The Marketing Book 5th Edition

What are direct marketing and interactive marketing? 575

these changes is likely to transform marketing
completely.

Ten ways in which interactive marketing is different

1 The challenge of 24/7. A trading website is

always open. There is no downtime to

restock, correct programming errors or

repair broken links to other business systems.

2 Marketing in real time. A website deals with

customers in real time, raising expectations

of instant query resolution, immediate

response to requests and even faster delivery.

Furthermore, customer interaction data are

being gathered continuously.

3 Personalization. Personalization of a website is

very different from personalized print. It must

be based on a variety of data sources (e.g.

clickstream, personal data and previous

purchases) and used within a single site visit if

appropriate.

4 Data volumes and integration. A website can

collect much higher volumes of data of

different types than can be collected from

other reception points. This poses a systems

integration problem and a potentially crippling

data volume problem.

5 Many-to-many communications. Customers do

not phone call centres just for a chat. But the

Internet is different. It is open, democratic

and even revolutionary. The plus side may be

viral marketing. The downside could be flaming

(abusive replies).

6 Comparison shopping. Never was comparison

shopping so easy. The pricing policy may need

to be changed for interactive marketing. A

new brand?

7 Global reach. The reach of the website may be

wide but logistical or legal constraints may

apply. It may be necessary to restrict orders

geographically.

8 Keeping in touch. Unlike direct mail, e-mail can

be time-sensitive, especially when sent to a

business address. But, because e-mailing is so

cheap, it is tempting to overuse it. It is easy

to measure the response but not so easy to

measure customers lost through irrelevant

e-mailing (spam, the equivalent of

junk mail).

9 Low transaction costs. The cost of handling

on-line orders and information requests is

much lower. This may permit lower ticket or

lower margin transactions. However, credit

card payment queries will be high and

delivery costs will remain the same.

10 A website is more like a shop than a catalogue.

Unlike a catalogue, a website cannot be sent

to a list of prospective customers. Like a

shop, it must wait for them to call in. Unlike

a high street shop, it is not visible to

passers-by. It needs promotion.

Can you think of any other ways in which a

website is more like a shop than a catalogue?

Here are two ideas:

1 Out-of-stock items (stockouts) cannot be

deleted from a printed catalogue. They

continue to occupy selling space and disappoint

customers who try to order them. On the

other hand, stockouts can be deleted from

websites almost as readily as they disappear

from stores.

2 The direct marketer can measure the sales

performance of each page and position in the

catalogue. But the lessons cannot be applied

until the next printing. Furthermore, the

cataloguer cannot follow the customer’s route

through the catalogue, making it harder to

explain the sales performance of individual

items.

The website designer can use clickstream data

to track customers’ journeys through the site

and can relate these patterns to sales. Then the

site layout can be altered to optimize perform-

ance. The store can make similar adjustments,

although the data will rarely be so accurate or

so complete.