Ever wondered if your phone was listening to your conversations? When you are talking to your mum about your favourite brand of washing detergent and next minute your social media is advertising multiple oppositions brands even though you are a proud Omo user. Well I personally don’t talk about that topic with my mother, but I bet a similar story has happened to you.
Now I’ve drawn your attention and disgust at someone being a proud Omo user. I would like to introduce myself. My name is Michael McQueen and I’m a 22 year old University Of Canberra student undertaking a bachelor of business majoring in marketing. My interests consist of finding the perfect bottle of Sauvignon Blanc and playing AFL football for the mighty Belconnen Magpies.
But why have I asked you about your listening phone ? Because the era of digital marketing is upon us and that bloke from the digital dish will be explaining everything related to digital marketing in the next 5 weeks. So stay tuned and comment below your favourite Sauvignon so I can also find the perfect bottle in the process.
Remember the days of walking through the door after a long day on the tools with two bottles of Jacobs creek wine for only $15.99. Thinking Honey, I’ve absolutely robbed the bottle’o for all their fortunes. Well I personally don’t remember this because I’m 22 and didn’t drink in the early 1990’s but I’m sure they were the glory day’s. These days, throw out Jacob Creeks glorified goon and open your fridge to the many wine regions of the world because the Internet delivers to you.
To break down how the marketing mix has changed in the wine industry, we firstly need to understand the concept of marketing mix. According to Singh, “Marketing mix is a set of relevant factors and solutions that enable customers to meet the needs and achieve the goals of the company” (Singh in Išoraitė, 2016, p.2). Therefore, it’s the process of marketing your business so that customers are satisfied and company’s make money. Furthermore, there are 7 p’s which are crucial in forming a company’s marketing mix. According to Business Queensland, these include; “price, promotion, physical evidence, people, product, process and place” (Business Queensland, 2019). Together they form the relevant factors and solutions that enable customers needs and achieve goals for the company.
Product/Place: The product being sold hasn’t changed, however the Internet has allowed you to access a greater variety of product. “Australia exported 850 million litres of wine in 2018, costing foreign consumers 2.82 billion dollars” (Wine Australia, 2018). These statistics demonstrate the world as a market place rather than wineries being limited to the region they operate in. For example, recently I ordered a box of wine from a website called Cellar Masters. This box contained 12 bottles of Sauvignon blanc. All 12 bottles were from different regions of New Zealand. This example represents the ability of a consumer to obtain a greater selection of product without even leaving their house and has helped both the wineries and retailer to expand their market via using the Internet.
Price: The price of wine is dependent on commonality and product variation. Lynch and Ariely stated “When 90% of merchandise is common and 10% of products unique. It increases the risk of consumers looking for lower price elsewhere” (Lynch & Ariely, 2000, p.101). Therefore, by the Internet expanding the market and making bottles of wine a commonality, wineries must reduce prices or otherwise they will be forced out of the market.
Promotion/People: The capacity of the wine industry to promote their product has expanded immensely with technological advancement. The industry hasn’t stopped opening the cellar door and greeting wine tasters face-to-face, but has grasped the Internet as a tool for self promotion and mass product distribution. Wine companies have now expanded into social media platforms such as Instagram, Facebook etc and contain websites for consumers to purchase wine directly. Furthermore, middleman websites such as Cellar Masters operate as platforms for consumers to access a variety of brands for lower prices. Therefore, wineries must have an online platform to stay competitive.
People: When consumers search online they are flooded with a million different brands of wine they could potentially buy. Therefore, wine companies must employ web designers, digital marketing managers and social media influencers to communicate a polished message. Marketing scholar Natiala Viana stated “Now days consumers have more quality wine choices, they can count on apps, blogs and online reviews to be informed on your brand and in this scenario being fearless, adaptive and using new technologies to communicate your brand is the way to go”(Viana, 2016, p.1). Therefore, the implementation of these workers is a necessity for operational success.
Process/ Physical evidence: Customers physical environment when ordering wine has shifted towards being drawn in by an ascetically pleasing website. This type of website invites and entices the consumer to purchase a product. Once drawn into buying the wine, the consumer puts the bottles of wine in the online shopping cart, proceeds to the checkout and pays. From there the company is responsible for delivering it to the consumer’s door. This example demonstrates the Internets impact of bringing products to the customer directly, without the customer making the effort to go to the seller.
Boosting your sporting brand via social media
When planning the launch of your new sportswear and equipment company, you need to have a social media plan. For boosting your sporting brand via social media, this blog suggests the implementation of affiliate marketing and the SMART goals framework to successful marketing scheme . Lawlor and Hornyak stated “SMART goals are written using the following 1) specific- define exactly what is being pursued? 2) Measurable- is there a number to track completion? 3) attainable- can the goal be achieved? 4) realistic- is this doable from the business perspective and 5) timely- can it be completed in a reasonable time” (Lawlor&Hornyak, 2012, p.259). The framework will surround your use of affiliate marketing. Affiliate marketing is defined as “the process of earning a commission by promoting other peoples products”(Patel, 2019).
Specific: Identify high profile athletes and reach out to them to see if they will endorse your product. For example, professional soccer player, Lionel Messi, participates in affiliate marketing for Adidas through Instagram. Set athletes specific goals for how many people on social media engaged with the product via their social media platform.
Measurable: The company will measure the success of the affiliates posts by tracking whether there has been spikes in sales after content has been uploaded by the athletes. Furthermore, the company should purchase analytics from social media platform to track click and view rates.
Attainable: Making sure the athlete is within budget and actively uses social media to ensure that the goals set out are achievable and realistic. Also providing the athletes with plenty of material to post on their platform is important to making sure that the athlete’s can realistically achieve their goals in being active on social media.
Relevant: Is the affiliate allowing you to achieve the company’s visions and goals. For example, is the affiliate allowing you to achieve revenue through social media. Furthermore, ensuring that the athletes that you company partners with are within industry and have a reputation that aligns with your brand. For example, professional cyclist Lance Armstrong is within the industry because he is an athlete however, you wouldn’t want to associate with him due to his history of doping violations. A more preferred athlete would be Australian tennis player Ashley Barty, who is both an athlete, has a good reputation and is relevant today as she is currently the world no.1 tennis player.
Time specific: It is important to set specific time-based goals for the athletes to achieve when being active on social media. For example, posting a photo that incorporates your product at least 3 times per month. Furthermore, you should set monthly revenue targets to track and measure the success of your marketing strategy.
Remember those nights, where you’ve used up all your fuel tickets tearing the dance floor up in Mooseheads only for the dirty lights to come on at 5’clock. You swing past the kebab shop and jump in the first cab possible. As soon as you get in to your cab the driver demands $50 cash for a $30 dollar trip and you are forced to accept because its the only way home. The cab driver then proceeds to drive half way around Canberra racking up the bill and there isn’t anyway to keep them accountable for this highway robbery. Fear not young whipper snappers, because Uber was founded in 2009 by Travis Kalanick and Garret Camp(Uber, 2019).
Uber is a ride share application developed to connect drivers and riders. Kalanick and Camp developed the application to address the high demand for San Francisco’s public transport. Powered by your IOS/android devices, the application allows you to request drivers to pick you up from your current GPS location. Features that distinguish Uber from traditional companies consist of a rating system, which holds drivers accountable and improves quality, price estimates upon requesting, driver monitoring to allow user to know how far away driver is and fare splitting. According to Uber, “In December 2018 they had 91 million monthly active users, 10 billion trips completed worldwide, in 63 countries and 700 cities and 14 million trips completed each day” (Uber, 2019). In return, “2018 Uber revenue came to 11.3 billion, an increase of of 43% on 2017” (Ibqal, 2019).
Uber has continued to progress it’s app with innovative updates and has diversified its core offerings over the years. Uber has recently implemented new features including; Uber pool, which offers cheaper fares in return for sharing rides with other users travelling to a similar location. Other new features include; UberXL which can carry more passengers, UberLux which provides luxurious and premium service and UberCHOPPER which allows you to beat the traffic by taking to the skies.
Furthermore, Uber has developed their existing business model by expanding into different sectors. Uber created a food delivery platform called UberEats, which allows you to order food and get it delivered to your door. According to Forbes, “UberEats is on track to deliver $10 billion dollars worth of food this year, up from $6 billion and taking into consideration UberEats takes a 30% percent fee that UberEats could generate $1 billion dollars in revenue this year”(Carzon, 2019). This shows that UberEats is one of the biggest food delivery platforms in the world. As well as UberEats, the company is heavily investing in autonomous cars, which is a car that can drive itself without human interaction. Whilst this vision hasn’t yet been achieved as the autonomous cars are undergoing vigorous testing, it is an example of how Uber is constantly looking for innovative ways to expand their business model and achieve a competitive advantage over its counterparts.
UberEats business model
As shown in the figure above, UberEats is a three sided market place connecting restaurant, delivery partners and paying customers. Restaurants pay commission on orders, customers pay for their food and delivery partners earn through delivering the product to customers. UberEats is beneficial for restaurants because it advertises and sells their product to another segment of customers and produces revenue through sales on the application. Delivery partners have the ability to earn money through reliable deliveries. According to Uber, they currently have “3.9 million drivers worldwide”(Uber, 2019). This incredible resource enables UberEats to facilitate their blazing fast delivery model of promising food in under 30 minutes. Paying customers are provided with goods in exchange for price of food/small fee for delivery. Supported by Uber’s already existing client base that could be potential customers.
How UberEats makes money
Delivery charge: When ordering your $14.90 burrito from Zambero’s UberEats because you can’t be bothered cooking dinner, UberEats will charge you a flat fee of $5 dollars for delivery.
Recurring Revenue share from Restaurant partners: When you order that burrito every Monday because you are feeling down that the weekend is so far away. UberEats takes a 15% to %40 cut on every recurring order that is fulfilled through the application.
Marketing and advertising fee from restaurant partners: UberEats helps Zambero’s to attract more customers and reach a larger customer base. For example, the promotion to get 10% of your next burrito when ordering your next burrito with UberEats, email marketing to UberEats users and relatable social media posts. For this reason, UberEats charges restaurant marketing and advertising fees for this coverage.
Revenue from UberEats
UberEats business model and revenue strategy is a clear cut system that provides healthy returns. “According to the files UberEats represented 1.46 billion dollars, or about 13%, of Uber’s total revenue and revenue grew 149% from the previous years 587 million dollar total” (Dowling, 2019). Further, Forbes stated “UberEats is on track to deliver $10 billion dollars worth of food this year, up from $6 billion”(Carzon, 2019). In return, Revenue should continue to grow. Demonstrating UberEats business and revenue model strategies continue to be a highly successful operation.
Back in my day, you bought your idols footy card and you tuned in each week to watch them gather 40 touches and kick 3 goals. Today, you follow them on Instagram, you read all their tweets and immerse yourself in their everyday life. Alalwan et al (2017) in Chaffey and Ellis-Chadwick stated “our fascination with the personal and private lives of others has given rise to the increasing capacity of social media to influence every aspect of human activity”(2019, p.128). For example, professional tennis player Rafael Nadal wearing Nike apparel with links to purchasing Nike products on Instagram. The desire for fans to be like Nadal, has fuelled the capacity for Nadal to advertise products though his social media accounts. In this example, social media is reshaping the marketing environment.
Social Media Marketing Framework
Every successful operation needs good management, celebrity status only facilitates the opportunity. Felix et al (2016) in Chaffey and Ellis-Chadwick stated “there are four dimensions that offer a holistic way to consider the strategic application of social media, these include scope, culture, structure and governance” (2019, p.128).
Scope: The ability of the platform to entertain users or enable two way communication between the online page and the user. Chaffey and Ellis-Chadwick stated “The dimension focuses on on the extent to which a social media platform are used as one way communication tool, which provides entertainment or as an authentic collaborative entertainment, which facilities interactions between user and company” (2019, p.128).Therefore, the purpose of the page is to communicate one way or facilitate two way engagement.
Culture: The page either embraces social media or approaches social media as another mass marketing channel. “Culture distinguishes between social media as a traditional mass marketing channel or modernist approach of being open and flexible and accepting the style of social media platforms”(Chaffey & Ellis-Chadwick, 2019, p.128). Therefore, the page accepts the unique platform which allows companies to create differences through flexibility and creativity.
Structure: How the company structures its use of social media. In some cases, employees are limited by management as to how they use social media, whilst in others they are responsible to structure content themselves. For example, “application subject to centralised control and clearly defined protocols assigned to employees or decentralised and responsibility of all employees”(Chaffey & Ellis-Chadwick, 2019, p.128). This demonstrates structure as an internal component of social media planning between employees.
Governance: What an employee can and can not say on social media platforms. Chaffey and Ellis-Chadwick noted “its the extent that employees are told they can and cannot say on social media platforms” (2019, p.128).
Examples of celebrities/companies use of Social Media Marketing Framework to facilitate growth
For this example, we are going to illustrate the four dimensions being used by Kylie cosmetics.
Example 1: Kylie Cosmetics
Scope: Kylie Jenner and Kylie Jenner cosmetics are two different brands even though Kylie Jenner cosmetics is fuelled by Kylie Jenner’s popularity. The two brands should be considered distinct when looking at the scope of Kylie Jenner cosmetics. For example, “Kylie reportedly wiped 1.5 billion dollars off snapchat because she doesn’t read messages on their platform” (Chaffey & Ellis-Chadwick, 2019, p.128). Because Kylie Jenner does not reply to her followers, this example demonstrates one way communication for Kylie Jenner to her followers. However, Kylie cosmetic uses the hashtag; #KylieCosmetics to engage two way communication. The hashtag feature encourages followers to show their support, thus building an authentic collaboration of posts that demonstrate users engaging with the company on social media.
Culture: Being in a family of social media Queens, it should be no surprise that Kylie Jenner cosmetics has embraced social media and its flexible/ creative nature of marketing. The Kardashian empire has been built off the back of social media. For example, “Kylie utilised social media to build a $400 million dollar cosmetic company in under two years” (Chaffey & Ellis-Chadwick, 2019, p.128).
Structure: Limited evidence on structure of Kylie cosmetics. The brand Kylie cosmetics, uses Kylie Jenner’s social media platforms to launch new products and posts that are not limited to the cosmetic brand. This could be example of a brand that isn’t structured and doesn’t limit employees content. However, Kylie Jenner herself could have structured social media posting through the Kardashian empire.
Governance: Also very limited evidence, however bikini photoshoots and Kylie’s booty popping are a staple of Kylie Jenner’s Instagram. With no real limitation on content apparent, due to the uncensored nature of the posts, you could take a stance that there is limited governance over social media content posted by Kylie Jenner/Kylie Jenner cosmetics.
What is social media doing to the Financial compliance industry?
The financial compliance industry has been forced to use social media to maintain relevance. Initially hesitant of social media, financial customers demanded a faster form of communication. For example, Chaffey and Ellis-Chadwick stated “customers increasingly demanded real-time responses from all of the companies and service provides they engage with”(2019, p.128).With this, companies had their hand forced into developing financial technology that facilitated better outreach to customers. In turn, social media has become the platform that facilitates this engagement with customers for the financial compliance industry. “Facebook, Twitter and other platforms are used in a controlled way: as a channel that facilitates customer interaction”(Chaffey & Ellis-Chadwick, 2019, p.128). Therefore, social media is allowing the financial industry to communicate with consumers quicker than ever. Furthermore, social media is creating a more intensified market by increasing opportunities for new banks to enter, thus flooding the options of banks for customers to choose from. “By embracing social media, financial services have conceded customer mind share to Facebook, Google, Apple, Amazon and Microsoft”(Chaffey & Ellis-Chadwick, 2019, p.128). In return, Birch (2018) in Chaffey and Ellis-Chadwick stated that social media “paved the way for non banks to replace the long standing traditional financial services firms(2019, p.128). This demonstrates that social media is changing the financial compliance industry by both upgrading communication between consumer and service provider and intensifying the market for financial institutions.
Chaffey, D. & Ellis-Chadwick,
F., 2019. Digital Marketing. s.l.:Pearson Education Limited.
You are driving past your local KFC, you see the bright red light with the almighty Colonel Sanders staring you in the eyes and you just can’t pass up the mouth watering Zinger stacker. You park your car, you walk up to the counter and order said Zinger stacker by the Colonels accommodating staff. The Chef creates the masterpiece and before you know it you’ve got your hands on God’s greatest masterpiece. From start to finish the customer has been immersed in golden service. But how do customers experience golden service online?
According to the framework for understanding online customer experiences developed by Rose and Hair (2011), there are eight steps in customers online experience. These steps consist of information processing, perceived ease of use, perceived usefulness, perceived benefits, perceived control, skill, trust propensity, perceived risk and enjoyment. Furthermore Rose and Hair stated “these antecedents lead to customer experience a cognitive state/ affective state which results in customer satisfaction and re-purchase intention” (Chaffey and Ellis-Chadwick, 2019, p.64).
Information processing: You are searching online for brand new pair of brown shoes for you baby cousins baptism and you stumble upon the perfect pair of shoes but you don’t know your equivalent size in American measurements. The inability to process the websites data has restricted you from having the best looking shoes in the church. On the other hand, you click onto the next website and they’ve provided all the information to find the perfect size. The availability of information has shaped the customers experience and in turn has lead to customer satisfaction.
Perceived ease of use: Twelve months ago, I ordered food through Uber eats and it didn’t automatically change my delivery location to my current location. My twenty four nuggets with super charged sauce ended up at my work place when I was waiting at my house in Scullin. In the process, I changed to Deliveroo because their app provides a function that automatically updates the delivery location to the users current GPS location. This clear cut feature made it easier to receive my hungover tucker. The perceived ease of use allowed Deliveroo to gain re-purchase intention. Therefore, online applications that are easy to use create a platform for customer satisfaction and in the process re-purchase intention.
Perceived usefulness: This component refers to how the digital platform can fit into every day life. Arnold Et al (2005) in Chaffey and Chadwick listed “Shopping, booking train tickets online and banking as examples of digital platforms incorporated into every day life” (2019, p.64). These examples, allow customers to save time. Therefore, they are perceived as useful to customers because consumers benefit from saving time by using these digital applications.
Perceived benefits: If a customer feels like they can benefit from a digital application, a company is more likely to achieve customer satisfaction and re-purchase intention. For example, I recently downloaded the KFC application and it allowed me to order online and skip waiting, access to KFC secret menu and keep me updated on KFCs latest news. Multiple benefits that make the consumer(me) feel like they are benefiting from having the digital application.
Perceived control: If the customer can easily use the platform, then they will feel safe in purchasing online. For example, customers who can’t use modern technology are unlikely to feel comfortable purchasing online because they don’t feel in control of the experience.
Skill: This refers to the ability of the customer to use digital technology. We all know a generation X who cant keep up with the rapid evolution of technology. They don’t know how to use that god damn mobile that never stops getting tele marketing calls. Chaffey and Ellis-Chadwick stated ” The more frequent the visitor is to a website the greater their exposure and the higher ability to engage with digital content”(Chaffey and Ellis-Chadwick, 2019, p.64). Therefore, a customer will experience customer satisfaction if they have the skill set to engage with the digital content.
Trust and risk: When you buy products online, you don’t just walk out the door with a product you’ve tried and tested. You pay for the unknown result. You pay for a product that could be the wrong size, you pay for a product that might not even rock up and you pay for something that could ultimately be a scam. Not until that product is handed to you by the Australia post have you really gotten the product you were after. This creates doubt in new users because they fear the unknown. Chaffey and Ellis-Chadwick stated “Marketers should seek ways to limit risk and build relationships online” (Chaffey and Ellis-Chadwick, 2019, p.64). Therefore, if a brand can reduce customer doubt about digital applications. They lay themselves a platform for customer satisfaction.
Enjoyment: If a company can achieve the first seven steps, the eighth step will be achieved in the process. Just like walking out after your KFC employee has handed you your Zinger stacker with a smile. A company takes these seven variables and leaves customers happy as a kid in a candy store.
Chaffey, D. & Ellis-Chadwick, F., 2019. Digital Marketing. s.l.:Pearson Education Limited.
You wake up on a cold frosty morning in Canberra and you scroll through your Instagram and see a sponsored post by Nike. That is digital marketing! You receive an email from your favourite wine cellar. That is digital marketing! You search up aloe vera brands because your pale and prone to getting burnt and the first three suggestions are Google ads. That is Digital Marketing! The advancements in technology and the ability to access the Internet on all your latest devices created the modern marketing concept of digital marketing. The Digital Dish defines digital marketing as any form of communication through digital media that is trying to persuade a user into purchasing their product. Furthermore Chaffis and Ellis-Chadwick define “digital marketing as achieving marketing objectives through applying digital media, data and technology” (2019). Therefore, every time you look at your phone and are convinced to buy that new set of floaties because your 22 and cant swim or that new PS4 game to make you procrastinate from your studies. Then digital marketing has achieved its purpose.
How does a company perform digital marketing? Chaffis and Ellis-Chadwick stated that “companies manage digital marketing through different forms of presence. These include company websites, mobile apps and social media” (2019). Therefore, every bit of digital media about your Gucci belts or your limited edition Crocs is digital marketing.
Evolution of Ebay proposition and how they have communicated to achieve constant growth
Ebay’s proposition has changed through using relevant digital media, data and technology to achieve continued growth. Chaffis and Ellis-Chadwick stated “Ebay exploited big data and artificial intelligence to enhance customer experience” (2019). Combining modern digital media with artificial intelligence allowed Ebay to create a tailored experience for individuals. For example, Ebay used Shopbot on Facebook messenger to create personalised recommendations. The application used artificial intelligence gathered from Facebook messenger to suggest items related to that persons interests/needs (Chaffis, Ellis-Chadwick 2019). This demonstrates Ebays evolving proposition fuelled by digital media/data that provides a customer centric avenue of communicating with clients. In return, allowing them to achieve constant growth.
Furthermore, Ebay’s proposition shifted towards updated technology. For example, “Ebay’s proposition shifted towards mobile commerce, with 20% of sales coming through mobile in 2014 and increasing to 50% in 2017” (Challis, Ellis-Chadwick 2019). These figures displaying Ebay’s propositions of communicating through new technology has enabled them to achieve continuous profits.
Another technique Ebay considers crucial to communicating with their customers is search marketing. Chaffis and Ellis-Chadwick stated “search marketing is a key technique for Ebay meeting their aim of becoming apart of the fabric of their customers day to day online experience” (2019). Therefore, search marketing constantly engages and communicates with clients to create higher sales. In return, allowing Ebay to achieve continued growth.
Chaffey, D. & Ellis-Chadwick, F., 2019. Digital
Marketing. s.l.:Pearson Education Limited.