Một vài giải pháp digital marketing cho công ty CP appota

VIETNAM NATIONAL UNIVERSITY, HANOI SCHOOL OF BUSINESSTRAN VINH QUANG SOME DIGITAL MARKETING SOLUTIONS FOR APPOTA JOINT STOCK COMPANY Major: Business Administration Code: 60 34 05 MASTER

VIETNAM NATIONAL UNIVERSITY, HANOI SCHOOL OF BUSINESS

TRAN VINH QUANG

SOME DIGITAL MARKETING SOLUTIONS FOR APPOTA

JOINT STOCK COMPANY

Major: Business Administration

Code: 60 34 05

MASTER OF BUSINESS ADMINISTRATION THESIS

Supervisors: Dr Tran Doan Kim

Hanoi - 2012

TABLES OF CONTENTS

AKNOWLEGEMENT i

ABSTRACT ii

TÓM TẮT iv

TABLES OF CONTENTS vii

LIST OF TABLES AND FIGURES x

ABBREVIATIONS xi

INTRODUCTION 1

1 CHAPTER 1 - LITERATURE REVIEW 4

1.1 Overview of marketing 4

1.1.1 Marketing in general 4

1.1.2 Marketing management 4

1.1.3 Shift in marketing management 6

1.2 Digital Marketing 7

1.2.1 Definition 7

1.2.2 The advantages and disadvantages of digital marketing 8

1.2.3 The factors that influence in Digital marketing 10

1.3 Majors marketing tools in digital marketing 12

1.3.1 Email marketing 12

1.3.2 Online advertising 15

1.3.3 Affiliate marketing 18

1.3.4 Viral marketing 20

1.3.5 Social media marketing 22

1.3.6 Search engine marketing 26

1.3.7 Mobile marketing 29

2 CHAPTER 2 - ANALYSIS OF DIGITAL MARKETING SITUATION OF APPOTA JSC 34

2.1 APPOTA‟s introduction 34

2.1.1 General information 34

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2.1.2 Products and services 37

2.1.3 Customers 38

2.2 Digital marketing macro-environment analysis 40

2.2.1 Legal – political environment 41

2.2.2 Economics environment 42

2.2.3 Social – cultural environment 42

2.2.4 Technological environment 43

2.3 APPOTA‟s Digital Marketing situation analysis 49

2.3.1 Company factors influencing marketing activities 49

2.3.2 Market factors and trends 50

2.3.3 Future competitors and Appota analysis 501

2.3.4 Current major marketing tools 514

2.4 Evalution of Appota‟s digital marketing 60

2.4.1 Pros 60

2.4.2 Cons 62

3. CHAPTER 3 – SOME DIGITAL MARKETING SOLUTIONS FOR APPOTA JSC 63 3.1 Recommended in major digital marketing tools 63

3.1.1 Online advertising 63

3.1.2 Social media marketing 63

3.1.3 Viral marketing 65

3.1.4 Mobile marketing 66

3.1.5 Market research 67

3.1.6 Management process 67

3.2 Action plan 68

3.2.1 Action plan for each step 68

3.2.2 Budget and other resources 69

3.2.3 Schedule 70

3.2.4 Control and Evaluation 70

3.3 Other suggestions for company 70

viii

3.3.1 Differentiation-Focus to market segment 70

3.3.2 Focus in product‟ development and innovation 71

3.3.3 More suggestions to improve 72

4 CONCLUSION 77

REFERENCE 79

APPENDIX 1 SAMPLES OF WEEKLY CONTENTS PROVIDED TO APPOTA USERS 80

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LIST OF TABLES AND FIGURES

FIGURE 1-1: CONTEX OF DIGITAL MARKETING 10

FIGURE 1-2: THE SONG‟S TREND IN GOOGLE TREND 21

FIGURE 1-3: THE MODEL OF SOCIAL MEDIA 23

FIGURE 1-4: THE MODEL OF WEB 2.0 24

FIGURE 1-5: RELATED WORD IN SEARCHING 27

FIGURE 2-1: APPOTA‟S MAJOR MILESTONE: 35

FIGURE 2-2: APPOTA‟S BUSINESS MODEL 36

FIGURE 2-3: VIETNAM SMARTPHONE OPERATING SYSTEM SHARE 38

FIGURE 2-4: APPOTA‟S USERS BY MOBILE PHONE OPERATING SYSTEM 39 FIGURE 2-5: APPOTA‟S TOP & BIGGEST APPLICATION DEVELOPERS AND CONTENT PROVIDERS 40

FIGURE 2-6: IT INDUSTRY - REVENUES AND GROWTH RATE 42

FIGURE 2-7: INTERNET USERS - NUMBERS AND GROWTH RATE 45

TABLE 1-1: PROS AND CONS OF ONLINE ADVERTISING 17

TABLE 1-2: COMPARING BETWEEN TRADITIONAL MEDIA AND SOCIAL MEDIA 22

TABLE 1-3: SEARCH ENGINE MARKETING – SEO & PPC‟ PROS AND CONS 28

TABLE 1-4: MOBILE PHONE FEATURES AND IMPLICATION FOR MARKETERS 30

TABLE 2-1: NUMBER OF TELECOM, INTERNET SERVICE PROVIDERS 47

x

2G 2nd Generation Mobile System (usually GSM)

3G 3rd Generation Mobile System (usually UMTS/WCDMA)

SME Small and Medium Enterprise

ADSL Asymmetric Digital Subscriber Line

MBA Master of Business Administration

LAN Local Area Network

R&D Research and Development

ROI Return on Investment

SWOT Strengths, Weaknesses, Opportunities and Threats

SMS Short Messaging Service

IOS Apple mobile operating system

Android Google mobile operating system

FI Founder Institute

Mobile website A website that programed to compatible with mobile device ARPU Average Revenue Per User

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1 The thesis title

Some Digital Marketing Solutions for APPOTA Joint Stock Company

2 Purpose

The purpose of this thesis is to suggest some marketing solutions with actionplans to be used in a year to continue growth of Appota with existing products

In order to do that, the thesis focuses on reviewing and summarizing the theory

of marketing and digital marketing with major tools; applying the reviewedliterature to analyze Appota situation now; and propose some solutions to enhancethe digital marketing in Appota

3 The thesis necessity

Appota is a SME (Small and Medium Enterprise) in the information andcommunication technology founded in Dec, 2011 Within a year of start-up, it hasachieved a significant growth in terms of both revenues and headcount.Thecompany currently has employed more than 60 headcount who obtain many years ofexperience in mobile content Appota has become a premier partner to many bigcompanies in the same industry and a leading-edge smartphone content provider inVietnam With the market share of more than 60% of smartphone users includingiOS and Android mobile users, Appota is one of the most disruptive start-up inVietnam ICT industry The company intends to increase its market share to be thedominance and keep the impressive growth to extend business to South East Asiawith the target of coverage over 20 million smartphone users

Being one of the co-founders of the company and take responsible for all sales

& marketing activities, I have been working with both Sales& Marketing team togain market share, attract customer, monetized products and services, buildcustomer database, keep strong relationship with partners We have tried a lot ofnew marketing strategies or plans to find the best approach for the company Based

on the research in marketing activities and with an insight of company situation, my

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finding in this thesis is to address the digital marketing with specific solutions as astrong tool for the company to keep the growth.

4 Scope of research

APPOTA follows a new model in Vietnam with no competitors currently,moreover it has only one year of operation Therefore, instead of implementingindustry analysis (including competitors) and SWOT analysis (that providesunderstanding about Strengths, Weaknesses, Opportunities and Threats) the thesisfocuses on suggesting some practical solutions for the company

This thesis offers an idea for the company on how they could apply themarketing solution, especially eMarketing to keep the growth of market share andgrowth of customer base in the target segment

5 Research questions

1 Which theories can be applied in Digital Marketing at Appota?

2 What current digital marketing practice at Appota?

3 How to improve Digital Marketing and other suggestion to Appota?

6 Methodology and Limitations of Study

The thesis based on a qualitative research and a case study method for analyticalpurpose to suggest or explain why or how something is happening

Appota‟s specific data collection was carried out by interviews In theinterviews, Appota‟s representatives like CEO (Chief Executive Officer), CMO(Chief Marketing Officer) and Product Director provided very valuable ideas andinformation on the subject.Besides, author‟s own observations and experienceswere also used in data collection and analysis Secondary data has been computed

by research of documents, annual/quarterly reports of Appota

7 Significance

By reviewing the theory of digital marketing, this research benefits Appota inproposing marketing tools to increase the market share and improve the revenueswhich contributes to the company‟s development

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8 Expectation

Digital marketing is being well applied in many companies around the world sothe same methodology can be applied in the scenario of other companies in thesame industry with some adjustments

9 Follow-up

Further study will be carried on upon the result of this thesis in applying somedigital marketing solutions for the company Other way of study will be analyzingthe impact of the competition on the company and steps toavoidor come overunexpected impacts

1 CHAPTER 1 - LITERATURE REVIEW

1.1 Overview of marketing

1.1.1 Marketing in general

Marketing can be found everywhere as people nowadays are bombarded withtelevision commercials, direct-mail offers and sales calls Simplified, marketing isonly a two-way process, even though four stages can be recognized which aredesigning, developing, delivering and determining value1 Baines stresses that atwo-way process includes customer and marketing organization The four stages arethere to ensure that the whole process will be successful Customer is the one whohas the power to make the final decision and has a strong input Additionally,marketers must specify how to satisfy customers‟ needs

In Vietnam, perspective to marketing is very different They emphasize theimportance of market segmentation and positioning instead of other features As can

be seen, marketing is a wide and versatile term, which includes many dimensions ofbusiness activities Whatever determination is used, the terms value, customer needsand information are often mentioned Therefore, when thinking of promotion,which is a vital part of the marketing process, it is good to bear in mind that manyfeatures influence the result

1Baines, Fill, Page, “Marketing: Case insight”,Oxford University Press, 1st edition, 2008, pg.17

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Based on that concept, there is a formal definition about Marketing provided byAmerican Marketing Association:

“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationship in ways that benefit the organization and its stake holders” 2

“Marketing management is defined as the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering and communicating superior customer value.” 3

Marketing management consists of important tasks4:

Developing marketing strategies and plans, meaning to identify potential

long-run opportunities given its market experience and core competencies

Capturing marketing insightsthis step is to understand what is happening

inside and outside the company

Connecting with customersthis task is to consider how to best create value for

the chosen target markets and develop strong, profitable, long-term relationshipswith customers

Building strong brand: It requires the company to understand the strengths and

weaknesses of the brand with customers, define its value to bring to the customers

in considering its position in the market and anticipating its competitors‟ move

Shaping the market offerings: Define the value package the company wants to

offer to its customers

Delivering value: It is to determine how to properly deliver the value embodied

by the products and service to the target market

2Philip Kotler and Kevin Keller, “Marketing Management”, Pearson Prentice Hall, 12th edition, 2006, pg.5 3Philip Kotler and Kevin Keller, “Marketing Management”, Pearson Prentice Hall, 12th edition, 2006, pg.5 4Philip Kotler and Kevin Keller, “Marketing Management”, Pearson Prentice Hall, 12th edition, 2006, pg.29-30

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Communicating value: This task is to adequately communicate the value

embodied by the products and service to the target market Marketingcommunications activities are the means by which the company endeavors toinform, persuade and remind customers – directly or indirectly about the brand itsells

Creatinglong-term growth: This step considers a long-term view of company‟s

products and services, and how profits should be grown.It get involvements ofinitiating new products or services, organizing marketing resources and maintaining

a process to implement and control the marketing plan to ensure the efficiency andeffectiveness of marketing activities and how both could be improved

1.1.3 Shift in marketing management

Philip Kotler & Kevin Keller stated 14 major shifts in marketing management inthe 21st century:

 From Marketing does marketing to Everyone does marketing

 From organizing by product units to organizing by customer segments

 From making everything to buying more goods and service from outside

 From using many suppliers to working with fewer suppliers in a

“partnership”

 From relying on old market positions to uncovering new ones

 From emphasizing on tangible assets to emphasizing on intangible assets

 From building brand through advertising to building brand through

performance and integrated communications

 From attracting customers through stores and salespeople to making

products available online

 From selling to everyone to trying to be the best firm serving well-defined target markets

 From focusing on profitable transactions to focusing on customer lifetime value

 From a focus on gain market share to a focus on building customer share,meaning instead of increasing market share, companies aim to capture a larger

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share of customer‟s stomach by providing variety of choices to existing

customers

 From being local to being “GLocal” – both global and local

 From focusing on financial scorecard to focusing on marketing scorecard

 From focusing on shareholders to focusing on stakeholders

Those theoretical above shift from doing marketing with traditional channel ormethod to modern method with higher reach, effectiveness and cost-saving todigital marketing because of it scaling, extendable, un-limited reaching

1.2 Digital Marketing

1.2.1 Definition

Thanks to the booming of internet, digital marketing has appeared and gained anaccelerate growth

Digital marketing definition can be found in various approaches For example,

Business Dictionary defines “Digital marketing is the promotion of products or brands via one or more forms of electronic media For example, advertising mediums that might be used as part of digital marketing strategy of a business could include promotional efforts made via the Internet, Social Media, Mobile Phone and Electronic billboards, as well as via digital and television and radio channels ”5

Another definition is “Digital Marketing is the practice of promoting products and services using database-driven online distribution channels to reach consumers

in a timely, relevant, personal and cost-effective manner” 6

There are two different forms of digital marketing:

In pull digital marketing, consumers actively seek the marketing contents,

often via web searches or opening an email, text message or web feed Websites,blogs and streaming media (audio and video) are examples of pull digital marketing

5 http://www.businessdictionary.com/definition/digital-marketing.html#ixzz2DQyhFw3o

6 Asia Digital Marketing Association: http://www.asiadma.com/adma/aboutus/

In each of these, users have to navigate to the website to view the content Searchengine optimization is one tactic used to increase activity.

In push digital marketingmarketers send a message without the consent of the

recipients, such as displaying advertisings on websites and news blogs Email, textmessaging and web feed can also be classified as push digital marketing when therecipients do not give permission to receive marketing messages Push marketing isalso known as spam Push technologies can deliver content as it becomes availableand can be better targeted to consumer demographics, although audiences are oftensmaller, and creation and distribution costs are higher

1.2.2 The advantages and disadvantages of digital marketing

There are several advantages of digital marketing that make it attractive tomarketers and become a strong marketing tool7

Reach: advertisers can choose the internet marketing tool or mobile marketing

which have suitable viewers with overall marketing campaign Technique can helpadvertisers recognize and describe the portrait of readers that they want to focus on

Low cost: The emergence of Internet has brought many benefits such as

low-cost transmission of information and communication to the large number ofrecipients, the message is transmitted in many different forms such as text, images,sounds, movies, games This considerably reduces the costs because of WorldWide Web capabilities

Immediacy: With the interactive functions of online marketing, recipients can

respond to messages immediately, or interact directly with the object in a message.This is the greatest advantage of online marketing compared with other forms

Dynamic and Creation: Internet marketing combines creative and technical

internet aspects, including design, development, advertising and sales The onlinemarketing activities include search engine marketing (SEM), web display

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http://www.boldendeavours.com/191/Digital_Marketing.html

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advertising, e-mail marketing, affiliate marketing, interactive advertising, blogmarketing and viral marketing Online marketing is the process of developing andpromoting the business using online media Online Marketing is not simply building

a website Online marketing is a part of marketing strategy and must be a reasonableinvestment

Accessibility: Consumers can access products‟ information and conduct

transactions anywhere.Online marketing helps businesses access to a large marketwell when it do not encounter time or geographic constraints like other media such

as print or broadcasting media

Controlling: Online Marketing activities are easily monitored and evaluated.

For example, the services “Web Analytics” tracking number can access to theinternet contents and evaluate the message which is properly transmitted to thecustomer's desire As expected, online marketing is growing more powerful thanother types

However digital marketing also has disadvantages that marketers have to becareful when doing online marketing campaign:

Perception of the consumer, economic and social condition: Because the World

Wide Web is faceless, it can appear cold and user-unfriendly This can leavecustomers or advertisers feeling isolated and very inward Everyone likes tosocialize and meet people, but in this case, it is quite difficult to do in businessanyway

To be hard to control if people are lying: There is so much information on the

World Wide Web that it is sometimes hard to tell the difference between nonsenseand quality

Information Overload: there isan intensive amount of information on the

World Wide Web including good and bad, truthful and lying one So it is difficultfor readers to classify the kind of information If advertisers cannot control orhandle them, they can affect the perception of consumers

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1.2.3 The factors that influence in Digital marketing

Technological advances give SMEs new ways to digitally connect with theirexisting and potential customers Digital marketing covers a wide range ofopportunitiesthat can be explored including email campaigns, banner advertising,video marketing, blogging, mobile marketing, social media marketing, televisionand radio There are several factors that affect to digital marketing strategy, plan andexecution of a company

FIGURE 1-1: CONTEX OF DIGITAL MARKETING 8

Target Market: Before a marketer decides to use digital marketing to attract

customers and increase sales, determines if and how the customers use digitalmarketing to get information about products, services or topics related to company‟sbusiness A company‟s digital marketing efforts must include languages and images

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http://www.boldendeavours.com/191/Digital_Marketing.html

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that reflect to the target market and resonate with them.

Budget: Businesses with limited budgets might skip digital marketing efforts

with a fear that it is out of their budget In fact, low-cost digital marketing optionsinclude creating a social media presence, blogging or creating marketing videos insimple ways with computer and web camera Options such as setting up microsites,pay-per-click advertising campaigns and short message services often require alarger marketing budget

Talent: The knowledge and experience of marketing team have regarding digital

marketing influence whether or not it is incorporated it into the overall marketingstrategy Before delving into digital marketing, it is important to know company‟soptions, how to implement digital marketing ideas and measure the success.Normally, if company does not have a team with previous experience, using amarketing consultant who specializes in digital media services is an alternative

Technology: Servers being down or browser and software issues causes banner

advertisements and websites not to be loaded, such common technology issues canplay a major role in the success of a digital marketing strategy If a businessencounters issues frequently with its digital marketing campaigns, it may be lesslikely to use digital strategies to promote the brands Beyond technical difficulties,companies often have to invest in equipment and services to implement their digitalmarketing campaigns For example, a company that wants to do video marketingneeds a digital camera, lights and audio recording equipment and expertise to use it,

or must pay a studio to handle the video editing and recording

Time: Planning, implementing and monitoring digital marketing strategies

require a time commitment, which might be a problem for small business ownerswho are not well-versed in marketing Digital marketing plan requires constantmonitoring, to measure what is working and what needs to be altered

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1.3 Majors marketing tools in digital marketing

There is no doubt about it – the Internet has changed the world we live in Neverbefore has it been so easy to access information, communicate with people all overthe world and share articles, videos, photos and all manners of media

The Internet has led to an increasingly connected environment, and the growth

of Internet usage has resulted in declining distribution of traditional media:television, radio, newspapers and magazines Marketing in this connectedenvironment and using that connectivity to market is digital marketing oreMarketing

According to Rob Stokes9:

“eMarketing embraces a wide range of strategies, but what underpins successful eMarketing is a user-centric and cohesive approach to these strategies Marketing is about conversations, and the Internet has become a hub of conversations The connected nature of the Internet allows us to follow and track these conversations, and provides entry points for all parties What follows in this book are ways of conversing with potential and existing customers using the Internet.”

Based on Rob Stokes‟s categorizations, there are 16 tools for eMarketing.However, in consideration of tools which are practical in Vietnam, following aremajor tools being applied

1.3.1 Email marketing

“E-mail marketing represents an opportunity to experience both the thrill ofincreased customer loyalty and steady repeat business as well as the agony ofbounced e-mail, unsubscribe requests, and spam complaints”10

9 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd., 2008,

2 ndedition, pg.4-5

10 E-Mail Marketing For Dummies, 2nd Edition by John Arnold, pg.18

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Email marketing is a form of direct marketing which uses electronic mail as ameans of communicating commercial or fund-raising messages to an audience in itsbroadest sense, every email sent to a potential or current customer could beconsidered email marketing Most of big brands often use this method to keeprelationship with their customers in all over the world.

Simply put, email marketing is a form of direct marketing which utilitieselectronic means to deliver commercial messages to an audience It is one oftheoldestand yet still one of the most powerful of all online marketing‟s tactics Thepower comes from the fact that it is:

• Extremely cost effective due to a low cost per contact

FIGURE 1-2: SAMPLE OF EMAIL MARKETING 11

11 Author‟s received in personal mail box

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Applying email marketing will help marketers make long relationship with customers It can create many competitive advantages as:

Enhancing the relationship of a merchant with its current or previous customers, to encourage customer loyalty and repeat business,

Acquiring new customers or convincing current customers to purchase something immediately,

Adding advertisements to email messages sent by other companies to their customers

Sending email messages over the Internet, as email did and does exist outside

the Internet

To get high effectiveness in email marketing, the marketer often collectscustomers‟ email address carefully (based the target of marketing campaign,characteristic and email‟s form)

Spam mail is a concept which involves email marketing.Spam email also

known as junk email or unsolicited bulk email (UBE), is a subset of spam thatinvolves nearly identical messages sent to numerous recipients by email Spamemail means that email is unsolicited and sent in bulk To protect consumers, manycountries apply anti-spam law And some email providers also give anannouncement about banning spam emails

When implementing the email marketing, marketers should study the anti-spamemail law carefully to ensure that they do not violate it The anti-spam law isapplied to protect consumers from the harassment of the marketing activities SomeISPs also ban the email marketing if it was sent to a great quantity of emails or itscontent is so heavy Some email marketing encounters negative feedbacks fromcustomers because of big spam contents and high frequency of spam

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FIGURE 1-3: SAMPLE OF EMAIL MARKETING IN SPAM 12

1.3.2 Online advertising

Simply put, online advertising is advertising on the Internet Online displayadvertising began as simple hyperlinked images shown on a web site and has sinceprogressed to include video, sound and many other modern technologies Today,messages and interactions can be contained within the advertising display, withoutever taking consumers to a landing page There are various types to displayadvertising like: interstitial banners, pop-ups, map-advert, floating advert, wallpaperadvert, banner advert…

Although the Internet provides new scope for creative approaches to advertising,

we see its true advantage when we realize how track-able and therefore measurableInternet advertising is Or, to take it from Eric Schmidt, CEO of Google cited byLieb (2002): “The Internet will transform advertising because of its track-ability, notits beauty.”

12 Author‟s email box

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Advertising, whether online or off-line, has a number of objectives13:

Building brand awareness: Online, creative advertising or banner

advertising is largely visual, making it an ideal channel for promoting brand collateral

Creating consumer demand: Modern online advertising provides a greatway to communicate the USPs (unique selling points) of a product, therebyhelping stimulate demand

Informing consumers of the advertiser‟s ability to satisfy that demand

Driving response and sales: All forms of online marketing need to drivetraffic and sales in the long term However, the immediacy of onlineadvertising also drives traffic and sales in the short and medium terms.Unlike traditional media advertising, online advertising can turn potentialcustomers into actual customer‟s right there and then What is more, it ispossible to measure accurately how effectively the online advertisingcampaign does this

The key differentiator: Online advertising is able to drive instant sales andconversions Unlike offline advertising mediums, the consumers can go fromadvert to merchant in one easy click Because of the connected nature of theInternet, online activities are highly track-able and measurable, which makes

it possible to target adverts and to accurately track and gauge theeffectiveness of the advertising Each display advert can be tracked forsuccess

13 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd.,

2008, 2nd edition, pg.26

TABLE 1-1: PROS AND CONS OF ONLINE ADVERTISING 14

PROS Images - display can offer a rich brand building experience Some

campaigns are better suited to havingimages rather than the plain text such

as promoting travel package,launching an exciting new sportcars…

Interactivity It allows your target

market to not only see your banner,but to play with it too Interactionbuilds a bond and improves thechances of the consumer

remembering your brand tomorrow

Example: Viral marketing - cleverviral marketing games or “send to afriend” functionality from within the

ad Video - viewers can check outvideo previews or trailers fromwithin the ad

Measurability and data gathering

Banner ads, like all eMarketingtactics, are measurable Track click-through rates and you get an idea ofexactly how many people are

responding to your call to action

14 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd., 2008,

2nd edition, pg.38-39

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Some publishers even have the

ability to do post-click tracking‟ i.e

you can track the user all the way to

a sale if that is the purpose of the

advert

1.3.3 Affiliate marketing

If you recommend a restaurant to a friend, and that friend visits the restaurantbecause of your recommendation, the restaurant‟s revenues will have increasedbecause of your referral This is “word of mouth” marketing But you, as thereferrer, do not see any of the cash benefit that the restaurant does!

Imagine that the restaurant gave you 10% of the bill for every person that youreferred to the restaurant They would be paying you a finder‟s fee for newcustomers There are a number of businesses that market this way offline Brokersfor insurance products are examples, but these referrals can be hard to track Online,they are very easy to track This system of reward where compensation is based on

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referral is called affiliate marketing, and is used to describe this type of marketing

in an online environment.15

Affiliate marketing is used widely to promote websites, and affiliates arerewarded for every visitor, subscriber or customer provided through their efforts.Because of this, affiliates are sometimes viewed as an extended sales force for awebsite Affiliates are paid for performance, so affiliate marketing is also referred to

as performance marketing in digital marketing general Traffic or visitors exchange

is the motivation for one website, wapsite or company work with others to gain bothmutual benefits In some cases when use digital marketing, marketers normallyapply this type of marketing to save cost and keep a very strong relationship withchannels instead of paying for advertisement

The core of affiliate marketing is a simple process:

1 An affiliate refers potential customers to a merchant‟s web

site/wapsite

2 Some of those customers perform a desired action

3 The merchant rewards the affiliate for each desired action resulting from the affiliate‟s referral

FIGURE 1-4: THE AFFILIATE MARKETING PROCESS 16

15 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd., 2008,

2nd edition, pg.46

However, there are many different ways an affiliate might market a merchant‟soffering, different types of actions that can be rewarded, and most importantly, it isnecessary to keep track of the whole process.

of people who have been “infected” grows exponentially 18

Viral marketing campaigns work when a message is spread exponentially and itresults in a desired outcome for a brand Viral marketing utilizes electronic means tospread messages It harnesses the electronic connectivity of individuals to ensuremarketing messages are referred from one person to another Viral marketingcampaigns can be tricky and unpredictable However, the lure of exponential growth

at a very low marginal cost creates this method attraction to marketers

Example: Popular K-pop song “Oppa Gangnam Style” on Google Trend19

This song sang by PSY was released on July 15, 2012 As of November 18,

2012, the music video has been viewed over 750 million times (with 5.2 million

“likes”) on You Tube and it is the site‟s most watched K-pop and the second mostwatched video ever We can imagine that is more than 1/10 of the world population.And on September 21, 2012, The Guinness World Records announced that the videohas officially broken the record for “Most Likes on YouTube!”20

16 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd., 2008,

FIGURE 1-2: THE SONG’S TREND IN GOOGLE TREND 21

Steps to go viral:

Define the aims of the campaign, and how you will measure success

Plan a message or content that users want to share

Make your content easy to share

Make it as simple as possible for users to get involved

Be authentic and transparent

Provide an incentive for sharing and interacting

Make the message available

Use a strong call to action

Track and analyze, and optimize

Get lucky

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http://www.google.com/trends/explore#q=oppa%20gangnam%20style

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1.3.5 Social media marketing

Blogs, wikis, social bookmarks, tag clouds, social networks, tweet, pages… – new words for new things, and new ways to use words The many facets

micro-of social media are also called Web 2.0, consumer generated media, citizen mediaand new media In fact, comparing social media to traditional media is probably themost useful way of defining what exactly this means Most simply put, social mediaare media (from written to visual to audio to audio visual) that are designed to beshared Sharing means that it is easy to comment on, easy to send, and that there are

no high costs associated with viewing the media And, because of the connectednature of the Internet, it means that sharing; commenting and viewing can all betracked and measured

TABLE 1-2: COMPARING BETWEEN TRADITIONAL MEDIA AND

SOCIAL MEDIA 22 Traditional Media

Fixed, unchangeable

Commentary limited and not real-time

Limited, time-delayed bestseller list

Archives poorly accessible

Limited media fix

Committee publishers

Finite

Sharing not encouraged

Control

The Internet and software developed to run on it have made it simple for anyone

to publish and distribute It has also made it simple for anyone to access the contentpublished The realm of social media is about collaboration, users generatingcontents, sharing and, most of all, it is about connecting

22 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd., 2008,

2nd edition, pg.168

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Social media marketing is the newest internet marketing tool though social media orweb 2.0 There are some different definitions and arguments related to this term:

Social media marketing is a recent addition to organizations‟ integratedmarketing communications plans Integrated marketing communications is apractice organizations follow to connect with their target markets Integratedmarketing communications coordinates promotional elements: advertising,personal selling, public relations, publicity, direct marketing and salespromotion

Social Media Marketing is the active practice of developing content andsharing it with online communities in order to represent your brand andbusiness

Social media marketing is the process of marketing through social mediasites like Twitter, Facebook and YouTube By utilizing the social aspect ofthe web, social media marketing is able to connect and interact on a muchmore personalized and dynamic level than through traditional marketing

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FIGURE 1-3: THE MODEL OF SOCIAL MEDIA 23

Social media marketing refers to the process of gaining traffic or attentionthrough social media sites This is essential differences between Social media orwebsite 2.0

FIGURE 1-4: THE MODEL OF WEB 2.0 24

23 Google images search

24 Google images search

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There are many differences in concept but the main goals of social mediamarketing are making connection and information transformation though socialmedia or social network Social Media and Social Network are 2 terms whichrelated with Social Media Marketing closely.

Social media is media for social interaction, using highly accessible and scalablecommunication techniques Social media is the use of web-based and mobiletechnologies to turn communication into interactive dialogue Youtube.com website

is the typical example

A social network is a social structure made up of individuals (or organizations)called "nodes", which are tied (connected) by one or more specific types ofinterdependency, such as friendship, kinship, common interest, financial exchange,dislike, sexual relationships, or relationships of beliefs, knowledge or prestige Blog

is typical representative for a social network

There are some key differences and knowing between social media and socialnetwork:

Definition: Social networking is an act of engagement and social media is a

method to transmit, or share information with a broad audience Everyone has theopportunity to create and distribute Groups of people with common interests, orlike-minds, associate together on social networking sites and build relationshipsthrough community

Communication style: Social media is more akin to a communication channel.

It's a format that delivers a message Social media is simply a system thatdisseminates information „to' others The communication is two-way thought socialnetworking Depending on the topic, subject matter or atmosphere, peoplecongregate to join others with similar experiences and backgrounds Conversationsare at the core of social networking and through them relationships are developed

Return on investment (ROI): It can be difficult to obtain precise numbers for

determining the ROI from social media For instance, influence, or the depth of

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conversation and what the conversations are about, can be used to gauge ROI.Social networking's ROI is a bit more obvious If the overall traffic to your website

is on the rise and you're diligently increasing your social networking base, youprobably could attribute the rise in online visitors to your social efforts

Timely responding: Social media is hard work and it takes time You cannot

automate individual conversations and unless you are a well-known and establishedbrand, building a following does not happen overnight Social media is definitely amarathon and not a sprint Because social networking is direct communicationbetween you and the other people that you choose connect with, your conversationsare richer, more purposeful and more personal Your network exponentially grows

as you meet and get introduced to others

Target of conversation - asking or telling: A big no-no on with social media is

skewing or manipulating comments, likes, stumbles or other data, for your ownbenefit (personal or business) Asking friends, family, co-workers or anyone else tocast a vote just to cast it, does not do anyone much good for anyone and it canquickly become a PR nightmare if word leaks out about dishonest practices Everycan tell their peers about new business or blog and discuss how to make it a successthough social networking The conversations that you create can convert manypeople into loyal fans, so it's worth investing the time

“Social media and social networking do have some overlap, but they really aren't the same thing They're two separate marketing concepts can make a difference in how you position your business going forward”

1.3.6 Search engine marketing

Every day, all around the world, millions of people use search engines to findcontent on the Internet Search engines are web-based programs that index the weband allow people to find what they are looking for

“Search” or “search marketing” is often used to refer to the industry that hasbuilt up around search enginesGoogle, Yahoo! and Microsoft‟s Live are all well-

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known international search engines Google is by far the leading player in themarket A comScore study of worldwide search engine activity, release in October

2007, showed that Google has just over 60% of the global search engine marketshare In Europe, almost 80% of searches are on Google

Search engine marketing (SEM) has two arms: search engine optimization(SEO) and pay per click (PPC) advertising These correspond to the two types ofsearch results SEO aims at improving a web site‟s ranking in the natural searchresults PPC advertising involves bidding for placement in the paid search resultssection of the SERP Both SEO and PPC advertising are based around the samefundamental concept: keywords

For example: From the above-mentioned famous song “Oppa Gangnam Style”,when people want to know more about it, they start searching not only exact wordbut also relevant words or phrases The figure above is from Google Trend for theword “Oppa Gangnam Style” and we can see, for example “Download Gangnamstyle” has 65% searching compared with the exact word “Oppa Gangnam Style”(100%)

FIGURE 1-5: RELATED WORD IN SEARCHING 25

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http://www.google.com/trends/explore#q=oppa%20gangnam%20style

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Search Engine Optimization (SEO): SEO is the practice of optimizing a web

site so as to achieve preferred ranking on the search engine results pages (SERPs)

Pay per click (PPC): PPC is an advertising system where the advertiser only

pays for each click on their advert For the advertiser, the beauty of PPC advertising

on search engines is that their adverts are displayed when potential customers arealready expressing intent – they are searching for a product or service It allowsadvertisers to present their offering to a potential customer who is already in thebuying cycle

TABLE 1-3: SEARCH ENGINE MARKETING – SEO & PPC’ PROS AND CONS 26

SEM – SEARCH ENGINE MARKETING SEO – Search Engine Optimization

Lots of on-going work

Result can take a while to be seen

26 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd.,

2008, 2nd edition, pg.71

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1.3.7 Mobile marketing

The mobile phone is a small gadget

that has had a huge impact on our day to

day lives It has already had a profound

impact on the way we communicate and

conduct ourselves daily This continues

to be felt as the mobile phone enables

new ways to market and new markets in

which to transact

The picture on the right can illustrate

how mobile phone influence our lives27

Consider that there are 1.3 billion people worldwide with access to the Internet

Of those, 1.2 billion are active users of email With the world‟s population at 6.6billion, that‟s almost 1/5 of the population who can be reached on email That needs

to be compared to 3.2 billion mobile phone subscribers – almost half of the world‟spopulation And of that 3.2 billion, 2.5 billion were active users of SMS textmessaging in 2007 (Ahonen, 2008)

27 Source: pocket/

http://www.thatericalper.com/2012/11/12/photo-20-years-later-all-these-things-now-fit-in-your-29

TABLE 1-4: MOBILE PHONE FEATURES AND IMPLICATION FOR

MOBILE PHONE FEATURE

The mobile phone is personal

A 2006 survey (“Wireless Works” by BBO

and Proximity) found that 63% of

respondents would not share their phone

with anyone (and 90% of those surveyed in

Japan would not share their phone) While

laptops do present a personal connection to

the Internet, they are not as personal a

device as the mobile phone

The mobile phone is always carried

According to 2007 research by Morgan

Stanley, 91% of mobile phone owners keep

their phone within one meter, 24 hours a

day People have their phones with them at

all times of the day, even in the bathroom

The mobile phone is always on

In order to fulfill its primary function – as a

telephone – the mobile phone is always on

Messages and services can be sent and acted

on at all times of the day

The mobile phone has a built-in payment

28 Rob Stoke, “eMarketing – the essential guide to online marketing”, Quirk eMarketing (Pty) Ltd.,

2008, 2nd edition, pg.258-259

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Every mobile phone has a built in paymentmechanism – the SIM card Billing is easilyhandled through the user‟s mobile network.Not only do mobile phones have this built-

in payment mechanism, paying for contentand downloads has been built into the waythat consumers use their phones There isless of an expectation that goods and

services will be free

There are also a number of services that turnthe mobile into a virtual wallet or bankcard,bringing banking and payment services topeople all around the world

The mobile phone is available at the point

of creative inspiration

As the mobile phone is always carried andalways on, it is always available as a

creative tool Phones today feature a number

of tools that let users act on creative

impulse, from taking photos and videos, tobecoming a scribbling pad on which to jotdown ideas

The mobile phone presents accurate

audience measurement

While the Internet is vastly superior to othermedia in its ability to track and measureadvertising and marketing campaigns, it iseclipsed by the mobile phone Every

transaction made on a mobile phone can beuniquely tracked to that mobile phone

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number, whether the transaction be a voice

call, an SMS message or accessing the

Internet

The mobile phone captures the social

context of media consumption

This represents emerging thinking on the

benefits of the mobile Because of the

nature of the mobile phone to be able to

accurately track transactions to any

particular phone number, it can track

transactions between mobile numbers This

means that sophisticated data mining can

identify patterns that indicate information

about and preferences of mobile phone

users Not only can alpha users be

identified, but they may be identified within

their social context

Just as the Web is used in a myriad ways as a marketing, advertising anddistribution channel, so is the mobile phone There are a number of technologiesavailable to reach a mobile audience, such as, SMS, CRM, MMS, and tailoringwebsite for mobile phone…

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