Chapter 14 – Implementing Interactive and Multichannel Marketing
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CHAPTER CONTENTS
PAGE
POWERPOINT RESOURCES TO USE WITH LECTURES …………………………………… 14-2
LEARNING OBJECTIVES (LO) ……………………………………………………………………………. 14-3
KEY TERMS ………………………………………………………………………………………………………….. 14-3
LECTURE NOTES
• Chapter Opener: Seven Cycles Delivers Just One Bike. Yours ……………………………. 14-4
APPLYING MARKETING KNOWLEDGE …………………………………………………………… 14-22
BUILDING YOUR MARKETING PLAN ………………………………………………………………. 14-24
VIDEO CASE (VC)
• VC-21: Pizza Hut and imc2: Becoming a Multichannel Marketer ……………………….. 14-25
IN-CLASS ACTIVITY (ICA)
• ICA 14-1: Buying an Automobile: Marketplace vs. Marketspace ……………………….. 14-27
CONNECT EXERCISES …………………………………………………………………14-31
• Creating Customer Value in Marketspace Click and Drag*
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POWERPOINT RESOURCES TO USE WITH LECTURES
PowerPoint
Textbook Figures Slide
Figure 14-1 Seven website design elements that drive customer experience …………………………….. 14-8
Figure 14-2 Five product categories account for about 70% of online retail sales today ……………. 14-14
Selected Textbook Images (Ads, People, Products, and Websites)
Chapter Opener: Photo of a Seven Cycles bicycle rider …………………………………………………………. 14-3
Applying Marketing Metrics
Sizing Up Site Stickiness at Sewell Automotive Companies: Average Time Spent per Unique
Visitor (Minutes) [See UMD21TimeSpentVisitors.xls] ……………………………………………………….. 14-11
Marketing Matters, Making Responsible Decisions, and/or Marketing Insights
Making Responsible Decisions—Ethics: Who is Responsible for Internet Privacy and Security? .. 14-20
Videos
14-1: My M&Ms Video ……………………………………………………………………………………………………… 14-6
14-3: Pizza Hut Video Case ……………………………………………………….………………………………………. 14-26
In-Class Activity (ICA)
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LEARNING OBJECTIVES (LO)
After reading this chapter students should be able to:
LO 14-1: Describe what interactive marketing is and how it creates customer value, customer
relationships, and customer experiences.
LO 14-3: Describe why consumers shop and buy online and how marketers influence online
purchasing behavior.
LO 14-4: Define cross-channel consumers and the role of multichannel marketing in reaching
these shoppers.
KEY TERMS
behavioral targeting
interactive marketing
bots
online consumers
choiceboard
permission marketing
collaborative filtering
personalization
cookies
showrooming
cross-channel consumer
social commerce
customerization
spam
dynamic pricing
viral marketing
eight-second rule
web communities
webrooming
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LECTURE NOTES
SEVEN CYCLES DELIVERS JUST ONE BIKE. YOURS.
• Seven Cycles is the largest custom bicycle frame builder in the world.
• The company produces a broad range of road, mountain, cyclocross, tandem, touring,
single-speed, and commuter bikes annually; no two are alike.
• At Seven Cycles:
• The Seven Cycles website:
a. Has multiple languages.
b. Lets customers:
• Select components to complete the bike.
• Design their own bike frames.
– Uses the company’s Custom Kit™ fitting system that…
– Considers the rider’s size and riding habits.
• Monitor their bike’s progress through:
– The development and production process by…
– Clicking “Where’s My Frame?”
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e. Interact with Seven on the Seven Cycles blog to learn about the company’s
activities and products.
f. Use its company Facebook page and Twitter account to post updates and build a
stronger sense of community around the brand.
I. CREATING CUSTOMER VALUE, RELATIONSHIPS,
AND EXPERIENCES IN MARKETSPACE [LO 14–1]
• Consumers and companies populate two market environments:
a. The traditional marketplace.
• Is where buyers and sellers engage…
b. The marketspace.
• Is an Internet-enabled digital environment characterized by…
• Face-to-screen exchange relationships and…
• Electronic images and offerings.
A. Marketing Challenges in Two Environments.
• Consumers now:
a. Browse and purchase a variety of offerings in both market environments.
• Legacy Companies with a traditional marketplace origin, such as P&G, Walmart, and
General Motors:
a. Are challenged to define the nature and scope of their marketspace presence.
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• Bolster their marketspace presence.
• Internet Companies with a marketspace origin, such as Amazon.com, Google,
eBay, and E*TRADE:
a. Are challenged to refine, broaden, and deepen their marketspace presence.
• Regardless of origin, a company’s success in achieving a meaningful marketspace
presence:
a. Hinges on its ability to design and execute a marketing program that…
B. Creating Customer Value in Marketspace
• Marketers believe that the possibilities for customer value creation are greater in
the digital marketspace than in the physical marketplace.
a. In marketspace, the provision of direct, on-demand information is possible
from marketers anywhere to customers anywhere at any time (place and time
utility).
b. Operating hours and geographical constraints do not exist in marketspace.
C. Interactivity, Individuality, and Customer Relationships in Marketspace
• Marketers benefit from two unique capabilities of digital technology that promote
and sustain customer relationships:
a. Interactivity. Listening and responding to consumer needs.
b. Individuality. Empowering consumers to:
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• Interactive marketing.
a. Involves two-way buyer-seller electronic communication in a computer-
1. Choiceboards.
a. A choiceboard:
• Is an interactive, Internet-enabled system that…
[Video 14-1: My M&Ms Video)]
• Collects precise information about a buyer’s preferences and behaviors.
b. Collaborative filtering:
• Is a process that:
– Automatically groups people with similar buying intentions,
preferences, and behaviors.
– Predicts future purchases.
2. Personalization.
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a. Choiceboards and collaborative filtering are marketer-initiated efforts to
provide customized responses to the needs of individual buyers.
b. Personalization systems are typically buyer-initiated efforts.
c. Personalization:
• Is the consumer-initiated practice of generating content on a marketer’s
website that…
d. Permission marketing:
• Is the solicitation of a consumer’s consent (called “opt-in”) to:
e. Companies that employ permission marketing adhere to three rules:
• Make sure opt-in customers only receive information that is relevant and
meaningful to them.
D. Creating a Compelling Online Customer Experience
• An ongoing challenge for companies is to:
a. Design and execute marketing programs that…
b. Capitalize on the customer value-creation capabilities of Internet technology.
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• [Figure 14-1] Seven website design elements are used to produce a customer
experience:
1. Context.
• Refers to a website’s:
2. Content.
3. Customization.
4. Connection.
• Is the network of linkages between a firm’s website and other sites.
5. Communication.
• Refers to the dialogue that unfolds between the website and its users.
6. Community.
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7. Commerce.
• Is the website’s ability to conduct quick and simple sales transactions.
• In well-designed websites, online transactions are quick and simple.
• Amazon:
Chapter 14 – Implementing Interactive and Multichannel Marketing
APPLYING MARKETING METRICS
Sizing Up Site Stickiness at Sewell Automotive Companies
Average Time Spent per Unique Visitor (Minutes)
Automotive dealerships commonly measure website performance by tracking visits,
visitor traffic, and “stickiness”—the amount of time per month visitors spend on their
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LEARNING REVIEW
14-1. The consumer-initiated practice of generating content on a marketer’s website
that is custom tailored to an individual’s specific needs and preferences is called
__________.
14-2. What are the seven website design elements that companies use to produce a
customer experience?
Answer: From an interactive marketing perspective, customer experience is defined as
the sum total of the interactions that a customer has with a company’s website, from the
II. ONLINE CONSUMER BEHAVIOR AND
MARKETING OPPORTUNITIES AND PRACTICE
• Who are online consumers and what do they buy?
• Why and when do they choose to shop and purchase products in marketspace rather
than or in addition to the marketplace?
• Answers to these questions have a direct bearing on marketing practices.
A. Who is the Online Consumer?
• Online consumers:
a. Are the subsegment of all Internet users who…
b. Research products and services and…
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f. Observe the 80/20 Rule:
• 20% of online consumers…
B. What Consumers Buy Online [LO 14-2]
• Much still needs to be learned about online consumer purchase behavior.
a. Research has documented the most frequently purchased products and
• [Figure 14-2] Five general offering categories account for over 70 percent of
online consumer buying:
a. Items for which:
• Product information is an important part of the purchase decision but…
• Prepurchase trial is not necessary (computers, electronics, and books).
b. Items for which audio or video demonstration is important (CDs and DVDs).
C. Why Consumers Shop and Buy Online [LO 14-4]
• Why do consumers shop and buy online? Marketers emphasize:
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[ICA 14-1: Buying an Automobile: Marketplace vs. Marketspace]
• [Figure 14-2] Consumers refer to six reasons why they shop and buy online:
1. Convenience.
a. Online shopping and buying is convenient. Consumers:
• Can visit a given retailer to browse and order products.
• Don’t have to deal with traffic, long aisles, and store checkout lines.
2. Choice. Has two dimensions:
a. Choice exists in the product or service selection offered to consumers.
• Buyers desiring selection can avail themselves of more than 1 billion
websites…
3. Customization. Some customers prefer one-of-a-kind items that fit their specific
needs:
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a. Customization:
• Arises from Internet-enabled capabilities that…
b. Customerization:
• Is the growing practice of:
• Seeks to combine choiceboard and personalization systems to…
4. Communication.
a. The communication capabilities of Internet-enabled technologies take 3 forms:
• Marketer-to-consumer e-mail notification.
• Consumer-to-marketer buying and service requests.
• Consumer-to-consumer chat rooms, instant messaging, and social
networking websites (Twitter and Facebook).
b. The interactive communication capabilities of Internet-enabled technologies:
• Increase convenience.
• Permit choice assistance and customization.
c. Communication promotes the development of company-hosted and
independent web communities—websites that:
d. The web log or blog:
• Is a web page that serves as a publicly accessible personal journal for an
individual or an organization.
e. Spam.
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• Is communications that take the form of electronic junk mail or unsolicited
e-mail.
• Comprises 60 percent of all e-mail messages in the world.
• Has led to online services to:
• Has led to the:
– Passage of The Controlling the Assault of Non-Solicited Pornography
and Marketing Act (2004) or CAN-SPAM, which…
g. Viral marketing:
• Is an Internet-enabled promotional strategy that…
[Video 14–2: Frito-Lay Video]
h. There are three approaches to viral marketing:
• Embed a message in the product or service so that customers hardly
realize they are passing it along.
5. Cost.
a. Is the same price or cheaper online than in retail stores.
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6. Control.
a. Consumers want control over their online shopping behaviors as they:
7. Cookies.
a. Are computer files that a marketer can…
• Download onto an online shopper’s computer and mobile phone who…
• Visits the marketer’s website.