Description
A retailer purchases goods or products in large quantities from manufacturers directly or through a wholesale, and then sells smaller quantities to the consumer for a profit.
2007:056
MASTER'S THESIS
Communication Tools to Build Website Traffic
Cases from Small B2C Firms
Yidi Zhao Liang Xu
Luleå University of Technology Master's thesis Marketing Department of Business Administration and Social Sciences Division of Industrial marketing and e-commerce
2007:056 - ISSN: 1402-1552 - ISRN: LTU-DUPP--07/056--SE
Acknowledgements
Acknowledgements
It is our great pleasure to hereby present our Master's thesis. During the writing process of 15 weeks in the winter of 2006/2007, we have gained a lot of knowledge with investigating this area of research and it has been an interesting and intrusive experience for both of us. We would like to take this opportunity to thank the people who have been helpful for us during the writing process, and thereby making this thesis possible. First of all, we would like to thank our supervisor Mr. Manucher Farhang, for his help and feedback. Furthermore, we would like to thank Mr. Daniel Löfmark in Netix AB and Mr. Peter Holmagren in Rosell & Clack Importlagret AB, who all took the time to answer our questions and gave us valuable information for our thesis. Luleå University of Technology, 2007-01-15 Yidi Zhao Liang Xu
Abstract
Abstract
With the rapid development of Internet, online business companies are increasing in number. In B2C companies, traffic building to website is a major concern of the top manager and it is the key point for success. The process involves using offline and online communication tools to drive or attract visitor traffic to company web site. The purpose of this thesis is to provide a deeper understanding of the different communication tools used by companies to build traffic to their website and measures they adopt to improve the effectiveness of these tools. Three research questions were developed. The empirical data were collected on two small B2C Swedish companies were analyzed against a theoretical frame of reference. The findings showed that cost and evaluation become the principle factors for choosing appropriate communication tools for traffic building and small companies used the different communication tools on the basis of limited budget. Furthermore, the method of evaluation adopted by companies has a strong influence on improving the communication tools efficiency.
Table of Content
Table of Content 1. Introduction...........................................................................................1
1.1 Background ......................................................................................................1 1.2 Problem Discussion .........................................................................................3 1.3 Purpose and Research Questions .....................................................................5 1.4 Demarcations ...................................................................................................5 1.5 Deposition of the Thesis ..................................................................................6
2. Literature Review .................................................................................7
2.1 Offline marketing communication tools used for traffic building ...................7 2.1.1 Publicizing the URL offline..................................................................7 2.1.2 Public Relations ....................................................................................7 2.1.3 Direct Marketing...................................................................................8 2.1.4 Sponsorship.........................................................................................10 2.1.5 Exhibitions ..........................................................................................10 2.1.6 Corporate Identity ...............................................................................11 2.1.7 Packaging............................................................................................12 2.1.8 Merchandising.....................................................................................12 2.1.9 Word of Mouth ...................................................................................13 2.2 Online marketing communication tools used for traffic building..................13 2.2.1 Banner Advertising .............................................................................14 2.2.2 Affiliate Networks ..............................................................................14 2.2.3 Search Engine Registration and Optimization....................................16 2.2.4 Link Building ......................................................................................16 2.2.5 E-mail Marketing ................................................................................16 2.2.6 Viral Marketing...................................................................................17 2.2.7 Vertical Portals....................................................................................18 2.3 Evaluation of effectiveness of communication tools in traffic building........18
3. Conceptualization and Emerged Frame of Reference ....................21
3.1 Conceptualization ..........................................................................................21 3.1.1 How can offline marketing communication tools used for traffic building be described? .................................................................................21 3.1.2 How can online marketing communication tools used for traffic building be described? .................................................................................21 3.1.3 How can evaluation of effectiveness of communication tools in traffic building be described? .................................................................................22 3.2 Emerged Frame of Reference ........................................................................23
4. Methodology ........................................................................................25
4.1 Research Purpose ...........................................................................................25 4.2 Research Approach ........................................................................................26
Table of Content 4.3 Research Strategy...........................................................................................26 4.4 Data collection ...............................................................................................28 4.5 Sample Selection............................................................................................29 4.6 Data Analysis .................................................................................................30 4.7 Reliability and Validity..................................................................................31
5. Case Studies.........................................................................................33
5.1 Case 1: Netix AB ...........................................................................................33 5.1.1 Offline marketing communication......................................................33 5.1.2 Online marketing communication.......................................................33 5.1.3 Evaluation of effectiveness of communication tools in traffic building ......................................................................................................................38 5.1.4 Building traffic at Netix AB ...............................................................39 5.2 Case 2: Rosell & Clack Importlagret AB ......................................................39 5.2.1 Offline marketing communication......................................................39 5.2.2 Online marketing communication.......................................................39 5.2.3 Evaluation of effectiveness of communication tools in traffic building ......................................................................................................................43 5.2.4 Building traffic at Rosell & Clack Importlagret AB...........................43
6. Data Analysis.......................................................................................45
6.1 Within-case Analysis .....................................................................................45 6.1.1 Within-case Analysis: Netix AB.........................................................45 6.1.2 Within-case Analysis: Importlargret AB ............................................49 6.2 Cross-case Analysis .......................................................................................52
7. Findings and Conclusions ..................................................................57
7.1 Research question one: How can offline marketing communication tools used for traffic building be described?.........................................................................57 7.2 Research question two: How can online marketing communication tools used for traffic building be described?.........................................................................58 7.3 Research question three: How can evaluation of effectiveness of communication tools in traffic building be described?........................................58 7.4 Implication for Management..........................................................................60 7.5 Implication for Theory...................................................................................60 7.6 Implication for Future Research ....................................................................61
Reference: ................................................................................................62 Appendix..................................................................................................67
Table of Content
List of Figures
Figure 1.1 The outline of this thesis ......................................................................6 Figure 3.1 The Frame of Reference of this study ................................................24 Figure 4.1 Schematic Presentation of the Methodology .....................................25 Figure 4.2 Illustration of relationship between reliability and validity..............32
List of Tables
Table 4.1:Relevant Situations for Different Research Strategies........................27 Table 4.2:Sources of Evidence ............................................................................28 Table 6.1:A comparison of data of offline communication tools between two cases.............................................................................................................53 Table 6.2:A comparison data of online communication tools between two cases ......................................................................................................................54 Table 6.3:A comparison data of evaluation of effectiveness of communication tools in traffic building between two cases ..................................................56
Introduction
1. Introduction
In this chapter the background to the selected research topic is first presented, followed by problem discussion where the research area is discussed. The problem discussion leads to the research purpose and the research questions and finally, demarcations and overview of the study.
1.1 Background
Internet has been heavily exploited in marketing in recent years. The rapid rate of Internet adoption has resulted in an extraordinary pace of change in the marketing landscape and opened up a variety of opportunities for marketers (Wu, 2002). According to Huizingh (2000), Internet is a global system with low entry barriers, connecting both customers with suppliers, and customers with customers. Clow and Baack (2002) point out that Internet can serve various marketing functions such as advertising, sales support, customer service, public relations, and e-commerce (retail store) Internet also presents vast opportunities for branding (Ryan, 1999). The online retailers exploit Internet in even deeper level. According to Vishwanath and Mulvin (2001), the online retailers achieve success by leveraging their existing assets, brands, and customer bases through their online channels, by cleverly exploiting the synergies between online and offline operations, and finding creative ways to convert the highest possible percentage of website visitors into loyal customers. The retailers are using the Internet to gain customers, build revenues, and enhance profits. World Wide Web (WWW or Web) is known, according Hoffman et al. (2000), as the most exciting commercial development in the portion of the Internet. Advertisers are recognizing Web as a valuable additional media of their advertising tool box (Sheehan and Doherty, 2001). Internet users value the medium as a tool for learning about products and services (Kehoe et al. 1998). After online users are able to complete the purchase process through buying products online, marketers begin to search for ways to direct online users to their web pages and provide a strong communication message to them once they visit (Riedman, 1999). Every year billions of dollars are spent promoting brands and Internet brands, and companies compete against each other feverishly to establish brand recognition and consumer awareness. The commonly used communications vehicles, other than advertising, consist of public relations to stimulate word-of-mouth, sales promotions, and partnerships directing consumers to websites, direct e-mail, and a variety of other methods. Meanwhile they also stress that it would be a mistake for online businesses to reply completely online advertising to create awareness and site visitation (Ilfeld and Winer, 2002).
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Introduction Some manners of drawing prospects to e-commerce website are presented by Bellizzi (2000), which address that designing websites with proper key-word density, being listed with appropriate industry directories, and properly placed banner advertisements are very important in drawing prospects to e-commerce website. He also highlights that marketers should not overlook more traditional means of bringing more traffic to the e-commerce website. The ways that online users find out about websites, according to Sheehan and Doherty (2001), are through word of mouth, via traditional advertisements, and through banner advertisements and other types of online messages. Awareness of Web addresses (uniform resource locators, or URLs) through traditional advertising such as television and print represents an essential source of information about websites and how to find them (Kehoe et al., 1998; Maddox & Mehta, 1997). Since consumers appear reluctant to pay for access to specific sites, advertising is also important to the success of the Web; therefore advertising may be the primary support for the Web (Mc-Daniel, 1997). The selection of advertising media is determined by the nature of media and product characteristics. Yoon and Kim (2001) address that Internet as an advertising media has a few characteristics that are different from traditional medium such as unlimited delivery of information beyond time and space, unlimited amounts and sources of information, the ability to target specific groups or individuals, and especially its nature of interactivity; the choice and use of media in advertising is mostly influenced by product characteristics, to consider high-involvement products like automobiles or luxury watches the Internet is still not as effective as TV in enticing consumers. The essence of some online and offline advertisement are actually the same. According to Gallagher et al. (2001), the same advertisements were equally effective in print and on the web under the condition of being given equal opportunity for exposure to the target audience. Although the online and offline medium has essential distinguishes, the messages of advertisements are exactly the same. Further Kanso and Nelson (2004) highlight that in creating an online commercial site, it is important to recognize that the Internet requires different marketing and advertising practices than those used in traditional media; and mixed media advertising necessitates coordinated efforts between those managing the website and those designing advertisements for other media. They discover that marketers are not exploiting all possible benefits of their websites by not adequately integrating print and online advertising efforts. Email marketing is more efficient than traditional direct mail. Gartner (2002) present that email advertising revenue totaled $948 million in 2001 and has been forecasted to increase by 32.91 percent to $1.26 billion in 2002 and to $7.3 billion by 2005 (Beardi, 2001). Some researches in comparing email advertising and direct mail shows that email is cheaper than traditional direct mail, email advertising have been heralded as
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Introduction producing faster response times from consumer, and email can encourage interactivity with consumers by including hyper links in the mail (Gartner, 2002; Brown, 2002; Rickman, 2001; Garden, 2002). Permission-based emails are powerful, according to Martin et al. (2003), because the consumer is requesting the information from the advertiser that simply being exposed to it. Advertisers will increase spending on online advertising in many different forms such as paid search, online video, and banner advertising but there will not be significant rapid near term growth for the undesirable effectiveness. For instance, Advertisers currently direct 96% percent of their spending for online display ads to pages that represent just 30 percent of overall web traffic (Grosso et al., 2006). Some online advertisers are also moving offline in order to coordinate advertising in both online and offline media. According to Knowledge@Wharton (2006, p212), in the United States $150 billion is spent through traditional media advertising which is almost 10 times of online advertising although the growth rate of online advertising at a rate of 30% a year. In latest some Internet giants namely Google, Yahoo and eBay after conquering the advertising frontier in cyberspace are now turning to traditional media for future growth by brokering ad sales for offline media like radio, television and print. David Reibstein says that the move into old-style media is a logical extension for the Internet giants, as the soul is to distribute advertising messages, both the traditional media and online media can provide a more complete portfolio in advertising. One of the challenges for e-business marketers is to attract visitors to the site and generate significant repeat visits (Williamson and Johnson, 1995). According to Williamson and Johnson (1995), web traffic control leads to the initial site visit, and the repeat traffic mainly depends on customer need and partly influenced by website design (Saloman, 1995). Several types of web traffic control namely Internet yellow pages, web traffic control, direct, and links with other websites sharing the marketing objective of attracting visitors to the website are proposed by Hoffman et al. (2000).
1.2 Problem Discussion
Nowadays the 'build and they will come' model is insufficient to generate traffic to the sit, marketers need to actively attract users or customers (Parsons et al., 1998). According to Lindström & Anderson (2000), a company is more or less invisible on the Internet until its existence in cyberspace has communicated to its target group, and people do not just come across a new websites by chance, as there are too many of websites existing in cyberspace, thereby create the traffic which is a necessary precondition for the company's Internet strategy to be successful. Benbunan-Fich & Fich (2004) also explain that web traffic constitutes the mass of visitors to a website that can potentially be converted into sales or advertising revenue.
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Introduction Alpar, Porembski & Pickerodt (2001) point out that to attain a large amount of traffic is an intermediate goal of most websites regardless of their purpose, and achieving it is usually necessary in order to achieve their higher level goals. Nikolaeva (2005) also think that website traffic is a necessary step in the generation of sales for on-line merchants in cyberspace. Although in itself not a measure of success, Website traffic is a step in the consumer on-line purchase process that can lead to increased sales. Therefore to successfully generate web traffic become en issue. Traffic building, according to Chaffey et al. (2003), is the process of using online and offline communications to drive or attract visitors' traffic to a website, where visitors refers to not only new customers and potential customers but also irregular visitors of the existing customers. (ibid) Some other authors name the process by terms of generating traffic and website traffic generation (Huizingh 2002, Nikolaeva 2005, Parsons et al., 1998). In order to build website traffic, Pickton and Broderick (2001) say that the most effective mix of media should be employed, which are characterized as traditional offline marketing communications or new online communications. According to Nikolaeva (2005), both offline and online communications can influence the web traffic. Online advertising has a more direct effect on Website traffic because of the immediacy of the action that consumers can take. In contrast, advertising in traditional none electronic media increases a site's visibility and thus indirectly influences Website traffic. Some researchers have presented some offline and online communication tools that can contribute to traffic building directly or indirectly. Chaffey et al., (2003) points out some effective offline and online communication tools for traffic buildings such as publicizing the URL offline, public relations, direct marketing, sponsorship, exhibition, word of mouth, and banner advertising, affiliate network, search engine registration and optimization, link building, email marketing, viral marketing. According to Smith et al. (1998), there are many of various offline and online marketing communication tools available namely as press, radio, TV (terrestrial, satellite, and cable, and interactive video, text), telephone, mail, e-mail, and the Internet. Huizingh (2002) addresses that a few of different medias that are used to generate web traffic: television, radio, print media, bill boards, direct mail, business cards, company prints, electronic newsletter, information on company's products, participation in electronic malls, advertising in electronic newsgroups, e-mail signatures, advertising at other sites. Some specific online communication tools have been presented by some researcher that can generate web traffic. For example, Turban et al. (2004) considers pop-ups, interstitials, newspaper-like standardized ads, URLs, advertising in chat rooms, Internet radio/television as the online promotion tools. Lindstrom and Anderson (2000) present online word of mouth and vertical portal beside above mentioned tools.
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Introduction
According to Ilfeld and Winer (2002), a huge amount of money has been invested in generating traffic by exploiting different media; hereby how to improve cost effectiveness is a constant issue. Effectiveness of traffic building can be simply observed by clicks on the website during the period of promotion campaign, but it is more valuable to learn the knowledge behind the click-on and click-through, and evaluate the effectiveness of the marketing communication tools. As it can provide the marketers knowledge in better use of the communication tools, especially cost efficiency is very much concerned by small firms. The effectiveness of the website could be monitored in two different ways: to observe the path of visitors' behavior and to see whether they return to the site (Day, 1997). The effectiveness of website in marketing communication can be also measured quantitatively through some parameters likely the numbers of repeat visits, the number of minutes spent by the user, the number of minutes the visitor spends on average on the main activities of the website, the number of individual visitors, the user's behavior at the website, the number of e-mails received from customers, the website's sales and income. These tools can help company to find how good the company has been at creating traffic on the Internet from different communication tools (Lindström & Anderson, 2000). Some other researchers suggest to measure the effectiveness of website by duration of browsing time, the depth, or number of assessed pages, the number of repeated visits, making contact with interested individuals, converting some visitors to customers, the supporting the purchase and post-purchase phase of the supplier-customer relationship that follows (Karayanni and Baltas, 2003; Chaston, 2001).
1.3 Purpose and Research Questions
In view of the above discussion, the purpose of the present research is: To provide a deeper understanding of the communication tools used by companies to build traffic to their website and measures they adopt to evaluate the effectiveness of these tools. In order to reach the purpose of the research, the following research questions are developed: RQ1: How can offline marketing communication tools used for traffic building be described? RQ2: How can online marketing communication tools used for traffic building be described? RQ3: How can evaluation of effectiveness of communication tools in traffic building be described?
1.4 Demarcations
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Introduction This research will observe the following demarcations: a) concentrate on B2C companies; b) select smaller companies, and c) investigate the corporate perspective on traffic building.
1.5 Deposition of the Thesis
The work is done in seven chapters as shown in figure 1.1. In chapter one, Introduction is stated including the background of the research, the discussion of the concerned problem, the purpose of the research and research questions as well as demarcations; In chapter two, the literatures of the previous researches related to research problems are presented; In chapter three, the conceptualization and frame of reference are presented; In chapter four, the selection of research methods are stated as well as the discussions and motivations about them; In chapter five, the data from real business world are presented; in chapter six, the collected data are analyzed; finally in chapter seven, the conclusions and findings are discovered according to the analysis of the data. See figure 1.1
Chapter 1 Introduction
Chapter 2 Literature Review
Chapter 3 Conceptualiz ation
Chapter 4 Methodology
Chapter 7 Conclusion & Findings
Chapter 6 Case studies
Chapter 5 Data presentation
Figure 1.1 The outline of this thesis
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Literature Review
2. Literature Review
This chapter contains literature based on our research questions. This will include studies on both offline and online marketing communications, then the evaluation of effectiveness of communication tools in traffic building.
2.1 Offline marketing communication tools used for traffic building
According to Chaffey et al. (2003), Smith (1998), Fill et al. (1995) there are mainly 9 kinds of offline communication tools which might relate to the topic of traffic building: publicizing the URL offline, public relations, direct marketing, sponsorship, exhibition, corporate identity, packaging, merchandising and word of mouth. These tools will be discussed intensively as below: 2.1.1 Publicizing the URL offline According to Chaffey et al., (2003), there are two types of offline advertising: incidental and specific. Incidental offline advertising means that driving traffic to the website is not a primary objective of the advert. On the other hand, specific offline advertising means driving traffic to the website or explaining the online proposition is a primary objective of the advert. Chaffey et al., (2003) points out that publicizing the Uniform Resource Locator (URL) offline can be achieved by using some specialist techniques of specifying the URL (web address) that can be used to help customers in finding the information they need on the website. These techniques can be some kinds of traditional advertising such as newspaper, magazines, TV, radio, videos, catalogue and technical reports. It has benefit to give a specific page when companies doing their advertising because that is related to the offline promotion and the interests of the audience. A similar technique is to use a sub-domain which is different from the main domain, or to register a completely different domain name that is in keeping with the campaign. Awareness of URLs through traditional offline advertising, such as television and print, represents an important source of information about websites and the way to find them (Kehoe et al., 1998; Maddox & Mehta, 1997). Lindström & Anderson (2000) point out that it is obvious that the URL should be everywhere the physical address, such as business cards, letterheads, brochures, annual reports, telephone directories and other reference books, television and radio advertisements, advertisements, hoardings and billboards, packaging and point-of-sale material. Especially, many scholars suggested sometimes magazines have tremendous positive influence on the publicizing the URL offline. A study conducted by Gupta (1995) reports that using magazines to locate sites on the Internet is very common-almost two thirds of the surveyed participants learned about websites through magazines. Huffenberger, Kanfer, Schlosser, and Ryan (1998) find that promoting a website in magazine advertisements has increased at a nearly exponential rate. Print media are
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Literature Review particularly useful because the interested consumer can directly refer to the advertisement when he or she types the URL. This diminishes the likelihood of errors due to hastily copying on paper or memorizing the URL from a television, radio, or bill-board advertisement. (Schlosser and Kanfer, 1999) Using of providing specific page of the website in publicizing the URL offline is depending very much on situations. Providing the specific page enables the user to be sent direct to the relevant information without having to navigate through the corporate site, it especially suits the companies who have a diverse product range. A further advantage of using a specific web address is for measuring advertising effectiveness. If there is no other way of navigating to that page on the site, it can then be established how many people arriving at a site on this page have viewed the original advertisement. However, it is not normal for companies who strive for brand building and establishing the credibility of a site to provide a specific page in publicizing the URL offline by using traditional advertising ways. (Chaffey et al., 2003) 2.1.2 Public Relations Baker (1994) mentions that public relations is a promotion tool through a release to definable news media in the hope of secondary exposure via an editorial mention earned by the newsworthiness of subject matter. Chaffey et al. (2003) point out that public relations can be an important tool for driving traffic to the website if changes to online services or online events are significant. Kotler and Armstrong (2001) reveal that public relations is considered another mass-promotion technique. It concerns itself with building good relations with the company's various publics by obtaining favorable publicity, building a good corporate image, and handling or heading off unfavorable rumors, stories, or events. Several tools are used in today's public relations efforts: ? Press relations: Creating and placing newsworthy information in the news media to attract attention to a person, product, or service; ? Product publicity: Publicizing specific products; ? Public affairs: Building and maintaining national or local community relations; ? Lobbying: Building and maintaining relations with legislators and government officials to influence legislation and regulation; ? Investor relations: Maintaining relationships with shareholders and others in the financial community; ? Development: Public relations with donors or members of nonprofit organizations to gain financial or volunteer support. (Ibid) Internet can be used to expand the depth and breadth of PR. According to Chaffey et al., (2003), compared to the traditional public relations (PR) methods, there is new method of PR as an offline communication tools coming out in the context of webbased to be an effective promotion of driving traffic to the website. PR activity on the Web offers organizations scope for corporate communications, sponsorship,
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Literature Review publicity and a direct vehicle for communication press releases. The Internet provides scope for two-way interaction, clear targeting of key opinion-formers and journalists and the potential for communicating strong corporate brand messages. The Internet can be used to facilitate traditional methods of PR. According to Lindström & Anderson (2000) that when the companies go on the Internet, it will have to find a new angle which makes it interesting for a journalist to write about its activities. If the company can't do that, there is the danger that the users will not find the site very interesting either. Through this new method of PR, a company can talk direct to the market via the corporate website. Third-party agencies and old media still have a role, because of their credibility as independent sources of information and their wider circulation. Agency information can be supplemented by more detailed and timely information direct from the corporate website. PR can update their information in the public media by minute. This has the obvious benefit that a company can make an immediate impact and be better aware of the changing marketing environment. However, the problem of this new PR is that a company's competitors have these advantages too. So it is likely that there will be an increased need for defensive PR (Chaffey et al., 2003). Because of the high involvement of Internet in this new method of PR, it is not considered as an offline marketing communication tool in this study. The degree of trust and confidence generated by public relations makes this tool important because it can reduce buyers' perceived risk. However, while credibility may be high, the amount of control that management is able to bring to the transmission of the public relations message is very low (Fill et al, 1995). Forster (1998) also points out that public relations can have a stronger impact on public awareness at a much lower cost than advertising. But, because the communication efforts of PR staff are often focused on groups other than just buyers, its uses are limited. 2.1.3 Direct Marketing Direct marketing is a promotion tool through a mail shot (always delivered in the post), a mail drop (delivered to the door), telemarketing (unsolicited phone calls) or a fax message (Baker, 1994). Direct marketing can represent a strategic approach to the market although some organizations use it as a tactical tool. Use of this tool signifies an attempt to actively remove channel intermediaries, reduce costs and improve the quality and speed of service for individual customers. By removing the face-to-face aspect of personal selling and replacing it with either an email communication, a telephone of personal selling and replacing it with either an email communication, a telephone conversation or a direct mail letter(Fill et al, 1995). Kotler and Armstrong (2001) point out that the major forms of direct marketing include: --Face-to-face selling: relying on a professional sales force to locate prospects, develop them into customers, build lasting relationships, and grow the business. Or
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Literature Review companies hire manufacturers' representatives and agents to carry out the directselling task. In addition, many consumer companies use a direct-selling force to reach final consumers: insurance agents, stockbrokers, and salespeople working partor full-time for direct-sales organizations; ? Telemarketing: using the telephone to sell directly to consumers; ? Direct-mail marketing: through single mailings that include letters, ads, samples, foldouts and other"salespeople with wings" sent to prospects on mailing lists; ? Catalog marketing: direct marketing through print, video, or electronic catalogs that are mailed to select customers, made available in stores or presented online; ? Direct-response television marketing: direct marketing via television, including direct-response television advertising or infomercials and home shopping channels. ? Kiosk marketing: information and ordering machines called kiosk. Companies place the kiosk in stores, airports, and other locations in order to help customer tryout or get information before the purchase. ? Online marketing: marketing conducted through interactive online computer system, which link consumers with sellers electronically. According to Chaffey et al., (2003), direct marketing can be an effective method of driving traffic to the website. As the main way of direct marketing, direct mail campaign is used to drive the response to the website. Many catalogue companies will continue to use traditional direct mail to mail-out a subset of their offering, with the recipient tempted to visit the site through the fuller offering and incentives such as competitions or web-specific offers. Lindström & Anderson (2000) explain that direct mail which means to send all the recorded users in the target group a letter detailing what new opportunities are now being made available on the net is an appropriate idea. In this way the whole story can be told and can be adapted to suit the needs of different customers. 2.1.4 Sponsorship Sponsorship is a promotion tool through association of a product or service with an entity, event or activity (such as sports teams, cultural programmes, arts, education, community and broadcast.) in the expectation of secondary exposure via attribution to the sponsor during associated media converges. (Baker, 1994) Smith (1998) points out that sponsorship is more than patronage, altruism or benefaction. It can indeed help others while simultaneously achieving specifically defined promotion objectives. Some sponsors see sponsorship as a form of enlightened self-interest, where a worthy activity is supported with cash and/or consideration in return for satisfying specific marketing or corporate objectives. In Lindström & Anderson (2000) book, sponsorship is considered as the exposure of a brand, logo with the URL, typically for a long time than an advertisement which helps to make the company website visible to the public and generate the traffic to the website. There are several advantages and disadvantages of the sponsorship. Sponsorship can be cost effective (compared to advertising) in terms of reaching a particular audience.
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Literature Review It does allow access to very specific types of audiences that otherwise might be difficult to reach. Sponsorship can achieve many different objectives including: generate traffic awareness; image enhancement; improved relationships with many different "publics"; increased sales, sampling and database building; creating a platform for new promotional material; beating advertising bans, etc. It also offers creative opportunities including the engagement of an audience in a relaxed atmosphere of goodwill. Hospitality events open doors and create a dialogue that conventional media simply cannot. However, sponsorship is considered insidious and that it undermines artistic integrity. Although sponsorship can deliver extremely costeffective benefits, it can be misunderstood as an excessive indulgence by employees if they are kept in the dark about it and if there are redundancies occurring at the same time. (Smith, 1998) 2.1.5 Exhibitions Smith (1998) points out that exhibitions are unique in that they are the only medium that brings the whole market together- buyers, sellers and competitors-all under one roof for a few days. Products and services can be seen, demonstrated or tested, and face-to-face contact can be made with a large number of relevant decision makers in a short period of time. Relationships can be strengthened and opportunities seized if planned carefully. Exhibition offer an array of opportunities, problems and challenges to the keen marketing manager. They can be leveraged to the maximum effect by integrating them with other communications tools and developing a longer-term perspective incorporating an overall exhibition strategy. However, although exhibitions are a powerful marketing communications tool, they require detailed planning and coordination of resources. Compare to the B2B market, exhibitions in B2C market usually take up less marketing budget. Many objectives can be achieved through exhibitions such as: ? Sales - generate sales and enquiries from new and existing customers, agents and distributors. ? Launch new products or website. (It included new products, services and the important windows for the company: website. It is indeed an effective ways to attract more traffic to the website. ) ? Maintain a presence - in the market. ? Press coverage - internal and external PR opportunity. ? Reinforce relationships - with customers, distributors and agents through hospitality and introductions to senior managers and directors. ? Support local distributors/agents - by exhibiting. ? Market research - customers, non-customers and distributors. ? Test new ideas - product testing and informal creative discussions. ? Competitor analysis and intelligence gathering. ? Staff motivation - some exhibitions can be the focal point of the year. They allow staff to come to the show (exhibition) and feel a certain amount of pride in their organization.
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Literature Review ? Meet new staff or potential recruits. 2.1.6 Corporate Identity Corporate identity is what it says - a visual means of identifying a corporation, company or organization. Logos and names are only part, albeit a very obvious part, of an organization's identity. Corporate identity is a strategic asset that helps to achieve the longer-term communication goals. It cannot therefore be used as a shortterm tactical tool like advertising or PR, which can change from day to day (if required). As with and fixed asset, the corporate identity asset needs to be checked and maintained to keep it in good working order. If allowed to fall into disarray or disrepair it can, like other assets, eventually become a liability by projecting an inappropriate image. (Smith, 1998) Corporate identity reflects the personalities, core values and direction of a company. It is a one way of communicating the values it wants to express. Corporate identity is seen as a symbolic uniform that acts as a flag expressing everything about the organization. It is a visual system which uses all the points of public contact. This includes the "permanent media" or buildings (exterior and interior), signage, vehicles, uniforms, business forms (invoices, cheques, letterhead, etc), literature (Product brochures, annual reports), exhibition s, etc. Furthermore, some companies stamp their logos on to their individual brands' advertising, packaging and point-of-sale material. (Ibid) 2.1.7 Packaging Packaging is a promotion tool through display, guaranteeing exposure to customers at the point of sales, but not to a wider target audience. (Baker, 1994) Smith (1998) points out that since many sales assistants have been replaced by self-service systems; packaging today often has to act as a silent salesman, helping customers by bringing a particular brand to their attention, highlighting USPs (unique selling propositions/unique benefits), giving friendly tips on usage and, ultimately, helping them to break through the misery of choice created buy the increasingly vast range of seemingly similar brands. There are three basic functions of packaging: protect (and contain); offer convenience; communicate. First, a pack must protect its contents during storage, transport and usage. Some packs have to protect the user from the contents. Second, the pack must offer convenience in pouring, squeezing, storing, stacking and consuming. Even a minute improvement in convenience can create competitive advantage. Third, the pack can communicate, which include instructions, information of company, logo, and website address, which can create customer awareness of the website and corporate identity effectively. (Ibid)
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Literature Review 2.1.8 Merchandising There was a time when below the line point-of-sale (POS) materials were considered relevant only to cosmetics, perfumery, confectionery or other impulse purchase. Today merchandising techniques apply to a broader spectrum of markets, from customer to industrial. Although vast budgets can be spent above the line on advertising to gain the customer's attention or change an attitude, fewer resources are sometimes allocated to the crucial moment in the buying process - the point in the buying cycle where the customer is physically in front of the product or service and is about to make decision whether to buy or pass by - the point of sale. (Smith, 1998) In many consumer merchandise has the vital role to guide a buyer towards making a purchase by using merchandising techniques such as display and store design. However, the merchandising opportunity lies relatively untapped in industrial wholesale outlets such as electrical wholesalers or builders' suppliers, where a lot of merchandising tends to look dusty, dirty and uninteresting. But merchandising here can provide customers with useful information, which can remind the buyer about other relevant products, services, website and any special offers. (Ibid) 2.1.9 Word of Mouth According to Chaffey et al., (2003), word of mouth (WOM) is playing an important role in traffic building. WOM through friends, relatives and colleagues was the most important method. Internet customer can told their friends, relatives about his or her online shopping experience. If the online experience is favorable, the customer will tell more people the website, but if it is bad, they will tell twice as many, so word of mouth can be negative also. Thus, the role of opinion leaders and multi-step communications with target audiences receiving information about the Internet experience from opinion leaders, the mass media and the Internet, appear to be perhaps even more important in relation to the Internet than for other media. According to Rogers (1983), to exploit this tool, it is necessary for companies to use appropriate techniques to target and adapt the message for the opinion leaders when a product or service is at an early stage of diffusion. Furthermore, Smith (1998) points out there are many devices and techniques that encourage and accelerate the WOM process such as postcards, digital postcards, Tshirt, photographs, awards and certificates. Especially, Internet can promote WOM in an effective and efficient ways. The Internet can accelerate word of mouth with its networks of news groups, chat rooms, discussion forums and email chain letter. Better use of website can develop a network of different groups of person in the process of WOM.
2.2 Online marketing communication tools used for traffic building
13
Literature Review Chaffey et al. (2003) and Lindstrom & Anderson (2000) provide rather comprehensive descriptions of online communication tools including banner advertising, affiliate networks, search engine registration and optimization, link building, e-mail marketing, and viral marketing. We will discuss each of them below: 2.2.1 Banner Advertising Chaffey et al. (2003) define banner advertisement as a rectangular graphic displayed on a webpage for the purposes of advertising, which is normally possible to perform a click through to access further information. Lindstrom and Anderson (2000) reveal that the banner ad is Internet's most widespread and commonly used form of advertising. Banner is a graphic element with a fixed size and a fixed position on the website. The banner ad is effective at several levels - the user can see the advertisement, click on it and get onto the advertiser's website. In some certain cases the user can participate in an interactive game, etc., on the actual banner ad. (ibid) Along with the development of the Internet technology, the evolution of banner ads generates many different forms of them. Chaffey et al. (2003) point out banners can be in many different formats such as static banners, animated banners, interactive banners, pop-up, rich-media; and Lindstrom and Anderson (2000) present five different formats of banners including traditional banner ad, animated banner ad, interactive banner ad, context-sensitive banner ad, and rich media banners. According to their previous researches on the banner ads, we decide to discuss banner ads in the following six forms: a) Static banners do not change through time. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) b) Animated banners have the norm with a typical rotation of three to five different images, which are displayed in sequence to help to attract attention to the banner and build up a theme, often ending with a call to action and the conjunction to click on the banner. A further type of animated banner ad is the overt, which typically an animated ad that moves around the page and is superimposed on the website content. Animated banners are the most widespread type of banner now n the Internet as they attract more attention than traditional static ads. Animated advertisements can be in the style of a simple cartoon-still with text and the facility to click onto a website. It can last a maximum of a few seconds or loop. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) c) Interactive banners advertisements give the use the opportunity to participate in interactive games or amusements - these are incorporated into the actual banner ad itself. The interactive element increases the advertising possibilities dramatically. Provisional figures show that interactive banner ads can increase the click rate up to 600 percent in comparison to static banner ads. The user can type in an e-mail address on interactive banner to register for information, which may increase response since
14
Literature Review someone may fill in the form even though they might not bother to click on an advertisement. The interactive banners are intended to add value to the advertisement by providing a service that would normally only be available on the website. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) d) Pop-up is categorized as superstitious and interstitials. Interstitials are usually displayed as part of the main browser window, which are literally "in between" other screens of information. Superstitials take the form of an additional 'pop-up' browser window that is displayed when a new web page opened, which require interaction to remove them, so that they are intrusive and have been reported as unpopular, in contrast, some advertisers have found them to be quite effective. (Chaffey et al., 2003) e) Rich-media banners are to use a combination of animation, video or even sound on banner design. The new banner technologies, such as d-html, Java and Flash, introduce new possibilities with regard to the content and creativity possible in the banner. The banners can integrate small games, streaming news, sound and video clips. The users can even download files and print discount coupons or product information from a banner. Some problem of these developments need special technology t be installed on the user's machine, or require the most recent versions of browser before they can function properly. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) f) Context-sensitive banner advertisements are also called search word banners, which appear to the user as a conventional banner ad; they are made context-dependent and found primarily in search engines, each time a user searches for a word in the database, a banner ad appears for the company which has purchased that word. Search-word banners are at the present one of the most targeted marketing tools available on the Internet. American studies show that the banner appears under the condition has more than 60 percent chances to be clicked than the normal banner. (Lindstrom and Anderson, 2000) According to Cartellieri et al. (1997), the purpose of banner advertising could be: a) To deliver content, which is the typical case where a clickthrough on a banner advertisement leads through to a corporate site giving more detailed information on an offer. A direct response is sought here; (ibid) b) To enable transaction on a e-commerce site, which mainly refers to a merchant such as a travel site or online bookstore the ad is placed to lead directly to a sale. A direct response is also sought; (ibid) c) To shape attitudes when building brand awareness, which refers to the ad that is consistent with a company brand; (ibid) d) To encourage retention likewise a reminder of a company and its service and may link through to on-site sales promotions. (ibid)
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Literature Review 2.2.2 Affiliate Networks Chaffey et al. (2003) define affiliate networks as collection of websites that link to an online retailer in exchange for commission on purchases make from the retailer. It is effectively a no-cost method of advertising or one in which payment is only made where there is a definite outcome - the purchase of an item. The aim of affiliate networks is to use graphic or text link advertisements placed on many sites to generate traffic by referring links to a destination website. (ibid) 2.2.3 Search Engine Registration and Optimization Chaffey et al. (2003) explain that search engine provides an index of content on registered sites that can be searched by keyword; and search engine registration is a request to a search engine that a site be included within its index. Over 80% of web users state that they use search engines to find information, so that if search engine registration has not occurred for an organization, then traffic volume will be less than optimal. Search engines are constructed by software, which compile an index by sending out spiders or robots to crawl around sites that are registered with that search engine. Web directories or catalogues are constructed and presented differently from search engines. They provide a structured listing of registered websites and their purpose in different categories. They are constructed by human; and they do not give comprehensive access to all web pages but the list of company names, categories and a certain words description of the site. (ibid) The numbers of search engines are increasing more rapidly and specialized, so that the more places the company is registered the better. A product- or branch-specific search engine in the field the company represents is considered more important to get registered in. (Lindstrom and Anderson, 2000) Search engine users are most likely to select sites to visit that are near the top of a search engine listing (ranking) - typically within the first screen, so that how to make the firm's site stay in the first screen is a big issue, so that search engine optimization comes into the picture. It is a structured approach used to enhance the position of a company or its products in search engine results according to selected keywords. There are now many specialist search engine optimization companies. (Chaffey et al. 2003) 2.2.4 Link Building Chaffey et al. (2003) introduce the concept of link-building campaign which is a structured approach to gaining as many links as possible from other Web-related websites. It is a relatively straightforward method to make sure that their site has links from as many other related sites as possible, using hyperlinks. Chaffey et al. (2003) reveal that link building can be approached by following techniques:
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Literature Review a) Reciprocal links, which are two-way links agreed between two organizations. The benefit of the technique is that it is free. (ibid) Lindstrom and Anderson (2000) suggest that in order to find out what companies may be interested in such an exchange deal, think of the companies that are in the company's value chain. They are including shareholders, business associates, suppliers, dealers, and companies offering complementary products. b) PR - Content mentions, which refer to the links to the organization's site, are featured in media sites like online newspapers or trade magazines, then it also increase traffic. (ibid) c) Affiliates, which refer to affiliate networks, are widely used by e-tailers to drive traffic to a site. d) Sponsorship, which refer to a paid-for sponsorship of another site, or part of it, especially a portal, for an extended period is another way to develop permanent links. Co-branding is a similar method of sponsorship and exploit synergies between different companies. It is an arrangement between two or more companies where they agree to jointly display content and to conduct joint promotions using brand logos or banner advertisements. It is usually non-paid exchange, so it is seen as a cost-effective method of promotion which can be used for longer periods than banner advertisements. e) Banner advertising, which is widely used by large B2C companies to drive traffic to their site. f) Price-comparison portal, which are for companies selling commodity products using e-commerce to ensure that the products are listed on infomediary or portal sties offering product and price comparison. 2.2.5 E-mail Marketing Doubleclick (2001) reported that there is more spending on e-mail marketing than banner advertising in most European countries. Chaffey et al. (2003) point out according to surveys in many counties; it is a significant method of Internet communication. It is described in two categories: outbound email marketing, where email campaigns are used as a form of direct marketing to encourage trial and purchases and as part of a CRM dialogues, and inbound e-mail marketing, where emails from customers such as support enquiries are managed. E-mail offers many advantages as a communications tool - it offers immediacy, targeting, accountability and is relatively cheap. E-mail can also use in customer acquisition. There are two approaches to obtain e-mail address of prospects: one is to purchase of opt-in bought-in lists, which refer to the company contact a list broker or list owner and purchase e-mail addresses of individuals who have agreed to receive
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Literature Review marketing e-mails, the other one is to build a house list, which refer to use a company website combined with permission-based marketing opt-in techniques and a relevant incentive is offered in exchange for a prospect's providing their e-mail address by filling in an online form. (ibid) 2.2.6 Viral Marketing Viral marketing is used to transmit a promotional message to another potential customer. It is effectively an online form of word-of-mouth communications. Viral marketing harnesses the network effect of the Internet and can be effective in reaching a large number of people rapidly in the same way as a computer virus can affect many machines around the world. (Chaffey et al. 2003) 2.2.7 Vertical Portals Lindstrom and Andersen (2000) mention vertical portals as a kind of online marketing promotion technique, which is a web marketplace in a certain industry. It can also lead to an industry-specific community. If there is not yet a relevant portal, it could make sense to set up links to all competitors without necessarily getting links from their sites in return. In this way the company's website can become the gateway for the industry; then the company can make good use of the opportunity to present its information - being the fist and the best.
2.3 Evaluation of effectiveness of communication tools in traffic building
According to Lindstrom and Andersen (2000), there are several quantitative measurements of the success of communication tools, which all gives the company an idea on how well they manage to attract traffic to their website: ? The number of individual visitors This parameter can give an indication of how successful the external communication has been in promoting traffic on the website. Generally, an address of the site that is easy for the potential user to remember also tends to increase the number of individual visitors. ? The number of minutes spent by the user The longer time the visitors spend at the website, the greater the probability that strong relationships are being built between the user and the brand. The measurement should also include the amount of time the visitor spends per page, since that is a measurement of increased dialogue with the user. ? The number of minutes the visitor spends on average on the main activities of the website
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Literature Review For instance if two out of three pages in a main activity of the site has generated long visits, but not third, it is likely to assume that the creativity has come to an halt, rather than the user's interest in the subject itself. ? The number of repeat visits This parameter shows to what extent the site was able to live up to the expectations of the user. If the user needs for information, entrainment and communication have been sustained; it is likely that they will visit the site repeatedly. ? The user's behavior at the website Measure which activities on the site that were visited first and in what order the subsequent visits were selected and if this is in accordance with the messages and the values originally intended by the site owner. ? The number of e-mail received from customers The number of e-mail is also an indicative to the website's quantitative success, especially so if the site aims to provoke visitors to sending e-mails feedback. Conversely, if the site wish to avoid e-mail altogether, this measurement is obviously less significant. ? The website's sales and income The more the website is designed for Internet sales, the more important is it that goals should be set for sales, the rate of sales and the income. Lindstrom Andersen (2000) states that above measurements can be analyzed by companies' own database or special online software. Based on the result of evaluation on the effectiveness of each communication tools, company can find out efficiency of each communication tools and choose the most efficient tools to promotion the website. (Lindstrom Andersen, 2000) According to Hoffman et. al (1997), a website's effectiveness could be monitored in two different ways. First, one can observe the behavior of those entering the site and starting to move through it. The company can track their movements and see if they go to the areas the company wants them to go to. The company can see if they consistently log off a certain point and then tie that behavior back to our theory. If the company had assumed that our customers would want to download that hefty file of information because the company knows it will match their interests and yet the company see that most customers do not, the company can safely assume that the average download time of three minutes may be too long. So, the company can cut that file into smaller pieces and see if they hang on for 15 seconds. The company can help them along, just as the company do in an article, by advising them of what is to come and how long it will take. (Ibid)
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Literature Review The second prime way the company can track their behavior is to see whether they return to the site. The fundamental objective of any organization is to have repeat business - few people survive by interacting with customers only once. How many of our customers come back again and again, and how do they move through the site? People all know about bookmarks, so people usually bookmark the sites that they want to return to. By measuring the return hits and looking at the behaviors the company can quickly turn those data into useful information: 20 percent of first- time users come back again; 15 percent of them consistently log off at certain points, for example. That gives the best information of all - it tells the company what the people they are really interested in are doing. (Ibid)
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Frame of Reference
3. Conceptualization and Emerged Frame of Reference
This chapter includes the conceptualization and the emerged frame of reference of this study. The conceptualization allows us to answer this study's research questions. The frame of reference, which results from this conceptualization, will guide the data collection and data analysis in this study.
3.1 Conceptualization
All selected concepts below have been chosen on the basis of their potential strength as topics for data collection. Based on our three research questions: RQ1: How can offline marketing communication tools used for traffic building be described? RQ2: How can online marketing communication tools used for traffic building be described? RQ3: How can evaluation of effectiveness of communication tools in building traffic be described? We have developed relevant theory from several previous studies as our foundation of data collection. These are presented in the following sections. 3.1.1 How can offline marketing communication tools used for traffic building be described? In correspondence with the first research question, we are going to use the previous studies of below listed authors in order to make an effective data collection. These authors include Chaffey et al., (2003), Kotler & Armstrong (2001), Lindström & Anderson (2000), Smith (1998), Baker (1994), Foster (1998), Fill (1995), Powers (1989), Fill et al. (2005) and Morris (1992). After compared the literatures, we decide to select the six kinds of offline communication tools addressed by Chaffey et al. (2003) and Lindström & Anderson (2000) as frame of reference, as these tools are more relevant to traffic building according to them. Furthermore, we complement other authors' studies into each of the offline communication tool addressed by Chaffey et al. (2003) and Lindström & Anderson (2000) in order to provide a better understanding of the tools and thorough theoretical base for later analysis. ? Publicizing the URL offline Publicizing the URL offline could be in business cards, letterheads, brochures, telephone directories and other reference books, television and radio advertisements, advertisements (excludes TV and radio advertisements), hoardings and billboards, packaging and point-of-sale material, which could be incidental advertising or specific advertising of online presence; ? Public Relation
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Frame of Reference Press relations, product publicity, public affairs, investor relations and development. ? Direct Marketing Telemarketing, direct-mail marketing and catalog (non-electronic) marketing. ? Word of Mouth Of all the elements of the communication mix, word of mouth (WOM) is by far the most potent on a one-to-one basis. No amount of advertising or expert spelling could compete with the WOM. Opinion leader plays an important role in spreading the information. 3.1.2 How can online marketing communication tools used for traffic building be described? In order to collect data on second research question, we decide to use Chaffey et al. (2003) and Lindstrom and Anderson (2000) previous studies on the online marketing communication tools, because the authors' study are the most comprehensive ones. These studies will be presented into an eclectic list that we will use during the data collection. In the pretests of both cases, viral marketing is found to be an inappropriate online communication tool, as both companies think that the benefit of using viral marketing in terms of traffic building would not overcome its negative influence on their brand images. So it will not include in the concept framework of RQ2. ? Banner Advertising Banner advertising has different forms of banner advertising including static, animated, interactive, pop-up, rich-media, and context-sensitive banner. The purposes of banner advertising could be to deliver content, to enable transaction, to shape attitude, to encourage retention. ? Affiliate Networks Affiliate networks is basically a networks connected by exchange links and commissions between each others. It is primarily applying on B2C sites; the form of affiliate networks in B2B market could be different. ? Search Engine Registration and Optimization The more Search engine the company registered, the more traffic the website could generate. Directories and catalogues are technically different from search engine, but works as good as search engine, especially in a certain industry context. Search Engine optimization can be dealing in the company and outsourcing. ? Link Building Link building can be done by reciprocal links, PR-content mentions, affiliates, sponsorship, co-branding, banner advertising, and price-comparison portal.
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Frame of Reference ? E-mail Marketing Inbound e-mail marketing is very much related to CRM and customer retention, so that it would not be considered related to our research questions. Outbound depends on e-mail address list, which can be obtained by two ways: purchase of opt-in lists and build a house list. ? Vertical Portal The company could be the gateway or a single link in vertical portal of a certain industry. 3.1.3 How can evaluation of effectiveness of communication tools in traffic building be described? To answer our research question about measurement of effectiveness of communication tools, we select a few relevant variables from Lindstrom and Andersen (2000), which consists of the following methods: ? The number of individual visitors ? The number of minutes spent by the user ? The user's behavior at the website ? The number of e-mail received from customers ? The website's sales and income We will be using this theory since we think it is the most comprehensive method of evaluation in our reviewed literature. The method uses quantitative data, which are normally easy to collect from the website's statistics by companies.
3.2 Emerged Frame of Reference
As pointed out earlier in this chapter, the conceptualization above is what will allow us to answer this study's research questions. Based on the research questions and the purpose of this thesis stated in chapter one, we have created a frame of reference. This frame of reference will become the foundation of this study's data collection and analysis. The frame of reference is presented in figure 3.1 on next page:
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Frame of Reference
RQ1: Offline marketing communication tools
•Publicizing the URL offline •Public Relation. •Direct Marketing
.Word of Mouth
RQ3: Evaluation of effectiveness of online and offline marketing communications tools. visitors
RQ2: Online marketing communication tools
Traffic Building To Website
•The number of individual •Minutes spent by user •Users' behavior at the
website
•Banner advertising •Affiliate networks •Search engine registration
and optimization
•E-mail received from
customers
•Website sales and income
•Link building •E-mail marketing
.Vertical portal
Figure 3.1 The Frame of Reference of this study Figure 3.1 shows traffic building as the mainly concerned topic of the study is listed in the central place, online and offline communication tools which have interlinks with each other are listed in two distinguished boxes on the left side which can be employed in traffic building; and evaluation variables of the effectiveness of online and offline marketing communication tools are listed in the box on the right side, will leads the company to adopt more efficient tools in order to achieve better result of traffic building.
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Methodology
4. Methodology
In this chapter, a series of steps was described in order to collect the data necessary to obtain answers to the research questions. These methodology issues are presented below in figure 4.1, which show a graphical overview of the methodology issues used in this study.
Figure 4.1 Schematic Presentation of the Methodology Source: Adapted from Foster, 1998, p.81
4.1 Research Purpose
Yin (1994) shows that a research purpose was classified into three basic purposes: exploratory, descriptive and explanatory. ? The purpose of an exploratory stage is described that is designed to allow an investigator to just "look around" with respect to some phenomenon, in order to develop suggestive ideas. The research should be as flexible as possible and provide guidance for procedures. The focus is initially broad and becomes progressively narrow as the research progresses. ? A descriptive stage is to develop accurate description of persons, evens or situations. It is necessary to have a completed profiles of the phenomena on which you want to collect information to the data collection. ? The objective of an explanatory stage is used to explain a certain set of events and to indicate how the investigation may apply to other investigations (Yin, 1994). Saunders (2000) also suggests that an explanatory research aim to establish casual relationships between variables. The emphasis here is on studying situation or a problem in order to explain the relationships between variables. (Saunders et.al, 2000) Based on the overall purpose and the research questions involved, the research purpose of this study is descriptive and partially explanatory. Because we aim to develop an accurate description of the situation that how marketing communication tools being used in traffic building and the measurement of evaluating the
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Methodology effectiveness of the tools. When we answer the research questions, we begin to explain somehow in order to draw a conclusion. Therefore this study is more descriptive than explanatory.
4.2 Research Approach
Different approaches can be taken such as deductive or inductive. Deductive research starts with existing theories and concepts and formulates hypotheses that are subsequently tested; its vantage point is received theory. Inductive research starts with real-world data, and categories, concepts, patterns, models, and eventually, theories emerge from this input. After the initial stages, all types of research become iteration between the deductive and the inductive. This is sometimes referred to as adductive research. (Gummesson, 2000) A qualitative approach is one in which the inquirer often makes knowledge claims based primarily on constructivist perspectives (i.e., the multiple meanings of the individual experiences, measuring socially and historically constructed, with an intent of developing a theory or pattern) or advocacy/ particularly perspectives (i.e. political, issue-oriented, collaborative, or change oriented) or both. It also uses strategies of inquiry such as narratives, phenomenology, ethnographies, grounded theory studies, or case studies. The researcher often collects open-ended, emerging data with the primary intent of developing themes from the data. (Creswell, 2003) Since our research purpose and research questions were developed on existing theories and concepts, it is deductive. The purpose of this study is to provide a deeper understanding of the communication tools used by companies to build traffic to their website and measures they adopt to evaluate the efficiency of these tools. According to Jessica et.al, (2006), the qualitative method also has a tendency to see words as the central analysis unit and be associated with description and small-scale studies which is consistent with our research. So the selection of qualitative approach was found to be more appropriate to fulfill our research purpose.
4.3 Research Strategy
Based on our research purpose, we bring three research questions in order to answer the research problem and accomplish the overall purpose: RQ1: How can offline marketing communication tools used for traffic building be described? RQ2: How can online marketing communication tools used for traffic building be described? RQ3: How can evaluation of effectiveness of communication tools in traffic building be described?
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Methodology According to Yin (1994) there are five primary research strategies in the social sciences. These include experiments, surveys, archival analysis, histories, and case studies. Which one of these five strategies that are most suited for a study, depends on the type of research question, the degree of control the researcher has over the study, and whether the study has its focus on contemporary events. Table 4.1 described further for the different research strategies. Table 4.1 Relevant Situations for Different Research Strategies Requires Control over Behavioral Events
YES NO
Strategy Experiment Survey Archival Analysis History Case Study
Form of Research Question
How, Why? Who, What, Where, How Many, How Much Who, What, Where, How Many, How Much? How, Why?
Focuses on contemporary Events
YES YES
NO
YES/NO
NO
NO
How, Why?
NO
YES
Source: Yin, 2003 p.6 Yin (2003) points out that the case study is an empirical inquiry that investigates a contemporary phenomenon within its real-life context, especially when the boundaries between phenomenon and context are not clearly evident. The case study allows an investigation to retain the holistic and meaningful characteristics of real-life events. A case study can involve a single and a multiple-case study. The single case study makes an in-depth investigation regarding only one entity but multiple-case study has distinct advantages and disadvantages. The evidence from multiple cases is often considered more compelling, and overall study is therefore regarded as being more robust. (Yin, 2003) And the increased number of case can increase the validity of research. However, multiple-cases are time-consuming and high cost. In this study, we actually deal with 'how' and 'why' in some extent, so that according to Yin (2003) the strategy of experiment, history and case study can be choose from. As the study does not require control over behavioral evens, experiment is not suitable. In Internet context, things is changing constantly and rapidly, therefore the study will be rather valuable in focus of contemporary evens, hence history is eliminated. According to above consideration, case study is the one that we select. In light of Yin (2003), multiple-cases is regarded as more robust, hereby we choose
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Methodology multiple-cases. The number of case will be decided according to our resources in terms of timing and cost, and two cases are affordable.
4.4 Data collection
There are six sources for the collection data of case studies: documents, archival records, interviews, direct observation, participant-observation, and physical artifacts. (Yin, 1994) These sources of evidence can both be strong as well as weak evidence according to Yin (2003). In the figure 4.2, an overview of the six sources of evidence is presented together with their comparative strengths and weaknesses. Table 4.2 Sources of Evidence STRENGTHS WEAKNESSES
Source of Evidence
• Stable: can be reviewed repeatedly •Retrieval ability: can be low • Unobtrusive: not created as a •Biased selectivity: if collection is
result of the case Documentation incomplete
• Exact: contains exact names,
references, and details of an event
•Reporting bias: reflects(unknown)
bias of author blocked
•Broad Coverage: long span of
time, many events, and many settings Archival Records
•Access: may be deliberately •(Same as above for documentation) •Accessibility due to privacy
reasons
•(Same as above for documentation) •Precise and quantitative •Targeted: focuses directly on case
study topic
•Bias due to poorly constructed
questionnaires
Interviews
•Insightful: provides perceived
causal inferences
•Response bias •Inaccuracies due to poor recall •Reflexivity: interviewee gives •Time consuming •Selectivity: unless broad coverage •Reflexivity: event may proceed
what interviewer wants to hear
Direct Observations
•Reality: covers events in real time •Contextual: covers context of event
differently because it is
•Cost: hours needed to human •(Same as for direct observations) •Bias due to investigator's
manipulation of events observers
being observed
Participant Observation
•(Same as for direct observations) • Insightful into interpersonal
behavior and motives
Physical Artifacts
•Insightful into cultural features •insightful into technical operations
•Selectivity •Availability
Source: Yin (1994), P. 80
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Methodology
The data that will be collected is expected to be mainly of a qualitative nature, due to the chosen units of analysis. According to Yin (2003) information found in documents is likely to be relevant for nearly every case study topic, especially for confirming and supplementing evidence from other sources. Documents are important in the data collection stage in a case study, due to their overall value. However, care must be taken in the interpretation of documents, since they are often prepared for another purpose and audience than that of the case study (Yin, 2003). Yin (2003) defines the interview as a two-way conversation that gives the interviewer the opportunity to participate actively in the interview and states that interviews are one of the most important sources of case study evidence. The interview is structured and based on predetermined questions. According to Yin (2003) there are three types of interviews: open-ended, focused, and structured. The most commonly used interview method is open-ended, where the researcher asks the respondent unstructured questions, thus allowing the interview to be more of a discussion. The respondents can be asked for facts as well as their own personal opinion. When a focused interview takes place, the respondent is interviewed during a brief period of time-an hour, for example. The purpose with a focused interview could be to confirm certain facts that are already known to the researcher. The third form of interview, survey, is more of a combination of an interview and a survey and entails more structured questions along the lines of a formal survey. A common question about doing interviews is whether to record them. Using recording devices is in part a matter of personal preference. Audiotapes certainly provide a more accurate rendition of any interview than any other method (Yin, 2003). Most qualitative interviews occur on a one-to-one, face-to-face basis. However, one-to-one interviews may also be conducted by telephone in particular circumstances. (Saunders et al., 2003) Because the research approach and research strategy are qualitative and case study, archival records, direct observations, participant observation, and physical artifacts are not relevant to this study. Interview is the fundamental source to gain primary data; and secondary data can be collected through documentation, which is an important supplement to primary data. Therefore the interview and documentation are the two selected resources of evidence in data collection.
4.5 Sample Selection
According to Saunders et al. (2003) sampling techniques provide a range of methods that enable you to reduce the amount of data you need to collect by considering only data from a subgroup rather than all possible cases or elements. Qualitative researchers rarely draw a representative sample from a huge number of cases to intensely study the sampled cases-the goal in quantitative research. For qualitative researchers, it is their relevance to the research topic rather than their representative which determines the way in which the people to be studied are selected (Neuman,
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Methodology 2003). Non-probability or judgmental sampling is more frequently used for case study research. Purposive or judgmental sampling enables you to use your judgment to select cases that will best enable you to answer your research question(s) and to meet your objectives. This form of sample is often used when working with very small samples such as in case study research and when you wish to select cases that are particularly informative. (Saunders et al., 2003) In sample selection, we have following criteria: a) It should be an e-commerce company. b) It works on B2C markets in some extend. c) It is a new small company situated in Luleå. For every potential samples, we use email to contact it first in order to find out whether it appropriate to our study. Finally two online B2C companies are chosen as our interview objectives: NetixAB and Rosell & Clack ImportlagretAB. The reason for this selection is that both of the companies pay a lot of attention to promote their websites and focus on evaluation of effectiveness of marketing communication tools, especially they are very interested in our research topic.
4.6 Data Analysis
Data analysis is one step, and an important one, in the research process. Researchers generate information by analyzing data after its collection (Cooper & Schindler, 2003). According to Miles & Huberman (1994), the analysis of qualitative data consists of three activities: data reduction, data display, and conclusion drawing. Data reduction refers to the process of selecting, focusing, simplifying, abstracting, and transforming the data that appear in written-up field notes or transcriptions. Data reduction is not something separate from analysis. It is part of analysis. Qualitative data can be reduced and transformed in many ways: through selection, through summary or paraphrase, through being subsumed in a larger pattern, and so on. (Miles & Huberman, 1994) Display, generically, is an organized and compressed assembly of information that permits conclusion drawing and action. Looking at displays helps us to understand what is happening and to do something-either analyze further or take action-based on that understanding. Better displays are a major avenue to valid qualitative analysis. As with data reduction, the creation and use of displays is not separate from analysis, it is a part of analysis. (Miles & Huberman, 1994) Conclusion drawing and verification is the third stream of analysis activity. From the start of data collection, the qualitative analyst is beginning to decide what things mean and the competent researcher holds these conclusions lightly, maintaining openness and skepticism. Final conclusions may not appear until data collection is over.
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Methodology Conclusions are also verified as the analyst proceeds. The meaning emerging from data have to be tested for their plausibility, their sturdiness, their conformability-that is their validity. Otherwise we are left with interesting stories about what happened, of unknown truth and utility. (Miles & Huberman, 1994) The above-mentioned three steps were followed for data analysis. First, the data were reduced through a within-case analysis where the cases compared with the frame of reference. Secondly, all of the data was further reduced through being displayed in order to have an inter-case comparison. Last step was to draw conclusions and verify our findings with the theories explained previously in chapter two. So the empirical data will be analyzed in the order of the research questions. To begin, a within-case analysis will be for each of the case studies by comparing the empirical data presented in the previous chapter with the conceptual framework presented in chapter two. Thereafter, the data for each research question will be displayed through a cross-case analysis, where the two case studies are compared with each other to find similarities and differences in order to draw conclusions.
4.7 Reliability and Validity
Reliability means dependability or consistency. It suggests that same thing is repeated or recurs under the identical or very similar conditions. Validity is concerned with whether or not the item actually elicits the intended information. Validity suggests fruitfulness and refers to the match between a construct, or the way a researcher conceptualizes the idea in a conceptual definition, and a measure. It refers to how well an idea about reality "fits" in with actual reality (Neuman, 2003). As Neuman (2003) states reliability is necessary for validity and is easier to achieve than validity. Although reliability is necessary in order to have a valid measure of a concept, it does not guarantee that a measure will be valid. It is not a sufficient condition for validity. Figure 4.2 illustrates the relationship between the concepts by using the analogy of a target. The bull's-eye represents a fit between a measure and the definition of the contract. Yin (2003) discusses four different tests of judging the quality of research design: 1) Construct validity: establishing correct operational measures for the concepts being studied. 2) Internal validity: establishing a causal relationship, whereby certain conditions are shown to lead to other conditions, as distinguished from spurious relationships. 3) External Validity: establishing the domain to which a study's findings can be generalized. 4) Reliability: demonstrating that the operations of a study-such as the data collection procedures can be repeated, with the same results. (Yin, 2003)
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Methodology
Figure 4.2 Illustration of relationship between reliability and validity (Source: Neuman, 2003, p.186) According to Yin (2003), every case study project should strive to develop a formal, presentable database, so that, in principle other investigators can review the evidence directly and not be limited to the written reports. In this manner, a case study database markedly increases the reliability of the entire case study. For case studies, notes are likely to be the most common component of a database. The notes may be a result of an investigator interviews, observations, or document analysis. (Yin, 2003) To minimize the errors in this study, the interview guide was granted by supervisor, before it was sent to the respondents. It is necessary for respondents to get the interview guide in advance as the respondents can prepare themselves for the concerned questions, which could minimize the external factors influencing quality of data in terms of respondents' mood or health condition. During the interview, one of researchers conducts the interviews and the other take notes in order to minimize possibility of mistakes and to be sure that noting was forgotten. As our research is qualitative in nature, the aim is not to generalizations but efforts were made to improve reliability through tape recording of the interview too.
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Case Studies
5. Case Studies
This chapter contains the data collected from two case studies. Each case will be introduced with a short introduction about the company, and is followed by a presentation of the data collected from interviews as well as company documents.
5.1 Case 1: Netix AB
Company Background Netix AB is a small online advertising company, situated in Aurorum Science Park, Luleå City, Sweden. The company works both in B2B and B2C market. www.skraplotto.se is currently the main business of Netix AB. The business concept is to advertise their business customers' products or services through online free lottery. The registered users of the website are able to scrap free lottery tickets on the website and win random gifts, which are provided by Nextix's business customers. Netix AB was found in 2005 by two graduated students of LTU. There are two employees working in the company beside themselves. Although Netix AB is struggling on the bottom line of survival as a new company, the company has achieved rapid growth. By the end of 2006, it has gained 23,000 registered users and seven sponsor companies (three of them are large companies). Netix AB generates profit mainly from two sources: one is from advertising on its website for business customers, where the website traffic is an important metric in advertising rates; and the other is commission from the business customers. We have interviewed Mr. Daniel Löfmark who is one of the founders of Netix AB working as the marketing and financial manager. During the interview Mr. Daniel Löfmark was very active, friendly, and helpful. We also got the impression that he is very interested in our research as traffic building is essential for the company. 5.1.1 Offline marketing communication Publicizing the URL offline According to Mr. Löfmark, publicizing the URL offline is an important communication tool in traffic building. On the business cards, URL of corporation's website are stated, from which there is a link to the website of www.skraplotto.se. According to the respondent, the aim of doing so is to enhance branding of the corporation. The same situation and aim go for the letters, Netix AB is used to send mails to the winners, the website of corporation is stated on letterheads, but not the specific site. Brochures are not pressed yet because the essence of the business is online, physical brochures are not prioritized in budget. Telephone directories and other reference books are not used as the company thinks they are rather expensive and might not be effective media for promoting online business. He addressed that local newspaper is the most efficient offline medium for advertisement in publicizing the URL offline, because it is not only a cost effective medium but also cover a wide
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Case Studies range of reader in Luleå since the online lottery player may come from any group of people in the society. Netix AB does not make use of magazines, for the medium are much more expensive than newspapers and have usually a certain segment of readers. Therefore it is considered not to be a medium as efficient as newspaper for URL advertising. TV advertisement is too expensive to be employed for the company at the moment. Although costs of radio are also very high, Netix AB has used Radio advertisement to make public aware of their web address, because of its high credibility and wider coverage in the public. Respondent highlights that radio is worth of costing so much money for its huge effect on brand awareness and credibility. Hoardings and billboards have never been considered by the company. Packaging and point-of-sale material are not used because the products have original packaging from Netix's customers and it would be too expensive to make another packaging for only promoting the URL offline. Moreover, they also put website address on their friends' or relatives' cars in order to attract the public attention, which is a non-cost method. Public Relation Netix AB put a lot of attention to public relations despite the limited budget. Respondent says that when the company launched, the new business idea and the two young entrepreneurs of LTU became focus of news on local news paper and TV. The company has been interviewed once by TV column and local newspaper and twice by an IT magazine for its technological superiority in website constructing. These exposures Netix AB continuously communicates its superiority of IT technology to journalist and press media, which can provide Netix AB great opportunity to keep contact and build close relation with press media constantly. According to respondent, current effort without involving investment on PR has brought a lot of benefit to the company; they plan to invest more on public relation in broader range in the future. At the moment, PR budget is too limited to support more PR activities such as product publicity, public affairs, and investor relations. However Netix AB gets supports from some nonprofit organizations such as Luleå Handelskammare that can provide the company the information which is needed in its value chain. Direct Marketing Respondent addresses that Netix AB used none of direct marketing approaches namely telemarketing, direct-mail marketing, or catalog (non-electronic) marketing. According to him, telemarketing is too expensive to be carried out and not considered as a cost-effective communication tool under current financial circumstance. Directmail marketing overlaps very much with the newsletter marketing in online context, which has many benefits that direct-mail marketing has not especially in costeffectiveness; therefore direct-mail marketing is not used by Netix AB. As an advertising company, Netix AB aims to promote its website in B2C marketing instead of selling the products, so that catalog marketing is not feasible to Netix AB. Word of Mouth
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Case Studies Netix AB considers the word of mouth as an important communication ways in traffic building. As a new small company, the first thing that they can do to promote their website without any extra costs is to ask their relatives, friends, and people as many as possible who are around them to tell people around them. Respondent also stresses the importance of having satisfied users, as they have the tendency to be opinion leader in word of mouth communication. They provide in-depth answer to the users who coming up with questions, not only dealing with 'what' and 'how' but also 'why', so that the users have more knowledge about the company and the lottery game than other users. When they are in the situation, they would be more than happy to share their knowledge with others. Among potential users, the knowledgeable users would be rather active in talking about the website and the game. Therefore they basically play a role of opinion leader. Finally, the respondent says among the communication tools they have exploited, the efficiency of this spread of publicizing the website by word of mouth is highest. 5.1.2 Online marketing communication Banner advertising According to respondent, Netix AB makes all the banners itself for they have the related technical background and the relatively tight budget on marketing. To www.skraplotto.se, banners are the most used advertising forms in online promotion of the website. Most of them are static banners with the logo in orange color which is exact the same to the name of the website "skraplotto.se". Normally there are two or three lines of text beside or below the banners to explain what the website is about. The company explains that the reason they use static banners is that "skraplotto.se" already claims what the website deals with. The little explanation around the banners can clarify the "free" feature of the website. All types of banners that company used are listed bellow:
a) b) c)
d)
e) Banner "a" and "e" are the best examples of the kinds of simplest static banners. There are also static banners like "c", which is a simplest banner with a little explanation of "free" feature on it. The type of banner is to facilitate a click through from the banner advertisement to www.skraplotto.se where the visitors can get detailed information about the offer. The banners like "d" demonstrate the ways of playing the lottery on www.soundicradio.se. The type of banner is consistent with the company's brand. The only animated banner is the one on www.roligast.com, which
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Case Studies is made of eight text pictures. The texts are presented in sequences that can delivery a complete idea. The contexts content of the eight pictures are as following: 1. skraplotto.se (skraplotto.se) 2. klicka här och bli medlem gratis! (click here and become member free!) 3. skrap gratis lotter via nätnet ? (scraper free lottery via Internet ...) 4. ?och vinna coola priser! (...and win cool prizes) 5. Tipa din kompis så får ni båda extra lotter. (Tip your friends so that both of you get extra lottery tickets) 6. Varje dag (very day) 7. glöm inte att du får ett antal gratis lotter varje plus ännu fler om du tipar dina vänner. (Do not forget that you get a number of free lotteries everyday and plus some more if you tip to your friends.) 8. börja skrapa nu! (Start to scraper now!) The speed of rolling the pictures is set according to the length of context in order to make the readers be able to finish reading of the context. The type of banner is to remind the users regarding the company's service and present the sales information as well as link through to the on-site promotions. The respondent also explains that the more complex banners might be blocked automatically according to the setting of the user to IE (Internet Explore) as some users believe those complex banners takes too long downloading time. And it is also expensive to produce them because the complex banners takes many more working hours than producing the simple ones. Since the content of the banner do not requires the complexity of it, Netix AB does not choose the more complex banner forms. Affiliate network The respondent says that the company has not an affiliate network for the purpose of www.skraplotto.se is not to sell products at the moment but to advertise products of the business customers. To sell the products is stated in company's long-term objective, when the website has more registered users. At that time, affiliate network could be considered by the company. Search engine registration and optimization According to respondent, the domain of www.skraplotto.se is used before by some other companies and the company registered it on www.doubler.com immediately when it became available again, so that the search engine registration has been done in certain websites somehow. The domain has been registered to those famous search engines such as www.google.com, www.yahoo.com, www.msn.com, www.altavista.com, www.ask.com, etc. Some specific search engine is also used by the company, for example, katalogen.sunet.se, which is a Swedish search engine, and people can search according to location, industry, keywords, even text. The company also registers to some web directories and catalogues likewise www.mer-traffic.se, www.uppslaget.se, www.topplista.se, etc. These are the websites working on categorizing the website and directing the users to come to the right
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Case Studies website by providing the precise information of what each registered website does and sometimes as well as the popularity and the clicks of them. The company does search engine optimization by itself, too. The company tries key words such as 'fri lotto'(free lottory), 'skraplotto' (scraper lottory), 'gratis lotto' (free lottery) and so forth from time to time in order to make sure the website would always appear on the first screen when people search by the related key words. Because if not, the website would have very little chance to be found by the users. Link building ? Reciprocal links The respondent emphasizes that the company has some reciprocal links with some other Swedish companies. Their websites are listed on one page of www.skraplotto.se, which is called links. These companies are www.mer-trafik.se, www.swetop.com, www.uppslaget.se, www.topplista.se, www.coxco.se, www.toppensidor.se, and www.exchangelink.se. These websites do not need to pay the company but need to put the company's link on their website. The reciprocal links with www.tradedoubler.se is a very successful example, which is a well-known online advertising website working on promoting the other business. The company gets a non-paid permanent link on "tradedoubler.se" unlike the other companies has to pay by the period of their links presented on "tradedoubler.se". It is a very good saving for a young company like Netix AB. ? Co-branding According to the respondent, www.soundicradio.se do not only exchange links with the company but also cooperate on other programs such as providing the test radio program on www.skraplotto.se so that the users can listen to the music when they scratch lottery ticket online. www.soundicradio.se demonstrates the lottery ticket on its website as well as the banner 'c' shows in the previous section. ? PR - Content mentions The respondent reveals that the news paper's website has published the interviews with Netix AB and the focus of the interview is the launch of www.skraplotto.se . The domain has been publicized on the news paper's website for a few weeks. ? Affiliates Affiliates are not used by the company, which has been explained in affiliate network. ? Sponsorship The respondent says that Netix AB does not have any sponsorship with any websites because it is a cost method in promoting the website. ? Banner advertising
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Case Studies The company uses banner advertising, which has been presented in banner advertising section. ? Price-comparison portal According to the respondent, Netix AB does not use price-comparison portal to promote www.skrapalotto.se. Because it is a free lottery website, price-comparison portal does not exist at all. E-mail Marketing The respondent says that the company sends newsletter occasionally around once months, which contains the latest news about website and the pictures of new prizes, which the customer can win. Because Daniel believes that if company sends them too often, it will irritate the users and there would not be a lot of information in short period. The result of doing this could be considered as spam email after a while. So that the frequency and the content of the newsletter are measured very carefully each time in order to avoid of wasting both parties resources, which could also be harmful for brand identity of the company. The size of the email usually is not very big and pictures are in GIF format, because if it is too big, it would take long time to open the email, which could make the users have no patience to wait and delete the email before read it. The company builds the email list by themselves according to the users' registered information. Vertical Portals According to the respondent, www.skraplotto.se is a very new concept in Sweden so that there is not a particular portal for it. But the company promotes the website on those websites like www.blocket.se and www.tradedoubler.se, which are the web market places for all companies to promote their websites and the products. 5.1.3 Evaluation of effectiveness of communication tools in traffic building The respondent described that Netix AB mainly use quantitative tools of measurements to evaluate the effectiveness of the different communication tool they have used in order for traffic building. Netix AB uses its own database and an online free tool named Google Analyst to monitor the effectives of the website usage everyday especially after each promotion campaigns. The statistics on the number of the new visitors at the website, the number of minutes spent by the visitors, and the users' onsite behavior are the basis for the company in analysis the effectiveness of the offline and online marketing communication tools. By using these quantitative tools, Netix AB can obviously see the number of traffics achieved by the promotion campaign and the quality of the traffics namely the number of new registered customers, and in what extent they like and use the website. Netix AB never does any marketing communication that particularly requires email response from customers for it is unnecessary. As Netix AB does not sell the products either, the figures of onsite sales and income are not
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Case Studies relevant to evaluations. The respondent stresses that there is a phenomenon that generally the online communication tools are more effective than the offline ones in traffic building. The purposes of evaluating the effectiveness of the exploited marketing communication tools from Netix AB's perspective, according to the respondent, is to help the company to have a better understanding of the effectiveness of the each marketing communication tool in traffic building and make better use of them in the future, especially from cost-saving aspect. Although Netix AB has very limited resources both on money and workforce, the evaluation of effectiveness of the marketing communication tools can not be overlooked for it leads significant costsaving in the future. 5.1.4 Building traffic at Netix AB Netix AB is a small advertising company through free online lottery method. It is the essential issue for the company to build website traffic, but the limited budget on marketing is the common competitive disadvantage for small companies including Netix AB. From above presented data, we can see that company has selected and applied the offline and online communication tools carefully from cost effectiveness perspective and regarded evaluation of effectiveness of the communication tools as a significant activity for further cost-saving in traffic building. Netix AB's objective is not only to be an advertiser but also a merchant of the products that are advertised by itself in the future, so that website traffic would become more important. Therefore he says the company would invest more money on generating website traffic and branding, it would be a constant issue for Netix AB to make a better use of the marketing communication tools.
5.2 Case 2: Rosell & Clack Importlagret AB
Company Background Rosell & Clack Importlagret AB is a small e-business firm, which was founded in Luleå in 2001. The company work is an outlet online shop of majority factories around the whole world. People can purchase all kinds of factories' goods from the company's website (www.importlagret.se) by extremely low price, which could be half price comparing to normal shops. There are totally nine persons that include two founders and seven employees working in the company now. At Rosell & Clack Importlagret AB, we interviewed Mr. Peter Holmagren who is an e-marketing planner and CRM manager. 5.2.1 Offline marketing communication Publicizing the URL offline
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Case Studies Since the main sales and profit are gained from their online store, respondent states that publicity of the website is the most important purpose in their promotion. The company publicizes the URL on the business cards as both corporation website and ecommerce website, and the aim is to build brand and credibility of the corporation. The company does not contact their customers by mail very often; however the URL is stated on letterheads, which is to increase the formality in business operation. Respondent stresses that advertisement has been used specifically for traffic building. He describes they use mainly two kinds of press media for publicizing the URL address. First of all, newspaper is the cheapest and most efficient ways to promote. Public can easily access to the newspaper and its highest coverage for the public proves its highest efficiency for promoting the website. The other one is magazine as respondent mentioned. Since the function of magazine is different from the newspaper, the promotion on magazine not only increased the number of registered customers, but the sales. Respondent said although the cost of magazine is high, compared with the huge effect on the sales, it worth to do that constantly. Furthermore, according to respondent, URL has been printed on the packaging and point-of-sales material which might attract some potential customers' eyes and build brand. Although Importlagret AB realized the bigger influence and better credibility of TV and radio advertisement for the most of potential customers, the limited budget restricts them from using TV and radio widely. Limited sources also make company abandon the brochures, telephone directories, hoardings and billboards as the techniques for publicizing the URL. According to respondent, company does not realize reference book as the techniques. Public Relation Respondent stressed that public relations is an effective marketing communication tool when generating website traffic. Importlagret AB has a few times face-to-face covers with the local newspaper. 'Low prices' is the constant focus of Importlagret AB in press media' eyes, the company gets not only the brand promoted but also traffics to the website through the press relations. The company also publicizes their products in physical stores in Stockholm and Gothenburg. The function of these two stores is to provide customers opportunities to experience the products and services which listed on the website and increase the credibility of the brand and the website. The company has close connection to Luleå Handelskammare, which is a non-profit organization helping all businesses in Luleå in many aspects. Public affaires and investor relations are not adopted by Importlagret AB for its limited budget. Direct Marketing Respondent addresses that Importlagret AB does not use direct marketing for too much overlap with some online marketing communication tools. According to him, telemarketing is an expensive marketing communication tool compared to some other tools; therefore it is not used so far. Direct-mail marketing and catalog (non-electronic) marketing overlaps with newsletters and electronic catalog in online context, as newsletter and electronic catalog are much cheaper and having some extra benefits
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Case Studies than the two direct marketing tools; Importlagret AB has not used direct-mail marketing or catalog (non-electronic) marketing. Word of Mouth Respondent emphasizes that word of mouth is an important marketing communication tool for Importlagret AB. The two competitive advantages: the lowest prices and good after-sales service of the company stimulate the positive word of mouth communication naturally. According to respondent, many new customers get to know the company's offers and website from their friends, relatives or colleagues, who are the existing customers and the employees of importlagret AB. In order to minimize the negative word of mouth communication, the company takes care of complains very carefully and does the best to make the customers satisfy. Respondent says that increased number of the sales and registered customers proves the value of word of mouth and it is the most cost efficient tool among all the communication tools. 5.2.2 Online marketing communication Banner advertising According to the respondent, the company uses the simplest static banners that they makes by themselves, for having no personnel who can deal with more complicated technical issues in making banners. The two types of static banners are listed as below shown:
a)
b)
Banner 'a' has both the logo and the website address on it, which gives the visitors an impression of the company's logo and web address. The purpose of the types of banner is to facilitate a click through from advertisement website to the company's website and building brand awareness. Banner 'b' is made only of the name of the website that is able to highlight the website address. The purpose is to enhance the web address and facilitate a click through to the company's website. The respondent says that the static banners have low-cost advantage. It is clean and focuses on presenting web address and logo. It is good enough to the company for the moment. Affiliate network The company does not work on affiliate network at all. The respondent says that the company tried to build offline affiliate network with some local machinery shops in south of Sweden. The idea was that some goods of Importlagret AB physically displayed in the local shops, the shops would get commissions for each purchased
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Case Studies item in the shop. A lot of customers come to see the products in the shop then order the products through www.importlagret.com. Because of the competitive pricing of the company, the shops felt more threats than opportunities to join the affiliate network. So the idea was dead. The online affiliate network is not considered by the management of the company before. The respondent said logistic is a competitive advantage of the company, the low price is the key success factor in commodity products. The company believes that they are one of the best in pricing. Search engine registration and optimization The respondent reveals that except those world wide popular website such as www.google.com, www.yahoo.com, etc, the domain www.importlagret.com has mainly been registered to some Swedish branch-specific search engines namely www.annonsfynd.se, in which the customers can search by locations and catalogs of product. The company has also registered to some web directories and catalogues such as www.bgnorr.se and www.villabad.com, which categorize the website by locations, products and direct the customers to come to the right website when they look for products. Search engine optimization is outsourced to a specialist's company as Importlagret AB believes that outsourcing is not only costly efficient but also highly effectiveness. Link building ? Reciprocal links According to the respondent, the company does not do any free exchange links with any other websites. The respondent explains the reasons that the hard competitive situations in the industry create the difficulties to build reciprocal links with competitors. The supply chain of the business is a sort of business secret so that Importlagret AB has to be very careful when building reciprocal links. The company has neither dealer at the moment. ? Co-branding The company has no co-branding partners either. According to the respondent, it is not a concern of the company for the moment. Because the company is considered still a small company, the commoditization of e-business puts a lot of pressure on the company. ? PR - Content mentions The respondent reveals that the company has been covered by the local newspaper and the articles were publicized on the newspaper's website.
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Case Studies ? Affiliates The affiliates are not used, which has been described in affiliate network section above. ? Sponsorship According to respondent, the company has sponsorships with some websites, for example, www.luleahockey.se. Every click on the link of Importlagret AB will make a little money for Luleå Hockey team. ? Banner advertising The company uses banner advertising, which has been presented in banner advertising section above. ? Price-comparison portal According to the respondent, http://se.pricerunner.com/ is a price-comparison portal, where the customers can find the prices and the products from all the providers who are registered there. Importlagret AB is one of them. E-mail Marketing The respondent addresses that the company sends newsletter once a month. It usually includes the new products and special offers of every month with colorful pictures. The newsletter is short and has a few links to the webpage of detailed information about the products and offers. The company builds the email list by themselves based on the registered email address when they became the members of the website, so that the newsletter can only reach the registered existing customers. Vertical Portals According to the respondent, the company has registered in many Swedish portals. For example, villaportaler.se/ is a portal for the goods in use of building houses; ryggen.en.ec21.com is a B2B market place, where Importlagret.com can meet the business customers that could buy the products related to construction industry; www.blocket.se is a web market place of both B2B and B2C market where the company can promote the website and the products to both business and individual customers. 5.2.3 Evaluation of effectiveness of communication tools in traffic building As Importlagret AB has not IT specialists in the company, they simply outsource the evaluation of the effectiveness of the communication tools to a specialist company. Respondent described that they get figures from the company, who is specialist in monitoring website usage. Importlagret AB uses the data to analyze and evaluate the customers' needs and the effectiveness of each of communication tools. An obvious tendency of the figures is that the most efficient ways of traffic building is the online promotion tools although offline communication is important in some extent.
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Case Studies Importlagret AB has used several forms of quantitative measurement tools. Figures on the amount of hits and visitors are collected, as well as on how much time they spend on the site and what pages they enter, the activities they do and which products that attractive to them. The number of email received from customers is one of the measures when the marketing communication requires email response. However it is used not often. The company also uses the amount of sales and income to evaluate the effectiveness of the promotion campaign. Furthermore, the company continuously analysis the result of each communication tool to filtrate the most efficient tools for traffic building. 5.2.4 Building traffic at Rosell & Clack Importlagret AB According to respondent, we find that the company uses different communication tools in website traffic building and evaluation of effectiveness of the communication tools in order to make better use of the communication tools in future online marketing. Because the desirable result of website traffic building is to attract a purchase, the objective of the marketing communication has two aspects: generating website traffic and delivering a message which could lead a purchase. Because Importlargret AB does e-business in a relatively commoditize market, competitive pricing and after-sales service become the two key success factors. The company has confidence on the mentioned two factors so that they are used as the main messages in marketing communication. In future traffic building, the company will continue to focus on the two messages.
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Data Analysis
6. Data Analysis
In this chapter the empirical data will be analysed in the order of the research questions. To begin, a within-case analysis will be for each of the case studies by comparing the empirical data presented in the previous chapter with the conceptual framework presented in chapter3. Thereafter, the data for each research question will be displayed through a cross-case analysis, where the two case studies are compared with each other to find similarities and differences.
6.1 Within-case Analysis
The analysis will compare the data collected with frame of reference arrived at in chapter 3 and the text be displayed in the order of the research questions for each one of the case studies. 6.1.1 Within-case Analysis: Netix AB Offline marketing communication tools used for traffic building ? Publicizing the URL offline According to selected theories, publicizing the URL offline could be on business cards, letterheads, brochures, telephone directories and other reference books, television and radio advertisements, advertisements (excludes TV and radio advertisement), hoardings and billboards, packaging and point-of-sale material. Netix AB publicizes the corporation's website of www.netix.se on business cards and letterheads, and the purpose of doing so is to promote brand of the company instead of driving traffic to the specific website of www.skraplotto.se. Therefore the two kinds of techniques are not exploited in traffic building to www.skraplotto.se. Brochures, telephone directories and other reference books are not exploited in publicizing the URL offline as they are not prioritized in the limited budget. Radio advertisements are successfully exploited in driving traffic to www.skraplotto.se in Stockholm region; since TV and radio advertisements are in the same category in the theory, we consider TV and Radio advertisements are specifically exploited in traffic building. Newspapers is the main medium used in generating website traffic, so that advertisement is the most important technique specifically in driving traffic to the website in this case. Hoarding and billboards are not used in traffic building, as they have never been considered when doing traffic building. Packaging and point-of-sale material are not exploited because of the low cost efficiency. Moreover, to put advertisements on the friends' or relatives' cars are not included in the theory, but when we think over the essence of this technique, it has the same function of hoarding and billboards. Because of its non-cost feature, we do not categorize it to any of above mentioned theories. Netix AB uses two out of eight possible communication tools, namely TV and radio advertisements and advertisements (excludes TV and radio advertisements).
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Data Analysis ? Public Relations According to selected theories, several variables of public relations includes: press relations, product publicity, public affairs, investor relations, and development. Netix AB does not invest on public relation because of limited budget. However the company builds and maintains a good relationship with press media, such as newspapers, TV, and so on for its superiority of IT technology. The exposures on press media provide the company great opportunities to generate more website traffic. The company also develops good relations with some nonprofit organizations and gets volunteer supports in many aspects. Compared with the theory, Netix AB uses two out of five possible communication tools, namely press relations and development. ? Direct Marketing According to selected theories, direct marketing could include telemarketing, directmail marketing, and catalog (non-electronic) marketing. Direct marketing is a rather expensive method in marketing communications; therefore under current condition of limited budget, the company uses none of direct marketing communication tools. The other reason is that the newsletter marketing has covered the effect of direct-mail; catalog (non-electronic) marketing is not feasible for an advertising company like Netix AB. The company uses none of the three possible communication tools. ? Word of Mouth According to selected theories, word of mouth (WOM) is playing an important role in traffic building especially in B2C context. Word of mouth is an important communication tool for Netix AB in traffic building. The company first uses the available contacts namely people who they know to do WOM under non-cost circumstance. After a few users coming to the website, the company provides high quality services aiming to make them highly satisfied in order to win the effect of WOM. Some of them have more enthusiasm in the online lottery than the others therefore they come up with questions. While they are getting in-depth answers to the questions, which are organized on purpose by the company, they become more active, loyal, and knowledgeable to the online lottery, and automatically become the advanced opinion leaders. Therefore the opinion leaders could be anyone who knows the online lottery website such as the personnel, the familiars of personnel, any existing users and loyal users. The main communicated information in the word of mouth communication is the free feature of the online lottery. Negative word of mouth is unusual; because people get products without payments. Based on the result in experiment, company thinks WOM has the highest efficiency among the communication tools. In term of WOM, it is agreed with selected theories.
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Data Analysis Online marketing communication tools used for traffic building ? Banner advertising According to Chaffey et al. (2003), there are many forms of banners namely static banner, animated banner, interactive banner, pop-up, rich-media banner, and context sensitive banner. Netix AB considered that static banner and animated banner as their main tools since it plays a central role in their banner advertising. The domain of the website has clearly communicated to the users regarding what the website is basically about. The banners making of the domain and some simple statements are considered to be good enough to fulfill the three purposes of banner advertising proposed by Cartellieri et al. (1997) namely delivering content, shaping attitudes, and encouraging retention. Netix AB used static banners and animated banners out of six possible forms of banners presented by Chaffey et al., (2003). ? Affiliates network According to Chaffey et al. (2003), the affiliate network which built between retailers and the payment is only made under the purchase of an item. There are no retailers and purchase involved in the business process, so that affiliate's network is not feasible to Netix AB. ? Search engine registration and optimization Chaffey et al., (2003) pointed out that there are four forms of so-called search engines that the website can be registered to, which are usual search engines, industry specified search engines, directories, and catalogues. Search engine optimization can be done through two ways: 'do it self' and 'outsourcing'. Netix AB thinks that the website is a very new website and it should be as much accessible as possible so that it can be registered everywhere. Some of the search engines are free of charge. But some of them need to pay. The company selects carefully the ones that the company must pay. The company registers the website on all of the four kinds of search engines that mentioned by Chaffey et al., (2003). Netix AB does the search engine optimization by itself, because they have the specialist personnel who can handle the issue. ? Link building According to Chaffey et al., (2003), link building can be an effective method for driving traffic to the website. Link building includes reciprocal links, co-branding, PR-context mentioned, affiliates, sponsorship, and price-comparison portal. Since company thinks that a free advertising is always good, Netix AB used reciprocal links in a large extent. Co-branding is also used. The company considers it is a good way to promote its own brand on website. In the same time, its own website looks more sophisticated in the way that the company could achieve better branding
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Data Analysis on its own website. PR-context mentioned is used by Netix AB, because the company considers that the local newspaper could bring the company a good image and create the awareness of the website not only locally but nationally as it is also published on the website of the newspaper. It could also increase the company's trustworthy. The company does not use affiliate which has explained in affiliate networks section. Sponsorship is not used by the company for the limited budget. Banner advertising is a main communication tools that has been discussed in previous section. Pricecomparison portal is not used as it is a free offer and such a portal does not exist. Netix AB uses four of seven possible items listed by Chaffey et al., (2003). ? E-mail marketing Chaffey et al., (2003) point out that e-mail marketing has many advantages as a communication tool such as immediacy, targeting, accountability and relatively cheap. The key question is how to obtain the email list. There are two ways to obtain email list: purchase of opt-in bought-in list and build a house list. Netix AB uses e-mail marketing in term of newsletter because the company thinks it is relatively cheap, fast, and easy to monitor the result of the promotion campaign. The company builds a house list by themselves from the customers registered information, which means the newsletter works on customer retention and products promotion instead of customer acquisition. ? Vertical portal Lindstrom and Andersen (2000) mention vertical portal is basically a web marketplace in a certain industry and further can be an industry-specific community. If there is not yet a portal, the company's website can be a gateway. The company has no a certain portal to fit in. Evaluation of effectiveness of communication tools in traffic building According to the selected theory from Lindstrom and Andersen (2000), the quantitative measurements include: the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, the website's sales and income. Netix AB uses many quantitative tools in evaluating the effectiveness of the communication tools in traffic building. These quantitative tools consist of the number of individual visitors, the number of minutes spent by the user, and the user's behavior at the website. The number of e-mail received from customer is not used by Netix AB because the email-response required promotion is not feasible to the company. The website's sales and income is not used because the company does not generate sales or income from the website. Netix AB uses three out of five possible variables of the selected theory about evaluating the effectiveness of the communication tools in traffic building. An additional general fact after evaluation is
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Data Analysis that the online communication tools are more effective than the offline ones in traffic building. 6.1.2 Within-case Analysis: Importlargret AB Offline marketing communication tools used for traffic building ? Publicizing the URL offline According to selected theories, business cards, letterheads, brochures, telephone directories and other reference books, television and radio advertisements, advertisements (excludes TV and radio advertisements), hoardings and billboards, packaging and point-of-sales material are considered as techniques in publicizing the URL offline. Importlagret AB publicizes the URL on business card, although the purpose is to build brand, from the practical point of view it does drive the website traffic incidentally. Therefore this communication tool is considered the item for traffic building. Although letters are not used very often in communications, letterheads are still used in publicizing the URL offline, which could have positive influence in traffic building incidentally. For the limited budget, company has not used brochures, telephone directories, hoardings and billboards as the techniques for publicizing the URL offline. TV and radio advertisements are even more expensive than the other media therefore they are not used in traffic building. Two kinds of media namely newspaper and magazine have been heavily used for advertising the URL offline, which specifically drive traffic to the website. Packaging and point-of-sales material are used in publicizing the URL offline, which aims to build brand. However it has positive influence on traffic building incidentally. Importlagret AB uses four out of eight possible communication tools, namely business cards, letterheads, advertisement (excludes TV and radio advertisements), packaging and point-of-sales material. ? Public Relations According to selected theories, a few variables of public relations could be press relations, product publicity, public affairs, investor relations, and development. Although company does not invest much on public relations, Importlagret AB builds good relations with local newspapers and other press media, which increase the exposures and credibility of the brand and the website; therefore it contributes to generating more website traffics. The two physical stores facilitate the product publicity which improves both the brand building and the website traffic building extensively. The connection with Luleå Handelskammare provides the company benefits in many aspects and strength the brand and the website traffic building somehow. The company used three out of fem possible communication tools, namely press relations, product publicity, and development according to the theory. ? Direct Marketing
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Data Analysis According to selected theories, direct marketing could include telemarketing, directmail marketing, and catalog (non-electronic) marketing. Importlagret AB uses none of direct marketing communication tools because of its relatively high-cost and the company's limited budget. As online marketing communication tools has direct influence on traffic building than the indirect influence by offline marketing communication tools, when the overlap occurs between online and offline communication tools, the company trends to choose the online ones. Therefore direct-mail marketing and catalog (non-electronic) marketing are replaced by newsletters and electronic catalog marketing. According to the theory, none of the three possible communication tools are used by the company. ? Word of Mouth According to selected theories, word of mouth (WOM) is playing an important role in promoting websites. Word of mouth is an important marketing communication tool for Importlagret AB in building traffic to the website. The two competitive advantages of lowest prices and good after-sales are the central information to be communicated in word of mouth communication. The consequence of the word of mouth communication makes the new customers visit to the website or contact the company directly by telephone or email. The opinion leaders in the word of mouth communication are mainly the existing customers and the employees of the company. The company minimizes the negative word of mouth communication by carefully dealing with complains and increasing customers' satisfaction. It is agreed with the theory of word of mouth. Online marketing communication tools used for traffic building ? Banner advertising Chaffey et al., (2003) pointed out that banner advertising can be done in different forms, such as static banner, animated banner, interactive banner, pop-up, rich-media banner, and context sensitive banner. Importlagret AB thinks that banner advertising is an important online communication tools. The company uses the static banners to display the web address and logo of the company. The purpose of the banner advertising is to deliver content and shape attitudes in a certain standard. The company has used one out of six items listed by Chaffey et al., (2003). ? Affiliates network According to Chaffey et al. (2003), the affiliate network which built between retailers and the payment is only made under the purchase of an item.
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Data Analysis Importlagret AB does not work on affiliate network. It is decided by the managerial thought. The management believes that price is the key success factor, so that it is not necessary to share profits with other retailers. ? Search engine registration and optimization Chaffey et al., (2003) pointed out that there are four forms of so-called search engines that the website can be registered to, which are usual search engines, industry specified search engines, directories, and catalogues. Search engine optimization can be done through two ways: 'do it self' and 'outsourcing'. Importlagret AB registers the website to all kind of above mentioned search engines. The company thinks that it is a best way of building traffic it is also the reason that the company does not reply on cooperation with some other online business. Importlagret AB outsources the search engine optimization. Because the company thinks it is much cheaper to outsource than employ a specialist on these issues. Even though the specialist can handle other issues related to website, the company does not think there is much to do regarding website related issues. ? Link building According to Chaffey et al., (2003), link building can be an effective method of driving traffic to the website. Link building includes reciprocal links, co-branding, PR-context mentioned, affiliates, sponsorship, and price-comparison portal. Importlagret AB does not use reciprocal links at all. The company had considered some stakeholders to build reciprocal but it is not feasible and other stakeholders are not yet considered. Co-branding is not used for the same reasons of reciprocal links. PR-context mentioned is used as the company thinks that it is a free advertising online and it can increate the company's brand image and trustworthy. Affiliates are not used by the company, which has explained in affiliate network section. Sponsorship with some portals and market place is used by the company, which bring the company permanent links in some popular online market place. Banner advertising is used, which is presented in banner advertising section. Price-comparison portal is heavily used as the company thinks that they are good at competitive pricing in the industry. Importlagret AB has used four of seven items listed by Chaffey et al., (2003). ? E-mail marketing Chaffey et al., (2003) point out that E-mail marketing has many advantages as a communication tools such as immediacy, targeting, accountability and relatively cheap. There are two ways to obtain email list: purchase of opt-in bought-in list and build a house list. Importlagret AB uses e-mail marketing also in term of newsletter because the company thinks it is relatively cheap and a good way in products promotions and
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Data Analysis customer retention. The company also builds a house list by themselves from the registered customers' information. ? Vertical portal Lindstrom and Andersen (2000) mention vertical portal is basically a web marketplace in a certain industry and further can be an industry-specific community. If there is not yet a portal, the company's website can be a gateway. Importlagret AB takes part in some portals in the machinery industry and even some industry-specific community like motorcycle. Evaluation of effectiveness of communication tools in traffic building According to the selected theory from Lindstrom and Andersen (2000), the quantitative measurements include: the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, and the website's sales and income. Importlagret AB uses several forms of quantitative measurements consist of the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, and the website's sales and income. The number of e-mail received from customers is used not often for it costs a lot work hours. The company uses all of the possible variables that are presented in the selected theory. The extra fact gained through evaluation is that the online marketing communication tools are more effective than the offline ones in traffic building.
6.2 Cross-case Analysis
Having analyzed the data (presented in two case studies) against the theoretical frame of reference under the within-case analysis, here we shall seek to find similarities and differences in the outcome of the with-in case analysis. In order to clearly present the comparison between these two cases, we will use the Table 6.1 to compare the data collected from the two cases:
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Data Analysis
Table 6.1: A comparison of data of offline communication tools between two cases
Investigated Items
Netix AB
Importlagret AB
• Used in the form of partially TV
and radio advertisement (specific), Publicizing the URL offline (specific vs. incidental advertising)
• Used in the form of business cards
(incidental), letterheads (incidental), advertisements (specific), packaging and point-of-sales material (incidental). reference books, hoardings and billboards, television and radio advertisements are not used for the traffic building
• Business cards, letter heads,
brochures, telephone directories and other reference books, hoardings and billboards, packaging and point-of-sales material are not used publicizing the URL on the friends
advertisements (specific).
• Brochures, telephone directories and
• Beyond item listed by the theory, •Only used in the forms of; press
and relative cars
•Used in the forms of; press relations,
product publicity, and development
Public relations Direct marketing Word of Mouth
•Product publicity, public affaires, ·Pubic affairs and investor relations are
investor relations are not used
relations and development
•are not used
•are not used •considered as an important issue
not used
•considered as an important issue
Netix AB and Importlargret AB use publicizing the URL offline. Netix AB uses radio advertisements and advertisements (excludes TV and radio advertisements); both of them are specific approaches for traffic building. Business cards, letter heads, telephone directories and other reference books, hoardings and billboards, packaging and point-of-sales material are not used by the company. Importlagret AB uses business cards, letterheads, advertisements (excludes TV and radio advertisements), packaging and point-of-sales material. Among above mentioned variables, only advertisements (excludes TV and radio advertisements) is specific for traffic building, others are incidentally for traffic building. Brochures, telephone directories and reference books, hoardings and billboards, TV and radio advertisements are not used for traffic building. Both of the investigated companies use advertisements (excludes TV and radio advertisements) in publicizing the URL offline. None of them uses brochures, telephone directories and reference books, and hoardings and billboards. Netix AB also uses publicizing the URL on the friends and relatives' cars as a noncost method which is not mentioned in the theory.
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Data Analysis Netix AB and Importlargret AB use public relation. Both of the companies use press relation and development. Importlagret AB uses public publicity but Netix AB does not. None of them uses public affairs and investor relations. Netix AB and Importlargret AB do not use direct marketing at all. When it comes to word of mouth, both of these companies use it in a large extent and thought it is an important issue in the process of traffic building. Online marketing communication tools used for traffic building be described? In order to clearly present the comparison between these two cases, we will use the Table 6.2 on the next page to compare the data collected from the two cases. Table 6.2: A comparison data of online communication tools between two cases
Investigated Items
Netix AB
Importlagret AB
•Used in the form of; static banners
Banner advertising
•Interactive banners, pop-up,
rich-media banners and
and animated banners
•Used in the form of static banners •Animated banners, interactive
banners, pop-up, rich-media banners, and context-sensitive banners are not used
Affiliate network
• not used
context-sensitive banners are not used
• not used
Registration:
Registration:
•used in the form of search engine,
Search engine registration and optimization specific search engine, directory and catalogues Optimization:
•used in the form of search engine,
specific search engine, directory and catalogues Optimization:
•used in a large extent •used in the form of do it self, •Used in the form of; reciprocal links,
co-branding, PR, affiliates, outsourcing is not used
•used in a large extent •used in the form of outsourcing •Used in the form of; PR,
sponsorship, and price-comparison do it self is not used
Link building
•Affiliate network, sponsorship, and
E-mail marketing
banner advertising.
•Reciprocal links, affiliate network •Used in the form of; build by itself •Buy from others is not used •Used in the form of; industry specific •Industry specific community is not
used 54 market place co-branding, affiliates are not used
portal
•Used in the form of; build by itself
buy from others is not used
price-comparison portal is not used
•Not used
Vertical portal
Data Analysis . Netix AB and Importlagret AB use banner advertising in a large extent. Both of the investigated companies have used static banners in online advertising. Netix AB uses also animated banners. None of them used interactive banners, pop-up, rich-media banners, or context-sensitive banners. Both of the companies make banners by themselves, which is a practical cost-saving approach. Netix AB and Importlagret AB do not use affiliate network. Netix AB and Importlagret AB use search engine registration and optimization in a large extent. Both of the investigated companies use all four forms of search engine registration in terms of search engine, industry-specific search engine, web directory, and web catalogue. Both of the companies use search engine optimizations in a large extent. Netix AB does optimization by itself, but Importlargret AB outsources it. Netix AB and Importlagret AB use link building in a large extent. Netix AB uses reciprocal links, co-branding, PR, and banner advertising; but affiliates, sponsorship, and price-comparison portal are not used by Netix AB. In contrast, Importlagret AB uses PR, sponsorships, banner advertising, and price-comparison portal; but reciprocal links, co-branding, and affiliates are not used by the company. Netix AB and Importlagret AB use email marketing in a large extent. Both of the companies build a house list by themselves in stead of opt-in bought-in lists. Netix AB does not use vertical portal. In contrast, Importlagret AB uses vertical portal in a large extent. Evaluation of effectiveness of communication tools in traffic building In order to summarize the cross-case analysis for research question 3, we will use a Table 6.3 on the next page to conduct our cross-case analysis, where data from all our two cases. This table will show the theory stated compared to data derived from our two case studies:
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Data Analysis Table 6.3: A comparison data of evaluation of effectiveness of communication tools in traffic building between two cases Measurement
Number of visitors Minutes spent User behavior Number of e-mail Sales and income
Netix AB
Importlagret AB
+ + + --
+ + + + +
+: stands for evaluation tools used -: stands for evaluation tools not used
Table 6.3 shows that Netix AB and Importlargret AB are fundamentally using the exact same measurements to evaluate the effectiveness of the offline and online communication tools in terms of the number of individual visitors, the number of minutes spent by the user, and the user's behavior at the website. Both of the companies are in line with theory. The number of e-mails received from customers as well as the website's sales and income are used by Importlargret AB but Netix AB.
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Findings and Conclusions
7. Findings and Conclusions
This chapter contains the conclusions and the implications regarding the findings of this study. These conclusions will then lead to some implications for management, for the future development of theory in this area, as well as implications for further research that will be provided in the end of this chapter. In this thesis, we set out to gain more knowledge on how to build website traffic through different communication tools and the evaluation of the effectiveness of the tools in small B2C companies. We discovered that three components are needed to study traffic building: the offline communication tools, the online communication tools, and evaluation of the effectiveness of the tools. Consequently 3 research questions were developed and data were collected through two case studies. Based on Chaffey et al., (2003) and many studies of other authors, we develop the frame of reference that is related to each of the research question. After careful analysis of collected data, we can now draw conclusions, which help us to gain additional knowledge on the research topic. Since our cases are small B2C companies, findings from companies show both differences and similarities. Below, we attempt to answer each of the research question based on the findings.
7.1 Research question one: How can offline marketing communication tools used for traffic building be described?
Both of the two investigated companies are online business companies in B2C context, for which the website is the platform in doing business, so that website traffic is an important precondition to the success of the business. As small business, the limited marketing budget makes the company select marketing communication tools very carefully from cost effective perspective. The purpose of using the offline marketing communication tools is to increase the awareness of the website in public. According Chaffey et al., (2003) and studies of other authors, publicizing the URL offline, public relations (PR), direct marketing, and word of mouth (WOM) are the four major offline communication tools that are widely used within B2C marketing communication. According to our analysis, the above mentioned offline communication tools are mostly used by the two companies namely publicizing the URL offline, PR, and word of mouth, but direct marketing. Publicizing the URL offline is carried out basically through all kinds of advertisement and other kinds of physical reminders being used accordingly in some extent. The physical reminders can be anywhere beside the items mentioned in the theory, for instance, Netix AB resorts to paste the URL on the backside of the cars of their friends and relatives. As traffic building is an intermediate goal for a website's success, only advertisement of publicizing the URL offline can be specific for traffic building, the others are primarily incidental for generating website traffic. PR is mostly used in form of press relations by both of the companies and product publicity being used by Importlargret AB only for its business nature of selling products. WOM is used widely and agreed
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Findings and Conclusions to be the most cost-efficient communication tool by the two companies. Direct marketing is used by none of the companies for its high-cost feature and too much overlaps with online communication tools. Since the two companies set limited budget on building website traffic, the selection of communication tools is primarily depended on the cost efficiency, which is supported by the analysis. We find that both of the companies use least costly tools with high effectiveness. Both of the companies also agree that the offline communication tools have indirect influence on traffic building by providing awareness of the website. Although limited budget constrained the range of selection of the offline communication tools, both companies realize that PR has huge potential in marketing and traffic building and can be put more efforts on.
Conclusions:
? The extent to which the offline communication tools are used in traffic building is primarily depended on cost efficiency. ? The offline communication tools that are mostly used by small B2C companies likely include publicizing the URL offline, public relation and word of mouth. ? Publicizing the URL offline is the most extensively used one among the offline communication tools. ? In publicizing the URL offline, only advertisement can be a specific activity for traffic building, the others can have positive influence incidentally in some extent.
7.2 Research question two: How can online marketing communication tools used for traffic building be described?
Because of the intensive competition in online businesses, companies pay a lot of attention constantly in ensuring the visibility and accessibility of the websites. For being online business, both of the investigated companies use the online communication tools extensively in building website traffic. The online communication tools are found to be direct and effective factors in driving visitors to a website with relatively low-cost feature compared to the offline communication tools. The purpose of using the online communication tools is basically to generate visits to the website. According to Chaffey et al., (2003) and studies of other authors, the six online promotion tools: banner advertising, affiliate networks, search engine registration and optimization, link building, e-mail marketing, vertical portal, are widely used in B2C context. Banner advertising is considered as an indispensable communication tool in traffic building and used widely by both of the company. Affiliate network is a cost effective communication tool in traffic building in e-commerce context, but none of the companies use it. To adopt affiliate network is not feasible to Netix AB and lack of management commitment in Importlagret AB. Search engine registration and
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Findings and Conclusions optimization is done by both of the companies in different ways of 'do it self' and outsourcing according to their technological competence. However it is agreed to be an fundamental activity in promoting website. Link building is used heavily by both of the companies but the approaches are quite different, which could because of the industrial difference as an online advertising company of Netix AB and an ecommerce website of Importlagret AB. In both of the companies, e-mail marketing is used in form of newsletter which is a cost and time effective substitute of direct mail. E-mail marketing is agreed to be an important online marketing communication tool. Vertical portal is used extensively by Importlargret AB but Netix AB for having no such a portal.
Conclusions:
? Cost efficiency is the restriction on selecting online communication tools in small companies but not as serious as on selecting offline communication tools. ? Online marketing knowledge of management restricts the range of online communication tools' selection. ? Differences between industries influence selecting of online communication tools for traffic building in e-business companies. ? Banner advertising and search engine registration and optimization are the two indispensable activities regardless the type of e-business.
7.3 Research question three: How can evaluation of effectiveness of communication tools in traffic building be described?
Database and Google Analyst are the main software used by Netix AB in evaluating the effectiveness of the communication tools in traffic building. In contrast, Importlargret AB gets figures of the website usage from the outsourcing company and analyzes the figures by itself. It is obviously because of the individual company's technological competence. According to the selected theory, the five quantitative measurements are used in evaluation of effectiveness of the communication tools namely the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, and the website sales and income. Importlargret AB used all the measurements mentioned by theory, but Netix AB used three of them except for the number of e-mail received from customers and the website sales and income. Lacking of the two measurements is because of the nature of the business that Netix AB runs. In one hand, as an online advertising company, it is not used to promote the website through e-mail-response required marketing communication. In the other hand, Netix AB does not generate sales or income from the website.
Conclusions:
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Findings and Conclusions ? To small B2C online business, evaluation of the effectiveness of the communication tools is probably considered very important for its cost-saving contribution in the future. ? The selected measurements for evaluating the effectiveness of the communication tools differ for the nature of the business. ? The measurements of the number of individual visitors, the number of minutes spent by the user, and the user's behavior at the website seem to be fundamental ones in evaluating the effectiveness of the communication tools. ? Quantitative measurements are used primarily in evaluating the effectiveness of the communication tools. From above discussion about three research questions, Frame of reference is well supported. We can find that small B2C companies promote their website by both online and offline communication tools. Evaluation of the effectiveness of the communication tools helps them to make better use of appropriate communication tools for traffic building in the future. Cost efficiency is the basis in selecting both offline and online communication tools for traffic building due to the limited budget.
7.4 Implication for Management
Management should keep on searching and learning more up-to-date marketing communication tools in both offline and online context. Especially for small companies that consider very much cost efficiency in selecting communication tools, the more tools are available for the management, the better tools that could be found for traffic building. Some tools mentioned in theory, which might has huge potential effect on traffic building, are not used by companies, such as public relation and affiliate network. The cost of some of them may be a bit higher; management could compare the potential achievements with cost and make an appropriate choice. Management needs to monitor and assess the change of online environment constantly in order to select the most appropriate communication tools from time to them.
7.5 Implication for Theory
This study contributes to theory, in the fact that it provides the observation of phenomena within the small B2C online business. We have used previous research in the area in order to arrive at a series of research questions. In the end we draw conclusions from the data given from our two cases and try to explain the certain phenomenon, but of all, which need further research considerations.
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Findings and Conclusions Theory connects well with our two cases. But some factors bought up in theory were not used in cases or used in very minor extent. Also companies used some variables that are not listed in theory, for instance, in term of publicizing the URL offline. Therefore theory need constantly update and keep up the pace with the development of business.
7.6 Implication for Future Research
? To investigated on-site promotion tools after traffic building. ? To investigated traffic building in large companies. ? To investigated integration of online and offline communication tools. ? To investigated evaluation of website for traffic building. ? To investigated traffic building in context of B2B companies.
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Reference
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Appendix
Appendix
Interview Guide
Respondent information Name: ______________________________________________ Department you work in: _______________________________ Position: ____________________________________________ Company information Size of firm: ________________________________________ Year of company established: __________________________ Annual Revenues: ___________________________________ Type of industry: ____________________________________
Marketing communication tools 1. Please describe the offline tools which your company uses in order to promote your company's website in light of the following alternatives:
? Publicizing the URL offline (Incidental vs. Specific advertising) •Business cards; •Letterheads; •Brochures; •Telephone directories and other reference books; •TV and radio advertisements; •Advertisements; •Hoardings and billboards; •Packaging and point-of-sales material. Others:
? Public Relation •Press relations; •Product publicity; •Public affairs, •Lobbying •Investor relations •Development
67
Appendix
•Others:
? Direct Marketing •Face-to-face selling; •Telemarketing; •Direct-mail marketing; •Catalog marketing; •Direct-response television marketing; •Kiosk marketing; Others: ? Word of Mouth Is there other kind of offline communication tools you would like to add? 2. Please describe the online tools which your company uses in order to promote your company's website in light of the following alternatives: ? Banner advertising o Static banners advertisements o Animated banners advertisements o Interactive banners advertisements o Pop-up o Rich-media banners advertisements o Context-sensitive banner advertisements Other: The purpose of banner advertising: o To deliver content o To enable transaction o To shape attitudes o To encourage retention Other ? Affiliate networks ? Search engine registration and optimization Search engine registration: o Comprehensive search engine o Product- or branch-specific search engine o Web directories o Web catalogues Other: Search engine optimization: o Outsourcing
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Appendix o Do it self Other: ? Link building o Reciprocal links with(free) Shareholders Business associates Suppliers Dealers Companies offering complementary products Other: o PR - Content mentions o Affiliates o Sponsorship o Cobranding o Banner advertising o Price-comparison portal Other: ? E-mail marketing Obtain email address: To purchase of opt-in bought-in lists To build a house list The purpose of email marketing: Customer acquisition Other: ? Viral marketing The purpose of viral marketing ? Vertical portal o a web marketplace o an industry-specific community o a gateway Other: The purpose of vertical portal:
Is there other kind of online communication tools you would like to add? 3. How does your company evaluate the effectiveness of application of different communication tools which used for traffic building? --The number of minutes spent by the users;
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Appendix --The number of individual visitors; -The user's behavior at the website; --The number of e-mails received from customers; -The website's sales and income.
IV Open discussion Is there anything else you would like to describe?
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doc_590667178.docx
A retailer purchases goods or products in large quantities from manufacturers directly or through a wholesale, and then sells smaller quantities to the consumer for a profit.
2007:056
MASTER'S THESIS
Communication Tools to Build Website Traffic
Cases from Small B2C Firms
Yidi Zhao Liang Xu
Luleå University of Technology Master's thesis Marketing Department of Business Administration and Social Sciences Division of Industrial marketing and e-commerce
2007:056 - ISSN: 1402-1552 - ISRN: LTU-DUPP--07/056--SE
Acknowledgements
Acknowledgements
It is our great pleasure to hereby present our Master's thesis. During the writing process of 15 weeks in the winter of 2006/2007, we have gained a lot of knowledge with investigating this area of research and it has been an interesting and intrusive experience for both of us. We would like to take this opportunity to thank the people who have been helpful for us during the writing process, and thereby making this thesis possible. First of all, we would like to thank our supervisor Mr. Manucher Farhang, for his help and feedback. Furthermore, we would like to thank Mr. Daniel Löfmark in Netix AB and Mr. Peter Holmagren in Rosell & Clack Importlagret AB, who all took the time to answer our questions and gave us valuable information for our thesis. Luleå University of Technology, 2007-01-15 Yidi Zhao Liang Xu
Abstract
Abstract
With the rapid development of Internet, online business companies are increasing in number. In B2C companies, traffic building to website is a major concern of the top manager and it is the key point for success. The process involves using offline and online communication tools to drive or attract visitor traffic to company web site. The purpose of this thesis is to provide a deeper understanding of the different communication tools used by companies to build traffic to their website and measures they adopt to improve the effectiveness of these tools. Three research questions were developed. The empirical data were collected on two small B2C Swedish companies were analyzed against a theoretical frame of reference. The findings showed that cost and evaluation become the principle factors for choosing appropriate communication tools for traffic building and small companies used the different communication tools on the basis of limited budget. Furthermore, the method of evaluation adopted by companies has a strong influence on improving the communication tools efficiency.
Table of Content
Table of Content 1. Introduction...........................................................................................1
1.1 Background ......................................................................................................1 1.2 Problem Discussion .........................................................................................3 1.3 Purpose and Research Questions .....................................................................5 1.4 Demarcations ...................................................................................................5 1.5 Deposition of the Thesis ..................................................................................6
2. Literature Review .................................................................................7
2.1 Offline marketing communication tools used for traffic building ...................7 2.1.1 Publicizing the URL offline..................................................................7 2.1.2 Public Relations ....................................................................................7 2.1.3 Direct Marketing...................................................................................8 2.1.4 Sponsorship.........................................................................................10 2.1.5 Exhibitions ..........................................................................................10 2.1.6 Corporate Identity ...............................................................................11 2.1.7 Packaging............................................................................................12 2.1.8 Merchandising.....................................................................................12 2.1.9 Word of Mouth ...................................................................................13 2.2 Online marketing communication tools used for traffic building..................13 2.2.1 Banner Advertising .............................................................................14 2.2.2 Affiliate Networks ..............................................................................14 2.2.3 Search Engine Registration and Optimization....................................16 2.2.4 Link Building ......................................................................................16 2.2.5 E-mail Marketing ................................................................................16 2.2.6 Viral Marketing...................................................................................17 2.2.7 Vertical Portals....................................................................................18 2.3 Evaluation of effectiveness of communication tools in traffic building........18
3. Conceptualization and Emerged Frame of Reference ....................21
3.1 Conceptualization ..........................................................................................21 3.1.1 How can offline marketing communication tools used for traffic building be described? .................................................................................21 3.1.2 How can online marketing communication tools used for traffic building be described? .................................................................................21 3.1.3 How can evaluation of effectiveness of communication tools in traffic building be described? .................................................................................22 3.2 Emerged Frame of Reference ........................................................................23
4. Methodology ........................................................................................25
4.1 Research Purpose ...........................................................................................25 4.2 Research Approach ........................................................................................26
Table of Content 4.3 Research Strategy...........................................................................................26 4.4 Data collection ...............................................................................................28 4.5 Sample Selection............................................................................................29 4.6 Data Analysis .................................................................................................30 4.7 Reliability and Validity..................................................................................31
5. Case Studies.........................................................................................33
5.1 Case 1: Netix AB ...........................................................................................33 5.1.1 Offline marketing communication......................................................33 5.1.2 Online marketing communication.......................................................33 5.1.3 Evaluation of effectiveness of communication tools in traffic building ......................................................................................................................38 5.1.4 Building traffic at Netix AB ...............................................................39 5.2 Case 2: Rosell & Clack Importlagret AB ......................................................39 5.2.1 Offline marketing communication......................................................39 5.2.2 Online marketing communication.......................................................39 5.2.3 Evaluation of effectiveness of communication tools in traffic building ......................................................................................................................43 5.2.4 Building traffic at Rosell & Clack Importlagret AB...........................43
6. Data Analysis.......................................................................................45
6.1 Within-case Analysis .....................................................................................45 6.1.1 Within-case Analysis: Netix AB.........................................................45 6.1.2 Within-case Analysis: Importlargret AB ............................................49 6.2 Cross-case Analysis .......................................................................................52
7. Findings and Conclusions ..................................................................57
7.1 Research question one: How can offline marketing communication tools used for traffic building be described?.........................................................................57 7.2 Research question two: How can online marketing communication tools used for traffic building be described?.........................................................................58 7.3 Research question three: How can evaluation of effectiveness of communication tools in traffic building be described?........................................58 7.4 Implication for Management..........................................................................60 7.5 Implication for Theory...................................................................................60 7.6 Implication for Future Research ....................................................................61
Reference: ................................................................................................62 Appendix..................................................................................................67
Table of Content
List of Figures
Figure 1.1 The outline of this thesis ......................................................................6 Figure 3.1 The Frame of Reference of this study ................................................24 Figure 4.1 Schematic Presentation of the Methodology .....................................25 Figure 4.2 Illustration of relationship between reliability and validity..............32
List of Tables
Table 4.1:Relevant Situations for Different Research Strategies........................27 Table 4.2:Sources of Evidence ............................................................................28 Table 6.1:A comparison of data of offline communication tools between two cases.............................................................................................................53 Table 6.2:A comparison data of online communication tools between two cases ......................................................................................................................54 Table 6.3:A comparison data of evaluation of effectiveness of communication tools in traffic building between two cases ..................................................56
Introduction
1. Introduction
In this chapter the background to the selected research topic is first presented, followed by problem discussion where the research area is discussed. The problem discussion leads to the research purpose and the research questions and finally, demarcations and overview of the study.
1.1 Background
Internet has been heavily exploited in marketing in recent years. The rapid rate of Internet adoption has resulted in an extraordinary pace of change in the marketing landscape and opened up a variety of opportunities for marketers (Wu, 2002). According to Huizingh (2000), Internet is a global system with low entry barriers, connecting both customers with suppliers, and customers with customers. Clow and Baack (2002) point out that Internet can serve various marketing functions such as advertising, sales support, customer service, public relations, and e-commerce (retail store) Internet also presents vast opportunities for branding (Ryan, 1999). The online retailers exploit Internet in even deeper level. According to Vishwanath and Mulvin (2001), the online retailers achieve success by leveraging their existing assets, brands, and customer bases through their online channels, by cleverly exploiting the synergies between online and offline operations, and finding creative ways to convert the highest possible percentage of website visitors into loyal customers. The retailers are using the Internet to gain customers, build revenues, and enhance profits. World Wide Web (WWW or Web) is known, according Hoffman et al. (2000), as the most exciting commercial development in the portion of the Internet. Advertisers are recognizing Web as a valuable additional media of their advertising tool box (Sheehan and Doherty, 2001). Internet users value the medium as a tool for learning about products and services (Kehoe et al. 1998). After online users are able to complete the purchase process through buying products online, marketers begin to search for ways to direct online users to their web pages and provide a strong communication message to them once they visit (Riedman, 1999). Every year billions of dollars are spent promoting brands and Internet brands, and companies compete against each other feverishly to establish brand recognition and consumer awareness. The commonly used communications vehicles, other than advertising, consist of public relations to stimulate word-of-mouth, sales promotions, and partnerships directing consumers to websites, direct e-mail, and a variety of other methods. Meanwhile they also stress that it would be a mistake for online businesses to reply completely online advertising to create awareness and site visitation (Ilfeld and Winer, 2002).
1
Introduction Some manners of drawing prospects to e-commerce website are presented by Bellizzi (2000), which address that designing websites with proper key-word density, being listed with appropriate industry directories, and properly placed banner advertisements are very important in drawing prospects to e-commerce website. He also highlights that marketers should not overlook more traditional means of bringing more traffic to the e-commerce website. The ways that online users find out about websites, according to Sheehan and Doherty (2001), are through word of mouth, via traditional advertisements, and through banner advertisements and other types of online messages. Awareness of Web addresses (uniform resource locators, or URLs) through traditional advertising such as television and print represents an essential source of information about websites and how to find them (Kehoe et al., 1998; Maddox & Mehta, 1997). Since consumers appear reluctant to pay for access to specific sites, advertising is also important to the success of the Web; therefore advertising may be the primary support for the Web (Mc-Daniel, 1997). The selection of advertising media is determined by the nature of media and product characteristics. Yoon and Kim (2001) address that Internet as an advertising media has a few characteristics that are different from traditional medium such as unlimited delivery of information beyond time and space, unlimited amounts and sources of information, the ability to target specific groups or individuals, and especially its nature of interactivity; the choice and use of media in advertising is mostly influenced by product characteristics, to consider high-involvement products like automobiles or luxury watches the Internet is still not as effective as TV in enticing consumers. The essence of some online and offline advertisement are actually the same. According to Gallagher et al. (2001), the same advertisements were equally effective in print and on the web under the condition of being given equal opportunity for exposure to the target audience. Although the online and offline medium has essential distinguishes, the messages of advertisements are exactly the same. Further Kanso and Nelson (2004) highlight that in creating an online commercial site, it is important to recognize that the Internet requires different marketing and advertising practices than those used in traditional media; and mixed media advertising necessitates coordinated efforts between those managing the website and those designing advertisements for other media. They discover that marketers are not exploiting all possible benefits of their websites by not adequately integrating print and online advertising efforts. Email marketing is more efficient than traditional direct mail. Gartner (2002) present that email advertising revenue totaled $948 million in 2001 and has been forecasted to increase by 32.91 percent to $1.26 billion in 2002 and to $7.3 billion by 2005 (Beardi, 2001). Some researches in comparing email advertising and direct mail shows that email is cheaper than traditional direct mail, email advertising have been heralded as
2
Introduction producing faster response times from consumer, and email can encourage interactivity with consumers by including hyper links in the mail (Gartner, 2002; Brown, 2002; Rickman, 2001; Garden, 2002). Permission-based emails are powerful, according to Martin et al. (2003), because the consumer is requesting the information from the advertiser that simply being exposed to it. Advertisers will increase spending on online advertising in many different forms such as paid search, online video, and banner advertising but there will not be significant rapid near term growth for the undesirable effectiveness. For instance, Advertisers currently direct 96% percent of their spending for online display ads to pages that represent just 30 percent of overall web traffic (Grosso et al., 2006). Some online advertisers are also moving offline in order to coordinate advertising in both online and offline media. According to Knowledge@Wharton (2006, p212), in the United States $150 billion is spent through traditional media advertising which is almost 10 times of online advertising although the growth rate of online advertising at a rate of 30% a year. In latest some Internet giants namely Google, Yahoo and eBay after conquering the advertising frontier in cyberspace are now turning to traditional media for future growth by brokering ad sales for offline media like radio, television and print. David Reibstein says that the move into old-style media is a logical extension for the Internet giants, as the soul is to distribute advertising messages, both the traditional media and online media can provide a more complete portfolio in advertising. One of the challenges for e-business marketers is to attract visitors to the site and generate significant repeat visits (Williamson and Johnson, 1995). According to Williamson and Johnson (1995), web traffic control leads to the initial site visit, and the repeat traffic mainly depends on customer need and partly influenced by website design (Saloman, 1995). Several types of web traffic control namely Internet yellow pages, web traffic control, direct, and links with other websites sharing the marketing objective of attracting visitors to the website are proposed by Hoffman et al. (2000).
1.2 Problem Discussion
Nowadays the 'build and they will come' model is insufficient to generate traffic to the sit, marketers need to actively attract users or customers (Parsons et al., 1998). According to Lindström & Anderson (2000), a company is more or less invisible on the Internet until its existence in cyberspace has communicated to its target group, and people do not just come across a new websites by chance, as there are too many of websites existing in cyberspace, thereby create the traffic which is a necessary precondition for the company's Internet strategy to be successful. Benbunan-Fich & Fich (2004) also explain that web traffic constitutes the mass of visitors to a website that can potentially be converted into sales or advertising revenue.
3
Introduction Alpar, Porembski & Pickerodt (2001) point out that to attain a large amount of traffic is an intermediate goal of most websites regardless of their purpose, and achieving it is usually necessary in order to achieve their higher level goals. Nikolaeva (2005) also think that website traffic is a necessary step in the generation of sales for on-line merchants in cyberspace. Although in itself not a measure of success, Website traffic is a step in the consumer on-line purchase process that can lead to increased sales. Therefore to successfully generate web traffic become en issue. Traffic building, according to Chaffey et al. (2003), is the process of using online and offline communications to drive or attract visitors' traffic to a website, where visitors refers to not only new customers and potential customers but also irregular visitors of the existing customers. (ibid) Some other authors name the process by terms of generating traffic and website traffic generation (Huizingh 2002, Nikolaeva 2005, Parsons et al., 1998). In order to build website traffic, Pickton and Broderick (2001) say that the most effective mix of media should be employed, which are characterized as traditional offline marketing communications or new online communications. According to Nikolaeva (2005), both offline and online communications can influence the web traffic. Online advertising has a more direct effect on Website traffic because of the immediacy of the action that consumers can take. In contrast, advertising in traditional none electronic media increases a site's visibility and thus indirectly influences Website traffic. Some researchers have presented some offline and online communication tools that can contribute to traffic building directly or indirectly. Chaffey et al., (2003) points out some effective offline and online communication tools for traffic buildings such as publicizing the URL offline, public relations, direct marketing, sponsorship, exhibition, word of mouth, and banner advertising, affiliate network, search engine registration and optimization, link building, email marketing, viral marketing. According to Smith et al. (1998), there are many of various offline and online marketing communication tools available namely as press, radio, TV (terrestrial, satellite, and cable, and interactive video, text), telephone, mail, e-mail, and the Internet. Huizingh (2002) addresses that a few of different medias that are used to generate web traffic: television, radio, print media, bill boards, direct mail, business cards, company prints, electronic newsletter, information on company's products, participation in electronic malls, advertising in electronic newsgroups, e-mail signatures, advertising at other sites. Some specific online communication tools have been presented by some researcher that can generate web traffic. For example, Turban et al. (2004) considers pop-ups, interstitials, newspaper-like standardized ads, URLs, advertising in chat rooms, Internet radio/television as the online promotion tools. Lindstrom and Anderson (2000) present online word of mouth and vertical portal beside above mentioned tools.
4
Introduction
According to Ilfeld and Winer (2002), a huge amount of money has been invested in generating traffic by exploiting different media; hereby how to improve cost effectiveness is a constant issue. Effectiveness of traffic building can be simply observed by clicks on the website during the period of promotion campaign, but it is more valuable to learn the knowledge behind the click-on and click-through, and evaluate the effectiveness of the marketing communication tools. As it can provide the marketers knowledge in better use of the communication tools, especially cost efficiency is very much concerned by small firms. The effectiveness of the website could be monitored in two different ways: to observe the path of visitors' behavior and to see whether they return to the site (Day, 1997). The effectiveness of website in marketing communication can be also measured quantitatively through some parameters likely the numbers of repeat visits, the number of minutes spent by the user, the number of minutes the visitor spends on average on the main activities of the website, the number of individual visitors, the user's behavior at the website, the number of e-mails received from customers, the website's sales and income. These tools can help company to find how good the company has been at creating traffic on the Internet from different communication tools (Lindström & Anderson, 2000). Some other researchers suggest to measure the effectiveness of website by duration of browsing time, the depth, or number of assessed pages, the number of repeated visits, making contact with interested individuals, converting some visitors to customers, the supporting the purchase and post-purchase phase of the supplier-customer relationship that follows (Karayanni and Baltas, 2003; Chaston, 2001).
1.3 Purpose and Research Questions
In view of the above discussion, the purpose of the present research is: To provide a deeper understanding of the communication tools used by companies to build traffic to their website and measures they adopt to evaluate the effectiveness of these tools. In order to reach the purpose of the research, the following research questions are developed: RQ1: How can offline marketing communication tools used for traffic building be described? RQ2: How can online marketing communication tools used for traffic building be described? RQ3: How can evaluation of effectiveness of communication tools in traffic building be described?
1.4 Demarcations
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Introduction This research will observe the following demarcations: a) concentrate on B2C companies; b) select smaller companies, and c) investigate the corporate perspective on traffic building.
1.5 Deposition of the Thesis
The work is done in seven chapters as shown in figure 1.1. In chapter one, Introduction is stated including the background of the research, the discussion of the concerned problem, the purpose of the research and research questions as well as demarcations; In chapter two, the literatures of the previous researches related to research problems are presented; In chapter three, the conceptualization and frame of reference are presented; In chapter four, the selection of research methods are stated as well as the discussions and motivations about them; In chapter five, the data from real business world are presented; in chapter six, the collected data are analyzed; finally in chapter seven, the conclusions and findings are discovered according to the analysis of the data. See figure 1.1
Chapter 1 Introduction
Chapter 2 Literature Review
Chapter 3 Conceptualiz ation
Chapter 4 Methodology
Chapter 7 Conclusion & Findings
Chapter 6 Case studies
Chapter 5 Data presentation
Figure 1.1 The outline of this thesis
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Literature Review
2. Literature Review
This chapter contains literature based on our research questions. This will include studies on both offline and online marketing communications, then the evaluation of effectiveness of communication tools in traffic building.
2.1 Offline marketing communication tools used for traffic building
According to Chaffey et al. (2003), Smith (1998), Fill et al. (1995) there are mainly 9 kinds of offline communication tools which might relate to the topic of traffic building: publicizing the URL offline, public relations, direct marketing, sponsorship, exhibition, corporate identity, packaging, merchandising and word of mouth. These tools will be discussed intensively as below: 2.1.1 Publicizing the URL offline According to Chaffey et al., (2003), there are two types of offline advertising: incidental and specific. Incidental offline advertising means that driving traffic to the website is not a primary objective of the advert. On the other hand, specific offline advertising means driving traffic to the website or explaining the online proposition is a primary objective of the advert. Chaffey et al., (2003) points out that publicizing the Uniform Resource Locator (URL) offline can be achieved by using some specialist techniques of specifying the URL (web address) that can be used to help customers in finding the information they need on the website. These techniques can be some kinds of traditional advertising such as newspaper, magazines, TV, radio, videos, catalogue and technical reports. It has benefit to give a specific page when companies doing their advertising because that is related to the offline promotion and the interests of the audience. A similar technique is to use a sub-domain which is different from the main domain, or to register a completely different domain name that is in keeping with the campaign. Awareness of URLs through traditional offline advertising, such as television and print, represents an important source of information about websites and the way to find them (Kehoe et al., 1998; Maddox & Mehta, 1997). Lindström & Anderson (2000) point out that it is obvious that the URL should be everywhere the physical address, such as business cards, letterheads, brochures, annual reports, telephone directories and other reference books, television and radio advertisements, advertisements, hoardings and billboards, packaging and point-of-sale material. Especially, many scholars suggested sometimes magazines have tremendous positive influence on the publicizing the URL offline. A study conducted by Gupta (1995) reports that using magazines to locate sites on the Internet is very common-almost two thirds of the surveyed participants learned about websites through magazines. Huffenberger, Kanfer, Schlosser, and Ryan (1998) find that promoting a website in magazine advertisements has increased at a nearly exponential rate. Print media are
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Literature Review particularly useful because the interested consumer can directly refer to the advertisement when he or she types the URL. This diminishes the likelihood of errors due to hastily copying on paper or memorizing the URL from a television, radio, or bill-board advertisement. (Schlosser and Kanfer, 1999) Using of providing specific page of the website in publicizing the URL offline is depending very much on situations. Providing the specific page enables the user to be sent direct to the relevant information without having to navigate through the corporate site, it especially suits the companies who have a diverse product range. A further advantage of using a specific web address is for measuring advertising effectiveness. If there is no other way of navigating to that page on the site, it can then be established how many people arriving at a site on this page have viewed the original advertisement. However, it is not normal for companies who strive for brand building and establishing the credibility of a site to provide a specific page in publicizing the URL offline by using traditional advertising ways. (Chaffey et al., 2003) 2.1.2 Public Relations Baker (1994) mentions that public relations is a promotion tool through a release to definable news media in the hope of secondary exposure via an editorial mention earned by the newsworthiness of subject matter. Chaffey et al. (2003) point out that public relations can be an important tool for driving traffic to the website if changes to online services or online events are significant. Kotler and Armstrong (2001) reveal that public relations is considered another mass-promotion technique. It concerns itself with building good relations with the company's various publics by obtaining favorable publicity, building a good corporate image, and handling or heading off unfavorable rumors, stories, or events. Several tools are used in today's public relations efforts: ? Press relations: Creating and placing newsworthy information in the news media to attract attention to a person, product, or service; ? Product publicity: Publicizing specific products; ? Public affairs: Building and maintaining national or local community relations; ? Lobbying: Building and maintaining relations with legislators and government officials to influence legislation and regulation; ? Investor relations: Maintaining relationships with shareholders and others in the financial community; ? Development: Public relations with donors or members of nonprofit organizations to gain financial or volunteer support. (Ibid) Internet can be used to expand the depth and breadth of PR. According to Chaffey et al., (2003), compared to the traditional public relations (PR) methods, there is new method of PR as an offline communication tools coming out in the context of webbased to be an effective promotion of driving traffic to the website. PR activity on the Web offers organizations scope for corporate communications, sponsorship,
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Literature Review publicity and a direct vehicle for communication press releases. The Internet provides scope for two-way interaction, clear targeting of key opinion-formers and journalists and the potential for communicating strong corporate brand messages. The Internet can be used to facilitate traditional methods of PR. According to Lindström & Anderson (2000) that when the companies go on the Internet, it will have to find a new angle which makes it interesting for a journalist to write about its activities. If the company can't do that, there is the danger that the users will not find the site very interesting either. Through this new method of PR, a company can talk direct to the market via the corporate website. Third-party agencies and old media still have a role, because of their credibility as independent sources of information and their wider circulation. Agency information can be supplemented by more detailed and timely information direct from the corporate website. PR can update their information in the public media by minute. This has the obvious benefit that a company can make an immediate impact and be better aware of the changing marketing environment. However, the problem of this new PR is that a company's competitors have these advantages too. So it is likely that there will be an increased need for defensive PR (Chaffey et al., 2003). Because of the high involvement of Internet in this new method of PR, it is not considered as an offline marketing communication tool in this study. The degree of trust and confidence generated by public relations makes this tool important because it can reduce buyers' perceived risk. However, while credibility may be high, the amount of control that management is able to bring to the transmission of the public relations message is very low (Fill et al, 1995). Forster (1998) also points out that public relations can have a stronger impact on public awareness at a much lower cost than advertising. But, because the communication efforts of PR staff are often focused on groups other than just buyers, its uses are limited. 2.1.3 Direct Marketing Direct marketing is a promotion tool through a mail shot (always delivered in the post), a mail drop (delivered to the door), telemarketing (unsolicited phone calls) or a fax message (Baker, 1994). Direct marketing can represent a strategic approach to the market although some organizations use it as a tactical tool. Use of this tool signifies an attempt to actively remove channel intermediaries, reduce costs and improve the quality and speed of service for individual customers. By removing the face-to-face aspect of personal selling and replacing it with either an email communication, a telephone of personal selling and replacing it with either an email communication, a telephone conversation or a direct mail letter(Fill et al, 1995). Kotler and Armstrong (2001) point out that the major forms of direct marketing include: --Face-to-face selling: relying on a professional sales force to locate prospects, develop them into customers, build lasting relationships, and grow the business. Or
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Literature Review companies hire manufacturers' representatives and agents to carry out the directselling task. In addition, many consumer companies use a direct-selling force to reach final consumers: insurance agents, stockbrokers, and salespeople working partor full-time for direct-sales organizations; ? Telemarketing: using the telephone to sell directly to consumers; ? Direct-mail marketing: through single mailings that include letters, ads, samples, foldouts and other"salespeople with wings" sent to prospects on mailing lists; ? Catalog marketing: direct marketing through print, video, or electronic catalogs that are mailed to select customers, made available in stores or presented online; ? Direct-response television marketing: direct marketing via television, including direct-response television advertising or infomercials and home shopping channels. ? Kiosk marketing: information and ordering machines called kiosk. Companies place the kiosk in stores, airports, and other locations in order to help customer tryout or get information before the purchase. ? Online marketing: marketing conducted through interactive online computer system, which link consumers with sellers electronically. According to Chaffey et al., (2003), direct marketing can be an effective method of driving traffic to the website. As the main way of direct marketing, direct mail campaign is used to drive the response to the website. Many catalogue companies will continue to use traditional direct mail to mail-out a subset of their offering, with the recipient tempted to visit the site through the fuller offering and incentives such as competitions or web-specific offers. Lindström & Anderson (2000) explain that direct mail which means to send all the recorded users in the target group a letter detailing what new opportunities are now being made available on the net is an appropriate idea. In this way the whole story can be told and can be adapted to suit the needs of different customers. 2.1.4 Sponsorship Sponsorship is a promotion tool through association of a product or service with an entity, event or activity (such as sports teams, cultural programmes, arts, education, community and broadcast.) in the expectation of secondary exposure via attribution to the sponsor during associated media converges. (Baker, 1994) Smith (1998) points out that sponsorship is more than patronage, altruism or benefaction. It can indeed help others while simultaneously achieving specifically defined promotion objectives. Some sponsors see sponsorship as a form of enlightened self-interest, where a worthy activity is supported with cash and/or consideration in return for satisfying specific marketing or corporate objectives. In Lindström & Anderson (2000) book, sponsorship is considered as the exposure of a brand, logo with the URL, typically for a long time than an advertisement which helps to make the company website visible to the public and generate the traffic to the website. There are several advantages and disadvantages of the sponsorship. Sponsorship can be cost effective (compared to advertising) in terms of reaching a particular audience.
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Literature Review It does allow access to very specific types of audiences that otherwise might be difficult to reach. Sponsorship can achieve many different objectives including: generate traffic awareness; image enhancement; improved relationships with many different "publics"; increased sales, sampling and database building; creating a platform for new promotional material; beating advertising bans, etc. It also offers creative opportunities including the engagement of an audience in a relaxed atmosphere of goodwill. Hospitality events open doors and create a dialogue that conventional media simply cannot. However, sponsorship is considered insidious and that it undermines artistic integrity. Although sponsorship can deliver extremely costeffective benefits, it can be misunderstood as an excessive indulgence by employees if they are kept in the dark about it and if there are redundancies occurring at the same time. (Smith, 1998) 2.1.5 Exhibitions Smith (1998) points out that exhibitions are unique in that they are the only medium that brings the whole market together- buyers, sellers and competitors-all under one roof for a few days. Products and services can be seen, demonstrated or tested, and face-to-face contact can be made with a large number of relevant decision makers in a short period of time. Relationships can be strengthened and opportunities seized if planned carefully. Exhibition offer an array of opportunities, problems and challenges to the keen marketing manager. They can be leveraged to the maximum effect by integrating them with other communications tools and developing a longer-term perspective incorporating an overall exhibition strategy. However, although exhibitions are a powerful marketing communications tool, they require detailed planning and coordination of resources. Compare to the B2B market, exhibitions in B2C market usually take up less marketing budget. Many objectives can be achieved through exhibitions such as: ? Sales - generate sales and enquiries from new and existing customers, agents and distributors. ? Launch new products or website. (It included new products, services and the important windows for the company: website. It is indeed an effective ways to attract more traffic to the website. ) ? Maintain a presence - in the market. ? Press coverage - internal and external PR opportunity. ? Reinforce relationships - with customers, distributors and agents through hospitality and introductions to senior managers and directors. ? Support local distributors/agents - by exhibiting. ? Market research - customers, non-customers and distributors. ? Test new ideas - product testing and informal creative discussions. ? Competitor analysis and intelligence gathering. ? Staff motivation - some exhibitions can be the focal point of the year. They allow staff to come to the show (exhibition) and feel a certain amount of pride in their organization.
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Literature Review ? Meet new staff or potential recruits. 2.1.6 Corporate Identity Corporate identity is what it says - a visual means of identifying a corporation, company or organization. Logos and names are only part, albeit a very obvious part, of an organization's identity. Corporate identity is a strategic asset that helps to achieve the longer-term communication goals. It cannot therefore be used as a shortterm tactical tool like advertising or PR, which can change from day to day (if required). As with and fixed asset, the corporate identity asset needs to be checked and maintained to keep it in good working order. If allowed to fall into disarray or disrepair it can, like other assets, eventually become a liability by projecting an inappropriate image. (Smith, 1998) Corporate identity reflects the personalities, core values and direction of a company. It is a one way of communicating the values it wants to express. Corporate identity is seen as a symbolic uniform that acts as a flag expressing everything about the organization. It is a visual system which uses all the points of public contact. This includes the "permanent media" or buildings (exterior and interior), signage, vehicles, uniforms, business forms (invoices, cheques, letterhead, etc), literature (Product brochures, annual reports), exhibition s, etc. Furthermore, some companies stamp their logos on to their individual brands' advertising, packaging and point-of-sale material. (Ibid) 2.1.7 Packaging Packaging is a promotion tool through display, guaranteeing exposure to customers at the point of sales, but not to a wider target audience. (Baker, 1994) Smith (1998) points out that since many sales assistants have been replaced by self-service systems; packaging today often has to act as a silent salesman, helping customers by bringing a particular brand to their attention, highlighting USPs (unique selling propositions/unique benefits), giving friendly tips on usage and, ultimately, helping them to break through the misery of choice created buy the increasingly vast range of seemingly similar brands. There are three basic functions of packaging: protect (and contain); offer convenience; communicate. First, a pack must protect its contents during storage, transport and usage. Some packs have to protect the user from the contents. Second, the pack must offer convenience in pouring, squeezing, storing, stacking and consuming. Even a minute improvement in convenience can create competitive advantage. Third, the pack can communicate, which include instructions, information of company, logo, and website address, which can create customer awareness of the website and corporate identity effectively. (Ibid)
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Literature Review 2.1.8 Merchandising There was a time when below the line point-of-sale (POS) materials were considered relevant only to cosmetics, perfumery, confectionery or other impulse purchase. Today merchandising techniques apply to a broader spectrum of markets, from customer to industrial. Although vast budgets can be spent above the line on advertising to gain the customer's attention or change an attitude, fewer resources are sometimes allocated to the crucial moment in the buying process - the point in the buying cycle where the customer is physically in front of the product or service and is about to make decision whether to buy or pass by - the point of sale. (Smith, 1998) In many consumer merchandise has the vital role to guide a buyer towards making a purchase by using merchandising techniques such as display and store design. However, the merchandising opportunity lies relatively untapped in industrial wholesale outlets such as electrical wholesalers or builders' suppliers, where a lot of merchandising tends to look dusty, dirty and uninteresting. But merchandising here can provide customers with useful information, which can remind the buyer about other relevant products, services, website and any special offers. (Ibid) 2.1.9 Word of Mouth According to Chaffey et al., (2003), word of mouth (WOM) is playing an important role in traffic building. WOM through friends, relatives and colleagues was the most important method. Internet customer can told their friends, relatives about his or her online shopping experience. If the online experience is favorable, the customer will tell more people the website, but if it is bad, they will tell twice as many, so word of mouth can be negative also. Thus, the role of opinion leaders and multi-step communications with target audiences receiving information about the Internet experience from opinion leaders, the mass media and the Internet, appear to be perhaps even more important in relation to the Internet than for other media. According to Rogers (1983), to exploit this tool, it is necessary for companies to use appropriate techniques to target and adapt the message for the opinion leaders when a product or service is at an early stage of diffusion. Furthermore, Smith (1998) points out there are many devices and techniques that encourage and accelerate the WOM process such as postcards, digital postcards, Tshirt, photographs, awards and certificates. Especially, Internet can promote WOM in an effective and efficient ways. The Internet can accelerate word of mouth with its networks of news groups, chat rooms, discussion forums and email chain letter. Better use of website can develop a network of different groups of person in the process of WOM.
2.2 Online marketing communication tools used for traffic building
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Literature Review Chaffey et al. (2003) and Lindstrom & Anderson (2000) provide rather comprehensive descriptions of online communication tools including banner advertising, affiliate networks, search engine registration and optimization, link building, e-mail marketing, and viral marketing. We will discuss each of them below: 2.2.1 Banner Advertising Chaffey et al. (2003) define banner advertisement as a rectangular graphic displayed on a webpage for the purposes of advertising, which is normally possible to perform a click through to access further information. Lindstrom and Anderson (2000) reveal that the banner ad is Internet's most widespread and commonly used form of advertising. Banner is a graphic element with a fixed size and a fixed position on the website. The banner ad is effective at several levels - the user can see the advertisement, click on it and get onto the advertiser's website. In some certain cases the user can participate in an interactive game, etc., on the actual banner ad. (ibid) Along with the development of the Internet technology, the evolution of banner ads generates many different forms of them. Chaffey et al. (2003) point out banners can be in many different formats such as static banners, animated banners, interactive banners, pop-up, rich-media; and Lindstrom and Anderson (2000) present five different formats of banners including traditional banner ad, animated banner ad, interactive banner ad, context-sensitive banner ad, and rich media banners. According to their previous researches on the banner ads, we decide to discuss banner ads in the following six forms: a) Static banners do not change through time. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) b) Animated banners have the norm with a typical rotation of three to five different images, which are displayed in sequence to help to attract attention to the banner and build up a theme, often ending with a call to action and the conjunction to click on the banner. A further type of animated banner ad is the overt, which typically an animated ad that moves around the page and is superimposed on the website content. Animated banners are the most widespread type of banner now n the Internet as they attract more attention than traditional static ads. Animated advertisements can be in the style of a simple cartoon-still with text and the facility to click onto a website. It can last a maximum of a few seconds or loop. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) c) Interactive banners advertisements give the use the opportunity to participate in interactive games or amusements - these are incorporated into the actual banner ad itself. The interactive element increases the advertising possibilities dramatically. Provisional figures show that interactive banner ads can increase the click rate up to 600 percent in comparison to static banner ads. The user can type in an e-mail address on interactive banner to register for information, which may increase response since
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Literature Review someone may fill in the form even though they might not bother to click on an advertisement. The interactive banners are intended to add value to the advertisement by providing a service that would normally only be available on the website. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) d) Pop-up is categorized as superstitious and interstitials. Interstitials are usually displayed as part of the main browser window, which are literally "in between" other screens of information. Superstitials take the form of an additional 'pop-up' browser window that is displayed when a new web page opened, which require interaction to remove them, so that they are intrusive and have been reported as unpopular, in contrast, some advertisers have found them to be quite effective. (Chaffey et al., 2003) e) Rich-media banners are to use a combination of animation, video or even sound on banner design. The new banner technologies, such as d-html, Java and Flash, introduce new possibilities with regard to the content and creativity possible in the banner. The banners can integrate small games, streaming news, sound and video clips. The users can even download files and print discount coupons or product information from a banner. Some problem of these developments need special technology t be installed on the user's machine, or require the most recent versions of browser before they can function properly. (Chaffey et al., 2003; Lindstrom and Anderson, 2000) f) Context-sensitive banner advertisements are also called search word banners, which appear to the user as a conventional banner ad; they are made context-dependent and found primarily in search engines, each time a user searches for a word in the database, a banner ad appears for the company which has purchased that word. Search-word banners are at the present one of the most targeted marketing tools available on the Internet. American studies show that the banner appears under the condition has more than 60 percent chances to be clicked than the normal banner. (Lindstrom and Anderson, 2000) According to Cartellieri et al. (1997), the purpose of banner advertising could be: a) To deliver content, which is the typical case where a clickthrough on a banner advertisement leads through to a corporate site giving more detailed information on an offer. A direct response is sought here; (ibid) b) To enable transaction on a e-commerce site, which mainly refers to a merchant such as a travel site or online bookstore the ad is placed to lead directly to a sale. A direct response is also sought; (ibid) c) To shape attitudes when building brand awareness, which refers to the ad that is consistent with a company brand; (ibid) d) To encourage retention likewise a reminder of a company and its service and may link through to on-site sales promotions. (ibid)
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Literature Review 2.2.2 Affiliate Networks Chaffey et al. (2003) define affiliate networks as collection of websites that link to an online retailer in exchange for commission on purchases make from the retailer. It is effectively a no-cost method of advertising or one in which payment is only made where there is a definite outcome - the purchase of an item. The aim of affiliate networks is to use graphic or text link advertisements placed on many sites to generate traffic by referring links to a destination website. (ibid) 2.2.3 Search Engine Registration and Optimization Chaffey et al. (2003) explain that search engine provides an index of content on registered sites that can be searched by keyword; and search engine registration is a request to a search engine that a site be included within its index. Over 80% of web users state that they use search engines to find information, so that if search engine registration has not occurred for an organization, then traffic volume will be less than optimal. Search engines are constructed by software, which compile an index by sending out spiders or robots to crawl around sites that are registered with that search engine. Web directories or catalogues are constructed and presented differently from search engines. They provide a structured listing of registered websites and their purpose in different categories. They are constructed by human; and they do not give comprehensive access to all web pages but the list of company names, categories and a certain words description of the site. (ibid) The numbers of search engines are increasing more rapidly and specialized, so that the more places the company is registered the better. A product- or branch-specific search engine in the field the company represents is considered more important to get registered in. (Lindstrom and Anderson, 2000) Search engine users are most likely to select sites to visit that are near the top of a search engine listing (ranking) - typically within the first screen, so that how to make the firm's site stay in the first screen is a big issue, so that search engine optimization comes into the picture. It is a structured approach used to enhance the position of a company or its products in search engine results according to selected keywords. There are now many specialist search engine optimization companies. (Chaffey et al. 2003) 2.2.4 Link Building Chaffey et al. (2003) introduce the concept of link-building campaign which is a structured approach to gaining as many links as possible from other Web-related websites. It is a relatively straightforward method to make sure that their site has links from as many other related sites as possible, using hyperlinks. Chaffey et al. (2003) reveal that link building can be approached by following techniques:
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Literature Review a) Reciprocal links, which are two-way links agreed between two organizations. The benefit of the technique is that it is free. (ibid) Lindstrom and Anderson (2000) suggest that in order to find out what companies may be interested in such an exchange deal, think of the companies that are in the company's value chain. They are including shareholders, business associates, suppliers, dealers, and companies offering complementary products. b) PR - Content mentions, which refer to the links to the organization's site, are featured in media sites like online newspapers or trade magazines, then it also increase traffic. (ibid) c) Affiliates, which refer to affiliate networks, are widely used by e-tailers to drive traffic to a site. d) Sponsorship, which refer to a paid-for sponsorship of another site, or part of it, especially a portal, for an extended period is another way to develop permanent links. Co-branding is a similar method of sponsorship and exploit synergies between different companies. It is an arrangement between two or more companies where they agree to jointly display content and to conduct joint promotions using brand logos or banner advertisements. It is usually non-paid exchange, so it is seen as a cost-effective method of promotion which can be used for longer periods than banner advertisements. e) Banner advertising, which is widely used by large B2C companies to drive traffic to their site. f) Price-comparison portal, which are for companies selling commodity products using e-commerce to ensure that the products are listed on infomediary or portal sties offering product and price comparison. 2.2.5 E-mail Marketing Doubleclick (2001) reported that there is more spending on e-mail marketing than banner advertising in most European countries. Chaffey et al. (2003) point out according to surveys in many counties; it is a significant method of Internet communication. It is described in two categories: outbound email marketing, where email campaigns are used as a form of direct marketing to encourage trial and purchases and as part of a CRM dialogues, and inbound e-mail marketing, where emails from customers such as support enquiries are managed. E-mail offers many advantages as a communications tool - it offers immediacy, targeting, accountability and is relatively cheap. E-mail can also use in customer acquisition. There are two approaches to obtain e-mail address of prospects: one is to purchase of opt-in bought-in lists, which refer to the company contact a list broker or list owner and purchase e-mail addresses of individuals who have agreed to receive
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Literature Review marketing e-mails, the other one is to build a house list, which refer to use a company website combined with permission-based marketing opt-in techniques and a relevant incentive is offered in exchange for a prospect's providing their e-mail address by filling in an online form. (ibid) 2.2.6 Viral Marketing Viral marketing is used to transmit a promotional message to another potential customer. It is effectively an online form of word-of-mouth communications. Viral marketing harnesses the network effect of the Internet and can be effective in reaching a large number of people rapidly in the same way as a computer virus can affect many machines around the world. (Chaffey et al. 2003) 2.2.7 Vertical Portals Lindstrom and Andersen (2000) mention vertical portals as a kind of online marketing promotion technique, which is a web marketplace in a certain industry. It can also lead to an industry-specific community. If there is not yet a relevant portal, it could make sense to set up links to all competitors without necessarily getting links from their sites in return. In this way the company's website can become the gateway for the industry; then the company can make good use of the opportunity to present its information - being the fist and the best.
2.3 Evaluation of effectiveness of communication tools in traffic building
According to Lindstrom and Andersen (2000), there are several quantitative measurements of the success of communication tools, which all gives the company an idea on how well they manage to attract traffic to their website: ? The number of individual visitors This parameter can give an indication of how successful the external communication has been in promoting traffic on the website. Generally, an address of the site that is easy for the potential user to remember also tends to increase the number of individual visitors. ? The number of minutes spent by the user The longer time the visitors spend at the website, the greater the probability that strong relationships are being built between the user and the brand. The measurement should also include the amount of time the visitor spends per page, since that is a measurement of increased dialogue with the user. ? The number of minutes the visitor spends on average on the main activities of the website
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Literature Review For instance if two out of three pages in a main activity of the site has generated long visits, but not third, it is likely to assume that the creativity has come to an halt, rather than the user's interest in the subject itself. ? The number of repeat visits This parameter shows to what extent the site was able to live up to the expectations of the user. If the user needs for information, entrainment and communication have been sustained; it is likely that they will visit the site repeatedly. ? The user's behavior at the website Measure which activities on the site that were visited first and in what order the subsequent visits were selected and if this is in accordance with the messages and the values originally intended by the site owner. ? The number of e-mail received from customers The number of e-mail is also an indicative to the website's quantitative success, especially so if the site aims to provoke visitors to sending e-mails feedback. Conversely, if the site wish to avoid e-mail altogether, this measurement is obviously less significant. ? The website's sales and income The more the website is designed for Internet sales, the more important is it that goals should be set for sales, the rate of sales and the income. Lindstrom Andersen (2000) states that above measurements can be analyzed by companies' own database or special online software. Based on the result of evaluation on the effectiveness of each communication tools, company can find out efficiency of each communication tools and choose the most efficient tools to promotion the website. (Lindstrom Andersen, 2000) According to Hoffman et. al (1997), a website's effectiveness could be monitored in two different ways. First, one can observe the behavior of those entering the site and starting to move through it. The company can track their movements and see if they go to the areas the company wants them to go to. The company can see if they consistently log off a certain point and then tie that behavior back to our theory. If the company had assumed that our customers would want to download that hefty file of information because the company knows it will match their interests and yet the company see that most customers do not, the company can safely assume that the average download time of three minutes may be too long. So, the company can cut that file into smaller pieces and see if they hang on for 15 seconds. The company can help them along, just as the company do in an article, by advising them of what is to come and how long it will take. (Ibid)
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Literature Review The second prime way the company can track their behavior is to see whether they return to the site. The fundamental objective of any organization is to have repeat business - few people survive by interacting with customers only once. How many of our customers come back again and again, and how do they move through the site? People all know about bookmarks, so people usually bookmark the sites that they want to return to. By measuring the return hits and looking at the behaviors the company can quickly turn those data into useful information: 20 percent of first- time users come back again; 15 percent of them consistently log off at certain points, for example. That gives the best information of all - it tells the company what the people they are really interested in are doing. (Ibid)
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Frame of Reference
3. Conceptualization and Emerged Frame of Reference
This chapter includes the conceptualization and the emerged frame of reference of this study. The conceptualization allows us to answer this study's research questions. The frame of reference, which results from this conceptualization, will guide the data collection and data analysis in this study.
3.1 Conceptualization
All selected concepts below have been chosen on the basis of their potential strength as topics for data collection. Based on our three research questions: RQ1: How can offline marketing communication tools used for traffic building be described? RQ2: How can online marketing communication tools used for traffic building be described? RQ3: How can evaluation of effectiveness of communication tools in building traffic be described? We have developed relevant theory from several previous studies as our foundation of data collection. These are presented in the following sections. 3.1.1 How can offline marketing communication tools used for traffic building be described? In correspondence with the first research question, we are going to use the previous studies of below listed authors in order to make an effective data collection. These authors include Chaffey et al., (2003), Kotler & Armstrong (2001), Lindström & Anderson (2000), Smith (1998), Baker (1994), Foster (1998), Fill (1995), Powers (1989), Fill et al. (2005) and Morris (1992). After compared the literatures, we decide to select the six kinds of offline communication tools addressed by Chaffey et al. (2003) and Lindström & Anderson (2000) as frame of reference, as these tools are more relevant to traffic building according to them. Furthermore, we complement other authors' studies into each of the offline communication tool addressed by Chaffey et al. (2003) and Lindström & Anderson (2000) in order to provide a better understanding of the tools and thorough theoretical base for later analysis. ? Publicizing the URL offline Publicizing the URL offline could be in business cards, letterheads, brochures, telephone directories and other reference books, television and radio advertisements, advertisements (excludes TV and radio advertisements), hoardings and billboards, packaging and point-of-sale material, which could be incidental advertising or specific advertising of online presence; ? Public Relation
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Frame of Reference Press relations, product publicity, public affairs, investor relations and development. ? Direct Marketing Telemarketing, direct-mail marketing and catalog (non-electronic) marketing. ? Word of Mouth Of all the elements of the communication mix, word of mouth (WOM) is by far the most potent on a one-to-one basis. No amount of advertising or expert spelling could compete with the WOM. Opinion leader plays an important role in spreading the information. 3.1.2 How can online marketing communication tools used for traffic building be described? In order to collect data on second research question, we decide to use Chaffey et al. (2003) and Lindstrom and Anderson (2000) previous studies on the online marketing communication tools, because the authors' study are the most comprehensive ones. These studies will be presented into an eclectic list that we will use during the data collection. In the pretests of both cases, viral marketing is found to be an inappropriate online communication tool, as both companies think that the benefit of using viral marketing in terms of traffic building would not overcome its negative influence on their brand images. So it will not include in the concept framework of RQ2. ? Banner Advertising Banner advertising has different forms of banner advertising including static, animated, interactive, pop-up, rich-media, and context-sensitive banner. The purposes of banner advertising could be to deliver content, to enable transaction, to shape attitude, to encourage retention. ? Affiliate Networks Affiliate networks is basically a networks connected by exchange links and commissions between each others. It is primarily applying on B2C sites; the form of affiliate networks in B2B market could be different. ? Search Engine Registration and Optimization The more Search engine the company registered, the more traffic the website could generate. Directories and catalogues are technically different from search engine, but works as good as search engine, especially in a certain industry context. Search Engine optimization can be dealing in the company and outsourcing. ? Link Building Link building can be done by reciprocal links, PR-content mentions, affiliates, sponsorship, co-branding, banner advertising, and price-comparison portal.
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Frame of Reference ? E-mail Marketing Inbound e-mail marketing is very much related to CRM and customer retention, so that it would not be considered related to our research questions. Outbound depends on e-mail address list, which can be obtained by two ways: purchase of opt-in lists and build a house list. ? Vertical Portal The company could be the gateway or a single link in vertical portal of a certain industry. 3.1.3 How can evaluation of effectiveness of communication tools in traffic building be described? To answer our research question about measurement of effectiveness of communication tools, we select a few relevant variables from Lindstrom and Andersen (2000), which consists of the following methods: ? The number of individual visitors ? The number of minutes spent by the user ? The user's behavior at the website ? The number of e-mail received from customers ? The website's sales and income We will be using this theory since we think it is the most comprehensive method of evaluation in our reviewed literature. The method uses quantitative data, which are normally easy to collect from the website's statistics by companies.
3.2 Emerged Frame of Reference
As pointed out earlier in this chapter, the conceptualization above is what will allow us to answer this study's research questions. Based on the research questions and the purpose of this thesis stated in chapter one, we have created a frame of reference. This frame of reference will become the foundation of this study's data collection and analysis. The frame of reference is presented in figure 3.1 on next page:
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Frame of Reference
RQ1: Offline marketing communication tools
•Publicizing the URL offline •Public Relation. •Direct Marketing
.Word of Mouth
RQ3: Evaluation of effectiveness of online and offline marketing communications tools. visitors
RQ2: Online marketing communication tools
Traffic Building To Website
•The number of individual •Minutes spent by user •Users' behavior at the
website
•Banner advertising •Affiliate networks •Search engine registration
and optimization
•E-mail received from
customers
•Website sales and income
•Link building •E-mail marketing
.Vertical portal
Figure 3.1 The Frame of Reference of this study Figure 3.1 shows traffic building as the mainly concerned topic of the study is listed in the central place, online and offline communication tools which have interlinks with each other are listed in two distinguished boxes on the left side which can be employed in traffic building; and evaluation variables of the effectiveness of online and offline marketing communication tools are listed in the box on the right side, will leads the company to adopt more efficient tools in order to achieve better result of traffic building.
24
Methodology
4. Methodology
In this chapter, a series of steps was described in order to collect the data necessary to obtain answers to the research questions. These methodology issues are presented below in figure 4.1, which show a graphical overview of the methodology issues used in this study.
Figure 4.1 Schematic Presentation of the Methodology Source: Adapted from Foster, 1998, p.81
4.1 Research Purpose
Yin (1994) shows that a research purpose was classified into three basic purposes: exploratory, descriptive and explanatory. ? The purpose of an exploratory stage is described that is designed to allow an investigator to just "look around" with respect to some phenomenon, in order to develop suggestive ideas. The research should be as flexible as possible and provide guidance for procedures. The focus is initially broad and becomes progressively narrow as the research progresses. ? A descriptive stage is to develop accurate description of persons, evens or situations. It is necessary to have a completed profiles of the phenomena on which you want to collect information to the data collection. ? The objective of an explanatory stage is used to explain a certain set of events and to indicate how the investigation may apply to other investigations (Yin, 1994). Saunders (2000) also suggests that an explanatory research aim to establish casual relationships between variables. The emphasis here is on studying situation or a problem in order to explain the relationships between variables. (Saunders et.al, 2000) Based on the overall purpose and the research questions involved, the research purpose of this study is descriptive and partially explanatory. Because we aim to develop an accurate description of the situation that how marketing communication tools being used in traffic building and the measurement of evaluating the
25
Methodology effectiveness of the tools. When we answer the research questions, we begin to explain somehow in order to draw a conclusion. Therefore this study is more descriptive than explanatory.
4.2 Research Approach
Different approaches can be taken such as deductive or inductive. Deductive research starts with existing theories and concepts and formulates hypotheses that are subsequently tested; its vantage point is received theory. Inductive research starts with real-world data, and categories, concepts, patterns, models, and eventually, theories emerge from this input. After the initial stages, all types of research become iteration between the deductive and the inductive. This is sometimes referred to as adductive research. (Gummesson, 2000) A qualitative approach is one in which the inquirer often makes knowledge claims based primarily on constructivist perspectives (i.e., the multiple meanings of the individual experiences, measuring socially and historically constructed, with an intent of developing a theory or pattern) or advocacy/ particularly perspectives (i.e. political, issue-oriented, collaborative, or change oriented) or both. It also uses strategies of inquiry such as narratives, phenomenology, ethnographies, grounded theory studies, or case studies. The researcher often collects open-ended, emerging data with the primary intent of developing themes from the data. (Creswell, 2003) Since our research purpose and research questions were developed on existing theories and concepts, it is deductive. The purpose of this study is to provide a deeper understanding of the communication tools used by companies to build traffic to their website and measures they adopt to evaluate the efficiency of these tools. According to Jessica et.al, (2006), the qualitative method also has a tendency to see words as the central analysis unit and be associated with description and small-scale studies which is consistent with our research. So the selection of qualitative approach was found to be more appropriate to fulfill our research purpose.
4.3 Research Strategy
Based on our research purpose, we bring three research questions in order to answer the research problem and accomplish the overall purpose: RQ1: How can offline marketing communication tools used for traffic building be described? RQ2: How can online marketing communication tools used for traffic building be described? RQ3: How can evaluation of effectiveness of communication tools in traffic building be described?
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Methodology According to Yin (1994) there are five primary research strategies in the social sciences. These include experiments, surveys, archival analysis, histories, and case studies. Which one of these five strategies that are most suited for a study, depends on the type of research question, the degree of control the researcher has over the study, and whether the study has its focus on contemporary events. Table 4.1 described further for the different research strategies. Table 4.1 Relevant Situations for Different Research Strategies Requires Control over Behavioral Events
YES NO
Strategy Experiment Survey Archival Analysis History Case Study
Form of Research Question
How, Why? Who, What, Where, How Many, How Much Who, What, Where, How Many, How Much? How, Why?
Focuses on contemporary Events
YES YES
NO
YES/NO
NO
NO
How, Why?
NO
YES
Source: Yin, 2003 p.6 Yin (2003) points out that the case study is an empirical inquiry that investigates a contemporary phenomenon within its real-life context, especially when the boundaries between phenomenon and context are not clearly evident. The case study allows an investigation to retain the holistic and meaningful characteristics of real-life events. A case study can involve a single and a multiple-case study. The single case study makes an in-depth investigation regarding only one entity but multiple-case study has distinct advantages and disadvantages. The evidence from multiple cases is often considered more compelling, and overall study is therefore regarded as being more robust. (Yin, 2003) And the increased number of case can increase the validity of research. However, multiple-cases are time-consuming and high cost. In this study, we actually deal with 'how' and 'why' in some extent, so that according to Yin (2003) the strategy of experiment, history and case study can be choose from. As the study does not require control over behavioral evens, experiment is not suitable. In Internet context, things is changing constantly and rapidly, therefore the study will be rather valuable in focus of contemporary evens, hence history is eliminated. According to above consideration, case study is the one that we select. In light of Yin (2003), multiple-cases is regarded as more robust, hereby we choose
27
Methodology multiple-cases. The number of case will be decided according to our resources in terms of timing and cost, and two cases are affordable.
4.4 Data collection
There are six sources for the collection data of case studies: documents, archival records, interviews, direct observation, participant-observation, and physical artifacts. (Yin, 1994) These sources of evidence can both be strong as well as weak evidence according to Yin (2003). In the figure 4.2, an overview of the six sources of evidence is presented together with their comparative strengths and weaknesses. Table 4.2 Sources of Evidence STRENGTHS WEAKNESSES
Source of Evidence
• Stable: can be reviewed repeatedly •Retrieval ability: can be low • Unobtrusive: not created as a •Biased selectivity: if collection is
result of the case Documentation incomplete
• Exact: contains exact names,
references, and details of an event
•Reporting bias: reflects(unknown)
bias of author blocked
•Broad Coverage: long span of
time, many events, and many settings Archival Records
•Access: may be deliberately •(Same as above for documentation) •Accessibility due to privacy
reasons
•(Same as above for documentation) •Precise and quantitative •Targeted: focuses directly on case
study topic
•Bias due to poorly constructed
questionnaires
Interviews
•Insightful: provides perceived
causal inferences
•Response bias •Inaccuracies due to poor recall •Reflexivity: interviewee gives •Time consuming •Selectivity: unless broad coverage •Reflexivity: event may proceed
what interviewer wants to hear
Direct Observations
•Reality: covers events in real time •Contextual: covers context of event
differently because it is
•Cost: hours needed to human •(Same as for direct observations) •Bias due to investigator's
manipulation of events observers
being observed
Participant Observation
•(Same as for direct observations) • Insightful into interpersonal
behavior and motives
Physical Artifacts
•Insightful into cultural features •insightful into technical operations
•Selectivity •Availability
Source: Yin (1994), P. 80
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Methodology
The data that will be collected is expected to be mainly of a qualitative nature, due to the chosen units of analysis. According to Yin (2003) information found in documents is likely to be relevant for nearly every case study topic, especially for confirming and supplementing evidence from other sources. Documents are important in the data collection stage in a case study, due to their overall value. However, care must be taken in the interpretation of documents, since they are often prepared for another purpose and audience than that of the case study (Yin, 2003). Yin (2003) defines the interview as a two-way conversation that gives the interviewer the opportunity to participate actively in the interview and states that interviews are one of the most important sources of case study evidence. The interview is structured and based on predetermined questions. According to Yin (2003) there are three types of interviews: open-ended, focused, and structured. The most commonly used interview method is open-ended, where the researcher asks the respondent unstructured questions, thus allowing the interview to be more of a discussion. The respondents can be asked for facts as well as their own personal opinion. When a focused interview takes place, the respondent is interviewed during a brief period of time-an hour, for example. The purpose with a focused interview could be to confirm certain facts that are already known to the researcher. The third form of interview, survey, is more of a combination of an interview and a survey and entails more structured questions along the lines of a formal survey. A common question about doing interviews is whether to record them. Using recording devices is in part a matter of personal preference. Audiotapes certainly provide a more accurate rendition of any interview than any other method (Yin, 2003). Most qualitative interviews occur on a one-to-one, face-to-face basis. However, one-to-one interviews may also be conducted by telephone in particular circumstances. (Saunders et al., 2003) Because the research approach and research strategy are qualitative and case study, archival records, direct observations, participant observation, and physical artifacts are not relevant to this study. Interview is the fundamental source to gain primary data; and secondary data can be collected through documentation, which is an important supplement to primary data. Therefore the interview and documentation are the two selected resources of evidence in data collection.
4.5 Sample Selection
According to Saunders et al. (2003) sampling techniques provide a range of methods that enable you to reduce the amount of data you need to collect by considering only data from a subgroup rather than all possible cases or elements. Qualitative researchers rarely draw a representative sample from a huge number of cases to intensely study the sampled cases-the goal in quantitative research. For qualitative researchers, it is their relevance to the research topic rather than their representative which determines the way in which the people to be studied are selected (Neuman,
29
Methodology 2003). Non-probability or judgmental sampling is more frequently used for case study research. Purposive or judgmental sampling enables you to use your judgment to select cases that will best enable you to answer your research question(s) and to meet your objectives. This form of sample is often used when working with very small samples such as in case study research and when you wish to select cases that are particularly informative. (Saunders et al., 2003) In sample selection, we have following criteria: a) It should be an e-commerce company. b) It works on B2C markets in some extend. c) It is a new small company situated in Luleå. For every potential samples, we use email to contact it first in order to find out whether it appropriate to our study. Finally two online B2C companies are chosen as our interview objectives: NetixAB and Rosell & Clack ImportlagretAB. The reason for this selection is that both of the companies pay a lot of attention to promote their websites and focus on evaluation of effectiveness of marketing communication tools, especially they are very interested in our research topic.
4.6 Data Analysis
Data analysis is one step, and an important one, in the research process. Researchers generate information by analyzing data after its collection (Cooper & Schindler, 2003). According to Miles & Huberman (1994), the analysis of qualitative data consists of three activities: data reduction, data display, and conclusion drawing. Data reduction refers to the process of selecting, focusing, simplifying, abstracting, and transforming the data that appear in written-up field notes or transcriptions. Data reduction is not something separate from analysis. It is part of analysis. Qualitative data can be reduced and transformed in many ways: through selection, through summary or paraphrase, through being subsumed in a larger pattern, and so on. (Miles & Huberman, 1994) Display, generically, is an organized and compressed assembly of information that permits conclusion drawing and action. Looking at displays helps us to understand what is happening and to do something-either analyze further or take action-based on that understanding. Better displays are a major avenue to valid qualitative analysis. As with data reduction, the creation and use of displays is not separate from analysis, it is a part of analysis. (Miles & Huberman, 1994) Conclusion drawing and verification is the third stream of analysis activity. From the start of data collection, the qualitative analyst is beginning to decide what things mean and the competent researcher holds these conclusions lightly, maintaining openness and skepticism. Final conclusions may not appear until data collection is over.
30
Methodology Conclusions are also verified as the analyst proceeds. The meaning emerging from data have to be tested for their plausibility, their sturdiness, their conformability-that is their validity. Otherwise we are left with interesting stories about what happened, of unknown truth and utility. (Miles & Huberman, 1994) The above-mentioned three steps were followed for data analysis. First, the data were reduced through a within-case analysis where the cases compared with the frame of reference. Secondly, all of the data was further reduced through being displayed in order to have an inter-case comparison. Last step was to draw conclusions and verify our findings with the theories explained previously in chapter two. So the empirical data will be analyzed in the order of the research questions. To begin, a within-case analysis will be for each of the case studies by comparing the empirical data presented in the previous chapter with the conceptual framework presented in chapter two. Thereafter, the data for each research question will be displayed through a cross-case analysis, where the two case studies are compared with each other to find similarities and differences in order to draw conclusions.
4.7 Reliability and Validity
Reliability means dependability or consistency. It suggests that same thing is repeated or recurs under the identical or very similar conditions. Validity is concerned with whether or not the item actually elicits the intended information. Validity suggests fruitfulness and refers to the match between a construct, or the way a researcher conceptualizes the idea in a conceptual definition, and a measure. It refers to how well an idea about reality "fits" in with actual reality (Neuman, 2003). As Neuman (2003) states reliability is necessary for validity and is easier to achieve than validity. Although reliability is necessary in order to have a valid measure of a concept, it does not guarantee that a measure will be valid. It is not a sufficient condition for validity. Figure 4.2 illustrates the relationship between the concepts by using the analogy of a target. The bull's-eye represents a fit between a measure and the definition of the contract. Yin (2003) discusses four different tests of judging the quality of research design: 1) Construct validity: establishing correct operational measures for the concepts being studied. 2) Internal validity: establishing a causal relationship, whereby certain conditions are shown to lead to other conditions, as distinguished from spurious relationships. 3) External Validity: establishing the domain to which a study's findings can be generalized. 4) Reliability: demonstrating that the operations of a study-such as the data collection procedures can be repeated, with the same results. (Yin, 2003)
31
Methodology
Figure 4.2 Illustration of relationship between reliability and validity (Source: Neuman, 2003, p.186) According to Yin (2003), every case study project should strive to develop a formal, presentable database, so that, in principle other investigators can review the evidence directly and not be limited to the written reports. In this manner, a case study database markedly increases the reliability of the entire case study. For case studies, notes are likely to be the most common component of a database. The notes may be a result of an investigator interviews, observations, or document analysis. (Yin, 2003) To minimize the errors in this study, the interview guide was granted by supervisor, before it was sent to the respondents. It is necessary for respondents to get the interview guide in advance as the respondents can prepare themselves for the concerned questions, which could minimize the external factors influencing quality of data in terms of respondents' mood or health condition. During the interview, one of researchers conducts the interviews and the other take notes in order to minimize possibility of mistakes and to be sure that noting was forgotten. As our research is qualitative in nature, the aim is not to generalizations but efforts were made to improve reliability through tape recording of the interview too.
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Case Studies
5. Case Studies
This chapter contains the data collected from two case studies. Each case will be introduced with a short introduction about the company, and is followed by a presentation of the data collected from interviews as well as company documents.
5.1 Case 1: Netix AB
Company Background Netix AB is a small online advertising company, situated in Aurorum Science Park, Luleå City, Sweden. The company works both in B2B and B2C market. www.skraplotto.se is currently the main business of Netix AB. The business concept is to advertise their business customers' products or services through online free lottery. The registered users of the website are able to scrap free lottery tickets on the website and win random gifts, which are provided by Nextix's business customers. Netix AB was found in 2005 by two graduated students of LTU. There are two employees working in the company beside themselves. Although Netix AB is struggling on the bottom line of survival as a new company, the company has achieved rapid growth. By the end of 2006, it has gained 23,000 registered users and seven sponsor companies (three of them are large companies). Netix AB generates profit mainly from two sources: one is from advertising on its website for business customers, where the website traffic is an important metric in advertising rates; and the other is commission from the business customers. We have interviewed Mr. Daniel Löfmark who is one of the founders of Netix AB working as the marketing and financial manager. During the interview Mr. Daniel Löfmark was very active, friendly, and helpful. We also got the impression that he is very interested in our research as traffic building is essential for the company. 5.1.1 Offline marketing communication Publicizing the URL offline According to Mr. Löfmark, publicizing the URL offline is an important communication tool in traffic building. On the business cards, URL of corporation's website are stated, from which there is a link to the website of www.skraplotto.se. According to the respondent, the aim of doing so is to enhance branding of the corporation. The same situation and aim go for the letters, Netix AB is used to send mails to the winners, the website of corporation is stated on letterheads, but not the specific site. Brochures are not pressed yet because the essence of the business is online, physical brochures are not prioritized in budget. Telephone directories and other reference books are not used as the company thinks they are rather expensive and might not be effective media for promoting online business. He addressed that local newspaper is the most efficient offline medium for advertisement in publicizing the URL offline, because it is not only a cost effective medium but also cover a wide
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Case Studies range of reader in Luleå since the online lottery player may come from any group of people in the society. Netix AB does not make use of magazines, for the medium are much more expensive than newspapers and have usually a certain segment of readers. Therefore it is considered not to be a medium as efficient as newspaper for URL advertising. TV advertisement is too expensive to be employed for the company at the moment. Although costs of radio are also very high, Netix AB has used Radio advertisement to make public aware of their web address, because of its high credibility and wider coverage in the public. Respondent highlights that radio is worth of costing so much money for its huge effect on brand awareness and credibility. Hoardings and billboards have never been considered by the company. Packaging and point-of-sale material are not used because the products have original packaging from Netix's customers and it would be too expensive to make another packaging for only promoting the URL offline. Moreover, they also put website address on their friends' or relatives' cars in order to attract the public attention, which is a non-cost method. Public Relation Netix AB put a lot of attention to public relations despite the limited budget. Respondent says that when the company launched, the new business idea and the two young entrepreneurs of LTU became focus of news on local news paper and TV. The company has been interviewed once by TV column and local newspaper and twice by an IT magazine for its technological superiority in website constructing. These exposures Netix AB continuously communicates its superiority of IT technology to journalist and press media, which can provide Netix AB great opportunity to keep contact and build close relation with press media constantly. According to respondent, current effort without involving investment on PR has brought a lot of benefit to the company; they plan to invest more on public relation in broader range in the future. At the moment, PR budget is too limited to support more PR activities such as product publicity, public affairs, and investor relations. However Netix AB gets supports from some nonprofit organizations such as Luleå Handelskammare that can provide the company the information which is needed in its value chain. Direct Marketing Respondent addresses that Netix AB used none of direct marketing approaches namely telemarketing, direct-mail marketing, or catalog (non-electronic) marketing. According to him, telemarketing is too expensive to be carried out and not considered as a cost-effective communication tool under current financial circumstance. Directmail marketing overlaps very much with the newsletter marketing in online context, which has many benefits that direct-mail marketing has not especially in costeffectiveness; therefore direct-mail marketing is not used by Netix AB. As an advertising company, Netix AB aims to promote its website in B2C marketing instead of selling the products, so that catalog marketing is not feasible to Netix AB. Word of Mouth
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Case Studies Netix AB considers the word of mouth as an important communication ways in traffic building. As a new small company, the first thing that they can do to promote their website without any extra costs is to ask their relatives, friends, and people as many as possible who are around them to tell people around them. Respondent also stresses the importance of having satisfied users, as they have the tendency to be opinion leader in word of mouth communication. They provide in-depth answer to the users who coming up with questions, not only dealing with 'what' and 'how' but also 'why', so that the users have more knowledge about the company and the lottery game than other users. When they are in the situation, they would be more than happy to share their knowledge with others. Among potential users, the knowledgeable users would be rather active in talking about the website and the game. Therefore they basically play a role of opinion leader. Finally, the respondent says among the communication tools they have exploited, the efficiency of this spread of publicizing the website by word of mouth is highest. 5.1.2 Online marketing communication Banner advertising According to respondent, Netix AB makes all the banners itself for they have the related technical background and the relatively tight budget on marketing. To www.skraplotto.se, banners are the most used advertising forms in online promotion of the website. Most of them are static banners with the logo in orange color which is exact the same to the name of the website "skraplotto.se". Normally there are two or three lines of text beside or below the banners to explain what the website is about. The company explains that the reason they use static banners is that "skraplotto.se" already claims what the website deals with. The little explanation around the banners can clarify the "free" feature of the website. All types of banners that company used are listed bellow:
a) b) c)
d)
e) Banner "a" and "e" are the best examples of the kinds of simplest static banners. There are also static banners like "c", which is a simplest banner with a little explanation of "free" feature on it. The type of banner is to facilitate a click through from the banner advertisement to www.skraplotto.se where the visitors can get detailed information about the offer. The banners like "d" demonstrate the ways of playing the lottery on www.soundicradio.se. The type of banner is consistent with the company's brand. The only animated banner is the one on www.roligast.com, which
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Case Studies is made of eight text pictures. The texts are presented in sequences that can delivery a complete idea. The contexts content of the eight pictures are as following: 1. skraplotto.se (skraplotto.se) 2. klicka här och bli medlem gratis! (click here and become member free!) 3. skrap gratis lotter via nätnet ? (scraper free lottery via Internet ...) 4. ?och vinna coola priser! (...and win cool prizes) 5. Tipa din kompis så får ni båda extra lotter. (Tip your friends so that both of you get extra lottery tickets) 6. Varje dag (very day) 7. glöm inte att du får ett antal gratis lotter varje plus ännu fler om du tipar dina vänner. (Do not forget that you get a number of free lotteries everyday and plus some more if you tip to your friends.) 8. börja skrapa nu! (Start to scraper now!) The speed of rolling the pictures is set according to the length of context in order to make the readers be able to finish reading of the context. The type of banner is to remind the users regarding the company's service and present the sales information as well as link through to the on-site promotions. The respondent also explains that the more complex banners might be blocked automatically according to the setting of the user to IE (Internet Explore) as some users believe those complex banners takes too long downloading time. And it is also expensive to produce them because the complex banners takes many more working hours than producing the simple ones. Since the content of the banner do not requires the complexity of it, Netix AB does not choose the more complex banner forms. Affiliate network The respondent says that the company has not an affiliate network for the purpose of www.skraplotto.se is not to sell products at the moment but to advertise products of the business customers. To sell the products is stated in company's long-term objective, when the website has more registered users. At that time, affiliate network could be considered by the company. Search engine registration and optimization According to respondent, the domain of www.skraplotto.se is used before by some other companies and the company registered it on www.doubler.com immediately when it became available again, so that the search engine registration has been done in certain websites somehow. The domain has been registered to those famous search engines such as www.google.com, www.yahoo.com, www.msn.com, www.altavista.com, www.ask.com, etc. Some specific search engine is also used by the company, for example, katalogen.sunet.se, which is a Swedish search engine, and people can search according to location, industry, keywords, even text. The company also registers to some web directories and catalogues likewise www.mer-traffic.se, www.uppslaget.se, www.topplista.se, etc. These are the websites working on categorizing the website and directing the users to come to the right
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Case Studies website by providing the precise information of what each registered website does and sometimes as well as the popularity and the clicks of them. The company does search engine optimization by itself, too. The company tries key words such as 'fri lotto'(free lottory), 'skraplotto' (scraper lottory), 'gratis lotto' (free lottery) and so forth from time to time in order to make sure the website would always appear on the first screen when people search by the related key words. Because if not, the website would have very little chance to be found by the users. Link building ? Reciprocal links The respondent emphasizes that the company has some reciprocal links with some other Swedish companies. Their websites are listed on one page of www.skraplotto.se, which is called links. These companies are www.mer-trafik.se, www.swetop.com, www.uppslaget.se, www.topplista.se, www.coxco.se, www.toppensidor.se, and www.exchangelink.se. These websites do not need to pay the company but need to put the company's link on their website. The reciprocal links with www.tradedoubler.se is a very successful example, which is a well-known online advertising website working on promoting the other business. The company gets a non-paid permanent link on "tradedoubler.se" unlike the other companies has to pay by the period of their links presented on "tradedoubler.se". It is a very good saving for a young company like Netix AB. ? Co-branding According to the respondent, www.soundicradio.se do not only exchange links with the company but also cooperate on other programs such as providing the test radio program on www.skraplotto.se so that the users can listen to the music when they scratch lottery ticket online. www.soundicradio.se demonstrates the lottery ticket on its website as well as the banner 'c' shows in the previous section. ? PR - Content mentions The respondent reveals that the news paper's website has published the interviews with Netix AB and the focus of the interview is the launch of www.skraplotto.se . The domain has been publicized on the news paper's website for a few weeks. ? Affiliates Affiliates are not used by the company, which has been explained in affiliate network. ? Sponsorship The respondent says that Netix AB does not have any sponsorship with any websites because it is a cost method in promoting the website. ? Banner advertising
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Case Studies The company uses banner advertising, which has been presented in banner advertising section. ? Price-comparison portal According to the respondent, Netix AB does not use price-comparison portal to promote www.skrapalotto.se. Because it is a free lottery website, price-comparison portal does not exist at all. E-mail Marketing The respondent says that the company sends newsletter occasionally around once months, which contains the latest news about website and the pictures of new prizes, which the customer can win. Because Daniel believes that if company sends them too often, it will irritate the users and there would not be a lot of information in short period. The result of doing this could be considered as spam email after a while. So that the frequency and the content of the newsletter are measured very carefully each time in order to avoid of wasting both parties resources, which could also be harmful for brand identity of the company. The size of the email usually is not very big and pictures are in GIF format, because if it is too big, it would take long time to open the email, which could make the users have no patience to wait and delete the email before read it. The company builds the email list by themselves according to the users' registered information. Vertical Portals According to the respondent, www.skraplotto.se is a very new concept in Sweden so that there is not a particular portal for it. But the company promotes the website on those websites like www.blocket.se and www.tradedoubler.se, which are the web market places for all companies to promote their websites and the products. 5.1.3 Evaluation of effectiveness of communication tools in traffic building The respondent described that Netix AB mainly use quantitative tools of measurements to evaluate the effectiveness of the different communication tool they have used in order for traffic building. Netix AB uses its own database and an online free tool named Google Analyst to monitor the effectives of the website usage everyday especially after each promotion campaigns. The statistics on the number of the new visitors at the website, the number of minutes spent by the visitors, and the users' onsite behavior are the basis for the company in analysis the effectiveness of the offline and online marketing communication tools. By using these quantitative tools, Netix AB can obviously see the number of traffics achieved by the promotion campaign and the quality of the traffics namely the number of new registered customers, and in what extent they like and use the website. Netix AB never does any marketing communication that particularly requires email response from customers for it is unnecessary. As Netix AB does not sell the products either, the figures of onsite sales and income are not
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Case Studies relevant to evaluations. The respondent stresses that there is a phenomenon that generally the online communication tools are more effective than the offline ones in traffic building. The purposes of evaluating the effectiveness of the exploited marketing communication tools from Netix AB's perspective, according to the respondent, is to help the company to have a better understanding of the effectiveness of the each marketing communication tool in traffic building and make better use of them in the future, especially from cost-saving aspect. Although Netix AB has very limited resources both on money and workforce, the evaluation of effectiveness of the marketing communication tools can not be overlooked for it leads significant costsaving in the future. 5.1.4 Building traffic at Netix AB Netix AB is a small advertising company through free online lottery method. It is the essential issue for the company to build website traffic, but the limited budget on marketing is the common competitive disadvantage for small companies including Netix AB. From above presented data, we can see that company has selected and applied the offline and online communication tools carefully from cost effectiveness perspective and regarded evaluation of effectiveness of the communication tools as a significant activity for further cost-saving in traffic building. Netix AB's objective is not only to be an advertiser but also a merchant of the products that are advertised by itself in the future, so that website traffic would become more important. Therefore he says the company would invest more money on generating website traffic and branding, it would be a constant issue for Netix AB to make a better use of the marketing communication tools.
5.2 Case 2: Rosell & Clack Importlagret AB
Company Background Rosell & Clack Importlagret AB is a small e-business firm, which was founded in Luleå in 2001. The company work is an outlet online shop of majority factories around the whole world. People can purchase all kinds of factories' goods from the company's website (www.importlagret.se) by extremely low price, which could be half price comparing to normal shops. There are totally nine persons that include two founders and seven employees working in the company now. At Rosell & Clack Importlagret AB, we interviewed Mr. Peter Holmagren who is an e-marketing planner and CRM manager. 5.2.1 Offline marketing communication Publicizing the URL offline
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Case Studies Since the main sales and profit are gained from their online store, respondent states that publicity of the website is the most important purpose in their promotion. The company publicizes the URL on the business cards as both corporation website and ecommerce website, and the aim is to build brand and credibility of the corporation. The company does not contact their customers by mail very often; however the URL is stated on letterheads, which is to increase the formality in business operation. Respondent stresses that advertisement has been used specifically for traffic building. He describes they use mainly two kinds of press media for publicizing the URL address. First of all, newspaper is the cheapest and most efficient ways to promote. Public can easily access to the newspaper and its highest coverage for the public proves its highest efficiency for promoting the website. The other one is magazine as respondent mentioned. Since the function of magazine is different from the newspaper, the promotion on magazine not only increased the number of registered customers, but the sales. Respondent said although the cost of magazine is high, compared with the huge effect on the sales, it worth to do that constantly. Furthermore, according to respondent, URL has been printed on the packaging and point-of-sales material which might attract some potential customers' eyes and build brand. Although Importlagret AB realized the bigger influence and better credibility of TV and radio advertisement for the most of potential customers, the limited budget restricts them from using TV and radio widely. Limited sources also make company abandon the brochures, telephone directories, hoardings and billboards as the techniques for publicizing the URL. According to respondent, company does not realize reference book as the techniques. Public Relation Respondent stressed that public relations is an effective marketing communication tool when generating website traffic. Importlagret AB has a few times face-to-face covers with the local newspaper. 'Low prices' is the constant focus of Importlagret AB in press media' eyes, the company gets not only the brand promoted but also traffics to the website through the press relations. The company also publicizes their products in physical stores in Stockholm and Gothenburg. The function of these two stores is to provide customers opportunities to experience the products and services which listed on the website and increase the credibility of the brand and the website. The company has close connection to Luleå Handelskammare, which is a non-profit organization helping all businesses in Luleå in many aspects. Public affaires and investor relations are not adopted by Importlagret AB for its limited budget. Direct Marketing Respondent addresses that Importlagret AB does not use direct marketing for too much overlap with some online marketing communication tools. According to him, telemarketing is an expensive marketing communication tool compared to some other tools; therefore it is not used so far. Direct-mail marketing and catalog (non-electronic) marketing overlaps with newsletters and electronic catalog in online context, as newsletter and electronic catalog are much cheaper and having some extra benefits
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Case Studies than the two direct marketing tools; Importlagret AB has not used direct-mail marketing or catalog (non-electronic) marketing. Word of Mouth Respondent emphasizes that word of mouth is an important marketing communication tool for Importlagret AB. The two competitive advantages: the lowest prices and good after-sales service of the company stimulate the positive word of mouth communication naturally. According to respondent, many new customers get to know the company's offers and website from their friends, relatives or colleagues, who are the existing customers and the employees of importlagret AB. In order to minimize the negative word of mouth communication, the company takes care of complains very carefully and does the best to make the customers satisfy. Respondent says that increased number of the sales and registered customers proves the value of word of mouth and it is the most cost efficient tool among all the communication tools. 5.2.2 Online marketing communication Banner advertising According to the respondent, the company uses the simplest static banners that they makes by themselves, for having no personnel who can deal with more complicated technical issues in making banners. The two types of static banners are listed as below shown:
a)
b)
Banner 'a' has both the logo and the website address on it, which gives the visitors an impression of the company's logo and web address. The purpose of the types of banner is to facilitate a click through from advertisement website to the company's website and building brand awareness. Banner 'b' is made only of the name of the website that is able to highlight the website address. The purpose is to enhance the web address and facilitate a click through to the company's website. The respondent says that the static banners have low-cost advantage. It is clean and focuses on presenting web address and logo. It is good enough to the company for the moment. Affiliate network The company does not work on affiliate network at all. The respondent says that the company tried to build offline affiliate network with some local machinery shops in south of Sweden. The idea was that some goods of Importlagret AB physically displayed in the local shops, the shops would get commissions for each purchased
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Case Studies item in the shop. A lot of customers come to see the products in the shop then order the products through www.importlagret.com. Because of the competitive pricing of the company, the shops felt more threats than opportunities to join the affiliate network. So the idea was dead. The online affiliate network is not considered by the management of the company before. The respondent said logistic is a competitive advantage of the company, the low price is the key success factor in commodity products. The company believes that they are one of the best in pricing. Search engine registration and optimization The respondent reveals that except those world wide popular website such as www.google.com, www.yahoo.com, etc, the domain www.importlagret.com has mainly been registered to some Swedish branch-specific search engines namely www.annonsfynd.se, in which the customers can search by locations and catalogs of product. The company has also registered to some web directories and catalogues such as www.bgnorr.se and www.villabad.com, which categorize the website by locations, products and direct the customers to come to the right website when they look for products. Search engine optimization is outsourced to a specialist's company as Importlagret AB believes that outsourcing is not only costly efficient but also highly effectiveness. Link building ? Reciprocal links According to the respondent, the company does not do any free exchange links with any other websites. The respondent explains the reasons that the hard competitive situations in the industry create the difficulties to build reciprocal links with competitors. The supply chain of the business is a sort of business secret so that Importlagret AB has to be very careful when building reciprocal links. The company has neither dealer at the moment. ? Co-branding The company has no co-branding partners either. According to the respondent, it is not a concern of the company for the moment. Because the company is considered still a small company, the commoditization of e-business puts a lot of pressure on the company. ? PR - Content mentions The respondent reveals that the company has been covered by the local newspaper and the articles were publicized on the newspaper's website.
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Case Studies ? Affiliates The affiliates are not used, which has been described in affiliate network section above. ? Sponsorship According to respondent, the company has sponsorships with some websites, for example, www.luleahockey.se. Every click on the link of Importlagret AB will make a little money for Luleå Hockey team. ? Banner advertising The company uses banner advertising, which has been presented in banner advertising section above. ? Price-comparison portal According to the respondent, http://se.pricerunner.com/ is a price-comparison portal, where the customers can find the prices and the products from all the providers who are registered there. Importlagret AB is one of them. E-mail Marketing The respondent addresses that the company sends newsletter once a month. It usually includes the new products and special offers of every month with colorful pictures. The newsletter is short and has a few links to the webpage of detailed information about the products and offers. The company builds the email list by themselves based on the registered email address when they became the members of the website, so that the newsletter can only reach the registered existing customers. Vertical Portals According to the respondent, the company has registered in many Swedish portals. For example, villaportaler.se/ is a portal for the goods in use of building houses; ryggen.en.ec21.com is a B2B market place, where Importlagret.com can meet the business customers that could buy the products related to construction industry; www.blocket.se is a web market place of both B2B and B2C market where the company can promote the website and the products to both business and individual customers. 5.2.3 Evaluation of effectiveness of communication tools in traffic building As Importlagret AB has not IT specialists in the company, they simply outsource the evaluation of the effectiveness of the communication tools to a specialist company. Respondent described that they get figures from the company, who is specialist in monitoring website usage. Importlagret AB uses the data to analyze and evaluate the customers' needs and the effectiveness of each of communication tools. An obvious tendency of the figures is that the most efficient ways of traffic building is the online promotion tools although offline communication is important in some extent.
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Case Studies Importlagret AB has used several forms of quantitative measurement tools. Figures on the amount of hits and visitors are collected, as well as on how much time they spend on the site and what pages they enter, the activities they do and which products that attractive to them. The number of email received from customers is one of the measures when the marketing communication requires email response. However it is used not often. The company also uses the amount of sales and income to evaluate the effectiveness of the promotion campaign. Furthermore, the company continuously analysis the result of each communication tool to filtrate the most efficient tools for traffic building. 5.2.4 Building traffic at Rosell & Clack Importlagret AB According to respondent, we find that the company uses different communication tools in website traffic building and evaluation of effectiveness of the communication tools in order to make better use of the communication tools in future online marketing. Because the desirable result of website traffic building is to attract a purchase, the objective of the marketing communication has two aspects: generating website traffic and delivering a message which could lead a purchase. Because Importlargret AB does e-business in a relatively commoditize market, competitive pricing and after-sales service become the two key success factors. The company has confidence on the mentioned two factors so that they are used as the main messages in marketing communication. In future traffic building, the company will continue to focus on the two messages.
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Data Analysis
6. Data Analysis
In this chapter the empirical data will be analysed in the order of the research questions. To begin, a within-case analysis will be for each of the case studies by comparing the empirical data presented in the previous chapter with the conceptual framework presented in chapter3. Thereafter, the data for each research question will be displayed through a cross-case analysis, where the two case studies are compared with each other to find similarities and differences.
6.1 Within-case Analysis
The analysis will compare the data collected with frame of reference arrived at in chapter 3 and the text be displayed in the order of the research questions for each one of the case studies. 6.1.1 Within-case Analysis: Netix AB Offline marketing communication tools used for traffic building ? Publicizing the URL offline According to selected theories, publicizing the URL offline could be on business cards, letterheads, brochures, telephone directories and other reference books, television and radio advertisements, advertisements (excludes TV and radio advertisement), hoardings and billboards, packaging and point-of-sale material. Netix AB publicizes the corporation's website of www.netix.se on business cards and letterheads, and the purpose of doing so is to promote brand of the company instead of driving traffic to the specific website of www.skraplotto.se. Therefore the two kinds of techniques are not exploited in traffic building to www.skraplotto.se. Brochures, telephone directories and other reference books are not exploited in publicizing the URL offline as they are not prioritized in the limited budget. Radio advertisements are successfully exploited in driving traffic to www.skraplotto.se in Stockholm region; since TV and radio advertisements are in the same category in the theory, we consider TV and Radio advertisements are specifically exploited in traffic building. Newspapers is the main medium used in generating website traffic, so that advertisement is the most important technique specifically in driving traffic to the website in this case. Hoarding and billboards are not used in traffic building, as they have never been considered when doing traffic building. Packaging and point-of-sale material are not exploited because of the low cost efficiency. Moreover, to put advertisements on the friends' or relatives' cars are not included in the theory, but when we think over the essence of this technique, it has the same function of hoarding and billboards. Because of its non-cost feature, we do not categorize it to any of above mentioned theories. Netix AB uses two out of eight possible communication tools, namely TV and radio advertisements and advertisements (excludes TV and radio advertisements).
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Data Analysis ? Public Relations According to selected theories, several variables of public relations includes: press relations, product publicity, public affairs, investor relations, and development. Netix AB does not invest on public relation because of limited budget. However the company builds and maintains a good relationship with press media, such as newspapers, TV, and so on for its superiority of IT technology. The exposures on press media provide the company great opportunities to generate more website traffic. The company also develops good relations with some nonprofit organizations and gets volunteer supports in many aspects. Compared with the theory, Netix AB uses two out of five possible communication tools, namely press relations and development. ? Direct Marketing According to selected theories, direct marketing could include telemarketing, directmail marketing, and catalog (non-electronic) marketing. Direct marketing is a rather expensive method in marketing communications; therefore under current condition of limited budget, the company uses none of direct marketing communication tools. The other reason is that the newsletter marketing has covered the effect of direct-mail; catalog (non-electronic) marketing is not feasible for an advertising company like Netix AB. The company uses none of the three possible communication tools. ? Word of Mouth According to selected theories, word of mouth (WOM) is playing an important role in traffic building especially in B2C context. Word of mouth is an important communication tool for Netix AB in traffic building. The company first uses the available contacts namely people who they know to do WOM under non-cost circumstance. After a few users coming to the website, the company provides high quality services aiming to make them highly satisfied in order to win the effect of WOM. Some of them have more enthusiasm in the online lottery than the others therefore they come up with questions. While they are getting in-depth answers to the questions, which are organized on purpose by the company, they become more active, loyal, and knowledgeable to the online lottery, and automatically become the advanced opinion leaders. Therefore the opinion leaders could be anyone who knows the online lottery website such as the personnel, the familiars of personnel, any existing users and loyal users. The main communicated information in the word of mouth communication is the free feature of the online lottery. Negative word of mouth is unusual; because people get products without payments. Based on the result in experiment, company thinks WOM has the highest efficiency among the communication tools. In term of WOM, it is agreed with selected theories.
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Data Analysis Online marketing communication tools used for traffic building ? Banner advertising According to Chaffey et al. (2003), there are many forms of banners namely static banner, animated banner, interactive banner, pop-up, rich-media banner, and context sensitive banner. Netix AB considered that static banner and animated banner as their main tools since it plays a central role in their banner advertising. The domain of the website has clearly communicated to the users regarding what the website is basically about. The banners making of the domain and some simple statements are considered to be good enough to fulfill the three purposes of banner advertising proposed by Cartellieri et al. (1997) namely delivering content, shaping attitudes, and encouraging retention. Netix AB used static banners and animated banners out of six possible forms of banners presented by Chaffey et al., (2003). ? Affiliates network According to Chaffey et al. (2003), the affiliate network which built between retailers and the payment is only made under the purchase of an item. There are no retailers and purchase involved in the business process, so that affiliate's network is not feasible to Netix AB. ? Search engine registration and optimization Chaffey et al., (2003) pointed out that there are four forms of so-called search engines that the website can be registered to, which are usual search engines, industry specified search engines, directories, and catalogues. Search engine optimization can be done through two ways: 'do it self' and 'outsourcing'. Netix AB thinks that the website is a very new website and it should be as much accessible as possible so that it can be registered everywhere. Some of the search engines are free of charge. But some of them need to pay. The company selects carefully the ones that the company must pay. The company registers the website on all of the four kinds of search engines that mentioned by Chaffey et al., (2003). Netix AB does the search engine optimization by itself, because they have the specialist personnel who can handle the issue. ? Link building According to Chaffey et al., (2003), link building can be an effective method for driving traffic to the website. Link building includes reciprocal links, co-branding, PR-context mentioned, affiliates, sponsorship, and price-comparison portal. Since company thinks that a free advertising is always good, Netix AB used reciprocal links in a large extent. Co-branding is also used. The company considers it is a good way to promote its own brand on website. In the same time, its own website looks more sophisticated in the way that the company could achieve better branding
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Data Analysis on its own website. PR-context mentioned is used by Netix AB, because the company considers that the local newspaper could bring the company a good image and create the awareness of the website not only locally but nationally as it is also published on the website of the newspaper. It could also increase the company's trustworthy. The company does not use affiliate which has explained in affiliate networks section. Sponsorship is not used by the company for the limited budget. Banner advertising is a main communication tools that has been discussed in previous section. Pricecomparison portal is not used as it is a free offer and such a portal does not exist. Netix AB uses four of seven possible items listed by Chaffey et al., (2003). ? E-mail marketing Chaffey et al., (2003) point out that e-mail marketing has many advantages as a communication tool such as immediacy, targeting, accountability and relatively cheap. The key question is how to obtain the email list. There are two ways to obtain email list: purchase of opt-in bought-in list and build a house list. Netix AB uses e-mail marketing in term of newsletter because the company thinks it is relatively cheap, fast, and easy to monitor the result of the promotion campaign. The company builds a house list by themselves from the customers registered information, which means the newsletter works on customer retention and products promotion instead of customer acquisition. ? Vertical portal Lindstrom and Andersen (2000) mention vertical portal is basically a web marketplace in a certain industry and further can be an industry-specific community. If there is not yet a portal, the company's website can be a gateway. The company has no a certain portal to fit in. Evaluation of effectiveness of communication tools in traffic building According to the selected theory from Lindstrom and Andersen (2000), the quantitative measurements include: the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, the website's sales and income. Netix AB uses many quantitative tools in evaluating the effectiveness of the communication tools in traffic building. These quantitative tools consist of the number of individual visitors, the number of minutes spent by the user, and the user's behavior at the website. The number of e-mail received from customer is not used by Netix AB because the email-response required promotion is not feasible to the company. The website's sales and income is not used because the company does not generate sales or income from the website. Netix AB uses three out of five possible variables of the selected theory about evaluating the effectiveness of the communication tools in traffic building. An additional general fact after evaluation is
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Data Analysis that the online communication tools are more effective than the offline ones in traffic building. 6.1.2 Within-case Analysis: Importlargret AB Offline marketing communication tools used for traffic building ? Publicizing the URL offline According to selected theories, business cards, letterheads, brochures, telephone directories and other reference books, television and radio advertisements, advertisements (excludes TV and radio advertisements), hoardings and billboards, packaging and point-of-sales material are considered as techniques in publicizing the URL offline. Importlagret AB publicizes the URL on business card, although the purpose is to build brand, from the practical point of view it does drive the website traffic incidentally. Therefore this communication tool is considered the item for traffic building. Although letters are not used very often in communications, letterheads are still used in publicizing the URL offline, which could have positive influence in traffic building incidentally. For the limited budget, company has not used brochures, telephone directories, hoardings and billboards as the techniques for publicizing the URL offline. TV and radio advertisements are even more expensive than the other media therefore they are not used in traffic building. Two kinds of media namely newspaper and magazine have been heavily used for advertising the URL offline, which specifically drive traffic to the website. Packaging and point-of-sales material are used in publicizing the URL offline, which aims to build brand. However it has positive influence on traffic building incidentally. Importlagret AB uses four out of eight possible communication tools, namely business cards, letterheads, advertisement (excludes TV and radio advertisements), packaging and point-of-sales material. ? Public Relations According to selected theories, a few variables of public relations could be press relations, product publicity, public affairs, investor relations, and development. Although company does not invest much on public relations, Importlagret AB builds good relations with local newspapers and other press media, which increase the exposures and credibility of the brand and the website; therefore it contributes to generating more website traffics. The two physical stores facilitate the product publicity which improves both the brand building and the website traffic building extensively. The connection with Luleå Handelskammare provides the company benefits in many aspects and strength the brand and the website traffic building somehow. The company used three out of fem possible communication tools, namely press relations, product publicity, and development according to the theory. ? Direct Marketing
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Data Analysis According to selected theories, direct marketing could include telemarketing, directmail marketing, and catalog (non-electronic) marketing. Importlagret AB uses none of direct marketing communication tools because of its relatively high-cost and the company's limited budget. As online marketing communication tools has direct influence on traffic building than the indirect influence by offline marketing communication tools, when the overlap occurs between online and offline communication tools, the company trends to choose the online ones. Therefore direct-mail marketing and catalog (non-electronic) marketing are replaced by newsletters and electronic catalog marketing. According to the theory, none of the three possible communication tools are used by the company. ? Word of Mouth According to selected theories, word of mouth (WOM) is playing an important role in promoting websites. Word of mouth is an important marketing communication tool for Importlagret AB in building traffic to the website. The two competitive advantages of lowest prices and good after-sales are the central information to be communicated in word of mouth communication. The consequence of the word of mouth communication makes the new customers visit to the website or contact the company directly by telephone or email. The opinion leaders in the word of mouth communication are mainly the existing customers and the employees of the company. The company minimizes the negative word of mouth communication by carefully dealing with complains and increasing customers' satisfaction. It is agreed with the theory of word of mouth. Online marketing communication tools used for traffic building ? Banner advertising Chaffey et al., (2003) pointed out that banner advertising can be done in different forms, such as static banner, animated banner, interactive banner, pop-up, rich-media banner, and context sensitive banner. Importlagret AB thinks that banner advertising is an important online communication tools. The company uses the static banners to display the web address and logo of the company. The purpose of the banner advertising is to deliver content and shape attitudes in a certain standard. The company has used one out of six items listed by Chaffey et al., (2003). ? Affiliates network According to Chaffey et al. (2003), the affiliate network which built between retailers and the payment is only made under the purchase of an item.
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Data Analysis Importlagret AB does not work on affiliate network. It is decided by the managerial thought. The management believes that price is the key success factor, so that it is not necessary to share profits with other retailers. ? Search engine registration and optimization Chaffey et al., (2003) pointed out that there are four forms of so-called search engines that the website can be registered to, which are usual search engines, industry specified search engines, directories, and catalogues. Search engine optimization can be done through two ways: 'do it self' and 'outsourcing'. Importlagret AB registers the website to all kind of above mentioned search engines. The company thinks that it is a best way of building traffic it is also the reason that the company does not reply on cooperation with some other online business. Importlagret AB outsources the search engine optimization. Because the company thinks it is much cheaper to outsource than employ a specialist on these issues. Even though the specialist can handle other issues related to website, the company does not think there is much to do regarding website related issues. ? Link building According to Chaffey et al., (2003), link building can be an effective method of driving traffic to the website. Link building includes reciprocal links, co-branding, PR-context mentioned, affiliates, sponsorship, and price-comparison portal. Importlagret AB does not use reciprocal links at all. The company had considered some stakeholders to build reciprocal but it is not feasible and other stakeholders are not yet considered. Co-branding is not used for the same reasons of reciprocal links. PR-context mentioned is used as the company thinks that it is a free advertising online and it can increate the company's brand image and trustworthy. Affiliates are not used by the company, which has explained in affiliate network section. Sponsorship with some portals and market place is used by the company, which bring the company permanent links in some popular online market place. Banner advertising is used, which is presented in banner advertising section. Price-comparison portal is heavily used as the company thinks that they are good at competitive pricing in the industry. Importlagret AB has used four of seven items listed by Chaffey et al., (2003). ? E-mail marketing Chaffey et al., (2003) point out that E-mail marketing has many advantages as a communication tools such as immediacy, targeting, accountability and relatively cheap. There are two ways to obtain email list: purchase of opt-in bought-in list and build a house list. Importlagret AB uses e-mail marketing also in term of newsletter because the company thinks it is relatively cheap and a good way in products promotions and
51
Data Analysis customer retention. The company also builds a house list by themselves from the registered customers' information. ? Vertical portal Lindstrom and Andersen (2000) mention vertical portal is basically a web marketplace in a certain industry and further can be an industry-specific community. If there is not yet a portal, the company's website can be a gateway. Importlagret AB takes part in some portals in the machinery industry and even some industry-specific community like motorcycle. Evaluation of effectiveness of communication tools in traffic building According to the selected theory from Lindstrom and Andersen (2000), the quantitative measurements include: the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, and the website's sales and income. Importlagret AB uses several forms of quantitative measurements consist of the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, and the website's sales and income. The number of e-mail received from customers is used not often for it costs a lot work hours. The company uses all of the possible variables that are presented in the selected theory. The extra fact gained through evaluation is that the online marketing communication tools are more effective than the offline ones in traffic building.
6.2 Cross-case Analysis
Having analyzed the data (presented in two case studies) against the theoretical frame of reference under the within-case analysis, here we shall seek to find similarities and differences in the outcome of the with-in case analysis. In order to clearly present the comparison between these two cases, we will use the Table 6.1 to compare the data collected from the two cases:
52
Data Analysis
Table 6.1: A comparison of data of offline communication tools between two cases
Investigated Items
Netix AB
Importlagret AB
• Used in the form of partially TV
and radio advertisement (specific), Publicizing the URL offline (specific vs. incidental advertising)
• Used in the form of business cards
(incidental), letterheads (incidental), advertisements (specific), packaging and point-of-sales material (incidental). reference books, hoardings and billboards, television and radio advertisements are not used for the traffic building
• Business cards, letter heads,
brochures, telephone directories and other reference books, hoardings and billboards, packaging and point-of-sales material are not used publicizing the URL on the friends
advertisements (specific).
• Brochures, telephone directories and
• Beyond item listed by the theory, •Only used in the forms of; press
and relative cars
•Used in the forms of; press relations,
product publicity, and development
Public relations Direct marketing Word of Mouth
•Product publicity, public affaires, ·Pubic affairs and investor relations are
investor relations are not used
relations and development
•are not used
•are not used •considered as an important issue
not used
•considered as an important issue
Netix AB and Importlargret AB use publicizing the URL offline. Netix AB uses radio advertisements and advertisements (excludes TV and radio advertisements); both of them are specific approaches for traffic building. Business cards, letter heads, telephone directories and other reference books, hoardings and billboards, packaging and point-of-sales material are not used by the company. Importlagret AB uses business cards, letterheads, advertisements (excludes TV and radio advertisements), packaging and point-of-sales material. Among above mentioned variables, only advertisements (excludes TV and radio advertisements) is specific for traffic building, others are incidentally for traffic building. Brochures, telephone directories and reference books, hoardings and billboards, TV and radio advertisements are not used for traffic building. Both of the investigated companies use advertisements (excludes TV and radio advertisements) in publicizing the URL offline. None of them uses brochures, telephone directories and reference books, and hoardings and billboards. Netix AB also uses publicizing the URL on the friends and relatives' cars as a noncost method which is not mentioned in the theory.
53
Data Analysis Netix AB and Importlargret AB use public relation. Both of the companies use press relation and development. Importlagret AB uses public publicity but Netix AB does not. None of them uses public affairs and investor relations. Netix AB and Importlargret AB do not use direct marketing at all. When it comes to word of mouth, both of these companies use it in a large extent and thought it is an important issue in the process of traffic building. Online marketing communication tools used for traffic building be described? In order to clearly present the comparison between these two cases, we will use the Table 6.2 on the next page to compare the data collected from the two cases. Table 6.2: A comparison data of online communication tools between two cases
Investigated Items
Netix AB
Importlagret AB
•Used in the form of; static banners
Banner advertising
•Interactive banners, pop-up,
rich-media banners and
and animated banners
•Used in the form of static banners •Animated banners, interactive
banners, pop-up, rich-media banners, and context-sensitive banners are not used
Affiliate network
• not used
context-sensitive banners are not used
• not used
Registration:
Registration:
•used in the form of search engine,
Search engine registration and optimization specific search engine, directory and catalogues Optimization:
•used in the form of search engine,
specific search engine, directory and catalogues Optimization:
•used in a large extent •used in the form of do it self, •Used in the form of; reciprocal links,
co-branding, PR, affiliates, outsourcing is not used
•used in a large extent •used in the form of outsourcing •Used in the form of; PR,
sponsorship, and price-comparison do it self is not used
Link building
•Affiliate network, sponsorship, and
E-mail marketing
banner advertising.
•Reciprocal links, affiliate network •Used in the form of; build by itself •Buy from others is not used •Used in the form of; industry specific •Industry specific community is not
used 54 market place co-branding, affiliates are not used
portal
•Used in the form of; build by itself
buy from others is not used
price-comparison portal is not used
•Not used
Vertical portal
Data Analysis . Netix AB and Importlagret AB use banner advertising in a large extent. Both of the investigated companies have used static banners in online advertising. Netix AB uses also animated banners. None of them used interactive banners, pop-up, rich-media banners, or context-sensitive banners. Both of the companies make banners by themselves, which is a practical cost-saving approach. Netix AB and Importlagret AB do not use affiliate network. Netix AB and Importlagret AB use search engine registration and optimization in a large extent. Both of the investigated companies use all four forms of search engine registration in terms of search engine, industry-specific search engine, web directory, and web catalogue. Both of the companies use search engine optimizations in a large extent. Netix AB does optimization by itself, but Importlargret AB outsources it. Netix AB and Importlagret AB use link building in a large extent. Netix AB uses reciprocal links, co-branding, PR, and banner advertising; but affiliates, sponsorship, and price-comparison portal are not used by Netix AB. In contrast, Importlagret AB uses PR, sponsorships, banner advertising, and price-comparison portal; but reciprocal links, co-branding, and affiliates are not used by the company. Netix AB and Importlagret AB use email marketing in a large extent. Both of the companies build a house list by themselves in stead of opt-in bought-in lists. Netix AB does not use vertical portal. In contrast, Importlagret AB uses vertical portal in a large extent. Evaluation of effectiveness of communication tools in traffic building In order to summarize the cross-case analysis for research question 3, we will use a Table 6.3 on the next page to conduct our cross-case analysis, where data from all our two cases. This table will show the theory stated compared to data derived from our two case studies:
55
Data Analysis Table 6.3: A comparison data of evaluation of effectiveness of communication tools in traffic building between two cases Measurement
Number of visitors Minutes spent User behavior Number of e-mail Sales and income
Netix AB
Importlagret AB
+ + + --
+ + + + +
+: stands for evaluation tools used -: stands for evaluation tools not used
Table 6.3 shows that Netix AB and Importlargret AB are fundamentally using the exact same measurements to evaluate the effectiveness of the offline and online communication tools in terms of the number of individual visitors, the number of minutes spent by the user, and the user's behavior at the website. Both of the companies are in line with theory. The number of e-mails received from customers as well as the website's sales and income are used by Importlargret AB but Netix AB.
56
Findings and Conclusions
7. Findings and Conclusions
This chapter contains the conclusions and the implications regarding the findings of this study. These conclusions will then lead to some implications for management, for the future development of theory in this area, as well as implications for further research that will be provided in the end of this chapter. In this thesis, we set out to gain more knowledge on how to build website traffic through different communication tools and the evaluation of the effectiveness of the tools in small B2C companies. We discovered that three components are needed to study traffic building: the offline communication tools, the online communication tools, and evaluation of the effectiveness of the tools. Consequently 3 research questions were developed and data were collected through two case studies. Based on Chaffey et al., (2003) and many studies of other authors, we develop the frame of reference that is related to each of the research question. After careful analysis of collected data, we can now draw conclusions, which help us to gain additional knowledge on the research topic. Since our cases are small B2C companies, findings from companies show both differences and similarities. Below, we attempt to answer each of the research question based on the findings.
7.1 Research question one: How can offline marketing communication tools used for traffic building be described?
Both of the two investigated companies are online business companies in B2C context, for which the website is the platform in doing business, so that website traffic is an important precondition to the success of the business. As small business, the limited marketing budget makes the company select marketing communication tools very carefully from cost effective perspective. The purpose of using the offline marketing communication tools is to increase the awareness of the website in public. According Chaffey et al., (2003) and studies of other authors, publicizing the URL offline, public relations (PR), direct marketing, and word of mouth (WOM) are the four major offline communication tools that are widely used within B2C marketing communication. According to our analysis, the above mentioned offline communication tools are mostly used by the two companies namely publicizing the URL offline, PR, and word of mouth, but direct marketing. Publicizing the URL offline is carried out basically through all kinds of advertisement and other kinds of physical reminders being used accordingly in some extent. The physical reminders can be anywhere beside the items mentioned in the theory, for instance, Netix AB resorts to paste the URL on the backside of the cars of their friends and relatives. As traffic building is an intermediate goal for a website's success, only advertisement of publicizing the URL offline can be specific for traffic building, the others are primarily incidental for generating website traffic. PR is mostly used in form of press relations by both of the companies and product publicity being used by Importlargret AB only for its business nature of selling products. WOM is used widely and agreed
57
Findings and Conclusions to be the most cost-efficient communication tool by the two companies. Direct marketing is used by none of the companies for its high-cost feature and too much overlaps with online communication tools. Since the two companies set limited budget on building website traffic, the selection of communication tools is primarily depended on the cost efficiency, which is supported by the analysis. We find that both of the companies use least costly tools with high effectiveness. Both of the companies also agree that the offline communication tools have indirect influence on traffic building by providing awareness of the website. Although limited budget constrained the range of selection of the offline communication tools, both companies realize that PR has huge potential in marketing and traffic building and can be put more efforts on.
Conclusions:
? The extent to which the offline communication tools are used in traffic building is primarily depended on cost efficiency. ? The offline communication tools that are mostly used by small B2C companies likely include publicizing the URL offline, public relation and word of mouth. ? Publicizing the URL offline is the most extensively used one among the offline communication tools. ? In publicizing the URL offline, only advertisement can be a specific activity for traffic building, the others can have positive influence incidentally in some extent.
7.2 Research question two: How can online marketing communication tools used for traffic building be described?
Because of the intensive competition in online businesses, companies pay a lot of attention constantly in ensuring the visibility and accessibility of the websites. For being online business, both of the investigated companies use the online communication tools extensively in building website traffic. The online communication tools are found to be direct and effective factors in driving visitors to a website with relatively low-cost feature compared to the offline communication tools. The purpose of using the online communication tools is basically to generate visits to the website. According to Chaffey et al., (2003) and studies of other authors, the six online promotion tools: banner advertising, affiliate networks, search engine registration and optimization, link building, e-mail marketing, vertical portal, are widely used in B2C context. Banner advertising is considered as an indispensable communication tool in traffic building and used widely by both of the company. Affiliate network is a cost effective communication tool in traffic building in e-commerce context, but none of the companies use it. To adopt affiliate network is not feasible to Netix AB and lack of management commitment in Importlagret AB. Search engine registration and
58
Findings and Conclusions optimization is done by both of the companies in different ways of 'do it self' and outsourcing according to their technological competence. However it is agreed to be an fundamental activity in promoting website. Link building is used heavily by both of the companies but the approaches are quite different, which could because of the industrial difference as an online advertising company of Netix AB and an ecommerce website of Importlagret AB. In both of the companies, e-mail marketing is used in form of newsletter which is a cost and time effective substitute of direct mail. E-mail marketing is agreed to be an important online marketing communication tool. Vertical portal is used extensively by Importlargret AB but Netix AB for having no such a portal.
Conclusions:
? Cost efficiency is the restriction on selecting online communication tools in small companies but not as serious as on selecting offline communication tools. ? Online marketing knowledge of management restricts the range of online communication tools' selection. ? Differences between industries influence selecting of online communication tools for traffic building in e-business companies. ? Banner advertising and search engine registration and optimization are the two indispensable activities regardless the type of e-business.
7.3 Research question three: How can evaluation of effectiveness of communication tools in traffic building be described?
Database and Google Analyst are the main software used by Netix AB in evaluating the effectiveness of the communication tools in traffic building. In contrast, Importlargret AB gets figures of the website usage from the outsourcing company and analyzes the figures by itself. It is obviously because of the individual company's technological competence. According to the selected theory, the five quantitative measurements are used in evaluation of effectiveness of the communication tools namely the number of individual visitors, the number of minutes spent by the user, the user's behavior at the website, the number of e-mail received from customers, and the website sales and income. Importlargret AB used all the measurements mentioned by theory, but Netix AB used three of them except for the number of e-mail received from customers and the website sales and income. Lacking of the two measurements is because of the nature of the business that Netix AB runs. In one hand, as an online advertising company, it is not used to promote the website through e-mail-response required marketing communication. In the other hand, Netix AB does not generate sales or income from the website.
Conclusions:
59
Findings and Conclusions ? To small B2C online business, evaluation of the effectiveness of the communication tools is probably considered very important for its cost-saving contribution in the future. ? The selected measurements for evaluating the effectiveness of the communication tools differ for the nature of the business. ? The measurements of the number of individual visitors, the number of minutes spent by the user, and the user's behavior at the website seem to be fundamental ones in evaluating the effectiveness of the communication tools. ? Quantitative measurements are used primarily in evaluating the effectiveness of the communication tools. From above discussion about three research questions, Frame of reference is well supported. We can find that small B2C companies promote their website by both online and offline communication tools. Evaluation of the effectiveness of the communication tools helps them to make better use of appropriate communication tools for traffic building in the future. Cost efficiency is the basis in selecting both offline and online communication tools for traffic building due to the limited budget.
7.4 Implication for Management
Management should keep on searching and learning more up-to-date marketing communication tools in both offline and online context. Especially for small companies that consider very much cost efficiency in selecting communication tools, the more tools are available for the management, the better tools that could be found for traffic building. Some tools mentioned in theory, which might has huge potential effect on traffic building, are not used by companies, such as public relation and affiliate network. The cost of some of them may be a bit higher; management could compare the potential achievements with cost and make an appropriate choice. Management needs to monitor and assess the change of online environment constantly in order to select the most appropriate communication tools from time to them.
7.5 Implication for Theory
This study contributes to theory, in the fact that it provides the observation of phenomena within the small B2C online business. We have used previous research in the area in order to arrive at a series of research questions. In the end we draw conclusions from the data given from our two cases and try to explain the certain phenomenon, but of all, which need further research considerations.
60
Findings and Conclusions Theory connects well with our two cases. But some factors bought up in theory were not used in cases or used in very minor extent. Also companies used some variables that are not listed in theory, for instance, in term of publicizing the URL offline. Therefore theory need constantly update and keep up the pace with the development of business.
7.6 Implication for Future Research
? To investigated on-site promotion tools after traffic building. ? To investigated traffic building in large companies. ? To investigated integration of online and offline communication tools. ? To investigated evaluation of website for traffic building. ? To investigated traffic building in context of B2B companies.
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Appendix
Appendix
Interview Guide
Respondent information Name: ______________________________________________ Department you work in: _______________________________ Position: ____________________________________________ Company information Size of firm: ________________________________________ Year of company established: __________________________ Annual Revenues: ___________________________________ Type of industry: ____________________________________
Marketing communication tools 1. Please describe the offline tools which your company uses in order to promote your company's website in light of the following alternatives:
? Publicizing the URL offline (Incidental vs. Specific advertising) •Business cards; •Letterheads; •Brochures; •Telephone directories and other reference books; •TV and radio advertisements; •Advertisements; •Hoardings and billboards; •Packaging and point-of-sales material. Others:
? Public Relation •Press relations; •Product publicity; •Public affairs, •Lobbying •Investor relations •Development
67
Appendix
•Others:
? Direct Marketing •Face-to-face selling; •Telemarketing; •Direct-mail marketing; •Catalog marketing; •Direct-response television marketing; •Kiosk marketing; Others: ? Word of Mouth Is there other kind of offline communication tools you would like to add? 2. Please describe the online tools which your company uses in order to promote your company's website in light of the following alternatives: ? Banner advertising o Static banners advertisements o Animated banners advertisements o Interactive banners advertisements o Pop-up o Rich-media banners advertisements o Context-sensitive banner advertisements Other: The purpose of banner advertising: o To deliver content o To enable transaction o To shape attitudes o To encourage retention Other ? Affiliate networks ? Search engine registration and optimization Search engine registration: o Comprehensive search engine o Product- or branch-specific search engine o Web directories o Web catalogues Other: Search engine optimization: o Outsourcing
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Appendix o Do it self Other: ? Link building o Reciprocal links with(free) Shareholders Business associates Suppliers Dealers Companies offering complementary products Other: o PR - Content mentions o Affiliates o Sponsorship o Cobranding o Banner advertising o Price-comparison portal Other: ? E-mail marketing Obtain email address: To purchase of opt-in bought-in lists To build a house list The purpose of email marketing: Customer acquisition Other: ? Viral marketing The purpose of viral marketing ? Vertical portal o a web marketplace o an industry-specific community o a gateway Other: The purpose of vertical portal:
Is there other kind of online communication tools you would like to add? 3. How does your company evaluate the effectiveness of application of different communication tools which used for traffic building? --The number of minutes spent by the users;
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Appendix --The number of individual visitors; -The user's behavior at the website; --The number of e-mails received from customers; -The website's sales and income.
IV Open discussion Is there anything else you would like to describe?
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