E-Marketing: A new approach to the new economy

Jonika Kromidha
Stavroula Krypotou
Department of Business Administration
PgD/MSc in International Marketing
250, P. Ralli &Thivon, 12244 Aigaleo
E-mail: kromidha@yahoo.com
E-mail: skrip@hotmail.com

Abstract
With increased globalization of the world economies, for most enterprises market
opportunities seem to be endless. Departing from the traditional marketing, innovative
managers are looking for unique ways to compete more effectively on a local,
regional and global basis. This is being shaped by advances in digital telephone
networks, interactive cable television, on line services, personal computers and
Internet. These technological advances inevitably change the face of marketing. Their
attributes may be utilized for a successful marketing presence, serving the audience
and reflecting the companies strategies. The fundamentally different environment for
marketing, that it is provided by Internet, requires different approach. Organizations
find more and more important to represent themselves on Internet to get more
customer, to increase the publics awareness of the companies and their products, and
to sell more of their products. Used properly, Internet and electronic marketing can be
powerful source of competitive advantage in global markets meanwhile interactive
technologies will have become a mainstream component of shopping for most
consumers.

The paper concludes that electronic marketing has become an accepted part of
marketing concept, it should be seen as a valuable and complementary tool, and
managers should embrace new technology in order to create greater value for
customers. Marketers need to evaluate their electronic offering regularly in order to
ensure that it meets customer needs and utilizes technology to the best effect.
Electronic marketing does not yet have the potential to replace traditional marketing.

This presentation will provide a source for anyone interested in e-marketing, and will
help to stimulate not only the interest in the area but also to be the base for future
research of effects that e-marketing has on e-users.

1. Introduction
Although electronic commerce can embrace the execution of transactions using any
electronic media, the literature refers only to Internet or web marketing. According to
Harridge-March (2004) if mobile telephones, digital TV are to be used as tools with
which to access the Internet, the term Internet marketing is not so correct, and the
term interactive marketing or electronic marketing is more appropriate.

E-marketing is the use of electronic data and applications for planning and
executing the conception, distribution, promotion, and pricing of ideas, goods, and
services to create exchanges that satisfy individual and organizational objectives. It
affects traditional marketing by increasing efficiency in traditional marketing
functions, and the technology of e-marketing transforms many marketing strategies
(Strauss and Frost, 2001).

Many papers have been written, including those devoted to the use of e-marketing in
transaction and payment completion, individualized and real-time pricing issues, disintermediation, data mining and manipulation, examining individual customer
behaviors, and relationship-building and some of them have gone as far as suggesting
that there is a new marketing paradigm for electronic commerce (Hoffman and
Novak, 1997).

E-marketing as a latest type of marketing has been considered in an attempt to

evaluate it, using the familiar seven Ps of promotion, price, product, place, process,
physical evidence and people (Booms and Bitner, 1981) and its potential contribution
to the marketing practice.

2. E-marketing
2.1. Characteristics of e-marketing
E-marketing is similar to traditional marketing but it is very important to know the
characteristics that distinguish this environment form the traditional marketing
environment (Pride and Ferrell 2004):
Addressability. E-users through the Internet have the possibility to identify
themselves and provide information about their product needs and wants before
making a purchase. The ability of marketer to identify customers before they
make a purchase is called addressability. Addressability as the ultimate expression
of the marketing concept allows marketers to tailor marketing mixes more
precisely to target customers with narrow interests. (Pride and Ferrell 2004).
Interactivity. Interactivity allows customers to express their needs and wants
directly to a firm in response to its marketing communications. Of course this
interaction existed on traditional marketing but now marketers can interact with
prospective customers in real time and at lower cost. Interactivity allows
customers to communicate with other customers and non-customers so the amount
of information possessed by e-users and marketers are greater.
Memory. Another distinguishing characteristic of e-marketing is memory which
refers to a firms ability to access databases or data warehouses containing
individual customer profiles and past purchase histories and use these data in real
time to customize its marketing offer to a specific customer (Pride and Ferrell
2004).
Control. Control refers to e-users ability to regulate information they view as
well as the rate and sequence of their exposure to that information. Web site is
seen as a pull medium as e-users determine what they view at web sites whereas
TV can be characterized as a push medium because the broadcaster determines
what the viewer sees once he or she has selected a particular channel (Pride and
Ferrell 2004).
Accessibility. The ability to obtain the amount of information available on the
Internet is referred to as accessibility. E-users are much better informed about
firms and their product because they can access in-depth information through the
Internet (Pride and Ferrell 2004).

 Digitalization. Digitatization is the ability to represent a product, its benefits as

digital bits of information allowing marketers to use the Internet to distribute,
promote, and sell those features apart from the physical item itself. Digital
features are easy to mix and match to meet the demands of individual customers
(Pride and Ferrell 2004).

2.2. The 7 Ps of e-marketing

Promotion

Telephone marketing, mobile telephony, e-mail, digital TV and the Internet have
supplemented the traditional tools of promotion. In order to maximize their
effectiveness cohesive integration is needed (Cornelisessen and Lock, 2001).
One of the characteristics of e- marketing is the control. So customers who visit a
firms Web site are there because they choose to be, which means that they are
interested in the firms products and therefore can be at least somewhat involved in
the message and dialogue provided by the firm (Pride and Ferrell 2004).
Second the interactivity characteristic allows marketers to enter into dialogs with
customers and learn more about their needs. This will help in tailoring promotional
messages to the individual e-users (Pride and Ferrell 2004).
Ghose and Dou (1998) found that the more interactive the website, the more likely it
was to be rated a top site.
Even minor peripheral cues such as pictures and background color could influence
consumers response to a site (Mandel and Johnson, 1999).
1

Advertising

Today, aided by banner advertising, pop-up boxes, and links from other sites,
communication with the target audience is made easier. Advertising is made also
possible by the purchase of banners and/or pop-up messages on sites, such as portals,
owned by other people. Customer aversion to such messages has guided some service
providers turning away advertisers, as with the announcement from America OnLine
(AOL) that pop-up ads would be ditched from new versions of its software (Carter,
2002) urged by the perception of these messages as being irritating or annoying
(Rettie et al., 2002)

2 Sales promotion
Sales promotion techniques such as buy-one-get-one-free may be difficult to replicate
in the virtual environment. But e-users have the possibility to download and print
coupons.
A survey by NPD Online Research found that 49 percent of Internet users who use
coupons are aware of online coupons, and 87 percent say they plan to use online
coupons in the future. Of those who use online coupons, 55 percent are aged 25-44,
45 percent are male, and one-third have a household income greater than $75000
(CyberAtlas, 1999). Such research suggests that online coupons have a strong future
(Pride and Ferrell 2004).
3 Direct marketing
The scope of direct marketing is to gain a response. This is helped by the advantage of
Internet to draw such responses in real time interaction with potential and actual
consumers as well as enabling intra-customer communications. It may be logical to
suppose that the tailored messages and offers which are made possible via the Internet
would mean the ultimate in one-to-one marekting, as originally espoused by Peppers
and Rogers (1993), giving so the possibility for better and stronger relationshipbuilding.
Also addressability can make marketing efforts directed at specific customers more
effective. Direct marketing combined with effective analysis of customer databases
may become one of e-marketings most valuable promotional tools (Pride and Ferrell
2004).
4

Publicity

Internet news releases have been seen as one of the most effective means of getting
wanted news. Instead of pushing out information to the target audience by using press
releases, todays PR executives have to rethink strategies and pull the audience in
towards them (Fane-Saunders, 2003).
5

Personal selling

Personal sales people are very important in traditional marekting. Internet can take
over some of the activities offered by the personal sales person (e.g. accepting
purchase orders). On the other hand some activities such as competitor research,
customer service activities pre-transaction (Porter, 2001) etc cannot be replaced by
technology. For many consumers the lack of personal interface may be detrimental
(Harris et al., 2000). On the other hand if organizations have the facility for questions
4

to be answered in real time can help alleviate consumer concerns (Harridge-March,

2004).

Price

One of the most important characteristics of e-marketing is accessibility allowing so

consumers to have more information about the cost and price of products than has
ever been available to them before. So e-marketing facilitates both price and nonprice
competition (Pride and Ferrell 2004).
E-users have the possibility to check, compare and negotiate prices in shorter time
scales. So customer become more empowered and the issue of pricing in electronic
markets has become a pressure point for e-marketers (Ancarani, 2002). According to
Bromage (2001) online shoppers buy online for convenience rather than for price
advantages. On the other hand Bevan and Murphy (2001) argue that as the price can
sometimes be perceived as the value that the customer puts on the product, it is
therefore essential that the customer perceives that they are getting value for money in
what is being offered, which may include convenience, efficiency and excellence.

Product

Through e-marketing strategies companies can provide products, services, ideas

offering unique benefits and improving customers satisfaction. The online marketing
of goods such as computer hardware and software, books, videos, CDs, toys,
automobiles, and even groceries is accelerating rapidly (Pride and Ferrell 2004).

Process

The process by which customer receives a service is discussed in marketing literature

(Shostack,

1984).

Interactive

media

have changed the service processes

fundamentally. It assists pre-purchase searching, and it removes the personal

interaction experienced by telephone marketing or retail stores. The process of paying
remotely is still subject to consumer concerns (Evans et al., 2001). What is interesting
about the virtual market place is that the user, rather than the organization, is in
control of the process (Robins, 2000) and little thought has been given to measuring
the effectiveness of these process changes (Jones and Kayworth, 2002).

Physical evidence

The physical evidence element of the marketing mix refers to the tangible expression
of a product and how it is purchased and used. In an online context, physical evidence

refers to customers site ease of use or navigation, availability and performance

(Smith and Chaffey, 2001).

People

In online marketing, there is no personal interaction between a customer and the

provider, or between other customers. Lack of the personal interface may result in
customer distrust of first-time interaction with electronic channels. It is also more
difficult for providers to build a relationship with customers whom they never see
(Dobie et al., 2001). According to Lennon and Harris, (2002) customers who try to
access customer service from online firms may encounter more problems than
customers accessing customer service from an non-online provider. Some companies
instead to enhance customer service activities through web enabled call centres
discourage customers to call them. Customers need fast service recovery actions in
order to prevent them defecting and to prevent subsequent negative word of mouth
(Ahmad, 2002).

Place

According to Lockett and Blackman, 2001 an implication for marketers is the

potential to shift from a non-virtual marketplace to a market-space instead,
incorporating virtual transaction/distribution spaces. Some organizations offer goods
and services exclusively and only through the virtual distribution channel. Some
retailers offer both a physical retail outlet and the opportunity to buy from an oline
facility. Research by Balabanis and Vassileiou (1999) determined that consumers
from the higher income rates were likely candidates for purchase through the Internet,
but only form retailers with recognized brands.

2.3. The adoption to the E-marketing

Understanding which demographic segment is using the Internet is important. Firms
have to know the demographic characteristics of e-users in order to design effective
and proper marketing strategies for their target markets.

Research has shown that psychographic variables, such as novelty seeking, need for
social interaction, product involvement, and perceived behavioral control have an
effect on consumersdecision on whether or not to purchase online (Kokkinaki 1999;

Sin an Tse 2002). Consumers attitudinal characteristics also influence their adoption
of the Internet. Szymanski and Hise (2000) find that convenience is the most
important predictor of e-satisfaction and measure it in terms of time and browsing
ease. According to Zeithaml et al. (2002) online security and privacy is of consumers
major concern when they decide whether or not to engage in electronic transactions.

Internet is changing the rules by which marketing is conducted and new consumer
market structures emerge (Peterson, Balasubramanian and Bronnenberg 1997). Levy
(1996) believes the Internet would ultimately become the medium by which we keep
in constant contact with our families, watch television, dash off a note to a friend,
check the traffic, read the news paper, prepare a report for work, make a phone call,
buy a book.

The volume and tendency of the Internet transactions reflect a more and more
important role the Internet is playing. According to Cyberatlas.com (2001c),
consumers spent $59.7 billion on line in 2000, and at the end of 2004, worldwide B2B
Internet sales transaction are forecast to reach $6 trillion (Cyberatlas.com 2001d).

Varadarajan and Yadav (2002) indicate that Internet enhance the effectiveness and
efficiency of marketing mix element (4P) except the actual distribution of nondigital
products focusing on the shift of the traditional physical marketplace to the hybrid one
that encompass both physical and electronic marketplace non considering the
competitive strategy of pure-Internet firms. On the other hand Kalyananam and
McIntyre (2002) present the e-marketing mix as compared to the conventional
marketing mix. Their e-marketing mix contains seven extra element thought to be
essential for e-marketing, including personalization, customer service, privacy, site,
community, security and sales promotion. According to Kalyananam and McIntyre
(2002) e-marketing mix has more overlapping element and the integration of those
elements is more common as compared to the traditional one. Also it is important that
Internet diversifies the pricing mechanism online (Hou and Rego, 2002).

3. Methodology
Doing business on the Internet will become even more important in the future. A
continuous connection to the Internet will become a common feature in households of
the future and customers will be able to do more and more interactively. So after this
e-marketing review questions that need to be answered arise, such as:

How the content and format of information provided online, using e-marketing
tools, can affect the Greek e-users willingness to purchase without
experiencing the product?

How the inability to control Spam or unsolicited commercial e-mail affects the
Greek e-users adoption to the e-marketing environment?

How banner ads, coupons, price incentives world of mouth and the lack of
social interactivity affect the decision making of the Greek e-users?

The research that will be conducted will give response to the above questions.
The sample will be people 18-25 years old as the population with the greater
percentage of the use of Internet.

USE OF INTERNET 2001-2002

100
90
80
70
60
50
40
30
20
10
0

YES
NO

2001

2002

USE OF INTERNET BY SEX

30
25
20
MEN

15

WOMEN

10
5
0
2001

2002

2003

USE OF INTERNET BY AGE

2500

2000

1500

2001
2002
2003

1000

500

0
15-17 18-24 25-34 35-44 45-54 55-64

65
and
over

10

Information for health

Use of public services
Free services
Bank transactions
Looking for job

2003
2002

Entertainment-TV, Video
Purchases of goods/services
Chat rooms
Information for public sector
Education
Entertainment-music
Entertainment-games
Information
Information for goods and services
e-mail

10

15

20

25

11

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