Customer Review Sites Consumers now prowl the Web in search of recommendations or warnings by other consumers, found on customer review sites

Consumers now prowl the Web in search of recommendations or warnings by other consumers, found on customer review sites. Business-listing sites by Google (maps.google.com is the most desired home for local businesses, and local business owners can sign up for a listing at maps.google.com/local/add to create a listing), Yahoo, and others such as Yelp, Citysearch, and AOL Local let consumers rave about their favorite businesses or complain about poor service, allowing consumers to get credible personal opinions about local businesses and services. The reviews can help dramatically raise a website’s visibility in search engines, with reviews and star ratings often cited in search results. For example, a search for “Los Angeles chiropractor” returns not only links to websites but also a 10-item list of local chiropractors with their addresses, reviews, star ratings, and a local map at the top of the page.

Local business marketers often try to game the system by e-mailing customers with web addresses for review sites, asking them to write a review. Unfortunately, some unethical marketers write fake reviews or aggressively seek favorable reviews by offering incentives like iPods and gift certificates.

There are many other recommendation sites, like music-recommendation site iLike that steers customers to tunes they are likely to enjoy.

In chat rooms groups of people sharing special interests can contact one another and exchange information and opinions. These can either be part of a marketer’s website or independent.

There are several other types of cybermarketing in addition to advertising:

1. Virtual malls. A virtual mall or online mall is a gateway to a group of Internet storefronts that provides access to mall sites by simply clicking on a storefront or category of store. These can be global in scope, such as Mall Internet or CyberShop, or these can have a more local flavor, such as the Virtual Mall from West Boston. These sites can attract browsers much as stores attract window shoppers. They are typically organized by product category, with each category offering click-throughs to stores, leading to corporate websites and home pages.

2. Sales promotions. Sampling, coupons, and sweepstakes and contests are big on the Internet in order to encourage people to visit or return to a Websites. Internet coupons can be printed out from distributor and manufacturer sites. Sites offer many things, like free e-mail, instant messaging, telephone services and sample computer programs (e.g., AOL disks, downloads of trial versions of software). Often, as a condition of obtaining such goodies and to enter sweepstakes and contests, marketers require consumers to divulge all-important personal data like address, phone number, and income.

Companies such as Coupons Online (www.couponpages.com), Catalina’s Valupage Websites (www.valupage.com), and www.hotcoupons.com distribute coupons over the Internet, including the sites of other commercial online services. Coupons Online and Catalina both allow Netizens to print out coupons and then take them to the store for redemption

Sweepstakes and contests are also popular for driving people to marketers’ Websites. For example, at BMW.com you can enter a contest for a free BMW, or go to the Bria water site and get a chance to win $500,000. Incentive programs are also popular.

Some on-line merchants offer short-term sales just like brick-and-mortar stores. For instance, Eddie Bauer’s home page featured a two-day sweater sale, and Macys.com offered a free DVD player with a $250 purchase.

3. Event marketing. Special events such as the Super Bowl and the Oscars have set up Websites. The sites are promoted during the program, sponsors get their logos on the sites with links to their own home pages, and they have an opportunity to provide editorial content for the event site.

4. Sales support. While the Internet has served as an efficient substitute for salespeople for some firms, other companies have used the Web to enhance and support their selling efforts. Home pages typically have an e-mail option for those wishing to request further information. Thus, the Net can provide a great source for leads for the sales force to follow up on, and these leads become part of a prospect database. Also, through trial demonstrations and/or samples offered online, customers can determine if an offering is worth requesting a sales call for.

5. Public Relations. Many companies devote a portion of their Websites to public relations activities like providing corporate information, developing positive e-mail relationships, and developing a media relations Website (providing news stories, press kits, etc.).

6. Managing the Brand in an E-Community. The Internet provides consumers an efficient way to communicate with one another. Communities are formed via Usenet groups, Listservs, instant messaging, and even Web pages or Websites built around special interests, such as iVillage or MediaBistro, or sponsored by corporations as a benefit to their customers (e.g., Microsoft Corp.’s free computer game-geek community, www.zone.com, Martha Stewart Living Omnimedia’ Inc.’s free online community of cooking and gardening enthusiasts at www.marthastewart.com). Through these communities, participants chat, exchange ideas, and ask and answer questions.

One trend is for marketers to foster a sense of community on their Websites—a natural for the Web considering its ability to pull millions of people together at once. Relationships between customers can be built through means such as moderated chat rooms (Internet relay chat—IRC, an expensive 24/7 proposition), bulletin boards, and incentives for people to bring in new visitors.

Sometimes, online communities form around particular brands. Members create detailed Web pages devoted to the brand. They share their experiences in using the brand: likes, dislikes, suggestions for buying replacement parts or getting the brand serviced, etc. Marketers can thereby monitor word-of-mouth communications.

Unfortunately, some of this word-of-mouth communication is negative, as when a company has disgruntled customers or employees. Such people engage in cyberventing—griping about companies on the Internet. Forums for this catharsis range from message boards at sites like Yahoo! And Vault.com to company-specific sites like Untied.com (a site for peeved United Airlines customers and employees. Such gripe sites (or “bitch boards” as their known in executive circles) can be monitored to discover perceived and actual company and brand problems, as well as to correct misinformation and false rumors.

Most corporations sponsoring online community sites require new members to register, and that’s when marketers should ask for permission to direct market, i.e., ask members to opt in). Online communities usually ask new members for permission to send them informative weekly or monthly e-mail newsletters and explain that these newsletters will also contain some targeted advertising, generally in the form of text-based advertising messages placed between informational articles containing the corporate sponsor’s products. These e-mail newsletters’ primary goal is to enhance relationships with customers. For instance, Procter and Gamble’s free monthly newsletter, HomeMadeSimple, offers all kinds of practical advice in areas such as décor, cooking, and household cleaning. The NFL’s weekly newsletter, NFL.com Newsletter, is customized by team, and then further tailored to the fan’s specific interests in the team. Fans are informed when they register that they will be monitored to allow for better customized information. When e-mails are sent to community members, they should always be given the option to opt out of the list.

Another trend is for consumer marketers to imitate their business-to-business brethren and set up extranets, which allow them to establish an alliance with their suppliers and business partners to build a Websites that is beneficial to all parties. For instance, an advertiser could create an extranet with Wal-Mart as the sponsor and center it on parenting.

One more trend learned from b-to-b marketers is to partner with another firm and create a micro-site—a site within a site where sponsors’ content is integrated into the look and feel of the host site, often a media site.

Advantages and Disadvantages of the Internet.

There are a number of advantages of advertising and marketing on the Internet.

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  Highly selective target marketing of a quality audience. Internet ads can be highly targeted to specific groups with minimal waste coverage. In business-to-business marketing only the most interested prospects will bother visiting. In consumer marketing personalization and other targeting techniques help sites to become more tailored to individual needs. By purchasing keywords and using cookies, advertisers can reach potential consumers when they are ready to buy. The market is upscale in nature.
  
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  Enormous audience. The Internet is the only truly global medium.
  
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  Message tailoring. Highly targeted markets help here, as does the interactive nature of the medium.
  
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  Information intensive. Lots of information can be presented if desired. A given site can offer a wealth of information on a company, product specifications, costs, purchase information, etc. Links will direct users to even more information if they wish. This is consistent with a major use of the Internet—to gather information.
  
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  Tracking – There is the ability to monitor who is viewing ads and responding to them.
  
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  Interactive capabilities. More than any other medium, the Internet allows consumers to directly interact with an advertiser, increasing customer involvement and satisfaction, and building a relationship between the advertiser and the customer. Marketers can speak with, not to, customers. This virtual reality environment simulates a direct experience for users, resulting in more confidently held and enduring attitudes.
  
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  Real-time information. The Net allows for lots of flexibility as sites can be constantly updated.
  
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  Sales potential. As we’ll discuss, the Internet can be a great direct response medium to generate sales, offering immediate response rivaled only by personal selling.
  
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  Opportunities for creativity. The multi-sensory nature of the Internet makes it one that offers lots of opportunities for creativity (like TV). This can enhance a company’s image and increase customer interest and involvement, leading to repeat visits.
  
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  Widespread exposure. Especially small companies with limited budgets can gain access to the world for a fraction of the cost of traditional media.
  

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  Costs. Internet ads are fairly inexpensive when measured on a CPM basis for a banner ad (about $5 to $50 on most sites, with an average of about $50, although a major site like Yahoo very targeted ads can run as much as $150 CPM, and rates are higher for home pages compared with subsequent pages). This compares to $5 for outdoor, $12 for TV, and $35 for a 4-color ad in a major consumer magazine). However, the absolute cost is relatively moderate, ranging from a few hundred dollars locally to $100,000 or more per month for a major Websites. . The reason CPM is high on certain sites is because Q. audiences are 1. highly targeted and upscale, and 2. highly motivated to shop/seek information and to buy . As with all media, CPM is for opportunities for exposures, not actual exposures, as there’s no reliable way to know how many people who call up a Web page look at its advertising. Absolute cost is relatively low because Q. Exhibit 17.16> the total number of exposures is relatively low. Also, the cost for producing banner ads and websites is comparatively low. While it is possible to establish a site inexpensively, establishing and maintaining a good site is becoming more costly.
  
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  Integration. Web advertising fits well into an integrated marketing communications program—it is easily integrated and coordinated with other forms of promotion. Offline ads can carry the Websites’s URL. Web banner ads, like outdoor billboards, can include images and slogans from broadcast and print campaign ads. Sales promotions such as contests and coupons can be featured on Websites.
  

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  Speed. The Internet offers the fastest way to access information on a company and its products.
  

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  Convenience. Electronic marketing increases customer convenience by breaking down many of the barriers caused by time and space, thereby adding time and place utility. Consumers can shop 24 hours a day without leaving the comfort of their home or office, avoiding crowded shopping malls in the process.
  
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  Greater availability of information, including price information.
  
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  Greater variety to choose from.
  
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  Not intrusive/interruptive (forced on consumers). Consumers seek out Web advertising and are therefore highly engaged with it and view it as credible. Marketers aren’t interrupting content—they are delivering it!
  

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  Measurement problems. There is a big problem with accurately estimating exposures—we are highly uncertain how many people see or notice Internet ads. Different research services report widely different numbers. Also, numbers reported become quickly outdated. These problems are discussed more in D. below.
  

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  Privacy and security concerns. Some consumers are leery of using the Internet because of privacy and security concerns. Privacy concerns the fear that data collection occurs without consumers’ knowledge or permission or that marketers engage in unauthorized use of their personal information. Privacy is also violated when consumers’ data is sold to other marketers without the customers’ permission. Consumers are therefore reluctant to give out personal data that might be important to the marketer. Security concerns cyber crime such as credit card theft and hacking into corporate Websites to get things such as customer lists or customer credit card numbers. Therefore, marketers must put in place appropriate encryption systems to protect the consumer’s data.
  

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  Declining impact. As the novelty of Web advertising wears off and as the medium becomes increasingly cluttered, there seems to be less tolerance for it. In 2001, there were over 20 million Websites with the “.com” domain name. More people now claim to actively avoid Web ads (through means such as software that blocks banner ads and e-mail solicitations), and the number who say they notice Web ads is down (a reason for the reported decline in banner ad effectiveness). Some consumers are tired of computers by the time they get home from work and don’t wish to spend their leisure time shopping online. And, browsing online can be time-consuming since high-quality images take time to download, especially if a lot of users are trying to download them at once, a phenomenon known as Websnarl. Net net, the impact of Web advertising is uncertain.
  

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  Limited production quality. Although it is improving, net advertising doesn’t offer the high-quality production of many other media, although the gap is narrowing.
  

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  Limited reach. Only about half the population is connected to the Net, due to the high cost of personal computers and technology impediments for many people (especially the elderly and poorly educated). Also, only a small percentage of sites are captured by any given search engine
  

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  Constant updating/site maintenance. Staffing is required to keep the site’s content up to date 24/7.
  
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  Channel conflict. Traditional retailers might dislike competing with the manufacturer’s Websites, and consequently give less support to or even discontinue carrying the producer’s products.
  

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  Lack of security. While a person’s financial liability is usually limited to $50, the damage to her credit rating can last for years.
  
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  Buying sight unseen. For certain experience goods such as clothing and furniture, the consumer usually wants to see the item up close and personal before buying.
  
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  Expensive to order and then return. Because consumers are buying without actually seeing the items, and since exact colors might not reproduce on computer monitors, consumers often end up returning merchandise. Even though most e-tailers have very liberal return policies, customers can still get stuck with large return shipping charges.