 Pearson Education
PPT 17-17
Viral marketing is the digital version of word-of-mouth
marketing.
Viral marketing involves creating videos, ads, or other
marketing content that is so infectious that customers will
want to pass it along to their friends.
Brands also conduct online marketing through various
digital forums that appeal to specific special-interest groups.
Blogs and Other Online Forums
Blogs (or web logs) are online forums where people and
companies post their thoughts and other content, usually
related to narrowly defined topics. Blogs can be about
anything, from politics or baseball to haiku, car repair,
brands, or the latest television series.
Many bloggers use social networks such as Twitter,
Facebook, Tumblr and Instagram to promote their blogs,
giving them huge reach. Such numbers can give blogs—
especially those with large and devoted followings—
substantial influence.
Review Learning Objective 3: Explain how companies
have responded to the internet and the digital age with
various online marketing strategies.
Ad: Android
P. 496
Key Term: Blogs
p. 496
Photo: Nuts About
Southwest
p. 497
PPT 17-18
p. 499
PPT 17-19
p. 499
Discuss how companies use social media and mobile
marketing to engage consumers and create brand
community.
SOCIAL MEDIA AND MOBILE MARKETING
Social Media Marketing
Social media are independent and commercial online
communities where people congregate, socialize, and
exchange views and information.
Facebook, Google+, Twitter, Instagram, Pinterest, YouTube,
and Snapchat are just a few digital communities; according
to one survey, nearly 92 percent of U.S. companies now use
social media networks as part of their marketing mixes.
In addition to these large, general-interest sites, numerous
niche and interest-based social networks have also emerged
Learning Objective
4
p. 497
Key Term: Social
media
p. 498
Photo: Snapchat
p. 499
Copyright© 2018 Pearson Education
p. 500
p. 501
PPT 17-20
p. 503
to cater to the needs of smaller communities of like-minded
people.
Social Media Marketing Advantages and Challenges
Advantages include that social media are targeted and
personal. They are also interactive, making it easy to start
and participate in customer conversations and listen to
customer feedback. They lend themselves to real-time
marketing, as they are immediate and timely, as well as cost
effective. The strongest advantage is the engagement and
sharing capabilities. Some social networks are huge!
Many companies are still learning how to use social media
effectively, and results are hard to measure. A significant
challenge is the lack of control that a company experiences.
Once a conversation has begun, the company cannot control
the direction it takes, though it can impact it.
Integrated Social Media Marketing is not as simple as
posting some messages and promotions on a brand’s
Facebook page. Those companies that use social media
successfully are integrating a broad range of diverse media
to create brand-related social sharing, engagement, and
customer community.
Mobile Marketing
Mobile marketing features marketing messages and
promotions delivered to on-the-go consumers through their
mobile devices.
Marketers use mobile marketing to reach and interact with
customers anywhere, anytime during the buying and
relationship-building processes.
The widespread adoption of mobile devices and the surge in
mobile web traffic have made mobile marketing a must for
most brands. Today’s rich-media mobile ads can create
substantial engagement and impact. But companies must
use mobile marketing responsibly or risk angering ad-weary
consumers.
In all, digital direct marketing continues to offer both great
promise and many challenges for the future.
Photo: Etsy
p. 501
Key Term: Mobile
marketing
p. 501
Photo: Mobile
marketing, Taco
Bell
p. 502
Photo: Mobile
Copyright© 2018 Pearson Education
Online marketing has become a successful business model
for some companies. However, for most companies, online
marketing will remain as one important approach to the
marketplace that works alongside other approaches in a
fully integrated marketing mix.
Review Learning Objective 4: Discuss how companies use
social media and mobile marketing to engage consumers
and create brand community.
marketing, Klip
p. 504
PPT 17-21
p. 504
PPT 17-22
p. 505
Identify and discuss the traditional direct marketing
forms and overview the public policy and ethical issues
presented by direct marketing.
TRADITIONAL DIRECT MARKETING FORMS
Direct-Mail Marketing
Direct-mail marketing involves sending an offer,
announcement, reminder, or other item to a person at a
physical or virtual address.
Direct mail (including both catalog and non-catalog mail)
accounts for 30 percent of all U.S. direct marketing
spending.
Characteristics:
Well suited to direct, one-to-one communication
Permits high target-market selectivity
Can be personalized
Is flexible
Allows easy measurement of results
Costs more than mass media per thousand people
reached, but the people reached are much better
prospects
New digital forms of delivery have become popular,
including email and mobile (cell phone) marketing. But the
disadvantage is that traditional mail provides something
tangible to hold, and can be used to send samples. It creates
an emotional connection a digital message cannot.
Catalog Marketing
Catalog marketing is direct marketing through print,
Learning Objective
5
p. 504
Key Term:
Direct-mail
marketing
p. 504
Ad: GEICO
Copyright© 2018 Pearson Education
PPT 17-23
p. 505
p. 506
PPT 17-24
p. 506
PPT 17-25
video, or digital catalogs that are mailed to select customers,
made available in stores, or presented online.
With the internet, more and more catalogs are going digital.
A variety of web-only catalogers have emerged, and most
print catalogers have added web-based catalogs.
Advantages of web-based catalogs:
Eliminate production, printing, and mailing costs
Allow real-time merchandising
Allow unlimited amount of merchandise
Interactive content
However, printed catalogs are still thriving.
Advantages of printed catalogs:
One of the best ways to convince consumers to use
the online versions
Creates emotional connections with customers
Telemarketing
Telemarketing involves using the telephone to sell directly
to consumers and business customers.
U.S. marketers will spend an estimated $44 billion on
telemarketing, almost as much as on direct mail.
Business-to-business marketers use telephone marketing
extensively.
Outbound telephone marketing is used to sell directly to
consumers and businesses.
Inbound toll-free numbers are used to receive orders from
television and print ads, direct mail, or catalogs.
Do-not-call legislation (National Do Not Call Registry) has
hurt the telemarketing industry, but not all that much.
Do-not-call lists appear to be helping most direct marketers
more than it’s hurting them.
Shifting call-center activity from making cold calls
to managing existing customer relationships
p. 505
Key Term: Catalog
marketing
p. 505
Photo: Patagonia
p. 505
Key Term:
Telemarketing
Copyright© 2018 Pearson Education
p. 506
p. 507
PPT 17-26
Development of “opt-in” calling systems
Direct-Response Television Marketing
Direct-response television (DRTV) marketing takes one
of two major forms:
1. Direct-response television advertising is short
television spots (often 60 to 120 seconds in length)
which describe a product and give customers a
toll-free number or website for ordering. Viewers
can also watch 30-minute or longer advertising
programs called infomercials.
2. Interactive TV (iTV) lets viewers interact with
television programming and advertising. It gives
marketers an opportunity to reach targeted audiences
in an interactive, more involving way.
Kiosk Marketing
Kiosks are information and ordering machines. Many
“smart kiosks” are now wireless-enabled.
p. 506
Key Term:
Direct-response
television (DRTV)
marketing
p. 507
Photo: Kiosk
marketing, Redbox
Assignments, Resources
Use Real Marketing 17.1 here
Use Real Marketing 17.2 here
Use Discussion Questions 17-3, 17-4, and 17-5 here
Use Critical Thinking Exercises 17-6, 17-7 and 17-8
here
Use Online, Mobile, and Social Media Marketing
here
Use Marketing Ethics here
Use Marketing by the Numbers here
Use Additional Projects 4 and 5 here
Use Individual Assignment 1 here
Use Outside Examples 1 and 2 here
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