Management Information System: Project

Report

Internet and
Marketing
March, 2016

Submitted by: Section C

Team Silicon Valley
Himani Garkoti
(PGP31150)
Manjot Singh Bhatia
(FPM16011)
Table of Contents
Sneha Khurana
(PGP31174)
Executive Summary...........................................................................................................3
Introduction........................................................................................................................4
The Marketing Process.......................................................................................................5
Understanding the customer and formulating strategy.....................................................5
Marketing Mix.....................................................................................................................7
Product............................................................................................................................7
Price................................................................................................................................8
Place................................................................................................................................8
Promotion........................................................................................................................8
Customer Relationship Management.................................................................................9
Understanding e-CRM: Amazon....................................................................................10
CRM Paradox.................................................................................................................11
Conclusion........................................................................................................................12
References.......................................................................................................................13

List of Figures
Figure
Figure
Figure
Figure
Figure
Figure

1:
2:
3:
4:
5:
6:

The Marketing Process........................................................................................5

Consumer Electronics Search in UP.....................................................................6
Consumer Electronics: Top Keywords..................................................................6
Comparison between SMART TV and LED TV......................................................7
WWF #LastSelfie Campaign................................................................................9
Salesforce CRM..................................................................................................10

List of Tables
Table 1: Number of Internet Users (million).......................................................................4
Table 2: Internet Users by Region (million)........................................................................4

Executive Summary
Internet is lauded as one of the most crucial technological development since
the industrial revolution. It has altered the business paradigm and it is now
crucial for businesses to have the internet as a part of their marketing
strategy. At the start of the century, it was expected that internet would
transform various marketing functions and these expectations have come
true. . This widespread use of internet provides an opportunity to
organizations to improve the effectiveness of their marketing process while
becoming more cost effective and practical at the same time. The report
tries to study the effect internet has had on each of the marketing processes.
Understanding the customers needs wants and demands is one of the most
crucial aspect for any marketer as any mistake at this step can have a
drastic effect on the companys profitability. Using tools such as Google
analytics, companies are able to identify what the prospective customers are
talking about. Such tools have helped many companies such as Tipsy Elves
to increase their revenues.
Each aspect of the Marketing mix is also influenced to a great extent by the
Internet. Be it the customization being offered by Nike or the #LastSelfie
campaign by WWF, Internet has impacted the companies in a positive way.
CRM being an important part of the marketing process is also studied
however it should be noted that implementing e-CRM is not a solution for all
problems as is evident from the Cigna Healthcare case study.

Introduction
The Internet has altered the way companies conduct business throughout the
world. Internet is lauded as one of the most crucial technological
development since the industrial revolution. It has altered the business
paradigm and it is now crucial for businesses to have the internet as a part of
their marketing strategy. At the start of the century, it was expected that
internet would transform marketing functions such as disintermediation,
customer relations management, mass customization, sales force
automation, marketing decision support information, and collaboration and
coordination.1
Over the last 16 years there has been significant development in each of the
mentioned areas and are still developing at a significant rate. This is mainly
due to the growing importance of internet with the widespread use of
smartphones. An indication of this can be seen from the statistics for internet
use in the world.
Table 1: Number of Internet Users (million)
2010

2011

2012

2013

2014

2015

Developed
Developing
World

824
841
921
961
997
1,
1,
1,
1,
1,
195
383
573
743
940
2,
2,
2,
2,
2,
019
224
494
705
937
Source: International Telecommunication Union (Geneva)

1,
035
2,
139
3,
174

Table 2: Internet Users by Region (million)

2010
Africa
79

2011

2012

2013

2014

2015

1
05

1
24
1
05
1,1
24
1
43
4
35
5

1
48
1
18
1,2
29
1
54
4
47
5

1
72
1
29
1,3
66
1
62
4
66
6

1
93
1
41
1,5
06
1
70
4
87
6

Arab States
Asia & Pacific

86
8
72

CIS
Europe
The Americas

95
4
10
4

93
9
88
1
14
4
19
4

1 V. Kanti Prasad, K. R. (2001). The Influence of Internet-Marketing Integration on

Marketing Competencies and Export. Vol. 9(No. 4).

56

83

39

84

16

51

Source: International Telecommunication Union (Geneva)

We can see from the tables that there is an exponential growth in the
number of internet users in the world, especially in developing countries.
This widespread use of internet provides an opportunity to organizations to
improve the effectiveness of their marketing process while becoming more
cost effective and practical at the same time.

The Marketing Process

The marketing process can be defined as all the steps in the process of
discovering unfulfilled customer needs and bringing to market products that
satisfy those customer needs. The steps involved in the marketing process
are illustrated below.

Figure 1: The Marketing Process

The Internet has impacted each of the above steps and several tools can be
used by companies to make the process more efficient and improve the
success rate of its campaigns. Businesses can conduct quick market
research, expand to new markets and provide better customer service at a
lower cost. The reduction in cost has also led to the creation and growth of
several startups across the globe. Through this report, we have tried to
explain the use and impact of internet at each of the above steps in the
marketing process.

Understanding the customer and formulating

strategy
Ability to create value for customers is one of the things that differentiates a
successful company from a failure. Identifying customer needs, wants and
demands are the first step in creating value. Its crucial for a company to
understand its customer and also the marketplace. Traditionally companies
have spent significant amounts on market research in identifying the same

but now several Internet tools provide the ability to gather relevant market
research data for free.
Companies can track the trends from the trending topics on various social
media sites, Google trends, etc. An example of a company using this
successfully is Tipsy Elves in the US. It was founded in 2011 by Evan
Mendelsohn and Nick Morton after they saw Ugly Christmas Sweaters
trending on Google. It has grown significantly since then and had revenues of
$14 million in 2014.

Google trends can be used in market research in the following ways:

Identifying product features valued by target customers

The Explore-in depth feature provides the ability select the relevant
location, industry and subcategory. Once the appropriate filters are
selected, it displays the popular search terms in the corresponding
industry and are the combination. The below image illustrates the interest
in consumer electronics in Uttar Pradesh for the past four years and top
queries in that category.

Figure 2: Consumer Electronics Search in UP

Figure 3: Consumer Electronics: Top Keywords

Estimating Customer Demand

Businesses can compare brands/features to determine which is more
popular. In the below example we have compared a Smart TV with LED
TV. We can see that the interest in LED TV is considerably greater than
that in Smart TV and more evenly spread throughout UP while that for
Smart TV has concentration mostly around Noida, UP.

Figure 4: Comparison between SMART TV and LED TV

Marketing Mix
Product
One major dilemma in any customers mind is the tradeoff between the
convenience and tangibility. A salesperson selling a Nike shoe has the
information that he has been trained on. In developing countries like India
and China where the training expenses are low and the number of stores
have been on a rise it become even more difficult. Firms has been able to
solve this dilemma to a great extent by the help of internet.
Nikes online store offers the complete details of all its product directly from
the experts. It also offers the option to customize the products thereby
increasing the product varieties and differentiating itself from the other
brands.

Price
Internet has had a huge influence on the pricing strategy being followed by
the firms. In todays competitive environment, price has become one of the
biggest differentiating factor especially with the increasing number of online
channels of sale. Firms of the likes of makemytrip.com and yatra.com have

been making efforts to capture the market by offering lucrative discounts

and ecommerce giants are bundling products together.
Companies like Xiaomi have adopted price skimming mechanism my
launching new products online. Companies have also leveraged the internet
to maintain loyalty programs in a better way.

Place
The internet has not only led to new startups but have also revolutionized
the way the traditional firms have been working. One big way in which firms
today have leveraged the power on internet is through Omni-channel
marketing. A person now while shopping gets an update on which is the
closest store nearby carrying that product.
Stores of the future such as the Rebecca Minkoff stores 2 are soon becoming
the norms. Coke also utilized the internet to bring people from across the
border together and thereby spreading the message of hope and happiness3.

Promotion
The promotional strategy has perhaps been the most affected with the
advent of internet. Promotions were limited to advertisements, especially in
the TV or print media. It ended with an advertisement which ran for
sometimes years. With internet, everything became more short-lived. It
became imperative for any company to focus on its online promotional
strategy. All leading firms started coming up with innovative online
campaigns to engage more customers.

2 In The Store Of The Future, Your Shopping Bag Connects To The Internet. (2016, March 22).
Retrieved from fastcompany.com: http://www.fastcompany.com/3057950/in-the-store-of-thefuture-your-shopping-bag-connects-to-the-internet
3 Happiness without Borders. (n.d.). Retrieved March 2016, from coca-colacompany.com:
http://www.coca-colacompany.com/stories/happiness-without-borders/

Figure
WWF

5:
#LastSelfie Campaign

WWFs #lastselfie campaign4 helped them in tackling a pressing

environmental issue as well as reaching targets much before than they were
due. Its a tool that has become a necessity for companies which are trying
to sustain a competitive advantage.

Customer Relationship Management

The word Customer Relationship Management (CRM) was coined in the year
1995 by Gartner and IBM5 around the same time. In his book CRM in Real
Time, Goldenberg defines CRM as a business approach which integrates
people, process as well as technology to maximize customer relationship.
Technological advancements with the help of internet has made CRM into an
organization that functions 24 hours a day and 365 days a year 6. This
combined with the advancement of social media ensures that CRM becomes
one of the most important aspect of any organization.

4 Castillo, M. (2014, April 18). WWF Snaps #Lastselfie of Endangered Animals Selfies
just got real. Retrieved from adweek.com: http://www.adweek.com/news/advertisingbranding/wwf-snaps-lastselfie-endangered-animals-157138
5 History of CRM. (n.d.). Retrieved March 2016, from wiretech.org:
http://www.wiretech.org/about-cloud/30-history-of-crm
6 Goldenberg, B. J. (2008). CRM in Real Time: Empowering Customer Relationships.
Emerald Group Publishing.

Taking an example of the Salesforce CRM, we can see how at every stage
technology is being used. We also notice how technology can actually ensure
that the customer is updated about the progress of any order on a real-time
basis.

Figure 6: Salesforce CRM

Understanding e-CRM: Amazon

Amazon is one company which is efficiently using Internet together with the
available CRM tools. It has made several provisions on its website that makes

it easier for the users to get what they are looking for. Some of the features
of Amazon e-CRM are listed below.

Featured Products: When the customer visits the website for the first
time he is shown the featured products on the homepage. However
after his/her first visit, the products shown are linked to customers
earlier visit.
Personalization: With the help of studying the user browser pattern, a
lot of information can be gathered ranging from the time maximum
purchases are made to the day of the week where customers prefer to
shop.
Wish-list Review System: With the help of the wish-list feature, Amazon
is able to track what the customer wishes for. He is then at a better
position to tap that purchase by intimating any discounts on the
product that may come up in the future.

CRM Paradox
CRM is not an easy way towards success, there have been cases where
implementation of CRM has caused company more problems rather than
improving customer relationships. It may happens at time that CRM leads to
create an image that the company is engaging in favoritism by giving
preferential treatment of few customers over the others. This can create a
very bad image about the company and can cause a lot of damage to the
companys future prospects.
An example for the same was when the third largest healthcare company in
the world Cigna Healthcares ambitious CRM project witnessed a massive
implementation failure. In terms of monetary terms, the loss was of the order
of close to 450 million dollars mainly due to loss of 6% members7.

7 Gupta, V., & Kumar, M. (2006). CRM Implementation Failure at Cigna Healthcare. IBS
Center for Management Research, 13.

Conclusion
Digitization and the Internet have changed the need for every company to be
in some way a technology company. Information Technology and the Internet
is no longer just a part of the infrastructure but an essential requirement to
drive business goals and outcomes. There are several aspects of marketing
that were not thought of as tech-driven traditionally but are now transformed
with the use of technology.
Marketing executives are focused on increasing customer base, improving
customer experience and creating customer loyalty. To achieve these goals
they have become reliant on web and data-based marketing activities.
Companies have ramped up their digital spending over past few years and
businesses have come up with many innovative campaigns using the
internet. A few of the successful campaigns are - Oreos Daily Twist
Campaign, it shared an ad reflecting the trending topics taking place in the
world each day. The Old Spice - Smell Like a Man, Man Campaign
generated over a billion impressions and over 105 million YouTube views.
These are just a few examples of successful online campaigns and reflections
of the growing importance of the internet. They also show the use of various
online tools and features of social media sites to create successful
campaigns.

References
Castillo, M. (2014, April 18). WWF Snaps #Lastselfie of Endangered Animals Selfies
just got real. Retrieved from adweek.com:
http://www.adweek.com/news/advertising-branding/wwf-snaps-lastselfieendangered-animals-157138
Goldenberg, B. J. (2008). CRM in Real Time: Empowering Customer Relationships.
Emerald Group Publishing.
Gupta, V., & Kumar, M. (2006). CRM Implementation Failure at Cigna Healthcare. IBS
Center for Management Research, 13.
Happiness Without Borders. (n.d.). Retrieved March 2016, from cocacolacompany.com: http://www.coca-colacompany.com/stories/happinesswithout-borders/
History of CRM. (n.d.). Retrieved March 2016, from wiretech.org:
http://www.wiretech.org/about-cloud/30-history-of-crm
In The Store Of The Future, Your Shopping Bag Connects To The Internet. (2016,
March 22). Retrieved from fastcompany.com:
http://www.fastcompany.com/3057950/in-the-store-of-the-future-yourshopping-bag-connects-to-the-internet
V. Kanti Prasad, K. R. (2001). The Influence of Internet-Marketing Integration on
Marketing Competencies and Export. Vol. 9(No. 4).