Category: Internet Marketing

Leveraging Online Media and Online Marketing

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The “Leveraging Online Media and Online Marketing” conference sponsored by the Marketing Science Institute just ended. The two-day conference brought together researchers from major universities and practitioners from MSI membership companies to discuss the emerging issues of online marketing. I summarize below three overarching sentiments that I observed from the conference:

(1) Facing lower switching barriers and declining consumer loyalty, companies are investing heavily into engaging their customers in the online channel. Different techniques were discussed, such as creating an environment for consumer-to-consumer interaction, incorporating consumer-generated content, and using multimedia contents such as video. Many of the ideas build on the increasing importance of social networking on the Internet, including some early exploration into the newest form of social networking in virtual worlds. No matter what form is used, however, the key is still to provide real value to consumers, whether that value comes from the firm or from other consumers.

(2) With the vast amount of brand-related commentaries and reviews online, companies are also watching closely what consumers are saying about their products and services. Specialized internal teams have been formed to plow through this valuable market information. For some companies, this information has powerful influences on their product mix and customer service decisions. With regard to negative comments and publicity, participants disagreed on how they should be handled. While some dismissed them as a natural part of life/business, others think they should be addressed more formally. Company blog seems to be the common approach, although other traditional PR channels are also mentioned.

(3) A major concern with many marketers is a lack of clear metrics for measuring online marketing, especially as it relates to social networking. This difficulty can be attributed to two sources: not understanding the true effect of some techniques (e.g., what is the value of positive or negative word-of-mouth); and an inability to track sales and conversion to the appropriate source (e.g., did this consumer buy because of that banner ad or because of a consumer-posted recipe). It is clear from the conference discussion that simple traffic building measures such as hits and visitors are not enough, as they do not necessarily lead to the critical step of conversion. But it is less clear what the right metric system should be. Without proper measurement, it becomes difficult to determine the right allocation of budget into different channels and campaigns.

Podcast from my MBA Internet Marketing Class

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My MBA class is jointly creating a podcast on Internet marketing this semester. The first episode has been posted, which discusses the issue of online branding and the use of tools such as virtual worlds in branding efforts. The homepage for the podcast is at http://emarketing.podcast.com. To subscribe to the podcast, please use http://emarketing.mypodcast.com/rss.xml, or visit itpc://emarketing.mypodcast.com/rss.xml from iTunes store.

This podcast will be updated at weekly intervals. We welcome you to join our discussion on the newest developments in the online marketing field, and please tell us what you think.

Best Practice — American Express Members Project

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Last month, American Express launched a new marketing campaign called “The Members Project”. On the Members Project website, American Express card holders can register and create or vote on projects that intend to have a positive impact on the world. Project proposals cover a wide range of areas, from arts, education, to environmental and wildlife protection. These projects will go through a few rounds of voting and selection both by the project advisory committee and the members of the website, and the winning project will be announced on August 7. American Express will contribute $1 for each card holder that registers on the website, up to $5 million, which will be used to fun the winning project.

I think this is a great campaign for a few reasons:

  1. It draws on the collective power of consumers and utilizes the increasingly collaborative nature of the Internet. While American Express is not the first one to do this, most of the influential viral marketing campaigns on the Internet so far either used corky humor (e.g., CareerBuilder’s Monk-e-Mail) or had a distinctively underground feel (e.g., Burger King’s Subservient Chicken site). The goals have often been to capture the younger generation’s attention. In contrast, the Membership Project stands out as a more “mainstream” campaign that resonates with everyday Internet users.
  2. The campaign is a great integration between advertising and public relations. The positive causes promoted through the campaign are likely to receive media attention, and it conveys a very positive image for American Express. By involving consumers in this process, the campaign seems more natural and less commercial-like.
  3. By building the campaign as a members’ project, American Express builds affinity of its card holders as a group and makes them proud of being part of something positive. This fosters the feeling that being associated with American Express really means something.

Since Mastercard’s successful “Priceless” campaign, I have not been very impressed with major credit card issuers’ marketing campaigns. Visa’s “Life Takes Visa” came across as being too similar to the “Priceless” idea, both to me and to my students from the sentiment reflected in classroom discussions. The Members Project has the potential of being another great case study of effective marketing campaigns. Judging by the number of projects submitted on the Members Project website, 3634 when I last checked, the campaign is already well on its way to success.