“Ya Never Know” (Mike Stud) Has got to be one of the best quotes I have heard. In life, If I know you then you know me, you never know what to expect and you never know what choices to take. Just live, and let everything fall into place.
University of Canberra Uni student. Bachelor of Marketing and Accounting, Personal Trainer, Music producer, Music Artist.
Sports, Music, movies, Exploring. Allow yourself to create new experiences, because new experiences allow us to define ourselves and our journey that we take.
The marketing mix is a “concept used by business owners, marketing executives and operations managers to describe the essential elements of a marketing strategy” (Bradley, 2019). Looking back to 1960, there were originally 4 elements developed my Jerome McCarthy; product, price, place and promotion. Later on, these 4 P’s were integrated with the service mix (People, process and Physical evidence) and in 1981 the original 4 P’s were changed by Booms and Bittner to form the mnemonic now known as the 7 P’s of a marketing mix.
Music industry before Internet and digital technology
(Vivid Photo, 2019)
Remember the days when you would go to your local
electronics stores and search for all your favourite artists in the CD section
and have to promise to do a few extra chores in order to pay for the physical
copy of the artists music. Being signed to Record Labels was the big dream for
many, as they “engaged in a wide range of functions in the music industry
including new artist recruitment and development (known as A&R),
music publishing, and copyright enforcement.” (McDonald, 2019)
Introduction of digital technology (YouTube, iTunes, Spotify)
(Phorus, 2019)
The
same people who visited their local electronics store for a physical copy of
their favourite artist’s work may also remember the creation of iTunes by Steve
Jobs in 2001. It wasn’t until 2003 when the music store was created, and this
store allowed labels and artists to distribute digital copies of albums and
songs and fans to be able to purchase these and download to their
iPods (released earlier in 2002). Digital distribution has
continually evolved, and we now have access to a vast majority of streaming
services such as Spotify in 2006 and YouTube in 2005 and provide distribution
and streaming services for fans to receive quick and accessible music from
artists all around the world.
The 7 P’s of the marketing mix
(Silcox, 2019)
Product
The product Aspect has definitely been affected by the
digitalisation of music and digital technological advancements in both
marketing and the music industry. The level of quality inside a music studio is
far better, however the final product could actually be worse than previous
decades due to the fact “All
streaming services use audio compression to make audio files smaller so they
will stream better” (Starlin, 2018).
Price + Place
The price of music has also changed as the technology has improved and the internet has enforced a shift in approaches artists and labels use to sell their work. In 1983, a vinyl album would set a listener back around $8.98 and in 2002 CD sales were around $18.99 per album. (Hogan, 2015). According to a David Byrne essay in 2007, the change from physical CD’s to a digital copy sold within the iTunes music store had seen a decrease in sales price by nearly 50%, taking the selling price of an album to $9.99 (Hogan, 2015). By being able to cut out costs of production of physical artwork, CD’s and cases, both digital stores and record labels can see more revenue from changing to a digital sale.
Process
The music industry and creation of music is definitely more
IT supported now than ever, with most of the industry being digitalised apart
from Music Concerts (again, usually run by qualified sound technicians). The
quality of music equipment and services have also improved and continue to
improve due to new research and developments into aspects such as sound production
including but not limited to; acoustics and electronic set ups (computers,
interfaces, microphones).
Promotion + People
(Instagram, 2019)
Branding can be referred in promotion and in product,
however talking about the branding of bands and artists will be more suited in
the Promotion aspect of the marketing mix. Before, artists used to play shows
interact with potential listeners or A&R representatives in order to
promote their new albums.
Nowadays, it’s the 12-year-old Canadian who was found by a manager
and big-time artists uploading covers of songs to YouTube and subsequently selling
137,000 copies of his debut album in less than a week. Nothing can illustrate
this change better than rising to extreme fame thanks to a bunch of YouTube
covers, even if some of us aren’t riding on the Bieber train.
The image of these artists is crucial to the success of
their music and the marketing and PR need to combine with the artist’s image in
order to sell their music effectively.
Physical Evidence
With less and less music actually being sold in physical
copies, there is now more of a focus on a basic album artwork and a very interactive
music video being produced. this step in the marketing mix I believe is less
present as the music has become digitalised, but this ultimately can be a
reduction in overheads to produce and a reduction in overall price for listeners
to consume.
Affiliate Marketing
Affiliate marketing is the
process by which an affiliate earns a commission for marketing another person’s
or company’s products (Enfroy, 2019). As of 2016, 81% of brands leverage
affiliate marketing and in the same year $4.78 Billion USD were spent in order
to engage in affiliate marketing (Tzortzis, 2018).
(Instagram, 2019)
Let’s say a company is selling
sports gear and equipment and wants to find a social media marketing strategy
that will in turn, bring in additional revenue well above expenditures.
Let’s go and pay $350,000 to Cristiano Ronaldo to post a
photo about us on Instagram with over 106 million followers (Keohan, 2017) and
let the revenue start piling in. If your company is like most new start-ups, this
figure may be a little extreme.
Different celebrities and influencers will charge different
amounts according to “an
influencer’s follower count, engagement rate, project scope, and production
costs” (Carbone, 2019) and it may be beneficial early on for a new business to
aim for affiliates who may bring in less customers but also charge a much lower
price.
Remember those nights, when you come home from work starving, open the fridge and you find out it’s empty. If you’re anything like me, it’s a weekly trend and one that a few companies had already been preparing to tackle.
With
the worldwide company Uber, launching its joint company UberEATS into Australia
in 2016, many might have forgotten Deliveroo entered the Australian market
earlier.
(Deliveroo,
2019)
Deliveroo,
founded in 2013 in United Kingdom and launched down under in 2014, is an online
food delivery service. Powered by your personal IOS or Android device, simply
sit right back on the couch and order online from one of the stores nearby and
have a driver or rider pick it up and deliver it right to your door for a small,
added fee.
With
over 6,500 riders and 10,000 partnered restaurants in Australia, the company maintains
a strong presence in the online restaurant delivery service industry. The
company makes their money from commission on orders and also transaction fees, while
allowing a “self-service, hassle free delivery option” (Future Work
Technologies, 2019).
(Marketing 4 Restaurants, 2019)
As
seen in the graph above, UberEATS since entering the market has gained the most
interest out of all the popular companies in the same industry. Whilst behind
both Menu Log and UberEATS, Deliveroo in Australia had seen “triple digit growth
and seen the number of restaurants grow 150% between 2017 and 2018” (Food Mag,
2019)
The
new ‘unlimited delivery’ innovation initiated by Deliveroo may be what can tip
the scales. The service “locks in customers subscription model similar to Netflix
and Spotify” (Durkin, 2019). This type of incentive does target regular users
of the app more so than ‘one-time users’, however it could potentially
encourage these users to purchase orders more frequently through the online delivery
service.
Alongside
the new subscription-based membership, promising not only free delivery, but a
delivery time of less than 32 minutes from order time and allowing payments to
be secure through websites such as Paypal (Matoso, 2018), Deliveroo is certainly
adopting new innovation strategies to improve their business model. These
changes throughout the numerous countries the company operates in, will
hopefully see a higher return and net profit in the future.
Business Model
Deliveroo Business Revenue Model (Future Work Technologies, 2019)
Key Partners
The key Partners as seen in the Model above, are
solely based on the riders that help the company provide the service to the
customer however, some may also argue that the businesses and restaurants displayed
on the company’s website may also be partners. The total number or riders employed
is 60,000 and associated restaurants comes to 80,000 respectively (Deliveroo, 2019).
These large amounts of riders and restaurants help Deliveroo to meet demand
levels across every country they currently operate in and help to achieve the less
than 32-minute delivery time promise made by the company.
Cost structure and revenue streams
According to a study
done in the UK, Deliveroo charges a £2.50
delivery fee per order and also takes a 10-20% commission fee from the associated
restaurant in the order. (Singh, 2019) This makes things a little interesting
because every time I have bought something off Deliveroo, it has never been
10-20% more expensive so maybe, businesses while making a larger gross profit
may actually be reducing their net profit per order by partnering with online
delivery companies. While it might be better for the associated business to purchase
in store, with little incentive over having it delivered it really shows why
Deliveroo has been successful so far.
Consumer segments
As seen below, Millennials and those falling under
the Generation Z category in the 12 months ending March 2018, were far more likely
to order food from one of the Australian online delivery websites than those in
older generations. (Roy Morgan, 2018)
This data finding correlates with a U.S study associated with technology usage
finding that 92% of millennials own a smartphone and 85% use social media,
while Gen Z respondents showed an 89% ownership and 75% admitted to using
social media. (Marketing Charts, 2018)
(Roy Morgan, 2018)
Before you go to the fridge and are left with the
same sad expression I face on a weekly basis, just remember the Deliveroo app
on your phone and how quick you could be sitting on the same couch with
restaurant quality food delivered to your door. Never go hungry my friends!
Kylie Cosmetics,
owned by Kylie Jenner (Or Kardashian, or Jenner however you know her) Is a
company that has really implemented the digital marketing approach
successfully. For a website that averaged more than 1 million visits per month
between February 2019 and July 2019 and more than 80% of these visits being
from either previous customers, visitors or people who have searched directly
for the website (similarweb),
it is not hard to see where the success has come.
Digital advertising is becoming more popular every year and especially for Kylie, who in June 2019 was in the top 5 highest Instagram Influencers with over 100 million followers and an engagement rate of 2.41% (Geyser, 2019), can easily reach a high number of interactions due to social media marketing and in turn, lead to multiple successful digital ad campaigns.
According to SimilarWeb, over 10% of traffic to Kylie Cosmetics is generated
from social media and Instagram nearly accounts for 46% of total social media
traffic. For Most people, 10% of traffic may not be a huge number to boast
about but Imagine your Social media accounts being responsible for over 100,000
visits of your website every month. What makes this an even more successful and
smart attribute is that as we all know, it is completely free to post on a
platform such as Instagram (without taking into account Ads of course).
Looking at the reasons for mentioning such feats as “top social media
influencer” reflects on the different trends in the industry that are present
today. For some however, they may still rely on other forms of advertising
besides their favourite influencers or celebrities and again, Kylie has found a
way to attract these customers as well.
Scope
Kylie Cosmetics and her personal social media accounts account as a whole, are
used as a one-way communication tool between herself, fans and/or potential
customers. Scrolling through Instagram will see there are some replies by Jenner
but as a whole, both Instagram accounts follow less than 400 people combined. Now
this may have a number of different reasons, but it also will limit the amount of
outside interactions Kylie will have with those outside her business, giving
the impression that her profiles are more one-way communicative tools rather
than being there to promote a collaborative environment.
Culture
Using the hashtag “#Kyliecosmetics” (with 3.9 million posts as of the 24th August 2019), consumers and other social media users are able to upload pictures with this hashtag to reach a worldwide audience and at the same time, allow Kylie’s brand to reach more due to word of mouth advertising. By doing this, Kylie is allowing others to post photos using her products and by using the hashtag, not only are all the original poster’s friends able to be referred to the cosmetic company but the hashtag itself is growing and will then appear more throughout Instagram and the news feeds of others. As above in the scope aspect of the SMMF, Jenner’s pages are more one-way communicative tools, but the use of this hashtag could almost begin to introduce an aspect of a collaborative environment allowing a degree of reciprocal interactions.
Structure and Governance
Hearing the Jenner or Kardashian last name may bring thoughts
of reality TV into some readers minds, However, as founder and current owner of
Kylie Cosmetics, Jenner definitely is self-made when it comes to this Company.
She markets how she wants and when she wants and if she was failing at this
side of the business even with her social media credentials, I do not believe
the company would be where it is and has grown as much/quick as it has today.
Financial Services Industry and Social Media
I believe that initially the financial services industry was opposed to using
social media due the associated risks that could come with either having
inadequate systems in place to monitor and deal with potential issues and also
the backlash they could receive if they incorrectly fix an issue or provide
misleading advice.
Upon realising that a high demand for a social media presence is necessary,
investments into these avenues were created and consequently delivered a faster
and more efficient service to customers. The problem they may find however is
that customers will rely more on these types of “convenient” services rather
than going to firms or to banks for advice and help. Realistically, this type
of practice reduces costs overall due to what we have learnt about digital marketing
as opposed to standard traditional marketing.
While the changes as a whole will have a positive effect on the scope aspect of the Social Media Marketing Framework, short term costs will also be higher due to the governance aspect of the framework which allows staff to learn about policies relating to what they can and cannot say to clients/customers. Another short term cost to take into account is by potentially changing the structure of firms and businesses, some jobs will need to be made redundant as the demand for these positions will not be as high due to a shift from traditional marketing roles to a digital team and also face to face contact may very well be overrun by exchanging questions/answers digitally.
Digital marketing is quickly becoming a popular way for
potential shoppers to avoid shopping in local retail stores or shopping malls
due to the potential for lower prices, extended product categories and an
overall easier transaction from beginning to end. A business has the option to
invest into paid advertising in order to gain additional customers and sales.
According to Ballantine,
paid search marketing nearly generates double the clicks of clicks generated
organically (or customer focused searches) and with businesses spending 10’s of
millions per year on Banner advertisements, online marketing appears to be a
financially successful venture for a business with an online presence to
undertake.
According to specific elements proposed by Rose and Hair,
information processing, perceived ease of use and perceived benefits can either
persuade a customer towards the targeted website or disassociate the customer
with any future transactions.
Ask around the room you are currently in and there’s a very
good chance at least one person has heard of Apple as a brand and will most
likely have any apple consumer electronic product with the above logo displayed
on it. They’re popular, trendy and a statement in this current century.
According to a Morgan Stanley survey through Statista,
Apple iPhone users are by far the most loyal of all platforms in the same phone
class and alongside the person in the room who is familiar with apple products,
most of us have seen a digital ad containing one of their newest products.
As an avid Apple user, I am included in the 92% who are
likely to repurchase a newly released apple product within the next 12 months.
The first step is realising we would like to purchase a
product or the intent to buy in the future. This can also be known as IP or
Information Processing. This could happen through personal thinking or
experiences, seeing these products within the real world or constantly seeing
or hearing advertisements for these products.
Further from IP, most of us will go and do some research on these products to make a pre purchase evaluation. Visit the Apple website and you will be bombarded with sharp, clear images that demand your attention and the newly updated technology and features these products contain.
Next, we may look at the Perceived Benefits of purchasing
these products. Old technology no longer as efficient or just the need for a
newer, better product option and these three antecedents are what can help
either a loyal or new customer to purchase the latest technology produced by
this company. The latest ad by Apple may cause users to remember the 11 million
batteries replaced in 2018 due to the Battery scandal that had occurred
(Leswing K, 2019). This ad, however, implies the battery life as being
extremely good and due to the digital ad, makes the iPhone look appealing to
not only loyal customers but also the chance to persuade new customers into
buying the latest Apple product.
Digital marketing can be defined as ‘a process of identifying customer wants/needs and satisfying these needs through marketing on digital platforms, devices and services in order to promote a business and gain sales.’ In the previous, classic approach to marketing, there were no such things as social media marketing and internet marketing was never a popular form of marketing by managers and consultants. As technology evolves, so does the use of digital marketing.
Digital Marketing can now be associated with targeted ads, through the
apparent subtle recordings performed by Google (Hill.S, 2017) and automated marketing
and analytical processes.
Digital Marketing can be classified into 3 different types of Media; Paid, Earned
and Owned.
Different Businesses can achieve a higher return on investment using whichever
type of Digital Media most applicable to their strengths. Paid media can be
expensive but effective through avenues such as paid ads on Google and digital
signage, as opposed to cheaper or free alternatives within the Owned Media
category including but not limited to Websites and Blogs. A reputable Business
could achieve a good ROI through paid media but could potentially also achieve
a better ROI if they were to engage in digital marketing through the Owned
media category.
Blog1b. Case Study 1 (E-Bay) – Discuss how eBay has had to evolve its online brand proposition and communicate it to Achieve continued growth.
eBay had to continually improve its service in order to
achieve the potential increase in growth for the company. By focusing on their
main core messages to buyers and sellers in attempts to increase users,
transactions and member activity, they are able to achieve increased sales
figures and customer retention. By promoting new levels of customer service
such as increasing buyer/seller feedback, the company is able to continually increase
trust in current members and purchasers and the opening of new categories and
new product types, eBay is able to continually keep currently clients coming back
and quickly develop the trust of potential sellers and/or buyers.
Whilst the fees/commissions were increased, there has still
been an increase in customers and transactions due to the other factors that
have been improving over the years since the company was created.
Why is customer retention so important?
“In the U.S., 40% of online
shopping revenue comes from repeat customers, who make up only 8% of site
visitors.” (Bernazzani, 2018) this statement further
compliments why the core messages adopted by eBay were effective and attributed
to the overall success of the company.
With the cost of gaining new customers and loyal members usually
being more costly than keeping current members, adopting principles where
loyalty is rewarded through avenues such as convenience and selection of
products for buyers and cost effective marketing/distribution and a large buyer
base for sellers to help not only eBay grow as a company, but also for buyers and
sellers to benefit from using the web service.
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