Up-to Trends

First order, buyer reviews and gig ranking in Fiverr

2023-02-12T22:08:00.003-08:00

Some time ago, I wrote an article about the most important factors that may affect your gigs’ ranking in Fiverr search. Ranking in Fiverr works much like ranking in any other search engine—a fixed algorithm calculates the position where a gig should appear in buyer's search; based on several factors each of which carries a certain weight. Today, we talk about how three variables which appear to carry a disproportionately greater weight in ranking and sway your gig’s ranking in Fiverr in upward or vice versa direction. Please don’t get me wrong, I am not claiming to have cracked Fiverr’s gig ranking algorithm. All I am doing is keeping a case study of one of my own gigs in front of you. The graph in the figure below shows a snapshot of the gig’s performance in terms of number of impressions over a month. I have highlighted three dates in the line chart using red arrows to explain how the first order, selling price, and buyer review affect the number of times your gig appears in buyers’ searches. But before that, I want to state an important assumption that we are making here: a rise in the number of impressions means your gig is being fetched by the algorithm more frequently and is being placed in a relatively higher position—since that’s the only way it can get more impressions. With that said, let’s now dive into the factors that may be responsible for this surge in impressions.

Getting the first order

I cannot emphasize enough the importance of the first few orders for how well your gig will perform subsequently. Although it might seem from the graph in the figure that getting my second order (we will talk about the first one in the section about price below) on January 13 has not affected the number of impressions. Impressions have remained relatively unchanged after this date. Well, apparently. However, notice that impressions spiked after January 22 when one of the orders received a 5-star rating from the buyer. Needless to say, getting a review without getting an order is impossible—unless you buy fake reviews, which we will talk about in a separate post. Therefore, getting your first order (or first few for that matter) is indispensable to pushing your gig to the top in buyers’ searches for the keywords related to your services. It may seem like a paradox: if my gig does not appear in enough searches, how do I get the first order? Well, the answer is simple: your gig does appear in enough searches to get an order IF your gig is well-optimized with keywords, has a powerful thumbnail to attract clicks, is described well, and your overall profile looks credible.

A 5-star buyer review

Fiverr is for buyers. If a freelance marketplace was possible without sellers, it would be Fiverr. There is a long list of reasons I am saying this which is out of the scope of this article. The point to make here is that Fiverr cares a lot about the buyers. Consequently, buyer reviews are by far the most important factor in deciding a seller’s fate. Referring to the graph again, I got my third order on January 17 and delivered it within the next 35 hours as requested by the buyer. On January 22 the buyer reviewed the order and gave it a 5-star review. The rest is evident in the image—exponential growth in gig impressions. There is no way I can explain using this graph how a different rating might have affected the gig performance since I have not received a less than 5 rating in this timeframe. There is, however, enough evidence to conclude that a positive review affects the gig ranking positively as compared to a no-review condition. This was also evident from my first order (not shown in the graph). The buyer never rated the order and gig performance remained roughly the same.

Selling price

The first order I just mentioned was priced at $30, as compared to the second and third priced at $100 each. It did not impact the gig performance significantly. It might quite well have been because it was not rated also. But my guess is, the lower price also contributed to no impact on the gig performance. I have also observed this effect while experimenting with some of my other gigs (I have seven of them) as well. The higher the price you successfully charge, the higher you rank in the buyers’ search results. You may find this article on how to optimally price your gigs useful.

Final thought

Now, everything might seem to revolve around getting the first order; and you might be feeling frustrated right now— and rightly so. My experience with selling on Fiverr suggests that Fiverr initially favors new sellers unless it cannot. It cannot favor you if your gig lacks optimization. There is an incentive for Fiverr to give chance to new sellers since they might turn out to be successful sellers and ultimately generate a lot of revenue for it (Fiverr gets 20% of each order’s gross price from the sellers in addition to the complex fee system they have in place for buyers).

Thus, what you can do is master your skill, optimize your gig, and delight the first few customers (it is always a good idea to delight your customers for all the right reasons) and reap the benefits.

Kingsford Charcoal Case Study Solved

2022-03-14T06:58:00.001-07:00

Kingsford Charcoal Case Study Solved

Executive Summary

This document presents analysis of the case “Kingsford Charcoal.” Kingsford Charcoal is facing a decline in its sales growth in 2000. Kingsford’s market share in the charcoal has increased relative to its closest competitors—Royal Oak and private label brands. However, its growth in total sales has seen a decline due to shrinkage in charcoal grilling category and customers switching towards gas grilling.

Kingsford’s brand team has a few options at their disposal to revive the growth: revise prices which they haven’t done in past several years; increase advertising to expand charcoal category pie; extend grilling season by adding new occasions; use promotions to partner with channels to encourage impulse buying; and finally, use a combination of these strategies to achieve the objective. Combination of advertising and promotions has been suggested. First, because recent price increases by Royal Oak and private labels have driven away customers from charcoal to gas grilling. Second, advertising can help change customers’ attitude, it can promote charcoal grilling as a natural and tasty way of grilling. Last, promotions can win channel support to provide discounts beyond the traditional summer grilling season.

First section of this document focuses on defining the problem and states the alternative solutions. The second part analyzes the alternatives in detail by performing quantitative and qualitative methods. It also comments on each solution’s feasibility and long-term implications. While the third section lays out the implementation plan for the chosen strategy.

Problem statement

Kingsford charcoal is a charcoal brand. Charcoal is used for grilling as an alternative to gas grilling. There are two methods of grilling: charcoal grilling and gas grilling. Gas grilling penetration has been historically slightly higher than charcoal grilling (Exhibit 6 in the case). Although charcoal grilling takes more time and effort to burn, most die-hard fans of grilling prefer it as a natural, suitable, and tastier way to grill. Therefore, the customers who use charcoal grilling are very loyal to the method. Kingsford has traditionally leveraged this attitude amongst Americans by providing superior quality charcoal at premium prices. However, the recent development is that gas grilling category’s sales are increasing (8% growth in 2000) while charcoal grilling category’s sales are declining (3% drop in the same year). As a result of decreasing pie for the charcoal grilling, Kingsford’s sales growth has started declining (See Exhibit 3 in the case) despite growth in its market share relative to its close competitors Royal Oak and Private label brands.

Thus, the challenge is: how to regain growth in revenue from charcoal, and expand the pie of charcoal grilling as a whole while also remaining in the budget of not more than $7 million.

There are four alternative areas where action can be taken to further the mentioned objective: pricing, promotion, advertising, and any combination of two or more among three.

First, prices are the handiest of the tools available. For several years, Kingsford hadn’t increased prices of its products. Now that both private labels and Royal Oak have increased prices, should Kingsford too? The payoff will be increase in the revenues. But costs will come terms of customers switching to competitors or worse even to gas grilling which Kingsford isn’t in position afford. One reason to expect the latter is the recent association between price surges by Kingsford’s competitors and customers’ switching towards gas grilling.

Second, advertising could help the brand stand out as a classic representative of grilling, the pure and natural way of grilling—with charcoal. Although Kingsford spends more on advertising than do its competitors, its advertising spending has declined over the past 5 years from $6 million to just one million. While advertising spending has been increasing advertising spending during the same period. Therefore, there seems more attraction towards this alternative. Moreover, co-adverting activities are common when increasing category share is the target.

Third, promotions are one thing Kingsford has more focused on in the past. This time, it is an option too. But promotions were a successful strategy to gain channel support mostly to wipe out competitors and not gas grilling. However, one attractive feature of this alternative is partnering with the channel to create promotions which could stretch the grilling season from a summer-oriented hobby to broader passion which encompassed sports.

The last, decision alternative is a combination of these three. Slightly increasing prices within customers’ just noticeable difference supported by advertising should help prevent customers from switching to competition or gas grilling. While, partnering with channels to offer discounts in newer occasions candidates for grilling, for example NASCAR, coupled with advertising focused mainly on ‘why charcoal grilling is better than gas grilling’ seems to be even better option. In the next section, we analyze each alternative in detail.

Analysis of alternatives

Pricing

Price elasticity what-if analysis (Exhibit 10 in the case) provides us with the expected pay offs and probabilities of different outcomes corresponding to different levels and types of price changes.

Price increases usually result in withdrawal of support from retailers because price increases can turn profitable customers away from a store. So, here we analyze how each price increase affects merchandising.

Frist, if the price are increased by 4% across Club/Home centers, three possible scenarios can occur: no merchandising loss resulting probable pay off of $648; 300 Msc loss at Costco with resulting payoff of only $0; and loss of 1000 Msc at Costco resulting in a loss of ($375). Therefore, the net payoff of this will be $283. (Exhibit 1 panel (1))

On the other hand, if price of Blue Bag were given minimal raise (2.5%), either no merchandising loss would be incurred (75% probability), or 10 of merchandising would be lost on 10 and 20 lbs. bags (25% probability). The resulting net payoff would be $217.5 (Exhibit 1 panel (2)).

Third a higher (5%) Blue Bag price increase would either result in no merchandising loss and generating $535, or 7% merchandising loss in of 10 and 20lbs. bags generating only $55. The resulting net payoff will be $585 (Exhibit 1 panel (3))

Lastly, a total line pricing increase of 5% would either result in no merchandising loss, which is only 30 percent likely and generates $561; or a combination of merchandising losses in different SKUs still generating $1204. Thus, total line increase of 5% results in net benefit of $1765 (Exhibit 1 panel (4)).

Now if we analyze, this last option is best of all. However, a mere price increase would result in long-term switching from charcoal grilling towards gas grilling. There is substantial number of customers who are not loyal to any brand or charcoal grilling. Therefore, a price increase without support of advertising is not a profitable move.

Advertising

If total $6 million are to be spent on advertising in 2001, assuming advertising has the same effects as in 1998, it would generate incremental volume both in 2001 and 2002. Additional fund required would be $5,000,000 and the accrued benefits would total $12.3 million. A net benefit of $7.3 million in sales at the static prices of 1999. (For a detailed calculation, see Exhibit 2 in Appendix 1). Besides these dollar-benefits, advertising could hit the real root of the problem: change attitudes about “gas vs. charcoal grilling” in the favor of the latter. Because charcoal category advertising has been continuously declining over the past few years while the same for gas grilling has been increasing, the switching behavior maybe associated to the increased advertising by the gas grilling category brands. Moreover, comarketing efforts can also expand the pie by increasing the number of grilling occasions.

Advertising message would need to be adjusted if the objective is to promote charcoal over gas grilling. Specifically, the message “lights twice as fast as other coals” was irrelevant in this case because customer were now comparing coal with gas not coal with different coal. Further, because the objective was to hit gas grilling, convenience and fast lighting feature was to be highlighted and at least parity with gas grilling should be achieved to stay relevant. As segmentation study showed Kingsford’s consumers consuming regular were more fond of charcoal grilling. Finally, care should be taken not to distort the original older associations with natural, and tasty. Otherwise brands identity would be hurt and even loyal customers might turn away.

Promotions

Besides all the regular benefits of promotions to the sales of Kingsford, promotions are very crucial tool to extend grilling occasions beyond summer season. One new occasion to turn into a grilling event is NASCAR which. Promotions could increase impulse purchase by attractive and appropriate displaying locations, they can increase trial on new occasions. In 2001, Kingsford’s promotional expenditure is estimated to be $39 million in terms of forgone revenue from price reductions—US $31 million—and sales promotions in terms of coupon redemptions—US $8million.

If additional dollars are expended on promotions, they might generate no benefit without advertising and bringing in new customers. Therefore, it is advisable to marry a combination of advertising and promotions. Price increases will drive customers away from charcoal category and cause Kingsford to lose channel support; given the objective of expanding the charcoal category, this strategy seem incompatible. Thus, the best of available alternatives is a combination of advertising and promotions. It may seem to be just a cost driver, but in fact it is an investment that will pay off. One drawback of this strategy would be that other charcoal brands might free ride the expansion of charcoal category. However, if designed carefully, advertising can strongly associate Kingsford (and only it) with charcoal that it might prevent new customers from going to Royal Oak and private labels.

Plan Development

Now that we have decided to use a combination strategy of advertising and promotions, we need to develop a plan of implementation of this strategy. We start with prices under this new strategy.

Prices

As we saw in the analysis section that price increases would result in higher revenues for the immediate periods, but we also stated that they would adversely impact the charcoal category hence Kingsford’s performance which holds more than 50 percent of the category. Therefore, in the initial phases as strategy become effective, prices remain at the same level (except for discounts).

Placement and Promotions

Placements are ensured at the same retailers but at the central Walmart stores a minimum of 5000 pounds is met by providing trade allowance to the retailer on Labor Day and then Memorial Day. Moreover, merchandize will be optimized using MAPS formula used by the company. $2 million additional will be spent on promotions at new occasions including NASCAR, since expected budget is $7 million and $5 million are dedicated to advertising.

Advertising and Message

The new advertising message for regular charcoal would be “grill as fast as gas” and “taste as great as charcoal.” This message highlights the superiority of charcoal grilled food’s taste (blind taste test has already supported this hypothesis) while tells that with Kingsford’s charcoal, convenience is not less than gas grilling. So, the net perceived benefit to the customer is greater and there is incentive to switch from gas to charcoal grilling. If prices are controlled for some time this advertising, Kingsford can become leader in grilling not only in charcoal. Therefore, as we saw while analyzing costs and benefits of advertising, volume increases will be the return on this investment. And once attitudes attitudinal loyalty is achieved, price premiums can become justifiable.

Production capacity

Production capacity decisions usually lie beyond the scope of brand teams. However, to support growth and investment in the brand with seamless supply brand teams need to recommend and forecast timely decisions for supply chain and production adjustments. If this plan is sustained for three consecutive years and 7% volume growth in 2001 3-4% in 2002, plants will be operating at their full capacity in three years. Given that building a new plant can take up to five years to be operational, a capacity increase is recommended by now.

Appendix 1 Exhibits

Exhibit 1: Net payoffs ($) of the proposed price changes

Exhibit 2: Cost benefit analysis of advertising

What is affiliate marketing? [A comprehensive guide]

2021-11-07T23:19:00.001-08:00

If you are a publisher looking for ways to turn your passion into livelihood, or a new e-commerce store owner looking to grow traffic to your store, this guide is right for you. It is fundamental and covers both aspects.

What is affiliate marketing in simple words?

In simple words, affiliate marketing is a collaboration between an online content publisher and an online product of service provide to promote the business of the seller. A more sophisticated and technical definition of affiliate marketing follows: "Affiliate marketing is a form of advertising where a seller or company pays content publishers to generate traffic and leads to the sellers’ products." Affiliate marketing has recently boomed as digital marketing, analytics, and a growing base of online users have emerged. Digital analytics make planning, execution, and measurement of affiliate marketing programs almost effortless. From the perspective of a publisher, affiliate marketing is one of many ways to monetize your content.

What is an example of affiliate marketing?

Amazon pays a large base of content publishers to promote its products to the people searching information on those products on the web. This contract between Amazon and its affiliates is a classic example of affiliate marketing. However, millions of large and small e-commerce merchants engage in affiliate programs for several benefits which we discuss next.

Why affiliate marketing?

Affiliate marketing is preferable over other methods of online advertising for three reasons. First, customers searching for products and services online are very careful about the quality of the products they purchase, security of payment methods, and post-sale experience such as returns and exchange. These customers are more likely to trust an impartial expert who has used the products than the seller themselves (Note, however, that not all affiliates may be experts in a niche or have used the products. We will discuss this under “types of affiliate marketing” later in this guide). Affiliates play the role of this expert and help overcome the mistrust especially for the new e-commerce merchants.

Second, affiliate marketing is a source of creating a long-term relationship with new users. The affiliates’ followers probably already have a relationship with them. Users who found you through an affiliate are more likely to be loyal customers than those who found you via say Google Ads. It is also easier to build long-term relationships with affiliates. They may be low-cost in the long-term and have deeper connection with your brand, and become ambassadors. As their own user base grows over time, you will have a growing base of users without having to spend on finding leads.

Finally, according to a report by Business Insider, around 15% of the e-commerce industry's revenue comes from affiliate marketing. This industry is growing and may even represent a larger share of revenue in coming years. Although other paid methods are not going anywhere, affiliate marketing may be one of the biggest models. Neither an e-commerce seller nor an affiliate would like to miss out on this opportunity.

How does affiliate marketing work?

Suppose for instance that an owner of an e-commerce store wants to grow their business. They can do it by bringing more customers to visit their website and see products, prices, promotions, and other benefits. There are multiple ways they can bring traffic to their website. Typically, the seller is an e-commerce platform owner selling products online. The publisher (affiliate) is usually someone who provides publishes content on related topics. However, affiliates may provide detailed information, reviews, and expert opinion on products to the customers searching for such information on the web. Since publishers have knowledge and influence, they have the power to refer potential customers to the seller. Affiliates have one or more websites and/or email lists of potential customers. They can promote their partner sellers’ products by recommending products and including an explicit link to the partner’ website, running display directly ads relevant to the content on each page of their website, sending out emails to their client base.

How does the e-commerce merchant track traffic from the affiliate?

This a very basic and must-ask question. But it is easy. The e-commerce merchant needs to embed a special link to their website code which contains a unique ID or username of the affiliate. Whenever a user visits their website through affiliate link, the website counts it as such. It also tracks the actions they perform on the website and whether they make a purchase. Alternatively, there are multiple tools and plugins like Voluum Affiliate Tacker that can help merchants track affiliate performance.

How does an affiliate get paid?

It is usually the case that the affiliate is compensated only when a lead sent by them converts (a conversion may be defined in several ways depending on the goals and objectives of the marketer, but we will limit the definition to a purchase made by the customer). The affiliate may be paid a flat fee for each conversion or they may be paid a share of the revenue made from each sale.

What does an affiliate marketer do?

Apparently, it might be tempting to think of an affiliate as a knowledgeable person in an area who writes content for the same niche. But in reality, that’s not all. An independent affiliate is required to posses a multitude of digital skills and capabilities, while an agency or affiliate company may hire a specialist for each area. Those areas include but are not limited to content writing, digital analytics, web management, and search engine optimization (SEO). Affiliate marketers may own several websites for the sole purpose of providing affiliate services to e-commerce merchants.

Types of affiliate marketing

There are three types of affiliate marketing depending on the affiliate’s level of expertise, involvement with the product and whether they have used the product themselves:

Unattached affiliate marketing

In this model affiliate is the least involved in the product. They might or might not have used the product, do not possess expertise and authority, and do not have a duty to recommend the product. Usually an unattached affiliate would run display ads on pages with content relevant to affiliated products. Users choose to click and visit the seller’s website. In unattached marketing affiliate is typically paid per certain number of click.

Related affiliate marketing

In related affiliate marketing, the affiliate has some sort of relationship with the products and services. Usually, a related affiliate’s content is highly relevant to the products. Related affiliates may be experts and opinion leaders in the niche, but may not recommend the product directly. For example, an experienced DIY plumber may include a few product names and links as a favor to their follower while getting paid by the seller.

Involved affiliate marketing

Involved affiliates have a deeper connection with the product. They have used the product, provide an explicit recommendation to their followers, are required to label the sponsored content as such, and their own reputation is affected by users’ experience with the product or service.

In my opinion related affiliate marketing is the best meth method because of the balance between involvement with the product and expertise in the niche. It may will create a more sustainable relationship between user, affiliate, and the seller.

Is affiliate marketing illegal?

No, affiliate marketing itself is not illegal. However, if you engage in any fraudulent activity in the process, it is considered affiliate fraud which is illegal. For example, the products you endorse are illegal, and various other activities may be considered illegal.

Mass Customization is More Viable to Create a Profitable Brand Than Mass Marketing

2021-03-16T09:32:00.006-07:00

Synopsis

Mass Customization is a marketing technique which operates in a combination of customization of products in accordance with segment needs, as well as the production flexibility and lower costs through economies of scale achieved from mass producing for that segment.

Mass Customization

Introduction

Marketing, in any organization forms one of the key pillars of strategic objectives. Marketing converges the strategic direction as well as the objectives of the organization, ensuring that the organizational objectives are achieved. Different business organizations can take different approaches to their marketing strategy. One of these modes is mass customization. This is a marketing technique which operates in a combination of customization of products in accordance with segment needs, as well as the production flexibility and lower costs through economies of scale achieved from mass producing for that segment. Mass customization combines the two ideas (flexibility and customization of products) with the costs per unit that are associated with mass production of items. This marketing technique is also known as made-to-order or built-to order. Dell computers are a perfect example of this method. Dell produces a basic version of computers which is same across virtually all of its customer segments; but there are various versions of each module (screen, speakers, input devices, power cables) suited for different segments such as businesses or individuals. Another technique is mass marketing, which is a marketing strategy where an organization decides to ignore segment differences and appeals to the whole market with one common offer. This supports the idea of broader message reach and broadcasting which will reach the largest number of people as possible.

Each of these strategies have their own merits and demerits. However, diverging needs among smaller and smaller segments of customers (niche), attributable, in the most part, to internet and communication media mean that mass customization marketing grounds my position in this argumentative research. According to Joseph & Pine (1993), mass customization offers vast advantages such as proximity with customer, customer involvement into the overall value creation and consumption process, positive customer attitudes, and increases willingness to pay. The fact that goods are built to order gives this strategy an upper hand in many dynamics. More of these details add strengthening my position with evidence and facts are found within the essay.

Argument

Currently, consumer markets are seen to be changing rapidly due to advances in communication and transportation technology, and the end consumers are much more demanding than before. Due to this reason, mass customization has come up in the last decade as a solution addressing the new market realities and helping different firms to grab the efficiency merits of mass production, customers satisfaction advantages of customization. Relative to mass production and mass marketing to mass customization has superior benefits. Mass customization allows the following:

Positive Customer Attitudes

Mass customization can help organizations build a profitable brand by affecting several customer attitudes. Some of these positive changes may include increase loyalty, increase in brand’s share, and hence profits. Mass customization builds brand loyalty (Yoo & Park, 2016) and increases brand share(Jiao, et al., 2003). This effect has been widely seen in the luxury and high-end products. Customization has been found to increase perceived service quality, which in turn has been found to drive purchase intention. One study found that customization increases customer satisfaction, trust, and as result, customer loyalty (Coelho & Henseler, 2012).

Increases Willingness to Pay

Because customers are willing to pay more for the products that satisfy their unique needs (Kuo & Carnage, 2012), mass customization allows organizations to charge premiums for their products and increase margins, and hence build a profitable brand. Willingness to pay is considered as an outcome of competitive advantage from a strategic point of view. Thus, it can be said that customization can build a competitive advantage.

Provides customers an ego-gratification

This strategy adds to the customer’s value by satisfying the ego-gratification need (Pine, et al., 1999). Ego gratification is defined as a feeling that customers get from consuming products specifically tailored to their unique needs. That ego boast results in enhanced loyalty and price premiums. Moreover, such a relation between customers and the brand which is based on emotions is an attachment desirable for customer based brand equity.

Aids Recall

Carefully devised customization which is centered around customer needs has benefit of triggering sales by reminding customers of the company’s brand when they find products best fit for their needs. Customized advertising on social media is one example of this effect. This helps companies to support sales by aided recall when their way of customization reminds customers of their brand in purchase situations. Transparent customization for example also eliminates the time customers need to spend finding accurate products, creating, or reviewing orders (Gilmore & Pine, 1997).

Provides a chance to create proximity with the customer

Under customization, every transaction adds more details of coordination between the customer and the company thorough client-specific product design and is pegged on a direct communication between the company and the customer. During this interaction, the supplier’s solution capabilities are usually converted into a unique customer order by the usage of enough tools of configuration. According to Zipkin (2001), this process can be referred to as elicitation of mass customization system. The supplier has to have some kind of interaction with the customer so as to enable them to obtain unique information in order to bring about definition of the product and also translate the needs of the customers into a definite product specification. This process of elicitation is in many instances more than the mere exchange of details but also an exact act of joint co-creation and cooperation (Joseph & Pine, 1993).

Increases customer involvement

Elicitation process just explained necessitates integration of customers into the design and production phases of customers. Customer integration results in value creation process in which customers take a play in all the processes and activities which were used to be seen as the companies’ domain. The customer is converted into a co-producer as well as a prosumer. The end result of all this is a co-creation which means that there is company-customer interaction and also ensures adaptation for the sole reason of achieving increased value for both the customer and the company—supplier (Joseph & Pine, 1993).

According to Kotler, et al. (2005), mass customization is a reflection of a growing trend of self-marketing. Self-marketing is a shift in the approach of product development and marketing communication from a one-monologue from companies to the customers to a more interactive process where customers are creators of the products. They increasingly use the internet to influence all aspects of marketing from design and development to final presentation of the products to the customers.

Many companies are now choosing to tailor their offerings to individual customers on a mass scale. This shift is reducing the time companies spend understanding consumer and the time customers spend finding, evaluating, and choosing from different alternatives. Cocreators also tend to be more satisfied with the products and services they settle for.

Conclusion

So, we have reviewed significant amount of literature and looked at several practical examples for evidence on why mass customization is superior to mass marketing in the modern era. Specifically, we argued that mass customization increases integration of customers into all stages of value creation, it positively affects customer satisfaction, loyalty, and trust. These attitudes in turn affect purchase intentions such as willingness to pay. Through customization companies can increase profits by charging premiums for their offerings, attracting more customers, and reducing costs of production. We now look into some specific recommendations on how to make mass customization work.

Recommendations

First, different segments to which company is to deliver need to be defined clearly in terms of their needs. This sets the objective for customization and helps companies visualize the end value for the consumer. Similarly, the product tailored at the defined segment needs to be defined clearly so that the processes of value creation can be visualized.

Second, rapid response is the first characteristic of effective mass customization. Processes involved in value creation for customer must be so designed to be rapidly linked together. Coordination of processes such as marketing and production is essential to deliver customized value.

Third, the costs of moving across different versions of a product should be reduced to minimum. Otherwise the increased costs of customization would erode its benefits. This is related more to production processes and modular design.

Fourth, a seamless value to each segment should be guaranteed; customization sometimes creates seams which interrupt how consumers extract their value from the product.

Finally, technology needs to be leveraged in this regard. Amazon is classic example of deploying computers to understand better each customer and then recommend products tailored to their specific needs by maintaining cookies and other customer records. Almost every modern business is doing this, but not with the same precision as does Amazon.

What is digital marketing?

2021-02-08T10:46:00.007-08:00

Every day, you hear buzzes out there “digital marketing is the future,” or that “digital marketing can make you a millionaire.” And I know what you think in your mind: “What the heck is digital marketing anyway?” Well, you won’t have this question anymore. Read to this article to end.

What is digital marketing?

Digital marketing is the process of reaching out, engaging, and converting online audiences into paying customers using a variety of digital tools and strategies. Now, we have used number terms we need to explain here. First, what do we mean when we say digital marketing is a 'process'? It is a process because it can be best implemented in a sequence of steps and repeated to keep it working. The steps include creating a digital marketing plan, identifying relevant online audiences, budgeting, implementing the digital marketing plan, and controlling the process by measuring and monitoring results.

Second, we turn to defining online audiences so that you can understand other terms well because we will be using this term all along. Your online audience is the people who either already are your customer or can be your customers and are present online in most of their daily routines. Just like in traditional marketing, online audiences can be segmented based a number of variables such as location, platforms they spend their time on, devices they use too access the internet, their interests, their actions online, and the list goes on. But every marketer will segment their audience the way it suits their goals the most and what they want to do with their audiences.

Third term we need to explain is ‘reaching out.’ Reaching out means identifying where (on which online platform such as Facebook, YouTube, or any other website or blog) your audience is on the internet and saying your first Hello to them. This might be in the form of a search ad when the potential customers look for a specific product or service in a search engine such as Google, a blog article answering a question your potential customer is pondering on, or a Facebook ad shown to them because they match the criteria you have set for who can be your potential customer. Note that these are just a few ways digital marketers reach out to their potential customers; in reality, the list goes on.

Fourth, engaging an audience online means showing them the content (text, videos, images, sounds) they enjoy. For example, a digital marketer trying to engage an audience such as pet lovers will share funny videos of cats on their website, YouTube channel or Facebook page. People will watch the video enthusiastically, react to it, comment on it, and share it if they like it so much. All these actions count as engagement. In a broader sense, all the time spent by customers doing any actions on your platforms (website, or social media pages) is engagement. Because today’s customers are bombarded with messages from millions of platforms and companies trying to get their attention, engaging online audience is the real deal.

Finally, what is conversion? Conversion can be defined in different ways depending on what matters the most to the marketer. Generally, conversion is the successful completion of action by the customer that the digital marketer considers really important. For example, when a customer completes a purchase, or signs up for newsletter. Conversion rate is the number of customers completing the target action divided by the total number of people who see the message or call to complete the action. Conversion rate will vary depending on how the marketer defines the conversion, what business they do, and how valuable each conversion is.

So to sum up, digital marketing is similar to traditional marketing in the sense that it is the process of finding customers for the product, digging deep into their needs, engaging them in different ways and them getting them to perform certain actions (buy a product and buy again). But certain aspects differ greatly in digital marketing because it is really different where (on the web as opposed to on the road or in the mall), how (by clicking on a digital ad as opposed to by looking at the billboard on the roadside) the advertisers interact with the audience.

Just before you go, bring your ear closer to me I want to tell you something. "This is just a brief introduction or definition of what digital marketing is, for details such as what activities and channels it includes, and what are some best digital marketing strategies, keep coming to our website. We will keep teaching you interesting stuff. And yes, we love it when you leave a comment."

How to rank your gigs on Fiverr

2021-02-07T12:43:00.007-08:00

Ranking your gig on top in Fiverr is not hard. But it isn’t the ultimate formula to success in selling on Fiverr either. Yet, it sure is the first important step to take your Fiverr journey to next level. I said it isn’t hard to rank your gigs on top because 3 of my six gigs rank on the first page and one gig ranks on number one. My experience suggests, ranking a gig has a lot to do with creating the gig the right way. Therefore, in this post, I am going to go over some of the most useful white hat SEO tricks—followed as you create your gig—that can help you rank your gigs on top, in the first page at least. Note, however, that since you can edit your created gigs any time, you need not be disappointed even if you have created your gigs already. Just read on patiently. Take notes or make changes as you read.

How to rank your gigs on Fiverr

Select SEO friendly title

The first important step in ranking your gigs is to ensure that your gig title is tagged “just perfect” when you are writing it. It is two of the metadata of your gig; algorithms use metadata to bring your gig to search results. As a rule, your title must contain keywords with which you think your buyer would search the services you provide. To get ideas for your title, search your relevant keywords as a buyer and see how many gigs are already providing service in the category. Next, analyze the titles of the gigs that appear on the top. It is a good idea to pick 15-20 titles and see which ones are most repeated. Select the repetitive title and add your USP (unique selling point) word to it. You must figure out what your unique selling point as a seller is.

Select the right category

When you are creating a new gig, you select the category in which you are going to provide your services. Try to be as accurate as possible at this stage. This is important because when buyers are looking for services, they have an option to directly select a category in which they want services. If you haven’t selected the right category, you won’t appear in the list of gigs they will be shown. You might be thinking what this has to do with where my gig appears in searches. Well, if your gig appears in the right searches its chances to get clicks increase even if the conversion does not take place. More clicks in turn will help rank your gig higher. Moreover, sellers are shown buyer requests based on which category they have chosen. If you have chosen the right category, you will be able to send offers in response to buyer requests. If you write a good copy in your proposal and get the buyer contact you, ranking of your gig will automatically improve. Algorithms track if buyers are interacting with your gigs and promote the gigs that are getting attention.

Select the right search tags

Fiverr allows you to associate five search tags with your gig. It is essential that you use the keyword that you have used in the title. You can add additional relevant tags but the one in title must be repeated in your search tags. To find out more search tags relevant to your keyword in the title, go to search bar as a buyer and write the one keyword you know; see what other words or terms Fiverr suggests below. You can use those as your further search tags. But this just a way, if your intelligence suggests otherwise, go with it. Search tags help your gig appear in search results which in turn will rank your gig higher.

Write a winning gig description

Your gig description is what you will tell your potential employer in an interview. The only difference being that your client here is more impatient, and transaction oriented as opposed to the relationship oriented long-term employer. But wait your gig hasn’t yet appeared in the search results so why are we talking about what to tell the client? Here is why. First, you need to write a creative, conversion oriented, and SEO friendly gig description because algorithms are more likely to pick your gig and show it in the search results page if you have described your service well. Your description must use the keywords in the description to make sure it is one more piece of coherent evidence that suggests to the algorithm that this is the right gig to show to the buy. Second, if your gig appears in a search in by chance and gets a click, a well written description can boost your chance of conversion (client placing an order or contacting you).
That said, what constitutes a good description? Well, read on to find out. Firstly, your description should highlight your experience related to the service you are offering. At this point, it is not a bad idea to lie that you have a year of experience. Do not brag a lot about yourself though; it is a good idea to limit yourself to line or two. Secondly, highlight your expertise or updated tools that you are equipped with to accomplish tasks in the field. Finally, you MUST highlight your USP in a line or two. As a bonus, tell the unique benefits of purchasing your services but be careful not to enlist redundant things such as “I will deliver on time.” You must deliver on time. Don’t tell.

Get people to click, like, and add your gig to “gigs I love”

Once you have published your gig, share it with people and ask them to open the gig, like, and add to the favorite list. This sends a signal to Fiverr algorithms that this is a good gig to rank high on the search results page. While most people do this by sharing a link with people on social media. Don’t do it. Because if you do, fiver will know where the people who like you gig are coming from (Facebook, WhatsApp etc.). Instead, ask your friends to search your niche keywords, find your gig, click, and do the above-mentioned actions. This will trick the Fiverr algorithms to think these were an organic interaction with your gig.

Get a VVRO

If a buyer happens to see your new gig by chance but they see a tag “Not rated yet,” it is surely going to turn them away thinking you might ruin their time and money because you are newbie. As a solution, you need to buy a very very real order (VVRO) by telling someone to place an order on your gig in exchange for something and then leave a positive review. Note that this does not apply to you if you have a senior profile.

Stay online all the time

Once you have published your gigs and are all set to go, install Fiverr app on your phone and stay online 24/7. Along with other filters, Fiverr gives buyers a chance to apply an “only online sellers” filter through with which sellers offline at the time are filtered out. To make sure that you appear in every search, stay online all the time. I recommend you to set a distinctive, long notification tone for messages to your Fiverr inbox. In this way you will have a chance to reply as soon as you receive message. Once the client is with you in the inbox you have a greater chance to convert them. More relevant to today’s talk, if you are very responsive to messages, there are chances your gig will rank higher.

Did I miss anything important that you know? Educate me in the comments below.

Five pricing strategies for freelancing services

2021-02-01T05:26:00.010-08:00

Since you have landed on this post, chances are high that you are familiar with the following scenario. The client seemed quite interested in your service; asking questions, talking about deadlines, and looking in great need of your services. All the while creating an impression they will be willing to pay as much as you asked for. You offer a slightly above your average price, and Bam! They are gone. You keep waiting and regret if you are told an unreasonable price. Not necessarily. There are several things to consider before concluding. Here is how you can offer a reasonable price to each individual client and still balance it with your priorities.

Firstly, we need to understand how pricing freelancing services is different from pricing traditional services. For one thing, traditional services are a lot more standardized than freelancing services. Traditional service providers have a list of activities or jobs that they will perform as a part of service performance. Activities rarely deviate from the list. However, in freelancing every individual client will come with a unique need and a specified list of activities that they need you to perform. As a result, they will combine to make an overall task that you have never done before. So, you have to price for every individual client. Note that freelancing platforms attempt to standardize by creating packages/jobs that clients can directly order. But freelancers prefer the client would first contact them and then accept a custom offer made after discussion.

Second, while pricing the traditional services, service providers usually survey buyers to gauge their willingness to pay for a combination of activities called a service. Such methods do not work with freelancing platforms unless you have a great deal of experience with clients from several different countries. In simple words, you do not have much knowledge about your customers’ backgrounds.

Finally, you are not aware of the particular circumstance in which the client is contacting you. We know from our marketing knowledge that situational factors play a great role in shaping clients’ willingness to pay.
All these factors play their part to make pricing freelancing services complex and usually order losing for you. Fortunately, there are some subtle similarities between traditional services ad providing your services online as a freelancer. These similarities can provide a basis for pricing your freelancing services. Here are five strategies that help you in pricing your freelancing services.

1. Compare to the niche standard.

Assume you worked at a start-up in your neighborhood rather than working as a freelancer. You will look at the people who have similar qualifications and experience and are working in a similar industry. Then you will look at your own superior skills and put a premium on them. This way you will come up with a price tag for your services. You can research your industry to find out the average prices being charged for similar services. Be careful with this technique, however. The prices visible to you may differ significantly from what they charge individual clients.

2. Estimate your time and effort for the task

Your cost of freelancing is the opportunity cost of your time. While pricing your freelancing services, it may be helpful to estimate how much time you will have to spend on a particular task, and then put a dollar value on those hours. Include your time spent discussing with the same client, and the time spent researching before starting the task formally.

3. Keep a standard price in mind.

If you tell your clients a very high price, you run the risk of scaring away them by asking for an unreasonable price and then regret it. If you tell a standard average price to every client, you run the risk of charging a lower price to a client who was willing to pay more. To avoid this issue, you can have a standard price in your own currency in mind: for example, 2 INR for every word of content you write, or 800 INR for every hour you spend. Then if you find a client interested in your service so much so that they will pay higher, you can adjust your price when finalizing the terms with your client.

4. Keep customer lifetime value in mind.

Many of your clients keep coming back for your service. Just like in the traditional services industry, loyal customers are rewarded, you need to adjust prices for such customers. if a client approaches you for a business plan for a beauty salon, for example, you can ask them what tasks they need you to perform. Do they need to do human resource planning, hiring, job analysis, and preparing job descriptions? Chances are they do. So, if you sense that will need such services you can offer to lower prices for the first order in exchange for placing new orders with you.

5. Negotiate

As already discussed every transaction with your client is a new process. You have to set prices for every client. You need to negotiate for the right price. Many buyers offer low prices to see just in case you may accept. Therefore, need to ask for a fair deal. If the client is stuck at a lower price than the cost of your time and consideration learn to let go of such clients. It is quite possible that another client will come over, willing to pay a lucrative price but demand results quickly. If you are busy doing the cheaper job and regretting why you accepted, you will lose.

Other considerations

In the above strategies, I have assumed you are an established freelancer. But if you are a beginner trying to build your presence online, your strategies might be slightly different. Especially, you may be less concerned about price and more about getting some reviews on your profile. Moreover, pricing freelancing services may depend upon the niche in which you are providing services. Although the fundamentals are the same, some niches may be flexible. For example, if your task is more laborious, you will have little room to be flexible with prices. On the other hand, if one additional photo retouching doesn’t take you long you might consider doing it for free to win the client’s satisfaction. Finally, to be able to charge premiums, you must satisfy your clients. Read strategies to satisfy your freelancing clients here.

How to satisfy freelancing clients?

2020-12-20T10:20:00.000-08:00

The first thing I learned in marketing was that in the modern-day business, customer satisfaction is the key to business success unlike selling more, making the best quality product, or selling at the cheapest price.

How to satisfy freelancing clients

The internet and information technology are making the customer even more important; customers have increasingly more control over information, pricing, and how products are delivered. Similarly work culture is also changing with the emergence of hiring freelancers as an alternative to traditional employees. I will talk about the benefits businesses get from doing so in a later post, today our focus is on how those selling their services to these businesses can satisfy these "clients."

I can't emphasize enough the importance of client satisfaction on freelancing regardless of the platform you sell your services on. However, it should be evidently elaborate by the fact that clients can rate their experience with the seller publicly and potential clients can see it before they buyer the seller's service.

Because delighted clients would leave positive reviews and comments, new customers would see the reviews and mostly decide on those basis of the reviews. And I cannot emphasize enough the power of reviews in attracting new buyers to your profile. Positive reviews reduce the buyers’ risk of losing their time and money on a seller who will create mess if they are assigned the task.

Obviously, as a seller you do not have much control power what type content about your profile is shown to the potential buyers, but you do have a choice what would be in the content. For example, Fiverr would show reviews of previous buyers to the new buyers looking for services, you cannot change that but what you can do is to strive to have positive reviews by satisfying your clients.

Achieving client satisfaction in freelancing is easy if you know your job well. Still here are a few subtle things you need to know about client satisfaction on freelancing platforms.

1. Know your client's needs.

You can be a master of your skill and still fail to deliver quality if you don't know what you are supposed to do. You need to dig deeper into the client's brief or requirements before you get started. If you are good at what you do, you know very well what information you will need to work on. Put specific questions in your requirements. Alternatively, you can ask the client precise and specific questions as to what they need as an outcome. Many times, your client won't have clear agenda as to what the need done. Therefore, it's your job as an expert to help them identify what they need. However, be careful not to confuse your client if they declare upfront what they want.

2. Calculate if you can do the job in the specified time.

Several factors affect the time you will take to complete a task: your level of expertise, experience, other tasks you have to get done, how much total time you can give to freelancing etc. So, take account all these factors and estimate if you can go the job in the given time. Never accept more orders than you can handle. If you are pressurized by the deadline, you can't deliver quality. Therefore, you need to be sure about the time you will take. You can bargain for time with the client, but making it a habit. Clients with urgent needs can be easily turned off by request for more time.

3. Always give more.

It is always a good idea to be on the giving end of transaction. If you put a little more to dig deeper into the job and make look more accomplished than the client would expect, you have already won over them. Remember if one or more aspects of the task surpass client's expectations, they will be less likely to be dissatisfied with the aspects that have been done poorly. They will politely ask for a modification in those parts rather leaving a negative review. Moreover, such clients are more likely to return and make repeat purchases. This is how clients start trusting you. Once the clients start trusting you, you have a chance to upsell by suggesting what client needs. If my repeat buyer approaches me and asks for one-page sponsorship proposal, I suggest them to buy a detailed one (covered in my premium package).

4. Always be ready for modifications.

Many times, your clients will have to show the work they get done by you to their boss, senior, or employer. After receiving feedback from their superiors, they will return to you for modification. You must be ready to modify your work as per the provided feedback. You should try your best to cover the modifications in the same price, but if changes required are significantly different than the original requirements, then you should clearly communicate and convince the client to pay the additional charges. Though this hasn't been the case in 99% of modifications I have given to my clients.

How to persuade people to do anything? Aristotle answered.

2020-11-09T04:06:00.007-08:00

Think of the last time you were listening to a speech or story that touched your heart, or even convinced you to take some action or refrain from one. What was the most powerful influential element that attracted your action in the first place, and then hooked you to a point you felt the speakers’ words so real?

The speaker persuaded you to believe what they were saying was true, in a way that aroused emotions in you. We are using and being the target of persuasion all the time. Everyone, from your kid attempting to convince you to allow them one more piece of chocolate to the most powerful politician on earth convincing their people to allow them spend tax money on building a military base in foreign country, is using the fundamentals of persuasion.

Since persuasion is a tool you can use to change people’s behaviors, it gives you power. Even more so if your job requires you to influence people’s behaviors on a mass scale as marketer. Kids, parents, salespeople, marketers, politicians, safely enough, everyone needs persuasion. The real question, therefore, is how to persuade people? Here are the five fundamental principles of persuasion according to Aristotle as he explained them in his "Rhetoric," to answer this question. But before that, we need to clarify a few things.

First, persuasion is a skill effectively anyone can learn. However, some people are more persuasive than others because they naturally possess some or all components (we discuss these components shortly) of persuasion more than others.

Second, persuasion doesn’t either work through emotion or through reasoning. Most of the times, the greatest persuaders are using a mixture of the two. The five methods that Aristotle explained in his “Rhetoric” reflect this point. I understand that you are impatient to know these principles so that you can use them to make people act “your way,” so we turn to these five fundamentals next.

Ethos

Ethos means character. By ethos Aristotle suggested that to be persuader, one needs to establish a character that the audience will feel is credible and trust. This will depend largely on the audience one is trying to persuade. Salespeople, for example, should appear to be experts on the products they are selling. One way effective communicators win trust in their character of their audience is by telling story. Stories are engaging and personal pieces of communication, therefore, they help persuader quickly create a connection with their target audiences. People are more likely to accept requests if they can relate to the one requesting. At the beginning of the article you were asked to recall a time you were moved by a speech. Research suggests the highest chances are that it was because the speaker told a personal story.

Pathos

It is true that people won’t listen to someone they don’t trust or do not think is credible enough in their field. But most of the people would listen and forget if the communication didn’t arouse any emotions “pathos” in them. Emotions help people turn their ideas into action. Besides, people would use the short route to think if they are targeted with emotional piece of information. It can save the persuader time and effort required to change their mind with reasoning. But in some situations, reasoning becomes necessary. Therefore, we turn to it next.

Logos

Logos in rhetoric refers to use of logic or reasoning to persuade people or change their minds. If you are an industrial salesperson trying to sell heavy machinery to a manufacturer, you can’t simply make them “fall in love” with the machine. You will need to present the facts and figures which prove your machine is better than that of competition. This technique is at work when politicians brag that they will bring thousands of jobs to your constituency if you vote them to power. For persuasion to lead to success the reasoning must get along well with the emotional aspects of the communication. The last two elements are not “-os” but they are explained in Rhetoric, and are quite useful tools.

Metaphor

Why do you enjoy comedy? What is inherently different about a joke than a normal conversation is that it compares two things in an expected manner. This surprise makes it funny and likeable. Metaphor is also a comparison used to explain complex things in terms more familiar to the audience. Besides this technical support to explain the argument metaphor adds beauty to communication such as fun in the case of comedy. Advertising and other forms of marketing communication may use metaphor in more subtle ways. For example, Red Bull says: “gives you wings.” But how many people have you seen flying just after drinking it? What the metaphor means is that it gives you energy boost at the same time communicates the intensity with which the speaker wants you believe it’s true.

Zaltman metaphor is a technique used as a way to dig into customers minds to find out how they relate a brand to other objects. In other words, metaphor helps people visualize in their minds what is being said. In this way it is easy for them to understand.

Brevity

Have you ever wondered why Twitter only allows 40-character tweets? Because it wanted to attract people who needed a platform where they could communicate with their audiences briefly and instantly. Most of the world’s political leaders and reputable brands use this platform for brief instant messages. When you see “see more” on a Facebook post, you scroll up faster and don’t even start reading that post! Brevity saves the audience’s time. And as scientific fact we can’t pay attention to anything for longer than 30 minutes. Attention is a useful but depleting resource.

Conclusion

Thus, a one-line formula for persuading anyone anytime is: “Wrap a blend of rational and emotional argument in a brief message (pictures, words and/or sounds), and tell it as a story.”

The 5 S's of Digital Marketing

2020-10-30T01:57:00.006-07:00

Digital marketing has become ubiquitous. Virtually every single company today does marketing of their products online. Since marketing is the process of deciding on what value to provide to whom and then create and deliver the value. The final step is to reap the value to the company from customers. To ensure that digital marketing process is compatible with this mentioned process, there are five fundamentals of digital marketing that must be ensured.

They are more commonly known as the Five S's of digital marketing: speak, serve, save, sizzle, and sell.

Speak

Speak refers to all forms of communication with the customer by the brand and its ambassadors. Communication with the customer is now more important than ever before—ever-increasing connectivity between companies, customers, and customers among themselves demands that brands stay connected with the customer all the time. Customer are no longer brand loyal. Therefore, it is high time companies used digital marketing to speak with their customers. One of the classiest examples of how internet enables brands to speak with their audiences is Tesla’s Elon Musk’s communication strategy. The CEO’s celebrity status on digital platforms, mainly his own Twitter account has enabled him to utilize ‘earned advertising’ rather than paid advertising.

Serve

Serve refers to taking care of all customer needs, especially informational needs. The marketing process starts with the identification of customer needs. The internet has radically improved this stage of the process. Companies can serve customers faster, more innovatively and at relatively lower costs. One such company is Korean retail giant Tesco. Tesco bought Homeplus to turn around shoppers’ experience by creating virtual stores. “Korean retailer Homeplus has invented a novel solution in the form of virtual stores—retail kiosks with life-sized virtual images of real product displays—placed in high-traffic areas such as subway stations, where potential customers will be killing time waiting around.”

Save

The third S stands for all the savings that companies make using the internet for their marketing activities. Tesla does not spend a single penny on advertising. Digital marketing is cost effective and has more reach and impact on consumers; hence it saves on overall process. However, saving means more than just costs. Companies use digital media to avoid a wide array of undesirable events. They use it for instant response to crisis, keep customers from switching, perform competitive intelligence to analyze how competition may steal their customers.

Sizzle

Sizzle, is perhaps the most interesting aspect of internet marketing: creating an online experience which makes customers salivate. Companies use multimedia to an extent where the online content forces customers into impulse buying. Just like the freshly cooked food sizzles (creates a hissing sound and hot steam), and intensifies hunger, brands should make customers want their products there and then as soon as they see them online. Research suggests a strong positive correlation between website aesthetics and impulse purchase. This leads to the final and most valued S, which corresponds to the value reaping function of the marketing process.

Sell

Internet marketing may not be used, in some cases, directly to sell products, but the ultimate goal, virtually every time is selling, making profit and increasing company value. Sales are the tools to get to these goals. Almost all of the Amazon’s sells are made online in all the categories it operates in. For example, Amazon and Barnes and Noble sell 85% the books sold online globally while Amazon has 90% of that share. Thus, companies can make total virtual shopping experience or can complement their physical sales by having a strong digital footprint.

Final thought

These five S's of digital marketing are to used to devise the digital marketing strategy. Companies are increasing exploiting the online resources because customers are also online most of the times, the whole marketing process from reaching out to customers to making them loyal users of the brand can be managed digitally with these five S’s of digital marketing.

Benefits of Virtual Stores: Why Businesses are Investing Heavily in the Technology?

2020-09-29T05:01:00.004-07:00

Benefits of virtual stores to business

Virtual stores are stores equipped with virtual reality technology and provide customers with real like experience while they shop online. These stores are radically reinventing the way companies work by providing an outlet for innovative ways for companies to test new product designs. As Smart phones and QR code technology are becoming more ubiquitous among shoppers, marketers can track shopping habits of an individual to tailor them certain products. Real-time augmented reality advertisements and product testimonials viewed through smart phones are being displayed using the geo-tagged digital information. This technology essentially observes customers as they shop and makes targeted suggestions based on their location, age, and past buying habits. The use of this technology aims to increase impulse buying. It is a good question to ask why businesses would invest so much in virtual stores?

Here we are going to go over some of the top uses (benefits) of virtual stores to businesses.

To attract traffic to real stores

Many companies are placing virtual stores in unusual places. One such company is Korean retail giant Tesco. Tesco bought Homeplus to turn shoppers experience around by creating virtual stores (Plamer, 2012). “Korean retailer Homeplus has invented a novel solution in the form of virtual stores—retail kiosks with life-sized virtual images of real product displays—placed in high-traffic areas such as subway stations, where potential customers will be killing time waiting around.” (Cardinal, 2011). Proctor and Gamble is another company that is testing such virtual stores. It has also set up these stores in subway stations in Prague. These stores help companies attract customers to their real stores or purchase online. Thus, fulfil the ‘sell’ fundamental of internet marketing.

To devise product placement and store layout strategies

Increasingly, companies are using virtual stores to test new product placement strategies. Redesigning or redecorating an entire physical store can be very expensive even probably cost prohibitive. While virtual stores can be used to improve the layout and placement in an actual retail store without having to change the physical store design first. Kimberly-Clark uses this high-tech virtual reality software to design stores (investor.kimberly-clark.com, 2020). The retailer uses this virtual platform to stage different store designs & floor plans utilizing various marketing strategies. Information derived form these experiments is then used to gain customer review to design the actual store layout in the form found to be the most effective while also incorporating the customers’ feedback. A plus point of this process is creating an environment which very customer friendly. This results in good product placement against relaxed customers which in turn is the key to increasing sales revenues.

Creates consumer trust in online stores

Initially virtual stores were created as a way to improve test marketing, such as new product or store designs, but the huge information they gather can also help companies enhance the online shopping experience. Shoppers may be deterred from using online shopping, due to trust issues as they think of product quality, performance may not match their expectations (Bhatnagar & Ghose, 2004). By creating this 3D online store, consumers would then be able to go on the company’s website and feel as if they are shopping in the actual store. Augmented reality can now enable people to try clothes, touch products and even smell perfumes without having to go to physical stores. One example of this could be a person that is shopping for shoes. They might not be able to trust how the shoe will look once they buy and wear it. However, the virtual store’s technology can analyze the foot structure, recommend the best shoes, and then show customer a sample of how the actual show will look on them. For experiencing what they buy beforehand, customers may prefer to go to a physical department store because they know exactly where the shoe department is and can see all shoes on display rather than having to scroll through multiple pages of a website. Therefore, to aid customer, a virtual store allows a consumer to get the in-store buying experience while preventing the hassle of going to the store.

References

Bhatnagar, A. & Ghose, S., 2004. Segmenting consumers based on the benefits and risks of Internet shopping. Journal of Business Research, 57(12), pp. 1352-1360.

Cardinal, D., 2011. Virtual stores help shoppers save real time. [Online] Available at: http://www.extremetech.com/mobile/99033-virtual-stores-help-shoppers-save-real-time [Accessed 11 September 2020].

investor.kimberly-clark.com, 2020. Kimberly-Clark Uses Virtual Reality Technology To Identify Innovations, Gain Insights And Strengthen Customer Relationships. [Online] Available at: https://investor.kimberly-clark.com/news-releases/news-release-details/kimberly-clark-uses-virtual-reality-technology-identify [Accessed 11 September 2020].

Plamer, M., 2012. Tesco trials UK’s first virtual store. [Online] Available at: https://www.ft.com/content/a1cc0fb0-dfd7-11e1-a96a-00144feab49a [Accessed 11 September 2020].

Apple crosses $2 trillion mark, here are the reasons behind sharp growth

2020-08-23T02:33:00.003-07:00

Ahead of its tech competitors, Apple corporation's market value crossed the $2 trillion mark this week. Amazon, Microsoft, Huawei, Samsung, and Google (Alphabet) are also fast-growing tech companies, but for different reasons than Apple's growth.

Amazon's success is mainly attributable to the efficiency with which it conducts its operations. One day delivery, drop at doorstep, and cost-effective delivery methods such as drivers are all parts of that chain. This has allowed the company to attract customers from other large and small online sellers.

While for Google, many analysts believe that its stockpile of information is the main advantage. It leverages information for several purposes, the most profitable one has tailored advertising for other businesses.

But what exactly has driven Apple's growth?

There is no doubt that Apple has its technology strengths including security, performance, and its app store ( for iPhones). Yet none of these features justifies the premiums the company charges given that competitors provide almost the same value for less money. It is the brand's emotional connection with the customers that have made so valuable. The launch of Macintosh, in 1984, and the iconic commercial which introduced the computer were the beginning of such an emotional connection.

The next big event in the company's history was Steve Jobs launching the iconic iPhone in 2007. Jobs himself was a reason that people felt a connection with the company. Somehow both launches mocked the competition--the former mocked IBM's PC and its monopoly over computers, and the latter mocked all the keyboard phones. I do not suggest that mocking competition can help win people's hearts, but what the two events said about Apple and the competition was true. IBM had monopolized the computer market and did not make any revolutionary innovation. While keyboard phones such as Nokia had dominated the market for years without innovation in input methods (touch vs keypad). Therefore, what the iPhone said was welcomed.

Thus the fact that just two years after achieving $1 trillion market capitalization, Apple has doubled its value to $2 trillion dollars to become the most valuable company in the world--Saudi's Aramco had reached this mark but its value went down again due to COVID-19. Although there are grey areas such as Chinese restrictions, and the recent war on Apple's app store initiated by Epic games, Apple's foreseeable future seems bright.

Why does Microsoft want to buy TikTok?

2020-08-07T09:44:00.001-07:00

Why does Microsoft want to buy TikTok?

Microsoft has recently revealed that it is under process of buying TikTok US. TikTok is a Chinese video application that has become very famous around the world. But it has been under scrutiny from Indian and the US governments on the ground that it spies user data as part of Chinese government’s intelligence mission. India has already banned the application and Trump has signaled his administration would consider banning the company’s US operations. Amid these tensions, why does Microsoft want TikTok on its portfolio? Well, there are a few good reasons.

Digital advertising market share

The global digital advertising market is expected to be worth $384.96 billion in 2020, a 16% growth over the last year; while it is estimated to cross half a trillion mark by 2023 to comprise over 60% of the total advertising spending according to e-Marketer. Google takes the lion’s share (70% of Google’s revenue comes from advertising), followed by Facebook. Microsoft does own a video-calling platform, Skype. But it is far from competing Google’s YouTube, and Facebook’s Instagram to drive ad revenues into the company. Now, given that video advertising market is $26 billion in 2020 and estimated to reach 35 billion by 2024 while mobile video would overtake desktop video after 2021, Microsoft desperately wants such video platform as TikTok to foray into the lucrative digital advertising market.

Customer base for existing products

Although Microsoft has historically been focusing on enterprise software solutions (except for Windows Office), it may want to scale down to the lower segment with its products such Xbox gaming consoles—TikTok’s young audience is ideal for the purpose. TikTok will not only give it more understanding of the teenage customers but also provide a platform to reach the segment.

Access to user data

Data is more important now than ever before. Companies like Google and Facebook are building their competitive advantage around user data. It complements advertising function. If the allegations that TikTok ‘spies user data’ are any true, Microsoft wins the bet by buying TikTok. Collected data and user profiling improves user experience as well as operational efficiency by creating tailored products and advertisements.

Final thought

Microsoft’s quest to buy a video application which is on the verge of being banned seems to be driven by the benefits the acquisition is expected to bring: online advertising platform; user data; and a customer base for its existing products.

Is it a good sign that one after another (Huawei) tech company is getting banned in the US? What happens if the US based company buys TikTok? Share your thoughts in the comments below.

What is NOT strategy?

2020-07-31T10:40:00.003-07:00

What is NOT strategy In business and management, the term ‘strategy’ has become very notorious; but unfortunately, not all the mentions come with the right meaning, associations, and interpretations. Thus, it is important to understand what strategy is not rather than only stating what it is.

First, it is important to grasp that strategy—if effective—does lead to accomplishing a long-term goal, but it is not one itself. So, the managers stating their strategy is “to become leader in certain category” are essentially confusing strategy with an objective/goal.

Second, it is tempting to attribute a business’s top position to its strategy, but Michael Porter made an important distinction between operation effectiveness and strategy by referring to the success of Japanese companies during the 1980’s (Porter, 1996). Operational effectiveness helps firms to become most cost effective and hence lead the profitability game. However, such a success is not sustainable because, over time, competitors can also achieve economies of scale, go up on the learning curve, hence, down on the cost curve.

What then is strategy?

Think of the Chess game. Your goal to checkmate your opponent, and there are several combinations of individual moves that can lead that outcome. Which move becomes activated and at what time depends on what your opponent does and how they respond to your moves. Note that in this case, you can do not decide on a particular combination and insist on playing even if, due to competitor’s choices, the combination becomes irrelevant. Instead, you have a favorite combination—or two even several—and you use them in contingencies. When you play this way, over time, some useful generalizations would surface; for example, you might come to recognize that you are a better defender/attacker.

Strategy is analogous to this; moves representing activities, checkmate representing success, and combination representing the firm strategy.

Therefore, strategy is a deliberate choice of set of activities that firm picks to perform for creating superior value for its customers either in the form of premium product, lower cost, or both. Strategy has long-term implications for the firm. Strategic decisions are either impossible or difficult to reverse. In a firm there are marketing, human resource, operations, customer, and many other forms of strategy each necessarily consistent with the overall business strategy which in turn needs to be consistent with the corporate level strategy.

Porter, M. E. (1996, December 1). What Is Strategy. Harvard Business Review.

Zoom’s success: what's so humanistic about a cloud meeting software?

2020-05-06T06:46:00.004-07:00

Most probably you have heard of video-conferencing/cloud meeting platforms like Skype, WebEx, GoToMeeting, Microsoft Teams, and Google Hangouts, to name a few, that have been helping people connect online to hold meetings, share content interactively, and even host and join social events. But you might be thinking “yes but I have also heard about Zoom!” Yes, you are right. Zoom has been hearing you a lot recently, after all. Isn’t it?

We might unanimously agree that none of the other similar platforms had an impact on us as great as this app has left in a matter of days. Well, that’s understandable: a friend in need is a friend indeed. The Covid-19 pandemic shockingly forced everyone of us to distance ourselves from our loved ones, coworkers, neighbors, companies, universities, and social gatherings. For most of us, it was deeply saddening. Timely, Zoom joined our life, and we loved its entry.

While on the one hand, it is true that our lifetime perception of brands is greatly affected by the situation we met the brand for the first time, the fact that Zoom had done a lot of good work already is prominent on the other; especially the vision of the man behind it—Zoom CEO, Eric Yuan. And this is the reason, I believe, the platform will continue to be part of our professional and social life when the quarantine is over. We will talk about other reasons too, let’s first look at what makes the brand so humanistic and empathetic—otherwise a mere software package.

Eric Yuan left China in the late 1980’s with the vision to use technology to create a handy, easy, affordable and portable platform for users to connect online mainly through video-based interaction. Eric worked with WebEx as head of engineering for several years and brought it to top until Cisco bought it for $3.2 in 2007. Eric continued with the WebEx under Cisco and kept leading it to success. During his time at WebEx, Eric learned to be customers centric and deeply empathetic towards customers—which WebEx was not. Analysts now believe that WebEx was booming because there wasn’t much competition in the video-conferencing segment despite Microsoft and Google’s presence.

With this knowledge at hand, and the vision in mind, Eric left Cisco to create a new platform which improved on WebEx’s deficiencies, and he did it. In January 2013, he finally launched Zoom. Eric’s vision turned to be the purpose behind the platform. So, now you get what is behind, the ease, speed, features, and cost at which Zoom has been helping you. Let’s now talk about Zoom’s success.

It’s no surprise then that Zoom’s stock skyrocketed 67% form start of February to end of March 2020. Some people might be skeptical of this jump attributing it to the 30 times increase in the app’s daily downloads due to the Covid-19 forcing people to work and study from home. Understandably, they will question the sustainability of this success of a company that just went public in mid-2019. But here are a few things that suggest Zoom will continue to be the best video-conferencing platform although active users will significantly drop once the quarantine is over.

First of all, the brand has got a high recognition and affiliation with people worldwide by connecting them in time of isolation; companions of hard times are remembered longer. In fact, people are arranging birthday parties, meetings, dance, and yoga sessions, and even weddings on Zoom, they are creating memories with it which is especially good for a brand’s relationship with consumers. It is also being associated with a hallmark event thus has a greater impact on our minds and better chance of recall later. For example, one teacher commented “I am going to use Zoom to take a class when I can’t join physically, previously, I took make up classes on such occasions which neither I nor my students liked.” I am sure going to opt for Zoom in my professional life, just because I am using it as a student.

Second, Zoom’s features, value for money, focus on video (unlike Skype which was an audio app and then adopted video), lower data requirement, and mobility were all being praised long before Covid-19 outbreak—2014. Zoom was constantly improving some very important videoconferencing metrics including lag between video and audio, eye contact, and ease of interface even when no one saw this pandemic coming. The company was valued at $1 billion in 2017.

Third, most of the businesses, government agencies and universities are learning it the hard way that distance learning and work from home are very crucial steps to be taken. Consequently, most of the post-corona world will be digital with business meetings and learnings of virtually all kinds happening online. Thus, market for video-conferencing and cloud meetings is likely to increase rather than decrease.

Finally, in terms of features, price, brand recognition, and connection with customers, Zoom has surpassed competition. This position of the brand is becoming hard to beat for the closes of its competitors, including players such as Microsoft (Teams and Skype) and Google (Hangouts).

Boom! Praise is over and other side of the coin pops: Zoom faces a bunch of risks that can impact its valuation and performance adversely. Worst even, from a friend it can turn into a nightmare for users if the concerns raised about its security by Apple turn out to be true. Employees and students also feel privacy as main issue because lectures and meetings are being recorded not really with the consent of all the stakeholders.

Final thought

Zoom as a brand has taken the world with storm, for its recent boom, the Covid-19 is being credited but the author is of the view that it had done all its hard work, it just met opportunity now. For the same reason, it is argued that Zoom's success will be sustained as world shifts to a more digitally advance and connected while physically distant place.
How zoom has recently helped in you? Or you have concerns regarding safety and privacy over the platform. Let us know your opinion in the comments below.

Thank You For Smoking: the movie lesson "marketers' self-esteem matters"

2020-05-01T12:14:00.000-07:00

No matter what you have become now, if you are anything like an average person, it is very likely that you doubted yourself at some point in your life. Self-esteem is an important psychological
asset one can have. Several factors contribute to its development it affects several life outcomes in turn.

Psychologists have researched self-esteem thoroughly, and there are several studies that show that self-esteem is associated with many positive outcomes in our lives including positive interpersonal relationships, academic success, career success, and others (Kammeyer‐Mueller, Judge, & Piccolo, 2008; Bagozzi, 1980). Another construct associated with self-esteem is self-confidence which tends to be byproduct of high self-esteem.

In case you didn’t know, self-esteem is an individual’s overall evaluations of themselves; how they see the person within themselves, while self-confidence is the degree to which an individual believes they are doing the right thing and that they can do it.

For people who constantly need to approach, persuade, and negotiate and interact with other people—lobbyists not the only ones, wait yet—being self-confident is quintessential.

Here are some movie lessons from “Thank you for smoking” for marketers and salespeople. I admire the movie for teaching me the lesson: “for marketers, especially those in advertising and sales, self-confidence and a strong belief in their own life and what they do is necessary.”

In the movie, Nick Naylor (Aron Eckhart) is a lobbyist who argues with the public, government agencies, and media for the so called ‘cigarette mafia.’ He is repeatedly questioned about his job—which supposedly kills 1200 people a day! At one point Heather asks him: “No, I don’t imagine that’s a problem. I want to know how you see yourself.” Nick immediately replies: “I’m a mediator between two sects of society that are trying to reach an accommodation.” That’s the way he sees his ‘killing’ job.

As working adults, our jobs are the activity that consumes most of our time. And how satisfied we are with our jobs depends on how we see them. Thus, job becomes an important factor affecting our self-esteem and our self-esteem also determines how satisfied.

Marketers and salespeople are some kind of a fraud. You don’t even need evidence for that, because that’s how you think of them. They are blamed for false claims, selling people things they don’t need, and manipulating people—which may be part truth but we are not going into that debate. So, how can they protect themselves from guilt which leads to dissatisfaction with your job and results in career failure?

Thinking on the bright side of your job and not the one people point out to is the real hack to stay satisfied with your job. Nick Naylor is really satisfied with his job. He replies to critics saying: “Michael Jordan plays ball. Charles Manson kills people. I talk. Everyone has a talent.” This means he is clearly proud of his talent: talking.

We know that marketer’s jobs in general and salespeople’s in particular are challenging jobs. The skill of self-esteem and believing in meaningfulness of your job as a marketer would matter. At another instance, Nick N. says: “I like a challenge. If you want an easy job, go work for the Red Cross.”

An important and specific lesson for Public Relations people is arguing correctly. This is suggested by the statement: “That’s the beauty of argument. If you argue right, never wrong.”

Conclusively, what we learn from this movie, and our experiences in fact, that for people whose jobs are challenging and considered by the society a threat to the community need to be more self-confident, self-believing. Loving one’s job is just one, there can be many other things to learn. Note that our assumption is that you are satisfied with your job, people’s taunts are the only problem.

References

Bagozzi, R. P. (1980). The Nature and Causes of Self-Esteem, Performance, and Satisfaction in the Sales Force: A Structural Equation Approach. The Journal of Business, 315-331.

Kammeyer‐Mueller, J. D., Judge, T. A., & Piccolo, R. F. (2008). Self‐Esteem and Extrinsic Career Success: Test of a Dynamic Model. Applied Psychology, 204-224.

If we were a few steps ahead in digitalization, would corona effects be less?

2020-04-01T08:34:00.002-07:00

While appearance of the corona virus Covid-19 is unrelated to how digitally advanced our world is, its spread should have something to do with how day to day transactions among people take place. The Chinese city Wuhan’s experience has suggested that despite an
environment where people do most of their transactions online from their jobs to shopping, the spread was inevitable because nobody knew initially that the virus was being transferred from one person to others. However, once that was discovered, common sense suggests that a world where people were digitally connected and physically distant, rest of the world could have prevented the spread viably.

You might have heard expert sociologists and analysts blame digital marketing revolution to have created a social distance among people by providing them opportunities to work, shop, and conduct business from home. So, the hypothesis that a more digitally advance world could have prevented the outbreak seems to have some truth. The internet revolution means people communicate increasingly online from distant locations substantially decreasing physical contact among people.

Digitalization affects businesses in two important ways: it affects how employees and other people working in the company interact; and how customers interact with the business and other customers. Some businesses have a digital model which significantly reduces customers' physical interaction with the business by accepting orders and payment online and then delivering products to home. Amazon is an appropriate example of this. But as you might have guessed, Amazon still employs many people who are working with it physically all the time. Because, lockdowns and curfews mean no or little transport, home deliveries might still be a problem for such businesses.

The other type of businesses is the reverse of the first category—they let their employees work from home but the customers still have to reach out. In both cases, however, physical interaction among people decreases.

With the fears surrounding the virus, people are themselves avoiding crowds and are trying go out less and less besides the lockdowns and shutdowns forcing them to stay home.

Moreover, as these data from e-marketer suggest, customers are more likely to avoid visiting a store than shopping online. This also implies that people are willingly shifting towards online channels; customers perceive them to be safer. This does come with some logic in fact because doctors are strictly suggesting social distance and preventing going out.

So, what we are trying to understand is how the situation would have been different given more regions and economies were digitally connected; for example, 80 or 90 percent of customers shopping online and larger share of worldwide employees working from home. The above-mentioned facts suggest that this outbreak should have impacted less adversely had the customers, business, NGOs, and government agencies been more digitally active rather than reliant on physical connectivity.

There are several side effects of the virus to consider, however, that affect online business at least as bad as brick-and-mortar. First, lockdowns—curfews in some countries and regions—mean no transport, which means products can’t be delivered to homes. Second, for some businesses a large number of employees have to come to work physically even if the outbound supply chain is digitalized as we talked about Amazon earlier. Third, and the most significant, supply chains are what is most affected by the outbreak. Even if a business is solely online, it still has to depend on suppliers, transporters and other supply chain partners that are shutdown due the corona virus outbreak.

Thus, while it is yet difficult to conclude if a more digital world would have been less severely affected by the virus or that containment and prevention would have been easier, what is quite evident is that the overall economic impact would have been less and recovery would have been faster in such a fortune situation.

Marketers can help the world win corona-fight

2020-03-27T08:45:00.000-07:00

With one of the deadliest and fast spreading viruses the Covid-19 still getting powerful after three months of its appearance and death toll crossing over 197,297 globally, many people are desperately
‘looking up to the skies for help.’ All the influential groups and communities—notably governments—are trying their hardest with little success globally in controlling the virus. While there aren’t perhaps any magic ways to contain or fight the virus, businesses—particularly their marketing departments—can be very successful agents in this fight against the ‘hidden enemy’ as Mr. Trump named it.

Marketers are thought to be a culprit behind several wrongs in the society including manipulating people to buy into their arguments. Many people are quick to point out that big corporations have the power to influence people’s behaviors. There are loads of allegations that argue that marketers manipulate people and persuade people to buy things they don’t need by creating needs that don’t exist. I endorse this point of view to the extent that marketing function of companies as whole has the power to influence people to adopt certain behaviors and quit others; and this article bases its argument on this.

Following are the reasons to believe that marketers can help the world to stop the disease from rapid spread and adverse effects on the populations around the globe.

Access to the right media

Almost all contemporary businesses have either their in-house marketing departments or they hire other separate businesses called the “creative agency” to look after their marketing function wholly or partly. Further, they have contracts signed with powerful and frequently accessed media channels. This can be helpful in designing and conveying the right message to the public. Mercedes Benz’ poster ad given in the picture is an example of how companies can disseminate right information without incurring marginal costs, because they have the necessary expertise and channels.

Knowledge of peoples’ behavior

To influence people’s behavior, it is quite essential to first know how they behave. Companies have detailed knowledge of customer behavior, and customer touchpoints and bottlenecks more than any other agency or government because of their extensive market research. Companies like Google, its subsidiary YouTube, and Facebook are the prominent examples of companies with useful customer information and access to billions of people online. These companies along with Twitter cosigned an agreement to fight online misinformation and spread the right information among publics to aware them about the hazards, symptoms, and prevention from the epidemic.

It is a different argument though that misinformation is so much so that there still is plenty of it despite these companies’ efforts to eradicate it.

Financial and human resources

With several companies’ individual revenues equaling countries’ GDPs, big corporations and small businesses have the right resources necessary to fight any crisis. Companies spend large sums on their advertising annually, these funds can be channeled to provide for the medication and prevention of the virus. In Europe, Ferrari was one of the first companies to donate €10 million to help Italy fight Coronavirus pandemic in the beginning of March. This was a marketing decision as it was intended to boast company image and stakeholder relations. The charismatic owner and CEO of Tesla Motors in USA announced that their workers could stay home if they were afraid of corona or felt any symptoms. He further ensured that they would get paid time off (PTO) for up to 60 hours during the outbreak.

Conclusion

Businesses are one of the most affected stakeholders in the situation of crisis of any kind, but they can also be one of the most helpful agents in getting the world through the crisis. Past experience suggests that the companies with more effective marketing have survived crisis and fared better in troubled times. So, marketers should better sharpen their axes and roll their sleeves to prove to the world that their jobs are meaningful and positive rather than manipulative ones. World should also expect better from this sect of the society.

The Elusive Nature of Digital Economy and Its Marketing Implications

2020-03-16T11:00:00.007-07:00

We listen jargons like “digital marketing, online business, digital footprint, search engine marketing” and a lot more nowadays. But do marketers really get the subtlety of this new ‘click-marketing’?
There is no denying the fact that the paradigm shift towards a digital world is underway and is headed towards its peak. Digital Economy Report 2019, published by the United Nations Conference on Trade and Development (UNCTAD) suggested that estimated 1.3 billion people, or one quarter of the world’s population aged 15 years and older, shopped online in 2017 up 12% from 2016.

Businesses and consumers are moving from a traditional way of interacting and transacting towards a virtual and web-based one. The digitalization is drastically altering the way marketing works. Particularly, how brands advertise themselves and reach new customers is changing. While we increasingly talk about the importance of digital footprint of brands out there, we might be overlooking the elusive nature of the digital economy. So, what exactly is ‘elusive’ about the modern digital consumer, or, more generally, about the overall digital environment in which marketers must operate? Here we will go over some data that would at least make marketers question the blind belief in digitization and convince them to approach it with more vigilance to get better results out of their digital investments.

Gaps in the access to the internet

Half the world’s population was still offline in 2019, one in five people was online in the Least Developed Countries (LDC), and gender gap in the access to the internet is still the widest among the LDCs!

Most of the digital economy is concentrated in the US, China, and some European markets. Almost 90% of the market capitalization value of the 70 largest digital platforms goes either to the US (68%) or China (22%); while Europe stands on third at 3.6%. These markets we know are mature economies and offer less potential for growth to the cross-border operating companies. However, developing economies including Pakistan are still facing critical challenges in inclusion to the digital world. While at the same time, these markets possess high potential for growth for the global giants. From the perspective of the national marketers (inside out approach), Pakistan still has some good internet penetration and digital media statistics. But if compared it to the overall world (outside in), it is far behind. This also implies an opportunity for the growth—internet penetration might increase as well as the gender divide between males and females using internet might also decrease over time. But what marketers right now need to consider is that online marketing strategies will have to be adapted to the prevailing situation. For example, in an area where small proportion of female population is online, marketing mix strategy of a cosmetic brand (Dove for example) will have to be significantly different than if a larger proportion of female population used the internet.

In addition to the differences among regions, within-countries differences are also prevalent; and those gaps are wider in the developing countries including Asian countries except China. Connectivity varies with socioeconomic status, and geographic location. Developing countries show a divide in urban vs rural groups with respect to access to the internet. According to the International Telecommunication Union (ITU) statistics, approximately 89% of urban households had a mobile phone compared with only 63% in rural households in 2018 in the LDCs.

More upsetting is fact that the gap between internet penetration in the developed and developing markets has not narrow over a considerably long period. Look at the graph in figure I.11.

Gender gap in the access to the internet

Another prevalent gap that marketers should be concerned about is between the proportion of male population with access to the internet and that of female population. This gap is almost 11.6 per cent for the world in 2019. As mentioned earlier, this gap is wider in developing countries where it is 16.1 per cent compared with only 2.8 per cent in developed countries. The highest gaps exist in LDCs (32.9 per cent).

Note that these gaps increased between 2013 and 2017 for LCDs, African, and developing countries.

Unreliability of data

Well to me, the foremost advantage of online business—at all stages of the marketing process—is the handiness with which consumer data can be collected. Marketers collect data on several important variables while consumers complete their online purchase (or just visit a website). Such data are then processed and turned into valuable insights about customers’ behaviors and demographics. If a marketer misses this point, do you think digital footprint of their business won’t mean anything? Researchers Patricia Al-Salom and Carlin J. Miller from University of Windsor found that participants filling surveys online as compared to offline (in a lab with paper and pencil) data collecting provided data less reliable. The data collected online failed more validity checks as compared to the same collected offline. Note that I am not suggesting that data collected online are useless or should not be used to assist decisions, in fact it is otherwise. However, it is a fact that such data are relatively less reliable. And it challenges the notion that assigns overinflated importance of online data collection.

Other psychological hurdles

Consumers express several other reservations with online purchases which they would never raise if making the same purchase online. For example, 57% of users will abandon a website after waiting for 3 seconds and 80% of them will never return. Security and privacy are other main concerns. According to SmartInsights.com, 59% of American consumers will abandon a transaction if they can’t find their trusted method of payment, and 80% consumers feel safer engaging in a transaction if they find trustworthy card logos for payment. Facts such as these show that online marketers must put extra effort to hook consumers to their website or page.

E-commerce Index is one measure based on four criteria—account ownership at a financial institution or with a mobile-money-service provider; share of individuals using the Internet; Postal Reliability Index; and secure Internet servers—which measures how ready a country or region is for e-commerce. Look at the following table from UNCTAD B2C E-Commerce Index 2019; it once again shows that developed countries lead while African and Asian, developing countries lag.

Conclusion

In a global perspective of digital marketing, digital economy is more elusive than it seems. Because almost everyone believes it is an easy opportunity to grab, they miss it. Only those who take it as a challenge to overcome, and more importantly work to solve it subtly, are the ones to understand.

Why making your brands controversial isn't so bad idea.

2020-02-29T01:43:00.000-08:00

Why making your brands controversial isn't so bad idea.

In my view, there are two types of brands. First, the brands that stand on the shoulders of masses. Tesla, for example, is very close to people, it is into them; it makes and markets people’s cars—or the planet’s cars as you may call them. Second, the brands that do not mind stepping on people’s toes. As an example of this, I would love to talk about General Motors’ Hummer Pick-up truck which was
notorious throughout 2000s and died when the brand’s parent company GM went bankrupt during the famous 2007-08 financial crisis. However, both of these brands can be successful regardless of category they belong to. This article focuses on this latter category and maintains that a brand with a divided attitude towards it among people is not actually as unprofitably devilish as most people think.

If you try to recall, you might come up with dozen brands in your surrounding markets which tried to go against the opinions of masses—intentionally or otherwise—and got severely punished for such ‘rebellious’ acts. Most of them would revert their actions fearing loss of reputation and brand equity, teaching marketers the lesson that rebellion is not everybody’s cup of tea. This implicitly reinforces the notion that going against the opinions of masses is always harmful and can never pay off. I challenge this latter mindset with real time examples and references to the works of known scholars.

The muscular and militaristic Hummer

Arnold Alois Schwarzenegger has been in the headlines in Pakistan lately for inviting Prime Minister Imran Khan to AustrianWorld Summit 2020. He is said to be the man behind the civilian version of the US military’s High Mobility Multipurpose Wheeled Vehicle (hence the nick-name Humvee). The trucks caught headlines when they were seen foraying like lions in the deserts of Iraq during the first Gulf war. They were carrying US military troops and artillery.

Schwarzenegger was reportedly shooting a movie when he saw the convoy of the trucks in a garage; that was when he decided to drive one. He later lobbied AM General (Humvee was initially developed by this company) to build him the vehicle. But the design was not street legal in the US at that time. So the company had to build a modified version of the vehicle named Hummer in 1992. In a short period of time, the truck outperformed almost all brands in the passenger vehicle segment and became very popular around the US during 2000’s. According to CNBC, Americans bought 715,524 Hummers in 2006 alone. Every celebrity owned a version of Hummer. The General Motors bought the brand in 1999 and launched smaller extensions H2 and H3. But how was the truck controversial if it was so successful? And why did it vanish despite such popularity?

The first and foremost reason for the brand’s polarizing nature was its militaristic origin and the fact that it derived its bold and aggressive look from being a ‘war-truck’. Because many Americans were against the war, they hated the idea of a vehicle being liked for its militaristic origins. The second reason was more of a practical concern than a sentimental one; the Hummer was aptly named as ‘gas guzzler’ by many outraged Americans who believed that the Gulf war had caused fuel prices to go up, so Hummer H1’s 10mpg was seen as a terrible monster. This issue coupled with the uprising from environmentalists heated so much that activists and protesters set number of Hummers on fire and vandalized them with writings such as ‘Gross polluters’ and ‘lazy fat Americans’. But that was not all. The real reason of Hummer’s disappearance, I, besides many analysts believe, were the rising gasoline prices ($4.18 per gallon in 2008), the recession, and the vehicle’s fuel inefficiency. GM discontinued the brand as part of ‘brand-firing’ process in which it divested several other brands (Pontiac, Oldsmobile, and Saab to name a few) because it did not have the resources needed to support these brands. GM filed bankruptcy in 2009 to later get the controversial GM bailout. So to conclude, Hummer’s controversial personality won it name, fame and profits; it simply made it successful. And, it was the other economic factors such as the recession and the war that hit it so badly as to throw it out of the business. This bet will become cleared up in a few years because GM’s subsidiary General Motor Company has announced that it is bringing Hummer back as a fully electric vehicle with ‘no sound’ as they showed in their Super Bowl 2020 commercial for the upcoming model expected in 2022.

Apple’s Macintosh 1984

Now, who doesn’t know about Macintosh and its so-called ‘controversial launch’ commercial “1984?” Apple openly challenged Microsoft’s ‘big brother’ (PC) in its Super Bowl commercial which announced the company was bringing Mac to tables. The spot was based on a political satire, 1984 by the 20^th century’s well-known author, George Orwell. The novel’s theme was the mind-controlled world of 1984. In the commercial, an audience of brainwashed and mind-controlled, gray-skinned skinheads (members of exploited working class from the streets of London) watched a big screen image of “Big Brother” sounding off an ideological harangue. Meanwhile, an athletic young woman threw an axe at the screen. With the destruction of the big brother came in light and fresh air. At the end, a bold man’s voice-over said aloud the words on screen which read: “On January 24th, Apple Computer will introduce Macintosh. And you’ll see why 1984 won’t be like ‘1984’.” What was the message? It was “Mac will destroy the traditional big brother (PC) and it will change the world.” Moreover, the rebellious athletic women was a portrayal of the ‘rule-breaker’ and ‘think different’ Apple user. Lee Clow, the creative director of the agency that crafted this commercial said in an interview with Bloomberg: “What makes something memorable? I think the challenge has always been to break the rules, find something new; find something unexpected, as a way of engaging people and telling story.”

Douglas Holt of Harvard Business School in Boston, dedicated a whole article “What Becomes an IconMost?” to this argument. He argued that brands that speak the rebel’s voice and create, rather than follow, ideologies and culture are the ones that become the Icons. He said “Icons don’t seek to mirror the thoughts and emotions of their customers. They speak as rebels. To assemble a populist challenge to the national ideology, iconic brands draw on people who actually live according to alternative ideals.” Now what he meant was that the iconic brands will always stay on the side of those who challenge the common narratives. He further said “And icons don’t simply borrow the trappings of rebel lifestyle, mimicking their clothing or language. Rather, they understand the rebel’s point of view so well that they can speak with the rebel’s voice.” It becomes evident then that distancing away from the culture will become disastrous since you won’t be able to understand the culture and what its alternative ideals would look like.

Coca-Cola’s refusal to ban plastic use

It is almost useless to mention here how powerful the schools of environmentalism, green marketing, responsible business, and planet friendliness are nowadays. But, would it surprise you if I told you that Coca-Cola rudely refused to ban the use of plastic because it believes its customers want it to be around? Bea Perez, Coca-Cola's senior vice president and communications and sustainability officer, told BBC "Business won't be in business if we don't accommodate consumers. So as we change our bottling infrastructure, move into recycling and innovate, we also have to show the consumer what the opportunities are. They will change with us.” According to Forbes, the company has plans to switch to 50% plastic though, and that only by 2030. Now which choice do you think could force Coca-Cola out of the business, believing the popular ideology of greenism and displeasing its rebel consumers who don’t buy into the popular narrative or staying with the rebels and antagonizing the giants including the one that reported in 2019 that Coca-Cola, PepsiCo, and Nestlé were among the top plastic polluters in the world for second year in a row?

By the way, what about the “Any publicity is good publicity” type arguments. Although this might appear to be something shallow and unscientific, there is evidence from our local markets that suggests that even negative publicity helps brands generate online word-of-mouth, reach broader audiences and create brand awareness. These tactics actually work because such a company approaches the masses and spouts to their ears: “there is a company called Careem which has gone against the society’s marriage norms.”

Final thought

Now we have seen some of the most vivid examples of how brands glisten by standing on the shoulders of rebels not masses. Having the divided opinion about your brand, and sometimes brightly so, is not always harmful. In fact it can be beneficial as has been in the case of most rooted brands like Apple, Hummer, Coca-Cola, Mountain Dew, Nike and others. The only thing marketers need to take care of is to be really close to the culture, learn it, identify the ideas that are annoying some rebels and then carefully craft some myths that provide these people an escape from popular narratives.