the different types of online presence introduced in Chapter 1, i.e. transactional e-com-
merce, relationship-building, brand-building and media owner portal. Allen and
Fjermestad (2001) and Harridge-March (2004) have reviewed how the Internet has
impacted the main elements of the marketing mix. There is no denying that all of the
elements are still important, but Smith and Chaffey (2005) have said that, online,
Partnerships is the eighth P since this is so important in achieving reach and affiliation.
In this text, though, Partnerships will be considered as part of Place and Promotion.The productelement of the marketing mix refers to characteristics of a product, service
or brand. Product decisions are informed by market research where customers’ needs are
assessed and the feedback is used to modify existing products or develop new products.
There are many alternatives for varying the product in the online context when a com-
pany is developing its online strategy. Internet-related product decisions can be usefully
divided into decisions affecting the core productand the extended product. The core
product refers to the main product purchased by the consumer to fulfil their needs,
while the extended or augmented product refers to additional services and benefits that
are built around the core of the product.
The main implications of the Internet for the product aspect of the mix, which we
will review in this section, are:1 options for varying the core product;
2 options for changing the extended product;
3 conducting research online;
4 velocity of new product development;
5 velocity of new product diffusion.
There is also a subsection which looks at the implications for migrating a brand online.1 Options for varying the core product
For some companies, there may be options for new digital products which will typically
be information products that can be delivered over the web. Ghosh (1998) talks about
developing new products or adding ‘digital value’ to customers. The questions he posed
still prove useful today:1 Can I offer additional information or transaction services to my existing customer base? [For
example, for a bookseller, providing reviews of customer books, previews of books or
selling books online. For a travel company, providing video tours of resorts and
accommodation.]
2 Can I address the needs of new customer segments by repackaging my current information
assets or by creating new business propositions using the Internet? [For an online book-
seller, creating an electronic book service, or a DVD rental service as has been
achieved by Amazon.]
3 Can I use my ability to attract customers to generate new sources of revenue such as advertis-
ing or sales of complementary products? [Lastminute.com which sells travel-related
services has a significant advertising revenue; it can also sell non-travel services.]
4 Will my current business be significantly harmed by other companies providing some of the
value I currently offer? [Considers the consequences if other companies use some of the
product strategies described above.]Product
Product
Product variable
The element of the
marketing mix that
involves researching
customers’ needs and
developing appropriate
products.
Core product
The fundamental
features of the product
that meet the user’s
needs.
Extended product
Additional features and
benefits beyond the
core product.