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What Is
Electronic Marketing?

Any transfer of goods or services from seller to buyer (the broadest definition of marketing) that involves one or more electronic methods or media can be considered electronic marketing (EM).

Electronic buying and selling started by telegraph in the nineteenth century. With the advent and mass acceptance of the telephone, radio, TV, and then cable, electronic media have become the dominant marketing force. New permutations of these four electronic methods–as well as the microcomputer explosion–continue to create many new forms of electronic media.

Marketing through an electronic medium ranges from the familiar to the cutting edge of technology. This book covers the gamut. Which of these electronic marketing forms are you familiar with or do you now use?

Broadcast or cable TV	                Radio
In-bound or out-bound telemarketing	Audiotape
Audiotext	                        Voice mail
Talking ads	                        Sponsored telemedia
In-bound or out-bound faxmail	        Fax-aided ads
Video brochures	                        Video catalogs
Video media ads in videocassettes	Video premiums
Movie ads on planes and in theaters	Interactive ads on com-
Interactive computer disk catalogs	puter disks
EDI	                                E-mail
Information and entertainment	        Computer bulletin boards
computer networks	
Online marketplaces	                Online catalogs
Electronic multimedia kiosks in         CD-ROM catalogs and mar-
retail businesses	                ketplaces
Electronic kiosks in public places	Other in-store electronic 
and trade shows	media
TV shopping networks	                Direct-by-satellite business
Audio- and teleconferencing	        TV marketing
                                        Electronic vending machines
Although this book devotes many chapters to individual electronic media and how they are successfully used, the larger context is also essential. Final chapters devoted to electronic customer service; electronic aid for your salesforce; electronic public relations; and the integration and enhancement of EM into all marketing give you a guide to making EM a powerful force in your successful company.

Which kinds of electronic marketing now impact your business most? Which will most affect your career? How soon? Nothing that I or you make, import or sell, no service we offer, no job that you can hold or aspire to will not be very soon significantly affected by electronic marketing, perhaps more than by any other force in your business life. And EM change is accelerating.


Whom Does EM Most Concern?

Electronic media and their marketing applications will soon touch virtually every aspect of business. EM knowledge is critical for those who hold the following jobs in big firms: CEO, CFO, VP of marketing, director of sales, advertising manager, direct marketing manager, head of PR, promotion manager, market research manager, telemarketing manager, product brand and category managers.

EM know-how is now vital for any new college graduate, even an MBA who is marketing-oriented, computer-trained, and innovative. But any trainee concerned with marketing, sales, advertising, display, promotion, PR, research, or service, will advance more quickly by demonstrating an understanding of EM. In addition, EM can be a life saver for career changers seeking a growth field in marketing.

Marketing specialists without EM know-how are becoming outmoded in many areas, including: advertising agency CEOs, account executives, creative heads, media buyers, research directors, or ambitious trainees in advertising agencies; catalog managers, creative heads, phone marketers, list brokers; marketing consultants in direct marketing; or principals, account executives; senior writers, and beginners in public relations.

Advancement or even getting hired in any field is becoming difficult without EM know-how, particularly in the areas of broadcast and cable TV, radio; new electronic media; mass and targeted print media; electronic information providers; trade magazines and newsletters; and trade associations.

Small businesses without EM facilities and expertise face a bleak future. EM know-how can save jobs and mean survival for a small firm. EM can make the difference between firing or advancement for an executive. And for home office business and other start-ups–whether you're a rep, consultant, or other type of one-person operation–electronic marketing know-how can make the difference between success and failure.


Each New Medium Affects Others

Any change in media affects the marketing mix. For sophisticated marketers, electronic media provoke these questions:

  1. Is it too early to use new forms of EM?

  2. Which work? Which fail? Which are too small to matter?

  3. Can older EM forms still work as new ones surge ahead?

  4. Does electronic media take away enough audience from print media to make print a poor buy as their rates go up?


EM Is No Panacea

No form of EM is a shortcut to success for failing ventures or people. If your company is unprofitable, or if your products are failing or are not responsive to promotion despite spending as big a percentage of sales as your competitors, your chances of getting help from EM are slim. Most businesses, products, and people who succeed via EM are already successful. Those who previously failed in business are more apt to fail using EM. However, some start-ups, "retread" products, and failed entrepreneurs do subsequently succeed in EM for reasons specific to individual cases.


What Failures Teach

Big organizations with highly promoted products and ample capital have sometimes failed in their use of EM. Some big companies acted like "King Canutes," ordering the public to use a new, untried medium, even expecting people to buy expensive equipment to do it. Huge sums have been squandered in misguided EM ventures. Other big companies start in EM more to keep others out than to truly succeed; some enter EM markets just to be able to proceed in earnest if it proves necessary. Most failures come from the following:

  1. A lack of understanding of, interest in, and commitment to the EM project of all those concerned within the company.

  2. Lack of flexibility, or a failure to change the original plan as constraints and opportunities change.

  3. Starving EM efforts through the fear of cannibalizing old income source by new EM forms.

  4. Halfhearted efforts. EM advocates in management get undermined by others who are dubious and resistant.

Small companies often fail in EM for the same reasons they suffer high mortality rates overall: underfinancing, poor management, lack of research, know-how, control, and planning. Small companies tend to underinvestigate and to dive in too fast. They fail sometimes by choosing a form of EM that's mismatched to their products, presentation and market. But some companies can be marketing bumblebees–who, according to scientific principles, can't fly–but by trial and error find a way to succeed.

Both large and small companies often fail with electronic marketing because they fall in love with the technology but lack the know-how to use it. Many companies have failed because the technology they used cost too much at that time. The irony is that based on today's improved technology cost, many of the same tests would succeed.


Dramatic and Frequent Failures but Overall Success

However great the total losses in all electronic experiments to date, the overall profits by electronic marketers are already many times more. Big losses are easy, but profits can be obtained only by someone with the right products, profit margins, offers, and presentation making the right decisions, usually made possible by study and know-how. Winners are the most competent and entrepreneurial, the most adventurous and scientific, the most practical and realistic marketers who accept and select and use EM most effectively. My job is to help you become such a winner. Regardless of every EM disaster, plenty of bright and brilliant people have demonstrated the vision, courage and the practicality necessary to create EM successes.

In Chapter 21, I describe how American Airlines transformed itself when it created SABRE–the first PC-based airline reservation network and the basis for its revolutionary frequent flyer program. American Airlines' travel agent business went way up, it air freight zoomed up, and its profits leaped. American Airlines became the number-one airline and made over a billion dollars in additional profit from just this one form of electronic marketing.

Plenty of other big companies have been surprisingly flexible in setting up decentralized, profitable EM operations run like small companies. Often they have backed innovative, small EM firms. Chapter 22 describes how Greg Kolodziejzyk, a commercial artist from Calgary, Canada, first created a new business and then started a new industry through electronic marketing. He bought a Mac and a laser printer and founded Image Club Graphics, with a mail-order ad which sold clip art and type fonts on floppy disk. But then he created a whole new way to market his art on a CD-ROM disk. This new electronic marketing technique is responsible for driving many companies today.