Digital Marketing E-Book

Godfrey Parkin

• Herausgeber: IMM Lifestyle Books
• Kategorie: Fachliteratur
• Sprache: Englisch
• Veröffentlichungsjahr: 2016

Seitenzahl: 449

Beschreibung

The force of the internet and the power of online consumers have dramatically altered the face of today's business world. Understanding and using this resource to its best advantage is essential to the success of every business. "Digital Marketing: Strategies for Online Success" clarifies the complex subject of ecommerce, presenting a simple 8-step strategy for success in internet marketing. This book is essential for anyone seeking success in a business environment altered by the digital revolution. Godfrey Parkin presents fascinating facts about both the history and potential of the internet, as well as providing clear and practical advice on how to make the most of it. Key strategies are outlined on every aspect of ecommerce including a step-by-step guide to developing a low-risk business strategy; the principles of designing a website that works as a successful business tool; guidelines on maximising effectiveness of search engines, email marketing and online advertising, as well as advice on using web 2.0 and social media in order to expand brand awareness and increase sales. This book is indispensable to anyone who wishes his or her company to remain relevant in today's digital environment.

Leseprobe

DigitalMarketing

DigitalMarketing

Strategies forOnline Success

Godfrey Parkin

Published in 2009 by New Holland Publishers (UK) Ltd

London • Cape Town • Sydney • Auckland

www.newhollandpublishers.com

Garfield House, 86–88 Edgware Road, London W2 2EA, United Kingdom

80 McKenzie Street, Cape Town 8001, South Africa

Unit 1, 66 Gibbes Street, Chatswood, NSW 2067, Australia

218 Lake Road, Northcote, Auckland, New Zealand

10 9 8 7 6 5 4 3 2 1

Text copyright © 2009 Godfrey Parkin

Copyright © 2009 in artworks: Godfrey Parkin

Copyright © 2009 New Holland Publishers (UK) Ltd

Godfrey Parkin has asserted his moral right to be identified as the author of this work.

All rights reserved. No part of this publication may be reproduced, stored in any retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publishers and copyright holders.

A catalogue record for this book is available from the British Library

eISBN 978 1 60765 195 6

Publishing Director: Rosemary Wilkinson

Publisher: Aruna Vasudevan

Editor: Julia Shone

Inside design: Sarah Williams

Cover design: District-6 Design

Production: Melanie Dowland

Reproduction by Pica Digital Pte. Ltd., Singapore

Printed and bound in India by Replika Press

The paper used to produce this book is sourced from sustainable forests.

Contents

Introduction

Online in context

New marketing

The elements of emarketing

Your emarketing strategy

Best and worst practices

New consumers and web 2.0

Website design

Search engine marketing

Online advertising

Email marketing

Buzz marketing

The future of marketing

Appendix: Building an effective online business

Glossary

Index

Introduction

This book is a guide to succeeding in today’s business world, the marketing rules of which have been forever changed by the collective power of the online consumer.

At the end of this book you will find a guide that summarizes the action recommendations covered in this publication. It takes you through the strategy development and implementation process step by step, and poses the questions that you need to answer to build a successful emarketing approach, or an entire ebusiness. Although you will learn the essential tactics for mastering every element of the emarketing landscape, this book is about marketing strategy, not about web technology.

You can learn technical hints, tips, and website optimization secrets from my seminars or from hundreds of other sources. But there is little point in building a website or fine-tuning your emarketing tactics unless your strategy is right in the first place. To build a competitive strategy to capture the loyalty of your online consumers requires rethinking your vision for your business from the ground up. It also requires an intimate understanding of what this online environment is all about, from the perspective of your business, from your competitors’ point of view, and particularly in the eyes of your target customers as individuals. Without those insights, you cannot begin to put together a digital strategy that has any hope of succeeding.

This book will provide you with the insights and inspiration, as well as the step-by-step processes, to succeed in marketing to the new consumer.

Wherever it is necessary to dip into technical detail I do so in laypersons’ terms. A glossary is included at the back of the book for easy reference and for clarifying any term that is not clearly defined in the text.

Though I am a closet geek, I’m not one of those people who believe that technology in itself has any real value. There are many instances where new technology is merely a solution looking for a problem. I have been immersed in this world of the web for too many years, have linked customers, businesses and brands through too many online experiences, battled too many IT policy makers, been frustrated by too many miracle software packages, been disappointed by too many consultants, and confronted too many medieval corporate prejudices, to be anything but pragmatic about technology’s role in strategic business growth.

Properly used, the internet unleashes personal communication and experience-sharing on a scale unprecedented in history.

Through that pragmatism, there’s a very simple, powerful, burning light that all of us need to keep in focus: properly used, the internet frees customers and marketers from the constraints of time and space, which in turn unleashes personal communication and experience-sharing on a scale unprecedented in history.

Any online marketing model which still uses the internet as merely a cheap means to broadcast canned one-way messages is simply missing the point. All companies need their brand bibles for defining what their brands are and how they seek to be perceived. But those brand bibles need to evolve constantly to stay relevant to changing consumer environments. Marketers can actively add huge value to their brands by embracing the power of the web as a catalyst for exploration, organic growth, experience-sharing, and relationship-building – making every customer both a convincing salesperson and a compelling advertising medium.

So why are the brilliant examples of how it should be done so few and far between? Why is it that almost every digital project that I get involved in seems to be seeking to use technology to recentralize the locus of control, to choke off collaboration and to make marketing more tightly administered than ever before?

The answer is that most businesses have an increasingly fuzzy vision of what their future should be, so their tendency is to clutch tightly to the past. As the world around them changes faster and faster, the future becomes ever more blurred and uncertain. Without a bright light to head toward, they feel safer not to move away from their fundamentals and put their efforts into shoring up their defences. Those companies that do stumble forward usually head in the general direction that they have always followed, tactically groping their way through the fog, turning to dodge obstacles, and grasping at opportunities reactively as they fly by. Without a vision, they have no idea where they are headed. Without a vision, they cannot put together an effective strategy.

You first need a clear idea of what you want to build before you dig the foundations.

One of my recent clients wanted to throw out all the marketing solutions currently in play and start from scratch. Well, nothing wrong with wielding a new broom. But it is the strategy of ‘starting from scratch’ that I take issue with: this company wanted to get a new content management system and build a new website, then create new marketing communications activities that would run on it. The argument is that you first need a good foundation before you can build.

But surely you first need a clear idea of what you want to build before you dig the foundations?

Throughout this book I will be using the terms ‘marketing’, ‘emarketing’, ‘marketer’, and ‘online consumers’ repeatedly. Without becoming too academic about terminology, this is what these terms mean to me:

MARKETING is the overall set of activities, processes and attitudes that a business applies to understanding the needs of its customers, and developing, supplying and communicating products or services that address those needs. It includes all the activities, inputs and outputs that might be classified under the traditional ‘Four P’s of Marketing’: Product, Place, Price and Promotion. Since the web is increasingly one of the places where individuals and companies market, marketing includes what you do online.

EMARKETING is the same as marketing, except that it focuses on those consumers whose attitudes and behaviours are being transformed through their online experiences. An ‘online customer’ is not necessarily someone who buys online or who engages with marketing experiences online. An online customer is a customer (or potential customer) whose life is influenced by digital communication, peer-to-peer collaboration and the digital revolution. Emarketing is about people who use the internet; it is not merely about the internet as an advertising medium. Emarketing is the collection of processes that seeks to understand and respond to customer needs in the online environment. It forms relationships with customers, builds brands, and drives business to online and offline channels. Emarketing drives visitors to your site or other digital experiences that have been designed to be customer-centric. It delivers a remarkably satisfying experience throughout the entire period during which the customer is in contact with your brand (from research to selection, sale to delivery, consumption and referral), and encourages the visitor to share that experience with others.

MARKETERS include all the people involved in the process of marketing, both on the ‘client side’ (such as product managers, brand managers or marketing communications people) and on the agency side (such as account directors, creatives, media planners or market researchers). Emarketers are those marketers engaged in trying to communicate with online consumers. In many manufacturing or service companies there is no real distinction between marketing and emarketing people; in most advertising agencies the digital operations are typically kept segregated from the traditional above-the-line media operations, not because this makes marketing sense but because each requires a very different business model.

ONLINE CONSUMERS are those whose lives have been influenced by digital technologies. They include people who never buy anything online, who never play online games and who don’t have a Facebook page. If they use email, or own a mobile phone, or access the web for any reason, they are online consumers because their information-sharing, opinion-formation and decision-making processes are inherently influenced by the internet.

This book will help to build an understanding of how our customers – consumers and businesses – are changing the way they become informed, form opinions and make purchasing decisions. It will explain, in non-technical terms, all of the interrelated concepts, tools and processes that make up the field of customer-centric emarketing – and how to use them to best effect. Most importantly, it will lay out ways in which your business can develop a clear vision of the immediate future and build a strategy that will ensure commercial success.

Emarketing is all about building relationships with these people, getting to know them and getting them to know you, or at least your brands. In addition, while traditional marketing is neatly framed by the four P’s, emarketing spills over into territory previously occupied by other corporate silos, such as sales, customer service, IT, finance and corporate strategy. A small business that is unencumbered by corporate structures can gain some benefit from the web with, for example, email marketing and a brochure-ware site, but major players need to be able to integrate all their internal processes in real time, at web speed, or else their investment in advertising, promotion or even the website itself, may be completely wasted.

Emarketers may not control those out-of-silo projects, but they do have to initiate and drive them.

I tend to use the terms ‘the web’ and ‘the internet’ interchangeably, but of course they are not the same thing – the not-so-user-friendly internet has been with us for longer than the microwave oven, while the web (the graphical, point-and-click, browser-based environment on the internet) has only been around since 1992.

Finally, this book is peppered with what my American colleagues like to call ‘factoids’. Any facts mentioned in it are either derived from formal studies carried out by various research bodies, from documented case studies or from my own professional experiences or those of my colleagues. Since this is not an academic treatise, I have not annotated every statement with footnotes and reference sources.

1 Online incontext

By 2008 the internet was fully validated around the world as an indispensable component of any marketing mix. Online advertising expenditure had leapt by 50 per cent on the previous year. The web was the place where creativity blossomed. Online video was ubiquitous. Despite having spawned dozens of me-too competitors, YouTube served more than 200 million videos a day. Marketers scrambled to create their own branded video channels. An online community allowing women to share videos of their shoes (called, of course, Shoetube.tv) was launched, attracted a huge following, and then within a year reinvented itself, adding designer boutiques and e-commerce. It was a breakout year for women and the ‘silver-surfer’ older generations, who started to dominate web usage and ecommerce. Even the Queen of England started her own YouTube channel. The Dalai Lama started to Twitter. The Vatican opted for a more conservative approach, and launched its own daily podcast.

Online experiences provided by global brands such as Coke, Wrigleys, Pampers and dozens of others all received millions of unique visitors. Consumer goods websites, microsites, nanosites and social sites proliferated. Google consolidated its position as the largest advertising agency – and advertising medium – in the world. Along with other bands, Radiohead rubbed salt in the wounds of dying business models by launching their new album online on a pay-what-you-like basis and made more money than they had on all their previous albums combined. Apple dropped ‘computer’ from its name, in anticipation of the mobile phone becoming the new web access device. The car industry moved billions of marketing dollars from conventional media into digital media, not as a trial, but as the result of experience. Television viewership and newspaper readership started falling around the world. Mothers in America spent seven times as long on the web as they did watching television.

Consumers are online, en masse. Digital marketing is no longer a peripheral experiment, but an essential fundamental in the strategy of every serious marketer.

Yet while the avant-garde of marketers are building online customer relationships, the majority are still building websites. A website is not enough, no matter how ‘optimized’ it may be. In fact, websites as you know them may be quite unnecessary if your emarketing is dynamic and focused.

A website is not enough, no matter how ‘optimized’ it may be.

To many businesses, the website has become an end in itself, the new vehicle by which senior marketing people conspicuously wield their power and importance.

And what status symbols they have become! At a recent symposium I shared a lunch table with two rather senior marketers from different companies. One alluded, with some pride, to the fact that he had spent a small fortune on a new website. The other smugly announced that he had spent three times that, and that was before the integration costs. Not only does a new website give you something to boast about, it can give you total control over every micro-move that customers and marketers make. If you were not a bureaucrat before the emarketing revolution, it is hard to resist becoming one now.

It is not too late for marketers to back out of this pretentious, site-centric cul-de-sac and rediscover the creativity, connectivity and infinite potential of the world wide web. Social media, user-generated content, marketing 2.0, web 2.0, web 3.0 and mobile marketing are now on the agenda of every progressive marketing company. These concepts, how they are creatively interpreted and what they evolve into, are some of the building blocks of New Marketing. Customer-centric online marketing is your future, or you’re history.

@If your current approach to emarketing consists of a website, a few banner advertisements, and a budget for Search Engine Optimization (SEO), you are not really taking the new consumer seriously. It is time to rethink your strategic vision.

In many respects, the future has already happened. You don’t need a crystal ball to see clearly how digital lifestyles and the technologies that connect us all will fundamentally change the way companies run their businesses; you simply need to look beyond your own comfort zone at what is happening in other industries, in other countries, in other cultures, in other generations. Or, if that is asking too much, you can look at the impact of the web a little closer to home, in your consumer bases, in your families, or in your own personal behaviour. People need to accept that these influences are neither isolated, nor trivial or transient; they are all interconnected and interrelated, and collectively they are deeply disruptive.

THE ONLINE LANDSCAPE

I have been running businesses in what analysts like to call the ‘digital space’ since 1991, when commercial use of the internet was first permitted. While I have tried not to be cast as a zealot, I have always been an optimist. Every step of the way, I have encountered people – academics, venture capitalists, business partners, prospective customers, even technologists – who have viewed the web with a mix of scepticism, denial and fear.

The digital revolution shakes things up, and established models do not like being shaken, particularly if they are fragile.

Ask anyone to give you a few examples of what they think of as digital, and they tend to respond with a list that includes computers, cameras, iPhones, printers or cell phones. These are just ‘things’. True, they all use digital technology to function, but they are still merely tools. In themselves, they are not responsible for the digital revolution. Very few people seek to own ‘things’ for their own sake. It is what those things can do for them that drives their desire to own them.

The true digital revolution is not in the appliances, but in the processes that they improve: designing, learning, sharing, communicating, job-searching, dating, researching, purchasing, exploring, and all the other activities that occupy your time. Digital technologies, particularly the web and the mobile phone, have enhanced the processes that you live by. Those processes have become cheaper, faster, more reliable, more convenient or more satisfying. And where digital technologies have facilitated those enhancements, people have adopted them voraciously. It took 125 years for landline telephones to reach one billion subscribers worldwide (that happened only in 2001). In 2002, the number of mobile phone users passed the 1 billion mark. It had taken 21 years. From there, the mobile phone global user base trebled to 3 billion people in a mere 5 years.

The true digital revolution is not in the appliances, but in the processes that they improve.

Sometimes the digitally enhanced process is a simple improvement on what already exists. Sometimes it is a replacement. The former is easy for companies to invest in, since it clearly adds value. The latter usually meets with resistance, since it threatens established investments and business models. It is far easier for a new company to succeed in a new business model, than for an existing company to abandon its existing approach and start again.

A BRIEF HISTORICAL PERSPECTIVE

Because the internet keeps evolving so rapidly, people tend to think of it as a new phenomenon. In fact, the internet has been around for longer than Microsoft Windows. It started out during the Cold War. The 1960s were a time of mutually assured destruction, the Cuban missile crisis, the assassination of John F. Kennedy and the Soviet invasion of Czechoslovakia. Computers were huge mainframes, connected only by dedicated cables. The military feared that a missile strike against one computer would break the chain that connected all of them, so they asked a think-tank of scientists at the Advanced Research Projects Agency (ARPA) to come up with a fail-safe solution.

The result was the first computer network. It used revolutionary concepts that still form the basis of the internet today. At the time, if you wanted to send a file from one computer to another, you sent it as one big file along a dedicated cable. While it was being sent, you could not use the cable for anything else, and if it got corrupted along the way, it was useless at the other end.

The first innovation was to break the individual data files into thousands of smaller ‘packets’ and send them off. Each packet was handled like a postcard, with the address of its destination and its sender. This allowed multiple messages to use the same cable system simultaneously. When they arrived at the other end, the packets were re-assembled into the original file, and even if some packets got lost or corrupted, the result was usable.

The second innovation was to build a mesh of cables like a large fishnet across the country, with a machine at each connection point that would receive the packets and route them to the next node. If a strand or a node in the net was broken, these ‘routers’ would send the packets down the next most efficient path. This ‘packet switching’ system was tested using four academic institutions in 1969, and the resulting network, the ARPANET, was the precursor of the internet.

There is a delightful irony in the fact that a system intended to strengthen the military-industrial complex became the most massively democratising engine of global freedom since the printing press.

The first email to use the ‘@’ sign in its address was sent in 1971.

The ARPANET expanded, and other similar networks were developed. But they all used different standards, so communication between networks was problematic. By 1983 a common communication technology called TCP/IP, for Transmission Control Protocol/Internet Protocol, became the only standard communication protocol for computer networks. Still used today, TCP/IP allowed all the diverse networks around the world to talk to each other, and the internet was born.

An internet is a network of networks, and for many years ‘the Internet’ was spelt with a capital ‘I’ to differentiate it. In the 21st century, the internet has become such a household term that most sources have abandoned capitalization of the term.

The internet remained a closed shop for many years, with only scientists, governments and academic institutions having access. It was controlled by the United States National Science Foundation, and commercial or personal use was banned. All of that changed in 1991, when the ban was lifted and the internet was opened up to anyone who wanted to use it.

A remarkable thing happened. A point-and-click interface was developed at the University of Wisconsin, which made it simple for non-programmers to use the internet. This was a potentially very valuable piece of software, yet it was made available for free. The software, called Gopher, was downloaded by thousands of people, and it fuelled an explosion in usage of the internet.

The following year, in 1992, the internet evolved from simply a way to move files around into a way to tap directly into the contents of those files. Tim Berners-Lee, an English scientist working at CERN, the particle accelerator institute in Geneva, invented a way to ‘link’ from within the text of one document to within another document at the click of a mouse. He called this system ‘hypertext’. He created a software package that allowed anyone to use hypertext to build what is called a website today, and he released that incredibly powerful tool for free. It was immediately downloaded and used by thousands of people. The name of the software was ‘World Wide Web’ and the web was born.

Hypertext is not a programming language, but a means of ‘marking up’ a document so that ‘web browsers’ such as Internet Explorer or Firefox know how to display it, and so that any system searching for the document can identify what it is and what it is about. This Hypertext Mark-up Language, or HTML, is still the basis of most websites on the internet today.

The first graphical user interface to take full advantage of HTML was released in 1993. In a business model that continues to make developers wealthy, it was released for free. Developed by a team led by Marc Andreessen at the University of Illinois, it was called ‘Mosaic’ and similarly to earlier free releases, it was downloaded by millions of people. Mosaic became the de facto web browser standard, and turned the internet into a marketing medium.

After graduating, Marc Andreessen evolved Mosaic into Netscape Navigator, and with Netscape’s IPO, he became a millionaire in his early 20s and the poster-boy for the dot-com pre-bubble-burst era. A few years later, America Online acquired his company for more than US$4 billion. (In the meantime, Microsoft had licensed Mosaic from the University of Illinois, and developed from it its own browser, called Internet Explorer, which would rapidly send Netscape into obscurity, before it rose again in the form of Firefox.)

While this short history of the origins of the web may be interesting, what happened after the release of Mosaic is nothing short of astonishing. By the end of 1993 there were 50 websites on what had become known as the world wide web. Six years later there were 17 million. By the end of 2006, there were more than 100 million websites. By 2008 there were an estimated 25 billion web pages, and one sixth of the world’s population (1.4 billion people) had internet access. Global business-to-consumer (B2C) ecommerce amounted to $517 billion in 2008. Business-to-business (B2B) ecommerce was $5.2 trillion. That makes business on the internet larger than the GDP of Japan, the world’s second largest economy. The growth is exponential, and by 2012 B2C will double, with $1.2 trillion changing hands online, and B2B transactions soaring to $12.4 trillion. (I am using the American billion, which is a thousand million, and the American trillion, which is a thousand billion).

Far from slowing down, the web is growing at an exponential rate. Even though countries such as the United States, Japan, South Korea and the Scandinavian countries are virtually saturated, the number of internet users in the rest of the world keeps climbing, as does the volume of ecommerce. At the same time, the bandwidths available to the general public keeps getting faster, while costs keep on falling.

The bandwidth capacity of a dial-up modem is usually 56 Kbps. In reality, you never get that speed because any connection is as slow as the slowest piece of line through which your signal must pass. At dialup speeds it would take you over 20 hours to download a music CD. With early-stage broadband, you get around one megabit per second. At this bandwidth you can download a CD in 45 minutes. With more advanced broadband speeds, which are available in Europe and Asia, you would get anything from 40 Mbps to 90 Mbps, and that same CD downloads in less than a minute. Finally, at the 4.2 Gbps bandwidths that are currently being tested for Internet2, you could download the CD in less than a second while watching a full-screen high-definition streaming video at the same time.

@Bandwidth is the speed at which data travels. The higher your bandwidth, the less time you have to wait for web pages or files to download. It is measured in kilobits per second (Kbps), or megabits per second (Mbps). (A megabit is a thousand kilobits.) Really high-speed bandwidths are measured in gigabits per second (Gbps). Bandwidth is always measured in bits, whereas file size is usually measured in bytes. A byte is approximately eight bits. The industry standard is to abbreviate bytes with a capital B and bits with a lower-case b to distinguish the two. It is not unusual for internet service providers to use these terms in a misleading fashion, particularly in their marketing material. A one megabit per second (1 Mbps) connection cannot download a one megabyte (1 MB) file in one second – it will actually take eight seconds.

Of course, this is not as fast as it gets. Most broadband still uses existing copper cable infrastructure or a wireless signal. Fibre optic cable holds the promise of truly amazing speeds. Recent tests have demonstrated the potential to move the equivalent of 1,900 music CDs across a single strand of fibre in less than a second! But then, who listens to CDs these days?

THE IMMEDIATE FUTURE

Because of its organic nature, there will, without doubt, be surprises in the future of the web. But some trends are unmistakable. Ten characteristics will define the nature of the web in the immediate future. The web will be:

fast

mobile

disruptive

ubiquitous

global

local

social

disintermediating

virtual

contextual.

FAST: The speeds at which you can access the internet are becoming faster. While there are significant inequalities among and within countries, the fastest data transmission speeds that are available to the general public from commercial providers have rocketed upwards over the past year or two. For many web users, flipping through pages on a website is already as fast as changing television channels. There is simply no download wait. Over the next year or two, internet users will be able to watch hi-definition videos, run web-based applications and engage in 3-D virtual worlds without annoying delays or interruptions. The implication for marketers is that online communication will be less constrained. There will be more creative freedom within existing frameworks such as websites, rich media banners or video overlays, as well as the potential for entirely new forms of marketing engagement.

MOBILE: The web has gone mobile, and the mobile phone is the new computer. People can increasingly access the internet while on the move through a number of technologies. Most laptops are equipped with wireless cards that will allow them to connect through local WiFi ‘hotspots’ that are virtually everywhere – in airports, hotels, conference centres, on university campuses, in coffee shops and in bookstores. In addition, higher-end mobile phones come equipped with 3G, HSDPA, or HSUPA technology. This allows the phone to be used as a web browser, or as a broadband modem that will connect a computer to the web from anywhere through the mobile phone network. HSDPA cards that plug into a laptop do the same thing.

Over the past few years there has been a concerted move by cities and towns across the globe to make high-speed broadband access available to their entire populations. Enlightened city governments realize that access to the web is a utility much like electricity. They realize that providing it to everyone can give a significant boost to education and commerce in the city, and can be a boon to smaller businesses and lower-income families. A technology known as Wi-Max can enable a city to become a vast wide-area hotspot, serving up internet access at speeds that outpace mobile-phone or landline solutions. Typically, this municipal Wi-Fi access (known as muni-WiFi) is either free, or is supported by advertising. While it is relatively inexpensive to set it up (the city of Philadelphia spent nearly US$17 million), the political opposition from telecommunications companies and the ability of service providers to retain customers presents major obstacles. Many over-ambitious city-wide projects have stumbled as a result of poor consumer up-take, but smaller projects with a more focused purpose have been very successful.

DISRUPTIVE: The internet is not something that is ever going to mature. It has always been a disruptive technology, and it becomes more disruptive every day. The easier it becomes for ordinary people to create and share content and applications, the more potential there is for overnight viral outbreaks of culture-changing behaviour. The impact of this on business, and on marketing in particular, is most keenly felt in the unpredictability of consumer trends and the rapidly diminishing life-spans of products. The nature of change is itself changing – change is no longer linear. You can no longer approximate the future by plotting on a graph where you were in each of the past five years and then simply extrapolating forward. You can no longer rely on annual planning and budgeting cycles, and you have to be prepared to take risks, to abandon projects mid-stream, and to make tactical leaps of faith. The internet is an inescapable agent of change – understand it, work with it, or be marginalized by it.

Europeans spend as much time online as watching television.

UBIQUITOUS: The web will become ubiquitous. It will be seamlessly integrated into the lives of every person who has access to it, and into the processes and planning of all marketing organizations. Already, Europeans spend as much time online as watching television, with those aged 16 to 24 spending 10 percent more time online than they do watching TV. In Britain, over-65s are spending more time online than any other age group. However, ubiquity does not mean that everyone will have access. The so-called ‘digital divide’ will still be around. But within major target consumer sectors, the web will become even more of a mainstream means of communication, and the place where consumers go to access all their media: movies, television programmes, music, news, sports, magazines, photography, phone calls and correspondence. With the amount of online content formatted for mobile use growing every day, the web is now on the verge of being available anytime and anywhere.

GLOBAL: One of the biggest advantages of the web for small to medium businesses is the ready access it provides to remote markets, nationally and internationally. This advantage of the web is often dismissed as irrelevant by large businesses, whose vision does not extend beyond their core strength: geographic proximity to their local markets. Before the internet, while the need for widespread physical presence was a massive barrier to entry for small businesses, it was a bankable asset for large businesses. Today, the reverse is true. As consumers move their interactions with vendors online, a company that insists that its customers physically come to its premises to do business can easily be outflanked by a smaller competitor who provides a more satisfying online experience. Perhaps the most successful companies today are those who have managed to integrate their online and brick-and-mortar operations in a way that provides an optimal service to their customers.

The downside of global ecommerce is that local businesses now face competition from foreign companies they may never have heard of. National retail chains selling, for instance, HDTV television sets, face the prospect of their local target market buying the same models from online suppliers on the other side of the globe at half the price, even after shipping, duties and taxes. I know someone who did an overland motorcycle trip from London to Cape Town, and instead of equipping herself through the motorcycle shop across the street, she sourced everything from online suppliers in China at a third of the cost. The local store never knew how much business it had lost.

@Global markets, too, are today only a click away. If you are selling gold-plated garden gnomes from your road-side farm stall, your business depends on the hundred or so cars that pass by every day. On the internet, your market expands exponentially. You can now sell your gnomes to people in Korea, Russia or Brazil. No longer do you need to spend a fortune on placing newspaper or television advertisements in multiple countries; an ad on Google that costs you 20 cents every time a potential customer clicks on it to get to your website will do just fine. You don’t need to rent and fit out physical stores around the globe. You simply need a search-optimized, commerce-optimized website, and an arrangement with a shipping company.

You can, of course, try to compete on price, but it is usually a strategic mistake to allow yourself to be commoditized. Your best defence is to change your business vision: instead of seeing yourself as a reseller of ‘stuff’ you need to focus on becoming a provider of a superior experience that is engaging, compelling and trustworthy, and adds value to your customer’s buying process.

LOCAL: In the same way as local radio has experienced a renaissance round the world, local web usage is a growing phenomenon. Local businesses and organizations are increasingly using the web to find local customers, and vice versa. Whether you are a restaurant, a panel beater, a dry cleaner, a church or a school, you primarily service a small neighbourhood. Marketing to your target audience through the local newspaper, or by stuffing flyers into neighbourhood post-boxes is one way to go. But there are other approaches that leverage the fact that consumers use the web to find, and share, solutions. These approaches include, for example, providing an easily found location-specific website; collecting and using email addresses from physical visitors; identifying your premises on Google Maps; running geo-targeted advertisements on search engines; advertising on local Wi-Fi hotspots or on municipal Wi-Fi when it arrives in your area; engaging with local online communities and having members recommend you.

SOCIAL: The web is becoming increasingly social, with users wanting to use it more and more as a medium for publishing and exchanging information, rather than as a medium for simply absorbing information. The trend towards consumer-generated media (CGM) is causing many marketers to re-evaluate their brand-centric approach to communicating on the web, and to encourage consumers to contribute content such as product reviews, photographs or videos. This boom in what is known as ‘social media’ is providing fertile ground for entirely new marketing approaches, which will be explored later in the book.

DISINTERMEDIATING: Traditional business models simply couldn’t work without a chain of intermediaries that ultimately connect manufacturers or service creators with the consumer. These intermediaries might include wholesalers, distributors, retailers, value-added resellers, brokers or agents, depending on the industry. In some industries, business partners such as the media or advertising and public relations agencies act as communication intermediaries. All of these entities are, in one way or another, under threat of disintermediation by the web. Once a company is able to transact with and talk with its customers directly, many of the previously important intermediaries may become redundant. This potential causes at least two strategic upheavals: companies have to struggle their way through the politics and logistics of reformulating longstanding business relationships, and intermediaries have to seek out better ways of making themselves an essential part of the value chain. Both of these require rethinking of a company’s business model and strategy.

VIRTUAL: Social networks have stormed into the consciousness of journalists and marketers in recent years, although they have been a significant factor in the appeal of the internet for decades. In fact, social networks have been around since the dawn of humanity. As the web evolves in different directions, increasing bandwidth and the desire to socialize online have stimulated the growth of virtual 3-D worlds. At the moment, your primary interface with the web’s content is through Google’s two-dimensional text-only listings. In the near future, your interface with web content will probably be through 3-D environments.

The king of the massively multiplayer online 3-D worlds (MMOs) is usually thought to be World of Warcraft, which is game-based, and has a population of around 12 million. But there is a bigger world, occupied by teenagers in Japan, China and Korea: Fantasy Westward Journey, which has a population of more than 80 million. At peak times, the game clocks up 2 million concurrent users. Because video game consoles are still officially banned in China, PC gaming has massive appeal. At $2.5 billion in 2008, China is now the world’s largest market for online role-playing games, with an estimated 147 million players playing for 14 hours a week on average.

Online places such as Second Life have captured the imagination of western media and marketers. With a registered virtual population in excess of 15 million, it is only the 10th largest virtual world. In fact the number of active members (around 68 thousand users online at any point in time) is a lot lower than the media buzz would suggest. You can join, for free, and acquire a 3-D character or avatar to represent you in the world. The avatar can be personalized in shape, appearance and clothing. For a small subscription, those avatars can acquire the virtual cash that allows them to buy property, build homes and decorate them. There is a Swedish Embassy, and Reuters has a full-time correspondent filing reports from Second Life. You can also attend virtual classes at virtual versions of Yale and Harvard. Your avatar can go on virtual shopping sprees for new clothes or hairstyles, which you buy from shops run by other virtual residents.

You can purchase virtual representations of real-world branded goods. Second Life’s Adidas store will sell your avatar the latest running shoes, often before they are available in real-world stores. Toyota, Ford, or any other car manufacturer will sell you virtual versions of the latest-model cars. You can buy books from online bookstores run by most of the real world’s large publishing houses. And if you really want to get away from it all, Starwood Hotels has built a fully functional Second-Life version of its latest Caribbean resort hotel. It may seem high-tech, but if you wanted to open a store in Second Life, you could do so with a lot less than 10 thousand dollars. For all the hype, though, there is currently considerable doubt about the real business impact of the marketing effort. See it as an investment in getting a little real-world publicity, and in acquiring experience in operating in a virtual mode. Remember that it will not be long before your primary interface with the web is in a 3-D environment.

Technology is not a prerequisite for social marketing, and never has been.

There are other online worlds with much larger active populations, of which you may never have heard. Habbo Hotel is aimed at teenagers, as is Gaia Online. Then there are Entropia Universe, There, Active Worlds, Kaneva, and the Red Light Center.

Club Penguin, a Canadian start-up now owned by Disney, has more than 12 million members. Its target market is 6-to-10-year-olds. This social network allows members to take on avatars that look like penguins, and they hang around an ice-floe, playing games and catching fish. Parents love the fact that their kids can learn to communicate with others from different cultures in a very safe environment. The world also exposes members to issues of social responsibility: the recipients of Club Penguin’s million-dollar annual charity donation are determined by children, who vote online with the club’s virtual currency. Club Penguin gives large sums to charities like War Child and Free The Children, to help AIDS orphans in Ethiopia and children affected by war in Georgia, Afghanistan and Northern Uganda; to care for children in Haiti and Rwanda; and to build schools in India, Ecuador and rural China. Far from being a trivial environment, Club Penguin will have a massive impact on the next generation of teenagers, and on the future of the web.

Facebook, a social network in a mere two dimensions, had over 500 million active members by mid 2010, each spending an average of 20 minutes a day immersed in the environment.

CONTEXTUAL: Though its unfortunate label gives web 2.0 the impression that it is all about bleeding-edge technology, technology is not a prerequisite for social marketing, and never has been. The networking tools certainly help and have projected the notion of social networks onto marketing radar screens, but hasn’t marketing always been marketing 2.0? Even way back when the secrets of hunting mammoths or making fire were being bartered by one social cluster to the next, the informal, spontaneous networks of shared experience and wisdom enabled such transfer. Palaeolithic marketers just didn’t have the mobile web.

All societies need labels to make the world an easier place to live in. People buy into categorizations, stereotypes and generalizations to help take some of the complexity out of the true diversity of their surroundings. People do it to people (‘She’s an ENFJ’); people do it to companies (‘They are an innovative organization’) and people do it to systems and processes (‘We are using emarketing for that’). There is nothing wrong with labels of convenience, as long as they are accurate and as long as people acknowledge that there are many other perhaps more important dimensions to the object or process thus labelled. Attila the Hun was an ENTJ, but his Myers-Briggs classification is hardly the aspect of his character that one would choose to describe him. You also need to be sure that everyone else shares the same understanding of what those labels imply.

As the complexity of information gets more baffling, it is becoming increasingly necessary to label, or ‘tag’, objects or processes. The volume of ‘new digital data’ produced in the world in 2007 was three million times all the knowledge in all the books ever written. To deal with it people need to have a way of classifying it so we can store and retrieve what we need. Not too long ago, there was the Yahoo! directory system on the web, where a web page would get placed under one, and only one, subdirectory in a vast tree of classifications. Then search engines started reading the hidden headers on a page and letting you look for those. Later on, Google started reading the actual words on the page and recording the number and importance of other pages that linked to each page, so you could get a pretty solid listing of important sources for any word or phrase of interest.

The volume of ‘new digital data’ produced in the world in 2007 was 3 million times all the knowledge in all the books ever written.

But even the best search engines can’t make value judgments about how ‘good’ a piece is: how well written or authoritative it is, or how well it fits the context of your query. For that, you need to go back in time to the directory approach, where human eyes and human judgement can make those hard-toprogramme qualitative decisions. When even the best search engines today encounter, for example, the word ‘rose’ on a web page, they have difficulty knowing whether it is in the context of a poem, a metaphor, a woman’s name, a botanical treatise, a gardening guide, or the past tense of rise. Google is primitive compared with the intuitive data retrieval system that your own brain uses to tell you what you know when you need it. As web 3.0 (what is known as the semantic web) starts to creep into being, context will become a more important guide than content itself, just as it is in your own thinking processes.

A similar phenomenon that lets you access what others in your immediate and more distant networks know, think or have experienced is what makes ‘marketing 2.0’ (another expedient label) so compelling. This is where web 2.0 social phenomena such as wikis, Del.icio.us (an unstructured support network where people voluntarily share their experience and wisdom) and Digg are starting to make inroads – places where individuals en masse can add contextual tags and commentary to anything that they find on the web, can supplement the content where it is deficient, and where searchers can tap into that collective wisdom to find the really pertinent diamonds in the coal dust.

Corporate marketing is often still a formal, centrally controlled, structured megaphone into which carefully crafted branding messages are shouted repeatedly. It is all about limiting perceptions, focusing context, even manipulation. But the communication that is most frequently used by individuals for forming opinions and making decisions is informal, more peer-enabled and organic. The communication that shapes brands today has more in common with Del.icio.us, than with the pre-determined frameworks and limiting dogma of the 20th-century brand bible.

While online tools help to facilitate informal sharing, they are not essential to it. In trying to understand how best to apply the tools or encourage their use, people need to understand why and how informal peer-to-peer communication processes flourish in technology-free environments. You need to be careful that, in your passion to explore and understand corporate marketing, you do not get all tangled up in the technology at the expense of understanding the root human processes that make the technology usable and useful. If the processes you are nurturing would work in a Palaeolithic society, you can assume they would work extremely well in a tech-savvy one. After all, the internet is not a network of computers, it is a network of people. And collectively they have launched a new economy.

THE WEB WORLD BEYOND AMERICA

Consumers have adopted the internet faster than any other technology in history. The pace at which the cycle of innovation, acceptance and re-innovation takes place is breathtaking. While nobody can deny that the web has fundamentally changed the way business is done around the world, the nature of its impact is by no means universal.

It is not unusual, even today, to hear sceptics assert that the web will never really be a significant force in commerce or education anywhere outside of developed nations, because developing nations are not suited to it. The availability of basic telecommunications access, computer hardware, affordable bandwidth or even basic literacy are often cited as reasons why the web won’t matter much in Africa or parts of Asia.

It is true that vast chunks of the population of the world will never own a conventional computer or a landline with which to connect to the web, even if they could afford the access. But 8 out of 10 urban Africans have access to a mobile phone, which requires neither a landline nor even a power point on the electricity grid. In the marketplaces of the poorest parts of the planet you will find entrepreneurs selling phone charge-ups from car batteries or crank-handles.

Most of the customers of the majority of marketing-driven businesses in countries such as Nigeria or Indonesia are already online. Marketers need to focus not on the universe, but on their own target markets and the communications and supply chains that are necessary to reach them. For some industries the web may be irrelevant, at least for now. But for most industries that think of themselves as sophisticated marketing entities, the web is already vital. Whether a business is marketing cars, machinery, jewellery, raw materials, clothing, insurance, travel, restaurants or professional services, its customers are using the web to help them make informed buying decisions.

All of this is happening despite the fact that much of the world’s web environment is relatively underdeveloped, at least for now.

Guess which country matches the following description:

Only a small percentage of the population has web access.

Less than 10 percent of these people have broadband access.

Broadband access is very expensive and typically only 2Mbps.

Buyers and sellers fear ecommerce fraud and data security.

Most people believe that the ‘real world’ is a more satisfying place to do business.

Where ecommerce is available, it is dominated by major offline companies with established brands – and even they are losing money online.

Most businesses (including those currently engaged in ecommerce and their advertising agencies) do not know much about emarketing.

This was China in 2006. It was the UK in 2004. It was the United States in 2000. From the late 1990s I ran an elearning business out of Washington DC, the central hub of world internet technology. Until the turn of the century, my personal web access was through a dial-up modem, as was the access of thousands of my corporate elearning customers. In fact, American consumers only started moving en masse to broadband in 2001. Before that it was too slow, too expensive or simply unavailable. Ecommerce was hamstrung by fears of fraud and identity theft, and there was a widespread belief that, except for books, videos and air tickets, nobody would ever buy goods online. Despite this unpromising start, web commerce has become an indispensable part of the global economy, and it only took a couple of years.

For latecomers to the web, such as South Africa, the evolution from geeky novelty to indispensible utility is increasingly compressed into months rather than years. Both the UK and China are now way ahead of the US, in technology, bandwidth and application. Already, more people in China are accessing the internet than in the US and Canada combined. At least a dozen other countries such as South Korea, Japan, Australia, Finland and most European countries have leapfrogged the US, and their populations have access to very high-speed, very low-cost internet that is fully integrated into their everyday lives. The populations of these countries are already abandoning landline phones in favour of mobiles.

The US usually pays the price for being a pioneer, leaving a beaten path that allows those who follow to do so rapidly, inexpensively and without the legacy baggage that makes it so hard for pioneers to surge ahead. In two years or less, the digital economies of most developing nations will catch up with the rest of the world, and they will do so despite the obstacles unenlightened governments and self-serving national telecommunications monopolies will leave in the road. Consumers will drive the evolution, and companies, academic institutions and governments will either embrace the new culture or be dragged reluctantly into engaging with it.

Many people who think of the internet as an American phenomenon might be surprised to know that only 1 in 6 internet users are in the United States and Canada, while 27 percent come from Europe.

Asia already accounts for 4 out of 10 people on the web, despite only 15 percent of its population being online.

Growth of internet penetration has slowed in America, as 74 percent of the population is already online. There is still growth ahead for Europe, where only 48 percent of the population has web access. By contrast, figures are only beginning to pick up pace in Asia. The Chinese middle class is already bigger than the American middle class, and by 2010, Chinese will be the dominant language of the web.

@Asia has 480 million internet users

@Europe has 384 million

@North America has 248 million

@Latin America and the Caribbean have 139 million

@Africa has 51 million

As countries start to adopt the web, there is a pattern. At first, the overwhelming majority of users are technology-savvy geeks. They are rapidly joined by young urban professionals who have the money and time to afford early-stage web access. Soon after, women come to outnumber men, and more senior age groups become significant users. Then, once major mass-market retailers (such as Wal-Mart and Sears in the US) go online, lower-income users started to flood the web, attracted by its convenience and comparison-shopping advantages.

The web has revolutionized commerce because it has empowered customers through allowing them to network their knowledge.

Often holding down two or more jobs, and having neither the time nor the transportation to shop around, lower-income consumers find the web a very helpful tool. In a similar vein, small businesses are able to use the web not only to grow a larger customer base, but also to source better suppliers from across the globe.

Online markets are wide open to competition, and present huge opportunities for any innovative business with a professional approach to user experience and a commitment to real customer engagement. If you are running a large established business, the web can be a wake-up call. Unless the loyalty of your customer base is fuelled by something more significant than geographic proximity, you can rapidly lose those customers to a world of new alternatives.