Unit 1
Unit 1
Unit - 1
Prepared By:
Dr. Milan Vachhani
Associate Professor, M – 9898626213, E – milan.vachhani@gmail.com
Sunshine Group of Institutions, Rajkot
Blog – milanvachhani.blogspot.com
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▰ The origin of digital marketing can be traced to 1994 when the first banner ad
appeared on the first commercial web magazine, HotWired (now Wired.com).
▰ Since then, the digital advertising market has evolved, and in 1996 the united
States' digital advertising market was worth $301 million. A year later, the market
experienced phenomenal growth touching the figure of $1 billion.
▰ Around 1997, companies began thinking about placing advertisements on related
websites and linking their web pages to the banners. In 1998, HotWired started
selling banner advertising space to companies and achieved a sensational 30 per
cent click through rate '.
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▰ Search engine, Yahoo!, adopted this idea by offering advertising space on its
homepage. Yahoo! acquired Overture Services (formerly GoTo.com) in 2003 for
placing ads on its search engine results which allowed Yahoo! to provide
advertisers an option to select a bid amount and compete with other bidders to
rank their ads higher.
▰ Another search engine named Google, had already launched its advertising
platform called Adwords in the year 2000 to provide advertisers a sponsored link
of their website and a description natively in its search engine results page.
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▰ The year 2002 saw the launch of Linkedln, the year 2004 witnessed the launch of
Facebook, and in 2006 Twitter was launched.
▰ Alongside, revolution was happening in mobile with smartphone prices dropping
sharply, enabling greater penetration among masses. The penetration of Internet
also increased dramatically during the period.
▰ Hence, while the decade of 1990s was fueled by display advertising, the early part
of the decade of 2000 was fueled by search advertising and later part by social
media, and the decade of 2010 was fueled by mobile.
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▰ Digital Marketing is very different from traditional marketing in multiple ways (as
shown in Table 1).
▰ While traditional marketing is spray and pray, wherein a marketer spreads the
message among many audiences and hopes that some will be in the market to
buy the product, digital marketing can be targeted to specific audiences who have
interest in the product and hence are already in the market to buy those products.
▰ There is a saying in mass media - 'Half of advertising is waste. But I don't know
which half’. Digital overcomes this limitation of mass media as it eliminates
wastage.
▰ Digital marketing is about maximising efficiency. Since it is possible to measure
performance of digital marketing in real time, there is ample scope to tweak the
campaigns and improve ROI. milanvachhani.blogspot.com
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▰ Marketers can do A/B testing to find the most effective messages, images, ads,
targeting, and layout. In digital, there is always scope for improvement.
▰ While mass media is priced on rate card basis for 10 second spot on TV or
column centimeter for newspaper, digital is priced based on auction. Instead of
fixed rate card, marketers bid in auction and price is determined based on bid as
well as quality score. Hence, there is fair price discovery that happens in digital.
▰ Digital marketing creates a level playing field for all marketers as it does not
distinguish between small and large businesses. The entry barrier is low as one
can engage in digital marketing even with little budget.
▰ The media rates are same for small as well as big businesses.
▰ The cost of failure is low in digital marketing. Even if the campaign does not work,
you will know immediately and can take corrective action. You may lose only a
small amount if your plan fails. milanvachhani.blogspot.com
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▰ Hence, it is a smart strategy to be bit edgy and try new ideas and different
mediums of digital marketing to check out what works for you and what does not.
▰ Digital marketing is like walking in the fog. Visibility is there only for the first 10
metres. If you want more visibility, you must walk the first 10 metres to be able to
see the next 10. Hence, instead of waiting for the perfect plan or blueprint, you
should start digital marketing and learn on the go. Instead of perfecting your
strategy from day one, it is better to make 1 per cent improvement every day and
at the end of the year you will have 365 percent improvement.
▰ In digital, you should go slowly; commit small resources to an idea or campaign
or content. If it works then put more resources behind it.
▰ Hence, instead of firing cannon balls, you should fire gunshots in digital marketing
and test the waters. Some more differences are highlighted in Table 1.1.
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Table 1
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▰ some of the consumer behaviour aspects that can help shape the digital marketing
strategy are as following.
▰ In today's world, consumers, even after the purchase, remain engaged and
promote the purchased product amongst their friends, family or colleagues if they
are satisfied with the product. The basic AIDA model of marketing applies to digital
marketing too, for consumer decision process.
▰ AIDA is an acronym that stands for
▻ A-Awareness,
▻ I-Interest,
▻ D-Desire,
▻ A-Action
▰ The consumer moves through successive stages in the buying process milanvachhani.blogspot.com
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Awareness
▰ The consumer is aware of a brand, has heard of its name. The goal of the
marketer at this stage is to get to the top of the mind recall.
▰ Awareness is the first step in the buying process and the most important.
▰ Without awareness, the consumer will not consider the brand for purchase. Digital
marketing can play an important role in creating awareness and some channels of
digital marketing are more apt for it.
▰ There is display advertising on websites, social media such as Facebook, LinkedIn
and YouTube.
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Interest
▰ It is not enough for a marketer that a consumer is aware of the brand. Consumers
must be interested in the brand. They must want to know more about the brand,
be intrigued by it. This is only known as 'consideration stage‘. Consumers must
consider the brand for purchase and it must be included in their consideration set.
In the funnel model, 'interest' stage has large number of brands. Consumers
consider the brands that they have heard about in traditional channels or on
social media or have seen their friends using it.
▰ Interest can be sparked by running highly creative campaigns that break the
clutter and stand out. Interesting posts highlighting the unique benefits of the
brand can also spark interest.
▰ Highly emotional messaging can also create emotional connect triggering
interest.
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Desire
▰ New media makes it easy for consumers to evaluate the competing choices using
inputs from reviewers, peers, retailers, influencers, specialists, marketer and
competitors. Smart marketers assist consumers in the evaluation process by
providing comparative analysis, economic value calculations, collecting feedback,
reviews and ratings and guiding consumers to the channels which can help them
in making choices.
▰ De Beers, for example, educates consumers about what criteria to look for while
selecting diamond. It emphasises on four Cs - Carat, Colour, Clarity and Cut.
Some digital channels that are more suitable for this stage are community
forums, blogs and review rating sites.
▰ Based on evaluation of different brands, consumers develop preference for
certain brands and they become part of the choice set. This set has much fewer
numbers of brands than awareness set or consideration set. milanvachhani.blogspot.com
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Action
▰ In this stage, consumers purchase the product that they desire and prefer.
▰ This stage generates revenues for the brand and is the outcome every marketer
desires.
▰ Having conveniently located retail outlets or online purchase facility will help the
consumers in making the purchase. The website should have smooth navigation
so that consumers can easily find products that they are looking for at the right
price and at the right time. Consumers may drop off at any stage as they may not
like the design of the site or it may be slow to load or they may not find the right
variant of the product or may be seeking discounts or payment may not go
through.
▰ Marketer must ensure that all hurdles are removed. In the digital marketing,
marketers have a many channels to choose from - search engines, websites,
blogs, social networks, mobiles, applications, forums. Depending on the stage of
the consumer buying cycle, marketers can choose the most appropriate channels.
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▰ Traditional AIDA model has only four stages as marketers have not given
importance to post purchase but with the start of digital marketing 'advocacy'
stage has become important in influencing other consumers and building loyalty.
▰ Hence, It is the fifth stage in the consumer buying funnel. It is Advocacy.
Advocacy
▰ Consumers experience satisfaction or dissatisfaction after purchase.
▰ They may share their experience on social media and spread word of mouth.
▰ If consumers are highly satisfied, they may develop a bond with the brand and
become loyal and purchase repeatedly or in larger quantities.
▰ They may purchase again without undergoing all the stages of decision process.
▰ Social media is most suitable for advocacy and word of mouth post purchase.
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▰ A good framework that can help you organise your digital marketing strategy is
Paid, Owned, and Earned Media
▰ Paid media includes sponsored advertisements in different channels of digital
marketing such as search engines, websites, Facebook, LinkedIn and Twitter. They
include campaigns run through different platforms such as Google Adwords and
Campaign Manager of Facebook, Linkedln, and Twitter. It also includes campaigns
run through ad networks or Demand Side Platforms (DSPs).
▰ Owned media is like an asset of the company Le., the company has the ownership
of these media. It includes company's official website, microsite, and social media
pages such as Facebook page, Linkedln page, YouTube channel and Twitter
handle. It also includes mobile apps or blogs, and also the original content created
by the company such as videos, images, info graphics and posts. milanvachhani.blogspot.com
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▰ The combination of 'owned, earned, paid media' is regarded as one of the best
practices in digital marketing. There should be a balance between all media and it
should not be lopsided towards one. It means, as a brand, you should not focus
only on one media and ignore others.
▰ A simple thumb rule is to divide the budget equally between paid and
owned/earned media. This is a best practice which means that you must allocate
50 per cent of your digital marketing budget to create content for your digital
assets and getting engagement, and remaining 50 per cent on running paid ads.
▰ Though the owned and earned media are organic, and hence more credible and
provide higher quality traffic, they take longer time to show results.
▰ Hence, owned and earned media should be part of your long-term strategy.
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▰ Paid media, on the other hand, will increase your reach, impressions
in the short term but once you stop running paid ads, you may not
get repeated engagement or traction.
▰ Hence, the best practice is to strike a balance between long-term
and short-term mediums.
▰ In India, marketers tend to focus more on paid media and less on
investing in creating quality content; and budget is sometimes as
high as 75 per cent for paid media.
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▰ If the brand is in the introduction stage, it needs more awareness which requires
more reach and impressions and that too within a short period as the brand
cannot wait for long to build awareness. Hence, more budget can be allocated at
the introduction stage to paid media.
▰ However, if the brand is already known and is in the maturity or growth stage, it
will have steady stream of customers engaging and buying, and hence need not
rely on paid ads to great extent. Thus, more budget can be allocated to
owned/earned media to drive engagement and loyalty.
▰ Is Facebook a paid media or an owned media or an earned media? It is all three!
▰ The content that you create on Facebook is your owned media which becomes
earned when it gets likes and shares, and when you make it sponsored, it
becomes paid.
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▰ One of the strengths of digital media is the enormous data that is collected about
customers. This data enables rich segmentation based on geographic,
demographic, psychographic and behavioural variables.
▰ Segmentation is dividing heterogeneous population into smaller homogenous
groups which are similar in characteristics.
▰ The targeted segment should respond better to marketing stimuli than general
population as the marketing mix will be more customised for the chosen segment.
▰ Hyperlocal targeting can be useful for local businesses and for retailers and outlets
who wish to attract customers in the vicinity.
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▰ Another popular method of targeting is behavioural, wherein the intent of the user is
tapped based on online behaviour to determine if the user is in the market to buy a
product or not.
▰ Another upcoming method of targeting is your CRM data targeting, wherein you target
database of leads or customers you have generated.
▰ These customers are more likely to purchase your brand as they have engaged with your
brand in the past. An objective of targeting CRM data could be to cross-sell or upsell.
▰ Marketers are hiring data providers to add layers of social media data and other
demographic and geographic data to their CRM data to make it richer, thus enabling
more customised messages.
▰ A new method of targeting which is gaining popularity is lookalike targeting. To reach
out to more people, you target users who are like your best customers (your CRM data).
▰ Lookalike modeling is done using sophisticated algorithms to find similar users.
▰ Following figure lists the targeting methods used in digital marketing. milanvachhani.blogspot.com
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▰ It is interesting to compare time spent on media with ad spend share for India and
then compare it with other countries.
▰ In India, consumers spend 56 % of the total media time on television and 31 % on
digital, which is a significant amount. If we compare the time spent on television with
ad spend, we realise that while consumers are spending more time on television,
proportionately less advertising budget is allotted to it. This skew is even more for
digital. While 31 % of the time is spent on digital, only 14 % of the advertising budget is
spent on the digital medium. Hence, digital is highly under leveraged.
▰ On the other hand, although consumers are spending less time on print media,
proportionately high budget is spent on print and hence it is over leveraged. what do
you think are the reasons for this skew? Marketers are comfortable with print and
television media and continue to spend heavily out of habit. Most of the decision
makers in marketing belong to the old school of thought and have been slow in
adapting to digital media.
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▰ Another reason could be that reach of television and print is much higher to more
than 70% of the population, whereas digital is limited to 30% of the population and
hence marketers spend more money on medium which gives them reach.
▰ Another reason could be that historically television and print have been used for
strategic advertising to build brand awareness and equity.
▰ Television is powerful as it has audiovisual capability and so can have an
emotional narrative unfold on the screen with lot of impact. On the other hand,
digital has historically been used for tactical advertising for generating sales or
leads. Marketers are looking at digital from ROI and measurability viewpoint, and
hence are more sensitive to returns than mass media. Marketers are willing to pay
premium prices for medium which can build brand awareness and equity as
compared to tactical medium aimed at offers or sales.
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▰ Table 1 milanvachhani.blogspot.com
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▰ Figure 1
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▰ Figure 2
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Think
▰ Digital marketing requires people who can think and conceptualise.
▰ They should be able to look at metrics and analyse the performance
and optimise.
▰ They should have analytical skills and should be able to run
campaigns on search, display and social media.
▰ They should be able to do A/B testing to know what works and what
does not and optimise.
▰ They should be able to identify some strategic goals of digital
marketing such as testing some product concepts or doing market
research for consumer trends milanvachhani.blogspot.com
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Feel
▰ This is one of the most important skills in digital marketing. It is the
ability to empathise with your customers by stepping into their
shoes and understanding their pain points.
▰ This skill will enable the digital marketer to identify the content
strategy that will resonate with their target audiences. Members of
the team possessing these skills will be actively involved in creating
content strategy for websites, blogs, forums and social media.
▰ They should analyse the sentiments using listening tools so that
they know the pulse of the market, the brand associations and the
consumer engagement. milanvachhani.blogspot.com
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Act
▰ Digital marketing requires lot of execution.
▰ You need people who can understand the brand concept and the
content strategy and create creative images and videos.
▰ These people should be graphic designers or be from institutes of
design and know software for editing photos and videos. They
should not only know how to use tools and software but should also
be artistic and creative. They should also understand brand values
and should be able to create images and videos that are aligned
with the brand values.
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Objectives
▰ The starting point is to identify the objectives of digital marketing. This can be
split into branding and performance objectives.
▰ Both the goals can coexist. Some campaigns and activities may have the
objective of increasing brand awareness and brand recall, whereas others may
have the objective of increasing sales or leads or conversions.
▰ It is advisable to identify metrics for measurement of performance alongside
objective setting. If the goal is branding then the metric would be recall. This may
be measured by hiring a market research agency which may do an online or
offline research for top of mind recall, etc.
▰ If the objective is performance, then measurement can be done through metrics
such as CTR(click through rate), leads, conversions and CPA(cost per
acquisition). milanvachhani.blogspot.com
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▰ Planning
process
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Buyer Personas
▰ Next step is to identify multiple buyer personas.
▰ This should be based on analysis of past data and profile of your
best customers and not based on hunch or assumptions. The more
scientific it is, the more accurate it will be.
▰ Another important aspect is that you should develop multiple
personas and not one.
▰ Rarely customers would be so homogenous that they can be
categorised into one persona. The information that you need about
your best customers can be categorised into three areas:
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▰ Who You should identify the age, gender, location, job title, responsibility,
education of your customers and make a pen profile.
▰ What You must deliberate what are the goals of your customers and their pain
points that need to be resolved. What are their areas of interests, what are their
passion points, what media do they consume, what are the touch points.
▰ Why Ultimately you must question why will they buy your product, what is your
unique selling proposition, what is your elevator pitch, and how compelling it is to
convince the customers to buy.
▰ You can get information to fill your buyer personas by examining the social media
profiles of your customers. You can also get useful information from audience
reports in Google Analytics that explains the geographic, demographic, device
data of your audience. milanvachhani.blogspot.com
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Content
▰ You must prepare content strategy by analysing what worked in the
past and what did not.
▰ You must analyse the performance of each of the content types
such as video, image, infographics, eBooks, webinars, games, how
to, trends and create more of the variety that performed better.
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Channel
▰ As a part of channel strategy, how much would you invest in creating paid, owned,
and earned content?
▰ In owned,
▻ will you have a website or a microsite?
▻ which social media pages or handles will you have and how will you
prioritise?
▰ For earned media,
▻ will you participate in blogs or forum or question answer sites?
▻ What is your content strategy for getting engagement?
▻ will you use contests or promotions or controversy or emotional appeal?
▰ For paid media,
▻ which platforms will you run campaigns on?
▻ will you run campaigns on search engines or banner ads on websites or on
Facebook, Twitter or LinkedIn? milanvachhani.blogspot.com
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Timelines
▰ You must prepare a month-wise calendar to record which activities
will be done in which month.
▰ You must further break down content strategy, channel strategy,
target audience week-wise so that there is a starting point to refer
to.
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Budget
▰ How much budget will you allocate to digital marketing? It depends upon what per
cent of the marketing objectives will be met through digital. It also depends upon
the industry and the role of marketing communications in marketing mix and the
role of digital in marketing communications mix.
▰ For certain industries such as e-commerce, financial services, automobile and
education, digital is very important and hence higher per cent may be allocated to
it.
▰ How much budget will you allocate for paid campaigns across different medium?
Hence, how much budget will you allocate as media cost? How much budget will
you assign for content creation? How much budget will you allot for technology
development cost such as developing website or a game?
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Measurement
▰ The measurement metrics (see figure) will be dependent upon the
objective.
▰ If the objective is branding then measurement will involve recall,
attitude and association studies. You may wish to hire a market
research agency to do it either online or offline.
▰ If the campaign objective is performance then measurement is
through CTR, leads, and conversions.
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▰ If you are a marketing manager needing to create a digital marketing plan or conduct
an audit or review online communications, models provide a helpful flow as to what to
include and to ensure nothing is missed.
▰ In considering what to include we explored digital audit tools, digital planning
frameworks as well as digital strategy models. We arrived at a list of ten, although we
think we will add to this – hopefully based on your feedback!
▰ Some of the classic digital marketing models like Hofacker’s 5 stages of information
processing are a little dated, but still relevant. Others like the Technology Acceptance
Model are longer established and popular with PhD researchers. Others such as the
research-based Honeycomb model are newer and was created by a group of
professors to unravel social media platforms. Download the full article from here
https://www.smartinsights.com/guides/digital-marketing-models/
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▰ Let’s look at each digital marketing model. 61
Forrester’s 5Is
▰ This looks at the level of involvement, interaction, intimacy, and influence an individual
has with a brand over time.
Lauterborn’s 4Cs
▰ This is an updated version of the 4Ps focused on the customer which is useful for an
internal audit as well as competitor comparison. We mentioned this in an earlier blog
post when developing the digital marketing models guide.
Ten C’s of marketing
▰ This is a popular framework with students and has been discussed on Smart Insights
before. The 10 Cs provides a framework to review internal and external online
marketing activities.
6Cs of customer motivation
▰ Originally created by Dave Chaffey, this is a useful marketing planning milanvachhani.blogspot.com
and online
customer communications model for developing your website or online community. 62
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▰ https://blog.wishpond.com/post/115675437113/social-media-tools
▰ https://optinmonster.com/23-tools-that-will-take-your-social-media-
marketing-to-the-next-level/
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THANKS!
Dr. Milan Vachhani
9898626213
Associate Professor,
milan.vachhani@gmail.com
Sunshine Group of Institions,
milanvachhani.blogspot.com
Rajkot
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