Samenvatting
Summary - all lectures - DMM
- Instelling
- Vrije Universiteit Amsterdam (VU)
This is a complete summary of all the lectures and insights given in class (including exam hints). All lectures were attended.
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Voorbeeld 4 van de 37 pagina's
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Voorbeeld van de inhoud
Summary – digital marketing & metricsDIGITAL MARKETING ALONG THE CUSTOMER JOURNEY – Lemon & Verhoef (2016)
Customer experience as a holistic concept:
Because it is based on firm-initiated and customer-initiated touch points (Lemon & Verhoef, 2016); Anderl et al., 2016)
Customer experiences the total experience (end to end), not separate touch points. Including the search, purchase ,
consumption and after sale phases of the experience. And may involve multiple channels – not separate touchpoints.
Touchpoints:
- Brand-owned touch points:
o These touch points are customer interactions during the experience that are designed and managed by the
firm and under the firm’s control
▪ F.e. Include all brand-owned media (advertisement, websites, loyalty programs) and any brand-
controlled elements of the marketing mix (e.g. attributes of the product, packaging, place, promotion
service, price, convenience, sales force
▪ Store (Physical & online), website, social media, display advertisement, etc.
▪ Essentially the 4 P’s: Price, product, place promotion
• Place: Distribution Breadth & Depth (online + offline)
- Partner-owned touch points:
o These are touch points are customer interactions during the experience that are jointly designed, managed
or controlled by the firm and one or more of its partners.
▪ F.e. Partners can include marketing agencies, multichannel distribution partners, multivendor loyalty
program partners and communication channel partners.
Brand-owned/partner-owned touch points blur: when firm creates own smartphone app, typically brand-owned touch point.
But updates from Apple/Google may require updates by the firm. So hereby partners may also influence some brand-owned
touch points.
- Customer-initiated touchpoints:
o These touch points are customer actions that are part of the overall customer experience but that the firm,
its partners or others do not influence or control
▪ Customers thinking about their own needs or desires in the pre-purchase phase.
o F.e. eWOM, IKEA hackers, Youtube tutorials
▪ Customer initiated touch points work better During purchase the customer’s choice of payment
method is primarily a customer-owned touch point, although partners may also play a role.
, o Customer initiated touch points work better at the beginning of the customer journey, at the beginning
consumers are more influenced by their environment. When they are more sure of what they want to buy,
they are less influential.
- Social/external touch points:
o These touch points recognize the important roles of others in the customer experience. Throughout the
experience, customers are surrounded by external touch points
▪ F.e. other customers, peer influences, independent information sources, environments
o Is it coming from the partner or consumer?
Can customer experience be poor, if the individual touchpoints perform well?
Yes, if the channels are not integrated and consistent (multichannel instead of omnichannel). Customers experience
companies through end-to end experience (holistic) and not through separate touchpoints. It is all about integration between
touch points. This question is at the base of the difference between multichannel and omnichannel.
What is the difference between multi and omnichannel?
- Multichannel: the design, deployment, coordination and evaluation of the different channels through which the
marketer acquires, retains and develops customers (Neslin et al, 2006) all channels are separate; you try to
maximize every channel on its own.
o Focus on managing and optimizing the performance of each channel
- Omnichannel: the design, deployment, coordination and evaluation across the different channels through which
the marketer acquires, retains and develops customers, synergize between the separate channels.
o Integrating activities across channels to correspond to how consumers shop (Ailawadi & Farris, 2017)
When we refer to channels we mean:
Channels of distribution? Channels of communication → BOTH
What are research shoppers?
- 43% of all shoppers search in one channel and purchase in another = research shoppers (Neslin et al 2006)
- Showrooming & webrooming (Lemon & Verhoef 2016)
o Showroomer: Visit store, buy online
o Webrooming: Search online, buy in the store.
- Why is it relevant in your opinion to know more about these behaviors?
o P.80 (lemon&verhoef, 2016) Attribution issues (Anderl et al 2016)
o Its important to know that you are dealing with customers in different parts of the customer journey.
- What are the drivers of search?
- Major developments in digital marketing are related to paid internet advertising and eWOM, hence our focus on
these topics.
- Understanding the effects of both advertising and WOM (and the proper metrics to assess them) has always been
important.
o What is new? The medium itself: interactive, ubiquitous, customizable, traceable. (Rutz et al 2009)
Online advertising:
= Paid search ads
= Banner ad
Why is the ZMOT relevant? (for brand and search)
ZMOT is very important, it is the first encounter with the brand. It is defined by the search and search is at the core of
marketing (with price/distribution) Problem is that the brands rely on touchpoints from partners.
Challenge: selecting the right combination of metrics to monitor and manage distribution (ailawadi & Farris 2017)
CONVERSION FUNNEL
= process customers go through
1. (Awareness) → Impressions
a. CPM (Cost Per Mille) = Cost / Impressions * 1000
2. (Interest) → Clicks
a. CTR (Click Trough Rate) = Clicks / Impressions
3. (Bounce rate) – (Clickstream) Action (Very relevant also for quality score, if people bounce back it interrupts your
quality score)
a. Start Application, Put Items in Shopping cart
b. SCAR (Shopping Cart abandonment Rate) = abandoned shopping carts / number of (initiated)
transactions.
, i. You improve SCAR: great return policy, simple payment system, registration, reviews, e-mail
marketing, remarketing advertisement (bol.com → vergeet je niet iets?)
c. Ratio of abandoned shopping carts to the number of initiated transactions OR completed transactions.
Typically between 60-80%
4. (Conversion)
a. Actual purchase
b. Conversion Rate = Application / Clicks
c. Return rate
5. (Retention Rate)
a. Churn Rate is the opposite of Retention Rate
i. Advocacy (eWOM) = positive eWOM
Profit = Impressions * CTR * (CVR * M – CPC)
Why do companies allow return rates?
High return policy makes the customer also feel safe. Companiess want to minimize this. But at the same time the
customers feel save and engaged. That they can send back a product.
Even if the item is not what they want, they don’t want to occur in additional cost to send things back. So sometimes they
keep the product and then its still a sale.
Is PLA better than Paid Search Ads?
➔ PLA: more complex purchases
➔ Paid Search ads: more consideration and awareness (See Naik/Peters: awareness, consideration and purchase)
, LEARNINGS FROM AILAWADI & FARRIS (2017)
Compliance: - Are both partners executing desired strategy with logistics, assortment, product availability, pricing and promotion policies?
- Is the supplier providing the needed marketing support?
- Is the retailer providing the appropriate distribution depth?
Compliance - - % On-time reseller deliveries to consumers
metrics - Incidence of Out of Stock (OOS)
- Return rate by retailer’s customers
o At least 30% off all products ordered online are returned as compared to 8.89% in brick and mortar stores.
- Bounce rate
o Page is opened and exited without doing something on the page.
- SCAR
- Ratio of the number of abandoned shopping carts to the number of initated transactions or the number of completed transactions.
The typical shopping cart abandonment rate for online retailers varies between 60-80% with an average of 67.91%
- Abandoned shopping carts / initiated transactions or completed transactions
Path-To - Are both partners achieving satisfactory reviews and recommendations?
purchase - Are they working to support the customer along the path-to-purchase across channels?
Path to - Advocacy:
purchase - o # or % positive brand reviews by brand or retailers customers
Metrics: - Cross channel Conversions
o # of visitors served by retailer and buys the brand elsewhere
- Cross-Channel Delivery or Cross-Channel Returns
o # of purchases elsewhere delivered by, picked up at, or returned to retailer
Sales, Velocity % Profit
- Are both partners achieving satisfactory traffic, sales, market share and growth rates?
- Are gross margins, turnover rates, servicing and other cost creating a profitable relationships for both partners?
Brand & - Are the marketing strategies helping attract and retain valuable customers, building loyalty for the supplier and retailer brands?
Customer o CLV (Customer Lifetime Value) = the net present value of future
Equity: ▪ CLV = margin x Retention Rate / (1+(Discount Rate – Retention Rate))
o Customer Equity = total combined customer lifetimes values of all the company’s
- Distribution: how easy is it to buy the brand? To find the store? Findability
o Breadth: how many stores does the brand have? – not only own stores, also other distributors
▪ How many outlets? How important (in the category)?
▪ How important are their distribution outlets? Traffic (Reach & Frequency)
▪ How easy to find is the product?
o Depth: how many models of the products does a store have?
▪ How much of the product is in distribution?
▪ How prominently is it merchandised relative to competitors?
▪ How well is it supported along the path-to-purchase?
(Ailawadi & Farris, 2017)
Numberic distribution: how many sales
- ACV: All Commodity Volume
o ACV Distribution (%) =100 x Total Sales of Outlets Carrying Brand ÷Total Sales of All Outlets
o The power of the stores to attract volume, Target Shopper/visitor Reach
o Reach/frequency
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