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Question:

a) Describe how e-marketing has created new business models that add customer value, build customer relationships and increase profit
b) Demonstrate an understanding of consumer behaviour in online environments
c) Discuss e-marketing strategy and demonstrate skills in e-marketing planning
d) Discuss the digital marketing mix and management
 
 

Answer:

Introduction  

The business world is dynamic, and new business models keep coming up over and over again. This means that businesses must also change to match the new changing industry. Traditional marketing is a thing of the past. Today, technology has revolutionized every sector in the business environment. Companies have embraced the digital way of doing business. Digital marketing is one of the areas that are changing the way companies are reaching out to clients. This is a model that entities communicate with its clients through the internet, mobile applications and other online platforms.

The IT companies like Google, Facebook, Twitter, and even YouTube offer businesses a platform to market online. Zappos, Nestle, and Netflix are making digital marketing a competitive platform to advance their business. Whenever consumers seek information about the products and services that they need in the market, the internet plays a crucial role in their information search. Thus, it explains the reasons why companies are turning into digital marketing. Promotions and products are placed online to attract internet users. Social media such as Facebook, Twitter and Google+ also forms other avenues that companies have exploited to market their products in the market. Today, billions of people have access to social media which makes it a precious space for companies to realize their business success.

Zappos is a company was founded in the year 1999 by Nick Swinmurn. The company deals in shoe selling. The company’s mission is to be the best company that sells the best quality shoes either in color, size, and brand. Zappos trades in shoes of all categories which aim in satisfying the needs of all clients in the market. This strategy has helped the firm evolve through successive periods to be one of the leading online shoe selling company. The company seeks to deliver efficient online purchase services to its customers as a way of improving customer experience and customer satisfaction. What Zappos knows is that higher customer experience is a strategy that ensures that customer satisfaction is realized (Burton, S., Roberts, J., & Sheather, 2015). In the long run, the firm will be able to dominate the shoe industry.

 

Nestle Company  

Nestle Company is one of the leading companies in the food and beverage market. The company was established in the year 1867 by Henri Nestle The firm produced its first freeze milk by the year 1874. However, formed Nestle Group in the year 1905 after merging with Anglo-Swiss Condensed Milk Company. The company continued to build its empire in the food and beverage products in this industry. In the year 2003, it acquired Movenpick Ice Cream which cemented its status as a world leading producer in the ice cream category. Nestle has been actively developing digital marketing strategies that aim at the global space serving different culture (Williams, 2017). This is a strategy that allows the company to be a dominant player in milk products across the world.

Netflix Company was founded in the year 1997 with its headquarters in Gatos California. The company offers online entertainment which includes documentaries and movies. Members subscribe to the channel and pay their membership annually or monthly depending on the package. Today, the firm has over 130 million subscribers across the world. The members can watch the programs of their choice anywhere across the globe without any commercial commitment (Leeflang, Verhoef, Dahlström, & Freundt, 2014). The company online services help the firm to expand quickly. 

The footwear industry is one of the competitive industries as many companies such as Nike, Adidas and Mizuno compete in this market. Intense marketing campaigns are part of the driving factors that define the level of competition in this industry. Social media and online marketing form the basis of marketing strategies in this industry. For example, Nike has engaged in an online marketing campaign that seeks to ensure that its brand is well placed and well known in the market (Purkayastha, & Rao, 2015). The management of Nike uses the digital platform to drive its sales. Moreover, companies also engage in mobile application strategies to market its products. This makes companies like Zappos build its online shoe platform with a bid to increase its market share.

The key opportunities in the industry are the growing demand for new shoe products. The market keeps growing, and it is expected to by 4.5% by the year 2023. This will offer the players in the market a chance to expand their businesses. On the contrary, there are risks which include a stiff competition as many players enter the market. The economic turmoil also threatens to shrink the market.  

The Current Marketing Environment for the Nestle Food and Beverage Industry

The integrated marketing approach is one of the driving force in the food and beverage industry. Integrated marketing refers to the marketing approach which includes adverts, direct sales and promotions, social media, and social media (Andrews, & Shimp, 2017). Companies leverage these strategies to offer the offer the best chance for the marketers to communicate to its customers. Social media such as Facebook and Twitter are some of the digital platforms that are used in the process of marketing in this industry. For example, Unilever a competitor of Nestle engage in TV and online marketing to attract its customers. Studies indicate that the cost marketing for about 2000 customers ranges from $50 to $75 in digital space (Bhargava, 2015). This is an indication of the cost-effectiveness of this strategy.

The opportunities in this market are innovation for quality products that will serve the needs of the clients better. This is a strategy that will support high customer satisfaction and development of quality service delivery to the customers. On the contrary, the high levels of competition is a threat to the existing business. The reason why companies merge or acquire the other is to eliminate competition.

The entertainment industry keeps growing the population of the people who demand such product continue also to thrive. In this industry, Netflix is facing competition from other companies such as Amazon and Hulu among others. With rising competition, online marketing and social media marketing are some of the key influencers in marketing. Each company seeks to position itself as the leading online film provider. Amazon develops an online video content that allows subscribers to access it on demand or rent. This strategy witnesses a stiff competition among companies seeking to offer online video services.

The growing population and accessibility of internet offer an opportunity for the firms in this industry to increase their services to various clients. The firms can, therefore, develop programs that will help different clients of different clients in the market. Market saturation and legal aspects are some of the threats of this industry. The international markets restrict the entry into some of the markets thus affecting their service delivery to their global space.

 

A summary of each company’s approach to Tier 1 strategies of Target marketing, Positioning and Branding from a digital /online perspective.

Zappos Company seeks to serve the global space with shoe products of every size, color, and brand. The firm works to ensure that it helps the global market with mind-blowing services which are customized. This is an approach that will ensure that the company will promote a better understanding of the market space. Zappos seeks to join Amazon as a big firm selling online shoes to all customers across the globe. The CEO of Zappos states that there will come a time when the US retail market will be about 30% of the total market share. This is the reason why the company builds towards delivering high-quality products through online platforms.

When Nick Swinmurn went round the shops looking for shoes, he realized that he couldn’t get a shoe of the right color, size, and brand. This prompted him to start up a company that will customize the shoe products. The focus for the firm is to develop all brands that will serve the needs of all clients in the global market. The company has continued to expand through many stages which have made it continually attract many clients in the market.

Nestle company offers food and beverage products across the world. This is the reason why Nestle brands are found across the global market. This is a strategy that allows the company to reach out to the different consumers of ice creams and other beverage products. The approach taken by Nestle is to develop a vast customer base in the market that will serve the products that the firm sells. The company’s Facebook is used as a marketing tool that allows the firm to reach out to its clients and keep updates with the clients. Fowdar’s (2013) explains that many Facebook users have access to products posted by the company.

Nestle Positioning and Branding

The approach taken by Nestle in its product positioning is s strategy that places the company in the top levels in this industry.  The firm developed different products or brands in the market which makes the company serve the different of classes. For example, Nestle offers ice cream products and at the same time provide drinks and beverages such as coffee. This is a strategy that diversifies the company’s products in the market. Zappos email its customers about the new product arrivals which then promotes better decision making about the purchasing process. This is seen many firms as part of the marketing strategy that will support the company’s growth.

Netflix positioning and target marketing strategy focus in serving the global customers. The firm has subscribers of over 130 million with each subscribing to the products offered by the company. This has proved that Netflix can develop a product or a service that fits the needs of the different clients in the market. The company’s market approach helps it to promote its products to the various classes in the market.

Clients of different cultures and behaviors are found across the world. Their interests vary and Netflix offer a high-quality streaming service which creates efficiency of customer’s demands. The clients can access whenever and wherever they are across the globe. As long as the customer can access the internet, then he or she can access their services with ease.  The emails usually carry a relevant content that supports the message that client’s intended message. Whenever the consumer receives information that meets its needs, then such they will always come back. This is how customer experience is developed for in the long run.

 

Strategic marketing mix analysis (Product, Price, Distribution, Digital Marketing Communications) of each company

Zappos Company offers a range of shoe products in the market to its consumers. These shoes come in different colors, sizes, and brand. In this case, the client will have to choose the one that serves their needs. Their prices also vary depending on the nature of the shoes. The firm also offers free shipping. For example, Calvin Klein is sold at $159.00. These shoes have descriptions and allow the clients to check on all sides of the shoes before finally choosing to buy these products. Therefore, the products, in this case, keep varying and depend on the choices of the customer preferences.

Apart from the online stores, Zappos distributes its products in the selected stores across the country. Amazon.com also sell Zappos shoes and clothing. This is an extensive network that allows the firm to reach out to various clients. As we have stated above, Zappos reach out to its clients through emails, social media, and other digital platforms. 

This is another giant offering different range of products with different prices. But the firm always seeks to offer the best quality at competitive prices. Nestle gives Nestle Coffee-Mate French Vanilla - 425 Grams at around $1000 and Carnation Milk Malted Original at about $1092 in India. Its products are relatively cheaper as compared to that of its competitors. This is a strategy that will ensure that the company can serve the needs of the customers in the market.

The communication process adopted by Nestle include social media and online marketing that allows the fir to reach out to a mass customer base. The firm has an active Facebook and Twitter account which communicates and interacts with its clients (Mount, & Martinez, 2014). The company has also developed carrying and forwarding distribution agents which help distribute its products across the world. This makes the company’s products available across the global market. However, the firm also has online shops that the clients can buy its products and get shipped to the clients.

 

Strategic marketing mix analysis of Netflix  

Netflix offers some unlimited streaming of its services at about $7.99 per month for a basic package and $13.99 for premium (Greene, 2016). These prices are relatively low and attracts many customers to subscribe. While for Hulu service, the basic plan remains $7.99 and $39.99 if individuals seek to watch TV live. This is an indication that the consumers have a choice of selecting the plan that is friendly to their pockets. Given the program it is unlimited, then this makes it easy for clients to enjoy their watching without interruptions.  

Netflix offers purely online services which do not need distribution as for the case of the physical products. The online services allow individual consumers to access these services whenever they are as long as they have subscribed. The companies like Nestle and Zappos have their agents across the word which helps in the distribution process. This means that such a firm uses both physical distribution and online sales product selling. The use of a mobile application to improve sales is another digital marketing strategy that helps create a customized service and increasing customer loyalty.

Conclusion 

The digital marketing strategy is creating the basis for business dominance and quick customer service delivery. The customers today are in need of services and products that are easily accessible and of high quality. However, information is a factor that influences their decision-making process. Companies like Netflix, Zappos, and Nestle have a mobile application that allows the customers to access the company’s products and services whenever they are promoted in the company’s sites. The digital marketing is cost effective and offers the company a chance to communicate a timely message in time. However, there are challenges which are coming with this business model. The firm can collect leads, but there is a need to ensure that the company’s brand is maintained and protected. The companies must develop the product content which will communicate effectively with the customers in the market.

 

Reference

Andrews, J. C., & Shimp, T. A. (2017). Advertising, promotion, and other aspects of integrated marketing communications. Nelson Education.

Burton, S., Roberts, J., & Sheather, S. (2015). Getting to Know Them: The Effect of Customer Experience in a Business-to-Business Market. In Global Perspectives in Marketing for the 21st Century (pp. 210-213). Springer, Cham. James, J. P., Lee, K. K., Zhang, M., &

David H. (2018) Is Zappos’ Email as Good as Their Social Media. Retrived from https://www.convinceandconvert.com/guest-posts/is-zappos-email-as-good-as-their-social-media/

Fowdar, R. 2013.The implications of Facebook marketing organizations. Contemporary Management Research. Vol.9, pp.73-84

Greene, L. E. (2016). Pricking the Monster: Netflix and the modification of how and what we watch.

Leeflang, P. S., Verhoef, P. C., Dahlström, P., & Freundt, T. (2014). Challenges and solutions for marketing in a digital era. European management journal, 32(1), 1-12.

Mount, M., & Martinez, M. G. (2014). Rejuvenating a brand through social media. MIT Sloan Management Review, 55(4), 14.

 Purkayastha, D., & Rao, A. S. (2015). Digital Marketing at Nike: From Communication to Dialog.

Price, S. B. (2017). Grunge’s influence on fashion. Retrieved January, 6, 2017.

Williams, J. D. (2017). Ethics and Policy Issues for Internet Advertising: Targeting Multicultural Consumers in the Digital Marketing Era. Journal of Management Policy & Practice, 18(4).

Yeomans, M. M. (2018). Learning to listen after a century of shouting. In Trust Inc. (Vol. 34, No. 44, pp. 34-44). ROUTLEDGE in association with GSE Research.

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