Marketing Reading

Sunil  Gupta; Joseph  Davin

Other Teaching and Training Material | 2015

Marketing Reading: Digital Marketing

by Sunil Gupta and Joseph Davin

Abstract

Digital technology has changed how consumers search for information, interact with each other, and buy products. The popularization of these technologies has made it possible for companies to have a better understanding of their customers' decision journey and subsequent word-of-mouth recommendations. Digital marketing requires a new approach to reach and engage consumers. We highlight four key elements of digital marketing: outbound marketing (search and display advertisements), inbound marketing, social media networks, and the mobile revolution. The Reading explores each element, explaining relevant tools and how to assess their effectiveness; it also covers advanced topics such as online-offline interaction and linking measurements to customer lifetime value (CLV). This Reading contains an Interactive Illustration, "Search and Display Advertising ROI," which helps students understand the relationships among measures of efficiency of search and display advertising, as well as the dependence of advertising campaign profit and ROI (return on investment) on its measures of efficiency. The Reading also contains links to six video clips on the implementation of digital marketing techniques, including "AdWords Video: Plan Your Campaign," describing the effective design and budget of a digital marketing campaign; "Ads Manager: A Facebook Ads Tutorial," describing a tool for monitoring the cost and results of an active campaign; "Coca Cola Hong Kong Multiscreen Ad Campaign," a creative combination of TV and mobile marketing; "HubSpot CEO Interview on Inbound Marketing," about the importance of creating noteworthy content that will attract customers; "United Breaks Guitars," an example of negative word of mouth via social media; and "Advertising Symbiosis: The Key to Viral Videos," describing why certain customers are likely to share ads. We recommend assigning this reading together with Core Reading: Marketing Communications (HBP No. 8186).

Keywords: advertising; buzz marketing; internet marketing; marketing; marketing management; social media; social networks; Viral Marketing; word-of-mouth marketing; digital; Internet; Marketing Channels; Marketing Reference Programs; Online Advertising; Advertising Industry;

Language: English

Format: Print

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Citation:

Gupta, Sunil, and Joseph Davin. "Marketing Reading: Digital Marketing." Core Curriculum Readings Series. Boston: Harvard Business Publishing 8224, 2015.

Disruption and transformation get a lot of hype and for good reason. Digital technologies have disrupted entire industries and incumbents have often struggled in this new world. Typical approaches used by legacy players such as using technology to improve efficiency, encouraging business units to do digital experiments, or launching independent units to spur innovation have met with limited success. These players have to strengthen their core and build for the future at the same time. It is like changing the engine of a plane while it is flying. Based on almost ten years of research, this book provides a framework for companies to reimagine their business. Using rich case studies and rigorous research, it shows how the rules of business have changed and why it is no longer enough for firms to be better or cheaper to gain competitive advantage. These new rules make it essential for companies to reexamine four fundamental aspects of their business to thrive in the digital era—their strategy, value chain, customer engagement, and organization structure. Done right, digital technology can be a tremendous opportunity for established players as demonstrated by Best Buy, New York Times, Weather Company, and others.

Sachin Bansal and Binny Bansal, co-founders of India's largest e-commerce company, Flipkart, were reviewing the foregoing Facebook post, which had gone viral and received more than 20,000 likes. A third-party seller listed a pair of women's sandals on Flipkart's website at 799 Indian rupees (₹) and offered it on promotion at ₹399. However, upon close examination of the product's display photo, consumers noticed a ₹399 price tag printed on the strap. Consistent with stated goals of transparency and building trusted relationships with customers, the Bansals immediately drafted an apology and terminated the seller's agreement with Flipkart.

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Marketing Reading: Digital Marketing

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