The Internet’s impact on integrated marketing programs
Louis Claps, President, PVI Communications, Ltd.
“The Internet is about competition. It's about growth. It's about reaching out to your people, your suppliers, your business partners, your customers in new and more comprehensive ways. In this new environment real-time access to information is power.” Lou Gerstner, president of IBM, source: Communications People Have No Business Running Web Sites, Andy Marken, Marken Communications.
This paper shares the experiences and opinions of a marketer who has been wrestling with how to best utilize the Internet within their marketing program. The impact of the Internet, or the web, is still being explored and realized. At the time of writing this paper, many new ways to exploit the unique features of the Internet are being explored. It is the goal of this paper to create a sharing of experiences within a community of marketers. Ideally, the Internet assists in nurturing communities of like-minded individuals. It is through these communities that information is shared, ideas are created and tested, and then come to fruition—shedding new light on others that seek this knowledge.
The World Wide Web was invented by Tim Berners-Lee at CERN, the European Laboratory for Particle Physics in Switzerland in 1989, to facilitate the sharing of information among researchers. It extended the concept of “hypertext” not only within a document, and between documents, but also between different computer sites accessible to each other via the Internet.
The web sits on a network of more than 100,000 networks spread around the globe. There are more than 32 million devices accessing the web. This number will grow to more than 300 million by the year 2001. More than 1,000 new web sites are posted each month with an average life span of a document on a business site of three months.
Internet technologies have spread like nothing the world has seen before. They have changed forever the way we educate, inform and entertain. They have flattened organization charts; blurred the lines between customers, staff personnel and suppliers; erased borders; and changed the work habits, hours and location of millions of people.
First, let's define the most basic term we are discussing here today: Marketing. Marketing is a process by which an organization adapts and responds to its ever-changing market opportunity. It's a dynamic process through which a firm is able to handle changes in market variables beyond its control. It's the answers to the “Where do we stand? How do we compare? Where are we going? and How will we get there?” questions.
The basic elements of a marketing program are to:
- Identify your audience
- Allocate resources effectively for each medium
- Implement plan and measure its effectiveness.
Marketing managers are responsible for this. The success or failure of a company's brand lies squarely on the ability to clearly identify, access and deliver—or create—a market. Our skill in developing an integrated marketing program, a program that delivers a cohesive message across the multiple media available that maximizes the limited resources we have, is the rule by which we are measured. A major limiting factor to success is the ability to reap the maximum performance with a limited budget. How often does marketing feel totally confident in their allotment of funding? Are the goals and objectives set by your management daunting considering the budgets approved?
Developing an integrated program means coordinating all marketing activities to provide more awareness than any individual activity. With a unified look, feel and message, these integrated activities build upon previous exposure and reinforce the message. Integrated marketing, when followed effectively, actually shortens the sales cycle. It allows the sales manager to spend less time positioning and more time closing on business. The introduction of the Internet to our program changes some things by adding more options. It also facilitates many of the previous successful elements of the program. By the same token, the Internet can also put an additional strain on our often-limited resources. Such as, simplifying the transfer of visuals to publications for inclusion with their publication.
Let's, just for argument's sake, review the outcome of a non-integrated program. We all have been tempted at times not to extend the effort necessary to create and implement an integrated program, especially when resistance is coming from the executives. Every department has its own agenda; someone on top is demanding a change. It is often said that it is the marketers themselves that tire of a marketing campaign well before the target audience does. Here's the consequence: All of the projects start at once in the different areas; say, at the beginning of your planning cycle. The activities in public relations, sales presentations, direct mail, and Internet marketing are done independently of each other. The result is multiple, unrelated impressions with a high risk of an inconsistent message that dilutes your branding efforts. What have you achieved?
As a general rule, nothing. Or at least nothing that can be accurately measured and successfully repeated. As a testing process, you might discover some interesting information, but you would be hard-pressed to know why an element of a non-integrated marketing program was successful … was it because of its unique message, the medium or the placement? And you would not have presented a unified image and message to your prospective audience.
On the other hand, some impact may be made, but only for a very short time frame. When this occurs, marketing develops another campaign, goes forward with the implementation, and fails to maximize its impact. Such non-integrated delivery lacks consistency and a commonality to the message. You have lost the “mindshare” of your target, which is achieved through catching someone's attention, reinforcing your message and providing a memorable format. This is why every six months to a year; non-integrated marketing develops new concepts with minimum results.
When an integrated program is developed and implemented, marketing has the opportunity to develop an idea, a theme and a strong positioning to reach the target marketplace. Utilizing all aspects of the mix, the results are improved. To be truly successful, all areas of the marketing mix must be planned and executed in a timely and disciplined manner. All of the communications tools are optimized and called into action in a coordinated, logical manner, building on each impression.
Add to this the impact of a new medium—the Internet—upon your program, the risks—and hopefully the rewards—increase. Now, not only must you deal with traditional communication vehicles but quickly trial new programs, measure their success and react accordingly. Wouldn't you like to increase your chances for success based on the experience of someone who has been through this before? That's difficult these days, because no one has been doing it long enough to know all the answers.
The Impact of the Internet
The Internet has impacted organizations by changing how we run our business processes—specifically our e-business processes—and reducing the amount of time we have to respond to change. The goal is still to create a long-term relationship with our clients. Ideally, we can use the Internet to improve our relationship with our clients, using multiple modes to interact with and foster a stronger relationship.
The impact of the Internet on marketing is both positive and negative. Let's face it—for all of its charms, the Internet is still a mystery to many of us, its full uses are still not completely explored, and yet we're supposed to become instant experts—incidentally, with the same budget as last year! Sound familiar? It's happening to everyone. Here are just a few of the implications we've noticed …
- Increases visibility
- Expanded reach (national/global)
- Reinforces your brand
- Offers Free information
- 24/7 customer service (or self-service through FAQs)
- Built-in response tracking
- 24/7 awareness building
- Added expenditure
- Often requires reallocation of limited funds
- Doesn't replace existing media
- Must pay close attention to content, and frequently update it
- Viewed as silver bullet by many
- Still must build awareness of site
- It's practically mandatory these days
The positive impact of the Internet is easy to see and many times becomes the main focus if not the only focus. The negative impact may not be taken into consideration fully. Decisions must be made based on your knowledge of your target market. Analyze your business and test market your client-base on cutting-edge usage or before making major investments of time and resources to develop “really cool stuff” for your web page. You should pay particular attention to how web-savvy are they. Is it a group of individuals that will react well to an Internet experience? How far will their capabilities carry them?
Moving funds from previously successful initiatives that result in less tangible results will have detrimental effects on long-term results. Don't forget that an awareness-building campaign for your site must exist and should be integrated within your existing campaigns. Your approach and your marketing solutions must balance out all these variables.
Defining Your Internet Goals
I think it's fair to say that everyone today needs to have a presence on the Internet. It's becoming a lot like the phone book: if you're a business, you are expected to have at least your phone number listed. But how much do you “invest” in the Internet? My answer is: It depends … upon the type of company you are, the audience you seek, and the type of product or service you offer.
Here's an example: Say you run an amusement park … should you have a web site? Absolutely. Should it be the sole marketing tool of your business? Probably not. You will most likely continue to rely on traditional media like ads, brochures, special promotions, and radio and TV—because you are competing with other kinds of entertainment for your audience's leisure dollars. And many of those decisions are made on impulse, or because you caught their attention at the right moment. The Internet is not immediate and “in your face” enough to grab people's attention.
Your web site is not the ultimate destination for your customers; your goal is still to get people to your park. So what do you want your web site to do? Well, for starters, it must give out all the information that a prospective customer would want to know: times, dates, events, etc. Perhaps it could also sell passes, to encourage the customer to make a commitment to visiting in the near future. Beyond that, you could start to build a sense of excitement on the site, one that you hope reflects the excitement at the Park. Using video, animation and special effects, you could either show some of the rides at the park, or create online games that are amusing distractions to “get people in the mood” for fun and games at the Park. You would probably have an ever-changing main page that featured events for the upcoming weekend, so that your audience would know to check before they come; it would also encourage repeat visits to the site, and hopefully, to your park.
Okay, that's Example One. Here's Example Two: You're a small bookseller specializing in valuable and hard-to-find books. Do you have a web site? If you want to survive. Should it be the sole marketing tool of your business? It could be. If you concentrate your efforts on making an easy to use, inviting and informative site, and you market the heck out of it, on and off the Internet, it could in fact BECOME your business! Why? You have a dedicated audience of people who love books, and who are probably web-aware if not web-savvy. They have the desire to get their hands on your books, so you just have to make it as easy as possible for them to do it. Many of them would prefer the tactile experience of picking up a book, turning the pages and smelling the musty scent of book dust; they can if they come to your store. But by going on the Internet, you have just become a national, even a global, bookseller! Millions of people can come to your “store” and see your books. Imagine that.
Content on the Web Page
Once you've set your goals for the Internet, you must begin to develop your content. The focus of Internet content should be centered on defining, developing and improving the one-to-one relationship with each person who visits a web site. It should answer basic questions about the products or services, the applications for these products and services, and the markets you serve. It should encourage your visitor to move to the next step in the purchase process by providing enough information to indicate that you meet their requirements. It should tell your prospect how to get more information and include addresses, telephone numbers, fax numbers, e-mail addresses, web site addresses, and names of reps and distributors. Have you given your advertising, product literature and other customer information a check-up lately? If you find your information ailing, start an immediate treatment program. If the diagnosis is positive, a regular review is good preventive medicine. The result will be higher sales and a better bottom line.
Here are some basic guidelines for developing your Internet content:
- Give your visitors the information they want and need from the firm
- Always provide contact information for the right group to obtain answers, assistance and/or guidance
- Build trust with your visitor
- Provide information and services that allows them to do their job faster and better
- When possible, obtain demographic and situational information. The best way to do this is to ask, and often to offer something in return (discounts, free updates, newsletter etc.).
Exhibit 2. Impact on the Internet on the Different Elements of Marketing Mix
Resist the temptation to simply take your printed content and post it on your web page. This is simply “brochure-ware” and does nothing to exploit the uniqueness of the medium. Effective use of streaming video, slide shows, detailed graphics and when possible, even audio will all enhance the experience of the visitor. The completely public arena the Internet has created should inspire you to put a consorted effort into your site.
A Case Study in Managing Internet Content: The Web site of a leading network provider.
This company has been widely publicized because their web site is an extraordinarily successful profit center. It produces more than $5 million in sales every day. This seemingly incredible feat is not the only thing to cause envy. There are things to learn from studying the approach used, as shown in Exhibit 1.
Your Internet promotions should make an offer that is valued by the individual. You should motivate them to interrupt their search and visit your site. Once they have reached your site, do not focus on motivating the visitor to any specific path but structure your content so that they easily see valued information upon first view.
Instead of focusing on the possible path, spend your creative energies on developing long-term relationships with your clients and future clients. The value of long-term memory and retention is more important than short-term motivation. One-to-one communications, the true strength of the Internet, is the ultimate goal.
Exhibit 2 summarizes some of the positive Impact that will be felt within a traditional integrated program.
While management presses for hard data, it is still true that marketing, sales, and communications are more art than science. This may be a prime reason management tends to lean toward those marketing and sales support activities which concentrate on getting orders, increasing share-of-market, and profits. The Internet can provide an effective means to track results.
Our budgets are modest. We need to produce measurable results for any business expenditure including investments in marketing programs. A marketing program can be direct mail whether web-based or traditional, a trade show, a print advertisement or a series of customer events. We need our marketing programs to provide quantifiable results.
What are quantifiable results? Return on Investment (ROI) is a term used most often with investing money. We invest 100 dollars in stock and we would be happy with a 20% ROI or we invest 10,000 dollars in direct mail and we would like a 50% ROI. To calculate ROI you must know the formula, and you should have data that supports the formula values. This brings us to the two steps for calculating ROI.
To calculate ROI, follow these two steps.
First, Track Your Leads
Many marketers spend time and money putting together marketing programs but do not have a way to track results and close the loop on the marketing process. This involves getting sales to cooperate with marketing. The sales and marketing departments need to work together to make this happen.
A common example of tracking results is using codes on ads and direct mail pieces. Prior to Internet, a code could be as simple as calling a certain 800 number with an extension number that is only printed on the direct mail piece or in the advertising. The company will know by the telephone number that the call was the result of an ad in a particular publication or from a direct mail piece. Now, we may use extensions on our URL. Simply add a /xxx after your .com and create specific content that relates to the promotion being distributed. This is the first step in closing the loop.
The final step in closing the loop is counting the sales that the salespeople made from the sales leads. If you can count sales, you can track ROI.
Second, Define the Results and Put Them Into the Formula
The ROI formula is the following:
Number of Sales x Average Price Per Sale = Sales Volume
Sales Volume x Gross Profit Margin = Total Gross Profit
ROI = Total Gross Profit/Total Cost of your Marketing Program - 1
You have done it, you calculated ROI on your marketing program! What if your program ran a negative ROI? Then your program failed. However, if your objective was increasing awareness then it may have been successful. It is important to define your goals in advance. Measuring intangibles, for example brand identity and awareness are difficult to measure when considering ROI. This is a topic for another column.
Marketing as a Catalyst to Change
Another benefit to an integrated program is the enhancement of marketing as a catalyst to change. Taking this approach, marketing communications can crystallize the intended message for their target market; they integrate individual sales approaches and messages into one consistent message; they can help focus a selling effort. Communications becomes a cost-effective complement to sales. It also works internally to build morale as well as help focus the firm's business resources.
Knowledge sharing is enhanced with the ease of access and delivery provided by the Internet. Effective knowledge management can result by the sharing of research, results, and content to team members whether local or dispersed. All of the communication-related activities are stored within a data-repository for just-in-time decision support. Once established, marketing will be in a better position to help define and satisfy user needs, boost share-of-market, increase sales, and improve corporate profits.
In short, communications has to be a total media mix. If marketing communications doesn't help management pull all of these activities together, they will quickly find they are no longer the trusted advisors within the company. Rather than discussing vaguely about creativity, image, and awareness, communications people (inside and outside the organization) have to align their activities with that of the business. This will ensure their providing continued value back to the business and increased budgets in the future.
Improving Positioning via the Internet
Sound positioning makes it difficult for others to dislodge your company, products, and services from the minds of customers, prospects, and other target audiences. In fact, in most instances, sound positioning overrides individual product benefits. This is because positioning evaluates the entire organization, its strengths and weaknesses, and projects the competition's possible reactions to your activities. Proper positioning is objective. It determines what mind share you own in the market so that you can determine the position you want to achieve and the cost of that effort.
The Internet allows for improved research to better determine your positioning. Implementing multiple surveys, reacting to interim results and refining the survey while still able, the purchase of analyst research that has been enhanced by the Internet, and competitive analysis has all been simplified.
Effective positioning then gives customers and prospects a reason to choose your company and products over your competition. It permits you to transfer company and product benefits from one product to another. It also helps you keep pace with a changing market. Delivering a high impact program, which takes advantage of the Internet's flexibility, will enhance your positioning.
Business today is built on results, so activities have to work. The immediacy of the Internet has caused management expect results immediately and for programs to be perceived as innovative. At the same time, communications has to develop solutions to perplexing conditions in a rapidly changing, competitive environment. This means that once marketing communications has developed a sound strategy for the company and its products/services, they have to develop totally integrated programs that are fluid. Once developed and approved, these programs have to be carried out quickly and decisively with results shared to the executive members. Tracking results can be facilitated in some instances but also makes it difficult in other cases such as awareness building.
Using the Internet to Foster a Communal Workplace
Successful implementation of an Integrated Marketing Program in a timely and well-focused manner should ensure you achieve your goals. Keep in mind, it is comprised of numerous independent projects rather than a single campaign. The program is not a noose around the creativity of each manager but a requirement to develop a brand synergy across each element. Whenever you are synchronizing the efforts of many individuals, it becomes difficult to maintain the focus over a sustained period. If collaboration of each project fails, the impact decreases.
How do you maintain collaboration? You need a communal workplace. The Internet is ideal for this. Collaboration is more than a scheduled meeting with a set agenda. This does not allow for the quick, proactive decisions that need to be made due to changes in our marketplace. Established a web-hosted workplace for all the information on each project and the overall marketing program. Team members can share easily regardless of their physical location.
The workplace easily accommodates involvement from all of your resources, outside of your department and company, and helps to remove the bureaucracy often inherent in projects. Senior executives can easily check a status when they desire or regular status update reports can be sent to designated stakeholders. This improves the likelihood of their involvement, ensuring proper alignment with the goals of the business, which can increase the likelihood of getting the resources required to complete an effective program properly.
While advertising, public relations, marketing and sales support, web marketing, lead processing, and the other communications activities are different; they must build on each other. Communications people have to develop a synergy among these activities. Strong, accurate positioning provides that synergy. It provides a preexisting reason to be receptive to your marketing, sales, and advertising message. It holds advertising, public relations, marketing support, sales promotion, and sales together.
It's a team effort so collaboration and communication is all important. By using the Internet as a vehicle for communication, your project team will maintain effective channels of communication on the goals, objectives, and needs of the marketing program. The final program will have more depth, breadth, and substance as well as a better-defined and measurable goal. Moreover, best of all, it gets results.
In conclusion, each of us has experienced different results from our varied approaches to integrating the Internet into our programs. We are still learning how to manage expectations, create new and exciting campaigns, sales shattering offers … the silver bullet. Once you have found it, please contact me at firstname.lastname@example.org.
Communications People Have No Business Running Web Sites, Andy Marken, Marken Communications
Impulse Advertising on the Web: Creating the Path of Least Resistance, Darren Zwack, Columbus Group Communications
“Interactive” is Key When Developing Web Content, Dianna Huff, DH Communications, www.marketingwriting.com.
Linear versus Spatial Communications Plans, Andy Marken, Marken Communications
Marketing Campaign ROI, by Alan Hutchinson, MarketWare Technologies, Inc.
Marketing Mix Management, Peter Grant, The Editors
Permission Marketing, Seth Godin,Vice President, Direct Marketing, Yahoo!, Simon & Schuster 1999
And for the contribution and editing assistance of Alison Hall, Creative Director, PVI Communications
Proceedings of the Project Management Institute Annual Seminars & Symposium
September 7–16, 2000 • Houston, Texas, USA