Company X is a fictional manufacturer of gourmet snacks and treats.
There are many Internet marketing strategies available to marketing managers. Of the available strategies, direct e-mail and banner ad campaigns are the most common. Each of these strategies has its strengths and weaknesses. Additionally, each strategy can be effective if used properly, or disastrous if mishandled.
Direct e-mail campaigns focus on sending marketing literature to a pre-defined list of recipients. They are popular among marketing managers because of their low cost of entry. The main drawback for direct e-mail campaigns is related to recipient perception. Although an effective e-mail campaign will result in increased sales, e-mail recipients become resentful of mailings that they consider “spam” (Perreault, Cannon, & McCarthy, 2008). Therefore, the key to a successful direct e-mail marketing campaign is to target receptive clients at the frequency they desire. Seth Godin used the term “permission marketing” to describe a relationship in which marketing recipients develop a relationship with the vendor and anticipate occasional e-mails from them. In order to ensure that the customer does not feel overwhelmed with the volume of e-mail involved, it is useful to give them the option of selecting their e-mail frequency (Rayport & Jaworski, 2004).
Banner ads have been defined as “small rectangular boxes that usually include text, graphics, and sometimes video to create interest” (Perreault, Cannon, & McCarthy, 2008, p. 394). Banner ads have the benefit of creating tremendous brand recall in viewers. A 2001 Morgan Stanley report showed that banner ads were even more effective than TV advertising at generating brand recognition. The downside of banner ads is that the industry appears to be uncertain as to their usefulness. The Morgan Stanley report indicates that the appearance of the banner ad is enough to be worth the advertising dollars, yet many in the industry feel that banner ads are only successful if they generate traffic to the target site via click-throughs. Therefore, it is obvious that the real benefit of banner advertising is not yet well understood (Rayport & Jaworski, 2004).
Company X should employ some aspect of all Internet marketing strategies. Each strategy has multiple methodologies that should be used or avoided, depending on the situation. For example, in the case of direct e-mail advertising, Company X should not send e-mail to recipients that did not sign up to receive them. HP has successfully increased their sales by sending customized newsletters to willing recipients (Perreault, Cannon, & McCarthy, 2008). Company X should follow suit and focus their direct e-mail campaigns on customers that have a proven interest.
Similarly, Company X should use banner advertising with care. They should not purchase pay-per-click advertising that directs the customer to their main Web page. Although this generates traffic, it does not focus the potential customer’s attention. Instead, pay-per-click advertising should funnel customers into specific product offerings or specials. On the other hand, impression-based advertising, such as those that are paid based on thousands of impressions, should focus on building the Company X brand. The destination of these ads is irrelevant because their intent is to build brand recognition rather than direct sales.
Perreault, Jr., W. D., Cannon, J. P., & McCarthy, E. J. (2008). Essentials of marketing: A marketing strategy planning approach, 11th ed. New York: McGraw-Hill Irwin.
Rayport, J. F., & Jaworski, B. J. (2004). Introduction to e-commerce (2nd ed.). New York: McGraw-Hill/Irwin.