Target Market and Positioning of Click Frenzy - Assignment Example

Q1a. What is Click Frenzy? b. How and why did this idea originate? Click frenzy was an online sales initiative in Australia that was largely publicized but failed to deliver what it had promised. The event was to launch at 7 PM AEST, on Tuesday November 20th 2012 but its servers crashed due to heavy traffic. This affected even the affiliate websites. However, after three hours, the website was up and running. Prior to the event, the site had assured the public that it was prepared to handle the huge traffic expecting about a million hits during the 24hr event (Wells, 2012). The event was supposed to bring together major retailers such as Myers, Microsoft, Target, Priceline, Dell, Bing Lee, Snappit, Brand exclusive and Toys ‘R’ Us among others who had paid a participation fee. Following the collapse of the first cyber frenzy event, the organizers have slated another cyber frenzy day set for Tuesday 3rd – 5th November 2013. Whether this particular event will live up to the name of “the sale that stops the nation” is yet to be seen. According to Click Frenzy website, this year’s Click Frenzy event will offer all products as 40% discount and will go on for three consecutive days. The event is organized by Global Marketplace Pty Ltd, which is an Australian registered firm (click frenzy 2013). The main idea behind this initiative was to encourage online shopping among Australians who tend to prefer doing online shopping with foreign firms. It was designed to replicate the ‘Cyber Monday’ initiative in the US that seeks to encourage a day of online shopping dominated by huge discounts and offers (Neville & Smithers, 2012). Cyber Monday also takes place for 24 hours only in a year which in the US is slated on every Monday after the Friday following Thanksgiving Day. The cyber Monday event has successfully been incorporated in the American culture with high sales volume recorded during the event. This must have been the inspiration and motivation that led to the organizers to plan for Click Frenzy. Nonetheless, with proper organization and technical support, this year’s event will be readily accepted by shoppers even those who might be cynical about online shopping attracted by the huge discounts. Q2. How did consumers make their decisions on whether or not to buy products/services from Click Frenzy, and how did they arrive at their final purchasing decision? Although Click Frenzy was largely a failure for retailers and consumers, some sales were made on the day (Kwek 2012). With the difficulties experienced at the Click Frenzy website, some consumers opted to bypass it and went directly to retailers’ websites and made their purchases. According to an article in The Sydney Morning Herald, the Click Frenzy servers were set to accommodate one million visitors over 24 hours but instead received double the number of visitors in minutes (Moses, 2012). This definitely led to the failure of the websites. This failure received a lot of negative criticism especially in the social media where consumers voiced their frustrations. However, figures on the ground indicate that there was a surge in online sales as evidenced by a 240% on online payment reported by eWay payment gateway on the particular day (Sarma, 2012). A section of consumers failed to make purchases because they could not access the Click Frenzy website. The willingness to buy was there plus the money, plus the information about the product but the product was not accessible. This was in part the failure of the distribution/supply system which was the website. Consumers were aware of the promotion as the firm had invested a lot in promotional campaigns days preceding the event. The advertising and public relations activities about the event had adequately informed consumers about the discounts and available offers (Moses, 2012). This motivated consumers to make choose to make online purchases at the site. Unfortunately, the final purchase decision was hindered by the failure of the website. Alternatively, some consumers made the final purchase decision by purchasing online directly from the partner websites directly. This was because they had access to information on the partner websites hence could access the same Click Frenzy offers via the participating retailers’ websites. Q3a. Evaluate the positioning of Click Frenzy. Have they defined their positioning correctly? b. Who is their target market? c. What is their main points-of- parity and points-of-difference? Click Frenzy carried extensive campaigns prior to the launch day. The event organizers marketed and positioned the event as a show stopper. It was deemed to be the biggest sale Australia had ever seen, “the sale that would stop the nation.” In these adverts, some names of the participating retailers were mentioned at an additional fee. This gave the audience the idea that the sale will offer ‘everything’ shoppers ever wanted to buy at great discounts. This positioning succeeded in creating a very unique image of a sale that would literally stop the nation. This is evidenced by the huge number of hits that the Click Frenzy website received thereby overwhelming and also the traffic that affiliate websites received which averaged 8.7 million hits over two for participating websites (Titman 2012). Click Frenzy targeted the price sensitive Australian shopper. The marketing exclusively targeted people who are open to deals and who shop online on foreign sites such as eBay and Amazon. The whole idea of Click Frenzy was to tackle increased competition of foreign shopping websites. The idea was to shore up a large percentage of the local online shopping community. The major point of parity for Click Frenzy was the discounts on offer and the fact that it was a first time event. The brand was positioned in the market to create an impression that Click Frenzy was supposed to push suppliers and retailers to give offers to their customers through the event. Therefore, their point of difference was that the offers at Click Frenzy did not exist anywhere else or if they did, the market was not aware. The prices at Click Frenzy would be the lowest customers could get in any store or website. Another point was that the sale was being held locally in Australia meaning that shipping time and charges would be lower compared to shopping in overseas online shopping sites. Another point of different was the scheduling of Click Frenzy just five days before Cyber Monday. This targeted consumers who had saved up money for Cyber Monday but could be lured to Click Frenzy with great offers and discounts and intense advertising. The point of parity for Click Frenzy on the other hand was the holiday mood associated with Cyber Monday shopping and history of success of Cyber Monday. Technically, by scheduling Click Frenzy earlier before Cyber Monday, the organizers realized that their main competitors, mainly American enjoyed the holiday shopping mood associated with Thanksgiving Day. Q4a. What competitive frames of reference does Click Frenzy face? b. What are the implications of those frames of reference for its positioning? The Click Frenzy event targeted Australian online shoppers. The event was modeled around the American Cyber Monday. The American Cyber Monday is held on the Monday following the Friday after Thanksgiving day where the Thanksgiving day is held every fourth Thursday of November annually. The Click Frenzy was to take place five days before Cyber Monday. Unlike the Cyber Monday, Click Frenzy is new to the Australian national culture. The Cyber Monday on the other hand is aided by the popularity of the national culture of Thanksgiving Day as a national holiday. The competitive frame of reference for Click Frenzy was thus not the ordinary Australian online shopper but rather Australian online shopper who had saved up to participate in Cyber Monday. The chosen competitive frame of references limited the organizers to online shoppers only. Australian retailers generally agree that the Australian online shopping market has not been growing at the rates witnessed in other developed countries. As such, there has been a need to nurture the regular in-store shoppers into an online shopper through attractive offers. What the organizers did not acknowledge was that the promise of discounts on goods was enough to convert the regular in-store shopper into online shopper. This is evident in the high number of interested shoppers into the event that eventually led to the failure of the system. The organizers had anticipated that the event would only attract those who had past experience in online shopping or those who predominantly participated in Cyber Monday sales. Q5a. Identify Click Frenzy‘s sources of brand equity. b. Assess its level of brand awareness and the strength, favourability, and uniqueness of its association. Brand equity is the associations that a brand commands from the consumer through their experience with the product or what they have learnt about the product. Borges (2009) says that brand equity is the ‘added value’ endowed to a product in the thoughts, words and actions of a consumer. There are different sources of brand equity. Charlesworth (2009) list the sources of brand equity as production, servicing, staffing, distributing, innovating, pricing and advertising. For click Frenzy, the main sources of brand equity are advertising and pricing. The fact that the event promised huge discounts on a range of products was what triggered the imagination of the customers. They imagined that they could buy goods at throw away prices and hence save a lot. The other source of brand equity was advertising. The marketers of the event embarked on a massive advertising campaign using various channel specifically the television, radio, newspapers and online. The fact that the advertising called on the public to register on the click frenzy website gave them a sense of community. Much of the advertising efforts called on the public to register on the site in order to participate in the sale. In the minds of the customers, they perceived themselves as part of a privileged group of people who will access the sale alone. Those who did not were meant to feel excluded thus encouraged them to be socially included in the group of shoppers with access to the sale. Unfortunately, shoppers were not required to log in with details to access the sale site. The Click Frenzy brand was a new brand in the market. Prior to launching the event, it was an nonexistent in the market. However, given the high levels of advertising that followed the launch, the brand gained strength in the market. For instance, some advertisers indicated that they paid as much as $30 000 to advertise on the brand’s websites and be associated with the sale as a unique event in the Australian retail market. Such high advertising fees indicated that the brand commanded a lot of respect from retailers and the market as a whole. The number of hits it received in minutes after launching which was over one million also captures the strength of the brand and awareness of the brand in the market. Furthermore, the level of attention the failed sale received in the social media indicated the level of awareness about the event among potential shoppers. Furthermore, newspapers and television news bulletin also covered the failed sale and in essence capturing brand’s level of strength and awareness and its uniqueness in the market by being associated with great discounts. Q6. Do you think Click Frenzy did a good job in managing its visitors and customers? Why? Click Frenzy failed at the outset in managing its visitors and customers. The first mistake they did in handling their customers is requiring them to register in order to participate in the sale. In essence, the sale was accessible to anyone who logged on in their site. This denied the customers the sense of community and inclusion that they had anticipated by registering for the sale. Through social media and other channels, some customers complained that the event was a hoax and was meant to collect people’s personal information to use in direct marketing activities. Although the organizers reassured customers that their personal information would not hired to third parties, it did not help much in winning the public trust. This move greatly damaged the trust that customers had placed on Click Frenzy and is likely to affect future sales activities. The second major way in which Click Frenzy failed in handling their clients is through the failure of the system. The marketing campaigns had promised “the sale that would stop the nation” but in fact the sale was never to be some extent. Although the sale was to bring together a number of retailers while Click Frenzy itself did not sell anything as customers were to be redirected to the retailers’ websites, the sale never happened in the minds of customers. This is because many customers anticipated making their purchases at the Click Frenzy website and hence not all of them thought of directly accessing the websites of participating retailers and manufacturers to make their purchases. After the Click Frenzy servers crashed, the organizers did not inform their clients about the existing alternatives of visiting the participating websites directly. Although some of the participating servers websites were affected by the high traffic such as Myers, not all of them were affected hence they remained active. It was the responsibility of Click Frenzy to advise their customers about the existing alternatives through custom messages on their website rather than indicating error messages. This would have been a show of allegiance to the participating retailers who had paid huge amount of money to participate in the sale and also to their customers who had made the effort and were expectant to make purchases at a discount. Such as message would have redeemed their image but they failed to capitalize on that. Consequently, clients who were not aware that they could access the sales through the participating websites directly kept refreshing and thus exacerbated the problem at the Click Frenzy website. Q7. How did Social Media impact the reputation of Click Frenzy, before and after the sales period? The click Frenzy organizers had used various channels to market the event. Among those widely utilized was the social media. In Facebook, the organizers had set up a page to inform shoppers of the developments prior to the actual sale. The existing official Click Frenzy page in Facebook has over 19000 likes. It was last updated by in November 21st 2012. However, prior to the failure of the actual sale, activities on the page were very impressive with individual offers op various items being posted. Going by the comments made on the individual offers posted, the response was mixed. Some shoppers were complaining that the prices of some items on offer were way high above compared to other sites. The social media offered shoppers a platform to review and discuss some issue pertaining to the sale. For instance, some shoppers asked for clarification on some information pertaining to products on offer and asked fellow shoppers to clarify some certain features especially in electronic goods such as computers. In another instance, the social media assisted customers in redirecting them to the participating retailers’ websites. For instance, one Facebooker indicated to fellow clients when the site failed “stop wasting your time and refreshing, while you waiting why don’t you visit www.mgear.com.au , want a discount? enter coupon” (Click Frenzy Facebook page). The social media also played an important role in communicating to the public on the progress of the sale. When the Click Frenzy website failed, the organizers took to Facebook to apologize to shoppers and inform them on the development. In one posting, it reads, “Everybody, this is Grant Arnott of Click Frenzy. We will be issuing a statement shortly about what happened in the first 30 minutes of our event, which we understand is unprecedented - meanwhile, Click Frenzy is available for you to browse and purchase from” (Click Frenzy Facebook page). The social media was also used to discredit the event by customers and also to express their frustrations which had a very negative impact on the image of the brand (Park2012). Some page fans also sympathized with the participating retailers. One fan in particular noted that “Let’s hope ALL those retailers who PAID to be listed on Click Frenzy get their money refunded! This was marketed to them also as 'the sale that stops the nation' offering them - fantastic sales opportunities - you FAILED to deliver - no amount of damage control will fix that.” Through such comments, customers showed that some of them knew how the entire event was organized and thus did not blame participating retailers but the Click Frenzy website. Click Frenzy on the other hand has remained inactive in the Facebook page despite the fact that another sales event is already being advertised in their website for year 2013. This shows that the organizers have failed to use an integrated approach to the marketing efforts and somehow treat social media marketing as a secondary channel. This is inappropriate given that social media offers live offer reviews which customers tend to trust more than adverting messages. Q8. How can retailers prepare for a Click Frenzy? The failure of the Click Frenzy event points to important issues to be considered in preparing for another click frenzy event. The most important issue in preparing for another click frenzy event is increasing website bandwidth. Why is this so? The Click Frenzy servers were engineered to handle a million visitors over the 24 hrs that the sale was to last. However, the servers were overwhelmed by the huge number of visitors. Other retailer websites such as Myers were also overwhelmed by the huge surge in number of visitors. It seems like that Australian retailers have underestimated the potential of online shoppers in the country and around the world (Whyte, 2012). A number of industry experts allege that online retailing in Australia is considered as an afterthought as many retailers prefer the in-store retailing model. Therefore, there is need to change the attitude towards online retailing by the retailers. Given that the online retail industry is nod as developed as in other OECD countries, the retailers underestimate online retailing as an effective distribution channel. On the other hand, Australian retailers have allowed foreign players to dominate the market and have been slow in challenging the influence of the foreign players. By adapting an improved attitude and perception towards online retailing and online shopping, the retailers will be better placed to implement better business strategies corresponding to the requirements of online retailing and shopping. They will even emulate foreign players in the industry in a bid to increase competition for the domestic market. In collaboration with Click Frenzy organizers, the retailers should seek to make sure that only the registered shoppers access the sales event. This not only gives the shoppers a sense of community and belonging but also ensures that the sales event does not attract unwanted visitors to the site. In the past incidence, it can be speculated that one of the main reasons why there was an upsurge in the number of visitors to the site was curious window shoppers. Genuine shoppers and those who had interest in the actual sale should have registered as per the requirements stipulated in the advertisements. The other issue that retailers need to address is price comparisons. In the past event, some customers noted that the offers advertised in the sale were actually highly priced as compared to other prices of the same products in foreign online retailing websites. Such a discrepancy in prices in the age of the internet is likely to be easily noted and information on such spreads very quickly (Doukas, 2012). Therefore, if retailers are genuine about their offers, they should allow a feature in their websites where shoppers can compare the price of the same product in other websites. By failing to provide such information to shoppers does not mean that they cannot access it from elsewhere. Q9. Using other strong brands which have been born online (eg, Google, Facebook), how do you build a successful online brand? Online brands have taken the world of marketing by a storm. Several years ago, a brand name such as Facebook was unheard of. Today Facebook is worth billions of dollars and has a global membership following that transcends national and geographic boundaries. While such pioneers as Facebook and Google charted unexplored waters, they have offered many learning opportunities for aspiring online brands. Experts in the field of online marketing have given a wide array of suggestions in making a successful online brand. The first and foremost requirement is having a compelling value proposition. A value proposition is what a brand intends to give the customer which is worth their time and money. For online stores, they must have a value proposition that is more appealing to the customer than the shopping experience provided by the brick and mortar stores. On the contrary, for social brands such as Facebook and Twitter, they must make the social interaction proposition more interesting than face to face interactions. Facebook promises enable members to “Connect with friends and the world around you on Facebook”. In essence, Facebook promises members to eliminate the geographic and distance boundaries that are present in face to face communication. For Online Brands such Click Frenzy, the value proposition was the world beating discounts on a range of products from different retailers and manufacturers. This idea of value proposition is layered in by the 8C’s of online branding namely; Convenience, Content, Customization, Community, Connectivity, Customer Care, Communication and Consent (Tsiames & Siomkos, n.d.). Reliable and high quality online experience. Online brands must always seek to engage clients in a high quality online experience. Facebook for instance engages its clients by enabling them to share photos, chat, and even play games on Facebook. This increases the product range of Facebook and ensures it continued presence online through increased use. In the case of Google, the brand has gone further and introduced brand extension to engage clients fully. For instance, Google Books, Google Maps ensures that clients have more reasons to use Google other than just being a search engine. Click Frenzy sought to engage clients by registering them but stopped there. The Brands online presence in social media has not been engaging ever since the failed sale. Strong partnerships and strategic alliances, just like in contemporary business are important in online branding. Such alliances are formed between major players. For instance, Google and Facebook have a strategic alliance that allows people to search Facebook members on Google. Additionally, Google allows customers to access Facebook using Google mail credentials. Q10. What do you think are the future branding challenges and opportunities for Click Frenzy? High traffic is an issue that Click Frenzy has to deal with. The fact that Click Frenzy has learned its lesson in that it has to increase its capacity n terms of the number of visits their servers can handle at any given moment offered an important learning lesson. It is expected that t in the future, the organizers will have increased their capacity. However, this cannot be said of its partners. The fact that Click Frenzy is not a homogenous brand and relies on its partners to make the event successful denies the brand a firm grip on the control of quality and other issues. Click Frenzy has to deal with the effects of a tainted brand image after the failure of the first event. While some consumers were able to make purchases directly from some of the participating retailers, others did not manage to do so. Such frustrations are both on the side on shoppers and partner retailers. While data shows that there were increased sales in some websites, some websites which had paid hefty sums to participate in the sale did not recoup their money. This means that their participation in future events could be in doubt. There exists numerous opportunities in the future for Click Frenzy. The most notable include correcting the mistakes of the past and presenting a better experience for their customers. This however, can only be achieved if all the issues that led to the failure of the first event are addressed effectively. This means increasing the capacity of the Click Frenzy serves and that of their partners. The other way is prolonging the period of the sale in order to avoid shoppers storming in the website at the very launching. This seems to be already addressed given that the firm indicates that the 2013 sales event will take place over three days. The other opportunity that the firm can exploit is increased awareness of the efficient and convenience of online shopping. This will be banking on the sales that were made during the last Click Frenzy event. With this in mind, Click Frenzy should seek to assure its clients and inform them about all positive changes that they have made. References Arnott, G. (2012). Click Frenzy – My Story [online]. Available from (21st March 2013). Borges, B. (2009). Marketing 2.0: bridging the gap between seller and buyer through social media marketing. London: Wheatmark, Inc. Click frenzy (2013) (21st March 2013). Click Frenzy. [online] (21st March 2013). Charlesworth, A. (2009). Internet Marketing: A Practical Approach. London: Routldge. Doukas, S. (2012). Click Frenzy fail – The top five learnings from the ‘sale that failed a nation’ [online]. Available from< http://www.digitalpulse.pwc.com.au/click-frenzy-fail-learnings/> (21st March 2013). Kwek, G. (2012). We're happy' - Frenzy drives traffic to retailers [online]. Available from (21st March 2013). Moses, A (2012), Click Frenzy a mega tech fail: the online bonanza that became nothing of the sort [online]. Available from, (21st March 2013). 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