What Is Digital Business?

What is digital Business? Internet and Mobile Marketing Second Assignment JAMK University of Applied Science International Business Lecturer: Aila Ahonen Student: Moritz Schweizer Jyvaskyla, October 2012 1 “In the beginning of the new millennium, sending basic text messages to customers was considered by many companies to be highly innovative. Today, however, mobile technology is vastly more robust and people are far more confident in using it. So much, so that in many societies? people have become „mobile-dependent? – and we are coming towards the end of the first generation of mobile users.

The impact of the mobile on the traditional time cycles of marketing, segmentation and targeting, as well as the creation of uniquely personalized marketing, has created an entirely new competitive environment in almost every industry. ”1 Sureyya Ciliv, the Chief Executive Officer of Turkcell mentions in this marketing specific case that we are now on the edge to a new century of thinking about marketing channels. The young internet and smartphone generation do not fit well to traditional marketing strategies and operations.

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Because of that, companies are thinking nowadays about new ways to reach these young customers, especially over marketing via mobile devices to make their efforts more efficient. On the other hand we should mention that there are some target groups and branches, especially concerning elderly people or traditional and local branches which are very difficult and ineffective to reach with this new marketing ways. In the following text, I want to provide definitions of internet and mobile networks as a tool for marketing and of a typical customer in the web or in a mobile network.

Furthermore I will deliver a comparison of traditional and modern marketing strategies/operations and the typical purchase process in the web and in the mobile network. Finally I outline an example of a successful and operational e-business and mobile service. 1 Varnali, K. , Toker, A. and Yilmaz C. (2011): Mobile Marketing. Fundamentals and Strategy. 1. Circulation: McGraw-Hill Professional. Page vii. 2 I want to start the topic with the definitions about internet and mobile networks as a tool for marketing. “Mobile marketing covers a large set of applications which basically revolutionized the way modern companies conduct their business.

Unlike any other existing media, mobile marketing enables distribution of interactive and personalized information to the consumer at the most appropriate time and place and in the right context and it provides an unprecedented opportunity to establish a direct link with consumer. ” 2 According to Mort and Drennan it can be said, that an up-to-date business belongs to internet and mobile marketing. It is necessary for the companies to take advantage out of it and to build up a strong connection to the customers to face the requirements of competitive situation on the market.

Furthermore Berthon, Pitt and Watson are executing the challenges and hurdles, which can be overcome from the modern way of marketing, which the traditional could not tackle. They say that “the space-time paradigm on which traditional marketing is based implodes into the „virtual now? of the network age and introduction of mobile technology into the business space is the ultimate catalyst of this transition. ”3 So as we can see from the definitions, there are a lot of challenges of traditional marketing strategies and operations these days. They are strong linked to the nature f the „push process? of traditional marketing methods. For example, as a company you are pushing your marketing material over a marketing channel at your target market. These so called target markets could be reached over Television, Radio, brochures, trade fairs, hospitality, cold calling and so on. Therefore the order is that the company broadcasts enough so that eventually one or more potential customers are reached who are ready to engage with the company. 4 On the other hand there is internet and mobile marketing. It is in relation to traditional marketing in general a „pull process? so 2 Mort, G. S. , and Drennan, J. (2002): Mobile digital technology: Emerging issues for marketing. Journal of Database Marketing. Page 10(1), 9-24. 3 Berthon, P. , Pitt, L. F. and Watson, R. T. (2000): Postmodernism and the Web: Meta themes and discourse. Technological Forecasting and Social Change. Page 65(3), 256 – 279. 4 According to: Kumar, Abhishek (2011): How does Internet Marketing help to overcome the challenges posed by traditional marketing?. Source: http://infinitesoluzioni. blogspot. fi/2011 /08/how-does-internet-marketing-help. html (Date of access: 08 Oct 2012). h 3 it is subtly different. This process starts with searching for a product or a service from a company by a customer. So the customer is ready to buy the product or service, or at least the customer just does research for a future purchase. In that case, the behaviors of the customers are crucial. The customers are looking for information in the web or in social networks to make a decision and finally to buy one product. So as you can see from that chronology, internet marketing helps to overcome a lot of hurdles which cannot be faced in traditional marketing.

The reasons therefore are wide-ranging, but the following arguments, provided from Abhishek Kumar, a leading Indian blogger in modern technology topics put it in a nutshell. Internet and mobile marketing makes strategic decisions based on facts, it is more measurable, it reaches the target group more efficient, it is a constant and ongoing source, it provides more and a better worth-of-mouth and it could be increase more conversions. 5 As you can see from the invoked aspects, there are a lot of benefits from internet and mobile marketing – companies should not miss the chance to use it for their targets.

In this context, it is important to talk about the customer potential in the web and in the mobile network. Based upon that information, a description of a typical customer is necessary to understand how to use internet and mobile marketing effective. At first, I want to mention some statistic numbers to suggest how big the customer potential in the web and especially on the social networks is. As you can see from the following „image 1’, there has been a huge and steady increase of the use of social media, compared to other contents in the last two years.

To name some expressive numbers, concerning the use of social networks at work, the Brown and Half Survey executes that there has been a decrease of banning social media at work from U. S. companies by 13% down to 31% in the year 2011 (2009: 54% of the U. S. companies banned social media at work). On the other Hand, the survey says that in the year 2011 (51%), 32% more companies allow their employees to access social networks 5 According to: Kumar, Abhishek (2011): How does Internet Marketing help to overcome the challenges posed by traditional marketing?. Source: http://infinitesoluzioni. blogspot. i/2011 /08/how-does-internet-marketing-help. html (Date of access: 08 Oct 2012). th 4 for business proposes than two years ago (2009: 19%). 6 This trend shows that companies now know how to use this potential for their professional targets. With the permission to use social networks at work, the companies try to motivate employees to represent their company online. 1. Image: Time Spent on Key Categories Online 7 To explain what a typical customer in the web is and in which way he or she acts, I want to break it down to some very expressive numbers, cited from cb{d} blog. An average user (in the year 2012) on Facebook. om has “130 friends and likes 80 pages, 56% of consumers say that they are more likely recommend a brand after becoming a fan and each week on Facebook more than 3. 5 billion pieces of content are shared.

”8 A general Twitter. com statistic (from the year 2012) says that: “34% of marketers have generated leads using Twitter and 55% of Twitter users access the platform via their mobile. ”9 Finally, 6 According to: Murphy, Richard (2011): Do Companies need Social Media? Source: http://socialmediatoday. com/clifffigallo/339097/do-companies-need-social-media (Date of Access 08th Oct 2012). Aquino, Carmela (2012): It? s a social world. A Global Look at Social Networking. Source: http://courtenaybird. com/post/15685177376/its-a-social-world-a-global-look- atsocial/ (Date of access: 08th Oct 2012). 8 Bryan, Cassandra (2012): cb{d} blog. A few interesting take outs for social media statistics in 2012. Source: http://www. cassandrabryandesign. com/2012/01/a-few-interesting-takeouts-for-social-media-statistics-in-2012/ (Date of access: 08 Oct 2012). th 9 Bryan, Cassandra (2012): cb{d} blog. A few interesting take outs for social media statistics in 5 here some other interesting statistics (from the year 2012) on the cb{d} blog which concludes the whole topic very vivid: “Nearly 30% of the web users are not tracking the impact of internet and mobile marketing. 20% of Google searches each day have never been searched for before. Out of the 6 billion people on the planet, 4. 8 billion have a mobile and only 4. 2 billion own a toothbrush”. 10 After this impressive numbers, I want to continue with the typical purchase process in the web and in the mobile network, to demonstrate in which ways companies can achieve success out of it.

To explain the fundamentals, I want to use the standard Buying Cycle with some adoptions concerning web and mobile network purchasing aspects. As you can see from the following image, the first of the five stages in the Buying Cycle is the need or the recognition or identification of a problem from an individual. In this case, the individual realizes that a problem or opportunity arises for which it has to look for an efficient solution. To find an efficient solution, the individual gathers information? s or determines alternatives in the second stage. 2.

Image: The Buying Cycle 11 2012. Source: http://www. cassandrabryandesign. com/2012/01/a-few-interesting-takeouts-for-social-media-statistics-in-2012/ (Date of access: 08 Oct 2012). 10 th Bryan, Cassandra (2012): cb{d} blog. A few interesting take outs for social media statistics in 2012. Source: http://www. cassandrabryandesign. com/2012/01/a-few-interesting-takeouts-for-so cial-media-statistics-in-2012/ (Date of access: 08 Oct 2012). th 11 Search Engine People Blog (2011): The Role of the Web in the Buying Process aka Purchase Process or Buying Cycle.

Source: http://www. searchenginepeople. com/the-buyingprocess-aka-purchase-process-or-buying-cycle/ (Date of access: 08th Oct 2012). 6 Especially in the internet and mobile network, it dramatically improves the ability of an individual to find alternatives and information? s about a specific topic. For example, search for the phrase „buy a bike? on Google; you will get about 570. 000. 000 results. In the following Stage three, the individual evaluates alternative products/services and decreases the risk to maximize the probability the objective set forth is satisfied.

Even in the internet and in the mobile marketing, the individual would look after recognized brands online or for anything on the website, which guarantees stability and credibility for the potential product or service. These so called guarantees are for example, the partnership from recognized brands, the mentioned awards and test scores of the product/service, the consumer feedback and opinions or just the quality of the website. The next step is the purchase in stage four. In this stage there has been a decision of the individual what alternative it will go with and which aspects are the best offer.

Perceived are the best combination of goal achievement and a minimization of risk. The last stage is the evaluation of the consummated purchase. In that stage, the individual asks itself a lot of questions to learn from potentially made mistakes. It will be based on the perceived results, relating to the expectations of the individual – but if the expectations are fulfilled; the individual may get a brand advocate. Here too, there are multiple higher possibilities in the internet and in mobile networks to spread the brand advocate and the brand message. 2 The next citation from the Search Engine People Blog explains perfect why that is so important for a nowadays company. “Blogging and micro-blogging (e. g. Twitter) make it possible for people to share their experiences with hundreds (even thousands) of others with minimal effort. At the same time, these post purchase opinions often remain online indefinitely, leading to a sudden rise in the need for ‘online reputation management’ services. This of course means that a firm’s ‘brand message’ is no longer carried by the firm, it? s now carried and disseminated by their clients. ”13 2 According to: Search Engine People Blog (2011): The Role of the Web in the Buying Process aka Purchase Process or Buying Cycle. Source: http://www. searchenginepeople. com/thebuying-process-aka-purchase-process-or-buying-cycle/ (Date of access: 08th Oct 2012). 7 To conclude all the mentioned facts, I want to execute one example of a successful and operational e-business and mobile service – the Amazon. com iPhone application. The reason for this choice is that I use this app very often and everywhere I have been in the last two years. To underline this, I want to add that I can? remember any point of time on which I had a problem with the app. I personally like the huge assortment of products from amazon. com. The app makes it possible to take this kind of „library of products? with me. Everywhere I go, from the bath tub up to maybe a hiking trip in the landscape. That makes it easy to compare prices, services and the product diversity, which is big benefit for me. One other very useful gadget of this application is the so called barcode scanner. You just have to put the barcode scanner field on the barcode on an arbitrary product.

The app reads the barcode and provides product details to show you if the product is available on amazon. com (that gadget only works if you have mobile internet or if you are connected with a wireless LAN). Furthermore, I want mention the brand new „Memo-function? of the app. I never used that function before, but I know how it works and I see a big potential in this function. The best benefit of this is, that I works without mobile internet or wireless LAN, so it is a good way that amazon. com found to bind customers on the shop, when potentially customer travel around without internet on their mobile device.

This is how it works: whenever and anywhere you see an interesting product, you can photograph it with your iPhone camera. The amazon. com application makes it possible to import these pictures into the content of the app when your mobile device connects the next time with an internet source. For example, you took a picture of a Football. So in that process, the app tries to identify products, concerning to your imported picture. If a product with my searched content is available, the app sends you automatically an e-mail with a buying offer of products with this content.

For example it sends me an offer of a football or for football shoes. I think that way of binding customers is very innovative and contemporary. As you can so from above, amazon. com does everything to transform all their customers to „Maverick-Buyers?. I must confess that I am one of them. 13 Search Engine People Blog (2011): The Role of the Web in the Buying Process aka Purchase Process or Buying Cycle. Source: http://www. searchenginepeople. com/the-buyingprocess-aka-purchase-process-or-buying-cycle/ (Date of access: 08th Oct 2012).

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