II. Review of existing literature

There are numerous reasons why marketing is so closely related to the Web. Web marketing offers increased awareness to somebody who uses it, it’s an easy way to distribute information, speech, and video presentations, improve a company image, an immediate direct line between customers and staff, and reduces costs of performing these tasks.

The unique advantages offered on the Web over conventional marketing are the following: 1) Accessibility around the clock and “it can attract people because of their interest and not because of other kind of simulative response” (Hoffman, Feb. 1996). 2) Feasibility to keep track of it’s audience. In contrast to conventional marketing in the web there are no distribution and printing expenses, it can be accessed for free and can be created with minimum expenses. Web’s content can be updated immediately at any time.

By analyzing the Web’s marketing perspective, the Web can be also viewed as a commercial medium, offering a number of important benefits which can be examined at both the customer and company levels. Buyer benefits arise primarily from the structural characteristics of the medium and include availability of information, provision of search mechanisms, and online product trial. All of these can facilitate the purchase decision. From the very beginning these commercial characteristics of the Web were recognized as very important; “company benefits arise from the potential of the Web as a distribution channel, a medium mostly viewed as a marketing tool, and a market in and of itself” (Chatterjee, P. and Narasimhan, A. 1994). These efficiencies are associated with Web technology and the interactive nature of the medium.

From a developmental point of view, Web marketers need to identify the extent to which companies are deploying existing models or developing new ones. One way to achieve this will be to “create innovative sites in less crowded categories, particularly as sites proliferate” (Wilson, 1996).

The World Wide Web’s marketing advantage reinforces the idea that the company's relationship with the customer must take advantage of a key feature of the medium, namely interactive, and that such relationships must be updated continuously. The interactive nature of the Web is especially “favorable to relationship building and offers marketers new opportunities to create stronger brand identities which have the potential to translate to brand loyalty and final success” (Hoffman and Novak, July 1996).

The importance that the Web has for commercial brands can be seen though the rapid growth of demand for Web business presence through the registration domain name with Internic (Bosley, April 1996). This is the “www.companyname.com”. From the Internic’s statistics it can be seen that during the first 6 months of 1996 commercial domain names have increased over 139%. The Web creates for the enterprises a more prestigious and professional look. In the corporate world any company which has a Web site should have it’s own domain name. It’s easier for the people to remember a unique name as such than memorizing long url’s of shared web addresses. It’s similar to the vanity toll-free business numbers.

The World Wide Web, has the potential to radically change the way businesses interact with their customers. The Web frees customers from their traditionally passive role as receivers of marketing data, gives them much greater control over the information search and acquisition process, and “allows them to become active participants in the marketing process” (Hoffman and Novak, February 19, 1996).

However, significant trends leading to commercialization exclude predictable and smooth development of commercial opportunities in the Web. Commercial development of the Web must follow the demand ("demand pull"), instead of being driven by "gold fever." “Companies will secure the benefits of innovation in interactive by being closer to the customer than ever before” (Geller, May 24, 1996).

The “more is better” approach, used to count traditional marketing success, is becoming apparent in current approaches when measuring consumer activity of commercial web sites. Derived from traditional media models, "hit" and visit counting methods implicitly defined a heterogeneous mass audience, since in traditional media, "advertising effectiveness" is tied to ratings where larger numbers are preferred.

From the SIBMA information study release of July 18, 1996 the sales generated by the World Wide Web are expected to grow rapidly in the coming years. This growth will be enormous because the Web is a new marketing and distribution channel that has the potential to take over a large portion of all commerce transacted globally. Part of its growth will be based on extending the reach of small and medium-sized marketers generating new sales. However, much of the Web's growth will be based on a transfer of commerce from other less efficient sales channels.

According to the same report the advertising revenues from the World Wide Web and the four largest online services (America Online, CompuServe, Prodigy and Microsoft Network) will total $200.1 million in 1996 and grow to $1.97 billion in 2000. The growth of Web advertising revenue, which will account for the bulk of online advertising growth, will be the direct result of the increase in the number of Web user sessions and page views. SIMBA report projects that Web user sessions will hit 15.79 billion in 2000, yielding 94.76 billion page views. The Web advertising market will total $110.0 million in 1996 and reach $1.86 billion in 2000. The greatest growth will occur between 1996 and 1997 when Web advertising revenues are expected to increase 265.8% to $402.4 million.

From the SIMBA report it can be estimated that 14 “Webleading” ad-supported sites will account for about 75% of the entire Web revenue market. These 14 web sites include CNN, ZD Net, Yahoo! SIMBA’s report also forecasts that CNN and ZD Net will generate the highest ad revenues with about $10.0 million each in 1996.

There is no doubt from what SIMBA’s report shows that a great deal of commercial activity exists on the Web and that this activity is increasing. Profitability from commercial activity on the Web includes “productivity savings, marketing and sales savings, and incremental or new revenue streams” (Hoffman and Novak, February 1996). Productivity savings arise from reduction in order and processing costs and more efficient inventory management. Savings may also be realized from efficiencies in the marketing and selling functions. The Web shifts more of these functions to the customer; savings result through reduced brochure printing and distribution costs, and reductions in order taking as customers use fill-out forms to prepare their own orders.

The reason the Web is growing at such an unprecedented rate is because of the incredible rate of return on the initial investment (Kling, October 1994). Every company wants to get in on the act, in its own appropriate way. Huge corporations like CBS, Sun Microsystems, AT&T, and Mobil all have their own commercial sites along with numerous others.

In addition, the profitability of a Web site depends on the level of its exposure to people. Web marketing has its share of activities that compare to traditional marketing functions. For example, in print publication marketing, "impressions" is a key word most often used in reference to some aspect of readership statistics. By comparison, "hits" or Web page accesses have become the primary area where Web measurement advocates have aimed their efforts at. Web measurement can indicate part of the success of a Web site as a marketing communications medium (Masotto, December 1995).

The commercial Web sites are comprised of 3 components. Content (text), graphical elements (graphics) and interactive channels (interactive).

By far, content is the most important of the three main components of commercial Web sites. In the final analysis, the user will know if he/she is wasting time or finding benefit in a particular Web site based on the content presented. Information is perceived differently on the Web than when published on a "traditional" medium, such as a data sheet or brochure. For this reason, the strategic Web marketer should be prepared to reformulate all applicable literature for electronic publication. Companies often make the mistake of trying to reproduce their existing collateral on the Web without modification.

The ability to display graphics on the World Wide Web has brought a highly specialized graphic art form to the attention of millions of consumers. In the same sense that a painter specializes in the placement of images on a canvas medium, digital artists prepare specialized graphics suited for display on the Internet. A very important concept is that the function of Web graphics should be to create a high-quality image for the site and/or convey product information which is easiest to understand in graphical format. Graphics should not interfere with the content, nor antagonize the consumer by causing unreasonably long download delays when browsing the site. The good combination of graphics and content is what makes a web site important in terms of marketing effectiveness.

While content is the most important component of a Web site, it may be rendered useless in the absence of interactive channels, i.e., buttons or "forms" which are used for commerce transactions. Lately, there has been a trend toward eliciting the e-mail address of the user so that further information can be sent via e-mail, either immediately or at a later time. The interactive aspect of the Web is more known for the use of “hyperlinks”. These are points on a Web page where the user clicks his mouse on and he’s transferred to another Web destination. With the hyperlink use the visitor of the Web site is taking full advantage of the unique interactive principle of the Web.

The initial impression of a Web site is formed by a visual combination of text and graphics and by how long the user must wait before the page is displayed in the browser. This is what is called the "Intake Stage," during which delays in display of particularly large graphics can cause the user to become impatient or even irritated, thus creating a negative viewpoint from the start. At this early point in time, the user forms an opinion about the overall image of the marketing product displayed on the site and more specifically about the quality of the goods or services being offered. This can be a fundamental element for developing specific marketing standards on the Web. Once a general opinion is formed, the user then seeks information about where they are , what other information is available (on a broad level), which links are available from there. This is what is called "Overview Stage". It is crucial to convey these three components of information clearly and quickly, because if the user believes that the site does not contain relevant information, then he/she will leave the Web site. (Novak, and Chatterjee, 1995)

By reviewing the events which occur from the time that the user interacts with a particular site, we can analyze the presence of various marketing stimuli sent to the visitor, and how each component affects the "visit" to the site. In a global sense, the ability to present an interactive marketing medium to an unlimited number of potential consumers is an important advantage of the Web over "flat" advertising and "conventional" publishing. Interactive Web forms are cost-effective and extremely efficient in handling simple automated tasks, such as processing credit card transactions, sending product information, building mailing lists, and routing visitors to appropriate locations in the Web site.

Due to the many features encountered in the analysis of such problems faced by businesses, investing and expanding to new technological phenomena, it may not be surprising to apply recent developments in the commercial and significant usage of the Web with unlimited possibilities in its worldwide reach. It may be unavoidable to guarantee feasibility of the research without narrowing down the research framework into solely aiming the marketing strategies’ development in respect to the commercial use of the Web. The primary focus of this paper is to provide insight in the statement that the World Wide Web is a marketing revolution and not just another marketing tool.

The backbone and framework of the paper is based on this statement. The Web is indeed a marketing revolution, that will open a new horizon to future marketing development, and not just another of the many available marketing tools used in traditional mass media. The elements of content, graphic layout and interactive are points which indicate the trend that the new medium will follow in the years to come. On the other hand the increased profitability the Web has from advertising and commerce is another indication for its impending development. The existing tendency of businesses showing today a unique preference to this new communications medium adumbrates glorious future for it. Considering the indications showing such a promising future for the Web, the following two hypothetical questions have been developed in order to analyze this issue. The integral role the Web will have over marketing is going to be demonstrated when answering these questions.

a. “How effective are commercial sites in issues derived from marketing activities with the use of the Web?” b. Which marketing strategies are currently used on the Web and what are the possibilities to that end?

Answering the first question (a), the effectiveness of the commercial Web sites should be examined and cross-matched with sales data showing the economic success of these business sites. Both WWW-based metrics and traditional business measures are going to be examined. The comparison of the Web with traditional marketing methods shows how much important is the revenue factor as for defining the Web as a successful commercial medium.

The second question (b) demands a more practical approach. The Web itself serves as a medium to generate data. By way of the Web one can make a clear analysis of the marketing activities and strategies presently applied in the Web. Obviously the Web plays a prominent part in the research process, not only as a main issue, but also as a means to accomplish the set goals. In the process of identifying the marketing strategies of the commercial sites examined in the previous question, the following marketing criteria are examined. The richness of marketing content, how much consumer information the site offers. The ease of use which is how easy is for a person to browse through the site by the use of hot-links- this will reflect the interactive aspect of the Web site. The quality of design, i.e. the aesthetic value of the site as for design purposes, is probably the most important criterion from a marketing aspect. After gathering data based on the above criteria, the evaluation process will show the trend of marketing for the World Wide Web.


Previous Chapter  Next Chapter


Copyright Alexandros © 1996