e-marketing

Internet marketing is considered to be broad in scope^[1] because it not only refers to marketing on the Internet, but also includes marketingdone via e-mail and wireless media.^[2] Digital customer data and electronic customer relationship management (ECRM) systems are also often grouped together under internet marketing.^[3]

Internet marketing ties together the creative and technical aspects of the Internet, including design, development, advertising, and sales.^[4]Internet marketing also refers to the placement of media along many different stages of the customer engagement cycle through search engine marketing (SEM), search engine optimization (SEO), banner ads on specific websites, email marketing, mobile advertising, and Web 2.0strategies.^{[citation needed]}

In 2008, The New York Times, working with comScore, published an initial estimate to quantify the user data collected by large Internet-based companies. Counting four types of interactions with company websites in addition to the hits from advertisements served from advertising networks, the authors found that the potential for collecting data was up to 2,500 times per user per month.^[5]

Types of Internet Marketing

iMarketing is broadly divided in to the following three^[1] types,

• PPC/I (Pay per click/impression): Advertisements for brands and products is done on pre-decided websites and helps in generating leads for companies.^[1]

• SEO Search engine optimization is the process of improving the visibility of a website or a web page in search engines via the “natural” or un-paid (“organic” or “algorithmic”) search results.

• Social media marketing (SMM)

Business models

Internet marketing is associated with several business models:

• E-commerce: a model whereby goods are sold directly to consumers (B2C), businesses (B2B), or from consumer to consumer (C2C).^{[citation needed]}
• Lead-based websites: a strategy whereby an organization generates value by acquiring sales leads from its website.^{[citation needed]} Similar to walk-in customers in retail world. These prospects are often referred to as organic leads.
• Affiliate Marketing: a process wherein a product or service developed by one entity is sold by other active sellers for a share of profits.^{[citation needed]} The entity that owns the product may provide some marketing material (e.g., sales letters, affiliate links, tracking facilities, etc.); however, the vast majority of affiliate marketing relationships come from e-commerce businesses that offer affiliate programs.^{[citation needed]}
• Local Internet marketing: a strategy through which a small company utilizes the Internet to find and to nurture relationships that can be used for real-world advantages.^{[citation needed]}Local Internet marketing uses tools such as social media marketing, local directory listing,^[6] and targeted online sales promotions.

One-to-one approaches

In a one-to-one approach, marketers target a user browsing the Internet alone and so that the marketers’ messages reach the user personally.^[7] This approach is used in search marketing, for which the advertisements are based on search engine keywords entered by the users. This approach usually works under the pay per click (PPC) method.^{[citation needed]}

Appeal to specific interests

When appealing to specific interests, marketers place an emphasis on appealing to a specific behavior or interest, rather than reaching out to a broadly defined demographic.^{[citation needed]}These marketers typically segment their markets according to age group, gender, geography, and other general factors.^{[citation needed]}

Niche marketing

Niche and hyper-niche internet marketing put further emphasis on creating destinations for web users and consumers on specific topics and products.^{[citation needed]} Niche marketers differ from traditional Internet marketers as they have a more specialized topic knowledge.^{[citation needed]} For example, whereas in traditional Internet marketing a website would be created and promoted on a high-level topic such as kitchen appliances, niche marketing would focus on more specific topics such as 4-slice toasters.^{[citation needed]}

Niche marketing provides end users of such sites very targeted information, and allows the creators to establish themselves as authorities on the topic or product.^{[citation needed]}

Geo-targeting

In Internet marketing, geo targeting and geo marketing are the methods of determining the geolocation of a website visitor with geolocation software, and delivering different content to that visitor based on his or her location, such as latitude and longitude, country, region or state, city, metro code or zip code, organization, Internet Protocol (IP) address, ISP, and other criteria.^{[citation needed]}

Internet marketing principles

6 key principles of persuasion by Robert Cialdini

One of the most famous guides to internet marketing is the book by Robert Cialdini^[8] ”Influence: The Psychology of Persuasion.”^[9] According to Cialdini there are 6 key principles of persuasion: 1. Reciprocity, 2. Commitment and Consistency, 3. Social Proof/Consensus, 4. Authority, 5. Liking, 6. Scarcity.

Advantages and limitations of Internet marketing

Advantages

Internet marketing is inexpensive when examining the ratio of cost to the reach of the target audience.^{[citation needed]} Companies can reach a wide audience for a small fraction of traditional advertising budgets.^{[citation needed]} The nature of the medium allows consumers to research and to purchase products and services conveniently.^{[citation needed]} Therefore, businesses have the advantage of appealing to consumers in a medium that can bring results quickly.^{[citation needed]} The strategy and overall effectiveness of marketing campaigns depend on business goals and cost-volume-profit (CVP) analysis.

Internet marketers also have the advantage of measuring statistics easily and inexpensively; almost all aspects of an Internet marketing campaign can be traced, measured, and tested, in many cases through the use of an ad server.^{[citation needed]} The advertisers can use a variety of methods, such as pay per impression, pay per click, pay per play, and pay per action. Therefore, marketers can determine which messages or offerings are more appealing to the audience.^{[citation needed]} The results of campaigns can be measured and tracked immediately because online marketing initiatives usually require users to click on an advertisement, to visit a website, and to perform a targeted action.^{[citation needed]}

Limitations

However, from the buyer’s perspective, the inability of shoppers to touch, to smell, to taste, and “to try on” tangible goods before making an online purchase can be limiting.^{[citation needed]}However, there is an industry standard for e-commerce vendors to reassure customers by having liberal return policies as well as providing in-store pick-up services.^{[citation needed]}

Security concerns

Information security is important both to companies and consumers that participate in online business. Many consumers are hesitant to purchase items over the Internet because they do not believe that their personal information will remain private. Some companies that purchase customer information offer the option for individuals to have their information removed from their promotional redistribution, also known as opting out. However, many customers are unaware if and when their information is being shared, and are unable to stop the transfer of their information between companies if such activity occurs. Additionally, companies holding private information are vulnerable to data attacks and leaks. Internet browsing privacy is a related consumer concern. Web sites routinely capture browsing and search history which can be used to provide targeted advertising. Privacy policies can provide transparency to these practices. Spyware prevention software can also be used to shield the consumer.

Another consumer e-commerce concern is whether or not they will receive exactly what they purchase. Online merchants have attempted to address this concern by investing in and building strong consumer brands (e.g., Amazon.com, eBay, and Overstock.com), and by leveraging merchant and feedback rating systems and e-commerce bondingsolutions.^{[citation needed]} All these solutions attempt to assure consumers that their transactions will be free of problems because the merchants can be trusted to provide reliable products and services.^{[citation needed]} Additionally, several major online payment mechanisms (credit cards, PayPal, Google Checkout, etc.) have provided back-end buyer protection systems to address problems if they occur.^{[citation needed]}

Usage trends

Technological advancements in the telecommunications industry have dramatically affected online advertising techniques.^{[citation needed]} Many firms are embracing a paradigm that is shifting the focus of advertising methodology from traditional text and image advertisements to those containing more recent technologies like JavaScript and Adobe Flash.^{[citation needed]}As a result, advertisers can more effectively engage and connect their audience with their campaigns that seek to shape consumer attitudes and feelings towards specific products and services.^{[citation needed]}

Effects on industries

The number of banks offering the ability to perform banking tasks over the internet has increased.^{[citation needed]} Online banking appeals to customers because it is often faster and considered more convenient than visiting bank branches.^[10]

Internet auctions

Internet auctions have become a multi-billion dollar business. Unique items that could only previously be found at flea markets are now being sold on Internet auction websites such aseBay. Specialized e-stores sell a vast amount of items like antiques, movie props, clothing, gadgets, and so on.^[11][12]

As the premier online reselling platform, eBay is often used as a price-basis for specialized items. Buyers and sellers often look at prices on the website before going to flea markets; the price shown on eBay often becomes the item’s selling price.^{[citation needed]}

Advertising industry

In addition to the major effect internet marketing has had on the technology industry, the effect on the advertising industry itself has been profound. In just a few years, online advertisinghas grown to be worth tens of billions of dollars annually.^[13][14][15] PricewaterhouseCoopers reported that US$16.9 billion was spent on Online marketing in the U.S. in 2006.^[16]

This has caused a growing impact on the United States’ electoral process. In 2008, candidates for President heavily utilized Internet marketing strategies to reach constituents. During the 2007 primaries candidates added, on average, over 500 social network supporters per day to help spread their message.^[17] President Barack Obama raised over US$1 million in one day during his extensive Democratic candidacy campaign, largely due to online donors.^[18]

Several industries have heavily invested in and benefited from internet marketing and online advertising. Some of them were originally brick and mortar businesses such as publishing, music, automotive or gambling, while others have sprung up as purely online businesses, such as digital design and media, blogging, and internet service hosting.

A large percentage of electronic commerce is conducted entirely in electronic form for virtual items such as access to premium content on a website, but mostly electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers are now electronically present on the World Wide Web.

Electronic commerce that takes place between businesses is referred to as business-to-business or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market). Electronic commerce that takes place between businesses and consumers, on the other hand, is referred to as business-to-consumer or B2C. This is the type of electronic commerce conducted by companies such as Amazon.com. Online shopping is a form of electronic commerce where the buyer is directly online to the seller’s computer usually via the internet. There is no intermediary service involved. The sale or purchase transaction is completed electronically and interactively in real-time such as in Amazon.com for new books. However in some cases, an intermediary may be present in a sale or purchase transaction such as the transactions on eBay.com.

Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of business transactions.

As an Internet marketing strategy, SEO considers how search engines work, what people search for, the actual search terms typed into search engines and which search engines are preferred by their targeted audience. Optimizing a website may involve editing its content and HTML and associated coding to both increase its relevance to specific keywords and to remove barriers to the indexing activities of search engines. Promoting a site to increase the number of backlinks, or inbound links, is another SEO tactic.

The acronym “SEOs” can refer to “search engine optimizers,” a term adopted by an industry of consultants who carry out optimization projects on behalf of clients, and by employees who perform SEO services in-house. Search engine optimizers may offer SEO as a stand-alone service or as a part of a broader marketing campaign. Because effective SEO may require changes to the HTML source code of a site and site content, SEO tactics may be incorporated into website development and design. The term “search engine friendly” may be used to describe website designs, menus, content management systems, images, videos, shopping carts, and other elements that have been optimized for the purpose of search engine exposure.

Another class of techniques, known as black hat SEO, search engine poisoning, or spamdexing, uses methods such as link farms, keyword stuffing and article spinning that degrade both the relevance of search results and the quality of user-experience with search engines. Search engines look for sites that employ these techniques in order to remove them from their indices.

Cost per click (CPC) is the sum paid by an advertiser to search engines and other Internet publishers for a single click on their advertisement, which directs one visitor to the advertiser’s page.

In contrast to the generalized portal, which seeks to drive a high volume of traffic to one site, PPC implements the so-called affiliate model, that provides purchase opportunities wherever people may be surfing. It does this by offering financial incentives (in the form of a percentage of revenue) to affiliated partner sites. The affiliates provide purchase-point click-through to the merchant. It is a pay-for-performance model: If an affiliate does not generate sales, it represents no cost to the merchant. Variations include banner exchange, pay-per-click, and revenue sharing programs.

Websites that utilize PPC ads will display an advertisement when a keyword query matches an advertiser’s keyword list, or when a content site displays relevant content. Such advertisements are called sponsored links or sponsored ads, and appear adjacent to or above organic results on search engine results pages, or anywhere a web developer chooses on a content site.^[1]

Among PPC providers, Google AdWords, Yahoo! Search Marketing, and Microsoft adCenter are the three largest network operators, and all three operate under a bid-based model. Cost per click (CPC) varies depending on the search engine and the level of competition for a particular keyword.^[1]

The PPC advertising model is open to abuse through click fraud, although Google and others have implemented automated systems^[2] to guard against abusive clicks by competitors or corrupt web developers.^[3]