Word of Mouth Helps Them Fly Off the Shelves by Schneider, K - Article Example

Current Event Paper- Marketing The development and management relationships has, in recent years, become a central focus of marketing as it has been realized that they are valuable assets of a firm. Businessmen from the advertising industry should take the following key issues into account while planning their marketing communication process. Today, online marketing experiences rapid growth proving its efficiency and high response potential. The article Word of Mouth Helps Them Fly Off the Shelves proves the idea that modern business cannot survive without effective online interaction and communication. The most interesting fact is that word-of-mouth adverting penetrates into online environment becoming one of the adverting tools in the Internet. Today, for many companies a website is the main tool on the basis of which the firm carries out the transactions flow between itself and the buyer. In indirect marketing the company utilizes the services of various types of independent marketing organizations or cooperative organizations that are located in the home country. When a manufacturer exports indirectly, the responsibility for carrying out the foreign selling job is transferred to some other organization. For instance, the Wee Ninja doll is one of the popular toys for children available online. Smiths and their partner use online marketing as one of the main tools of adverting and sales. They state that it is more “about personal taste and online conversation as they are about buying itself, although no products are sold on the sites” (Schneider, 2006). As businesses compete in a progressively fiercer market place for a larger wallet share of an increasingly discerning and diverse customer base, they become ever more communication-dependent. On the one hand the right to be informed of the facts involved in any buyer-seller relationship is clearly a fundamental right. Some of the key aspects, which have already been subject to legislation or regulation in Europe, include the full cost of credit/loans taken up, often known as truth-in-lending; the true cost of an item, under the slogan unit pricing; the basic constituent elements of products, known as ingre­dient informative labeling; the freshness of foods, discussed generally as open-dating; and truth-in-advertising. “Patti Freeman Evans, a senior retail analyst at Jupiter Research, added: “Shopping tends to be a social experience in the offline world” (Schneider, 2006). The emergence of direct marketing, customer relationship management, and various other marketing disciplines underline the importance of this approach. Recent years the sending of marketing materials to individuals is regulated in the USA and Europe. As Internet marketing is essentially a matching process between the needs and expectations of customers, and the organizations ability and capacity to satisfy them, the aim of the company is to create a good website to meet the needs of the customers and attract new clients. The most interesting was the fact that online marketing ‘borrows’ tools from traditional marketing such as word of mouth adverting. At this point, the individual either makes an initial purchase (in the case of the more expensive product) or continues to purchase—adopts and exhibits brand loyalty to—the less expensive product. Studies show that, as a person moves from the evaluation through trial to adoption, personal sources of information are more important than impersonal sources. It is during these stages word of mouth become major persuasive forces affecting the decision to buy. During the past Chrisman season early word-of-mouth buzz among influential consumer groups quickly achieved phe­nomenon status that then spreads over the USA. The comment that “We expect more as the Christmas season really gets going. For us, that’s amazing since we don’t advertise there. It’s all word of mouth. And when that happens people tend to come back” (Schneider, 2006). The main criterion used in the analysis is the level of customer satisfaction delivered by the website. The remarkable feature of Internet marketing applied by The Wee Ninja doll is a process, an end result, and a way of thinking. The Wee Ninja doll becomes increasingly internationalized as it becomes more involved in and committed to serving markets outside of its home country. This is a planned and orderly process, which arises from perceived new opportunities or threats. Bolt-on systems, used by many Web companies, can provide the basis for moving most or all selling operations to online systems. In cases where "bricks and mortar systems are necessary because of the need to satisfy customer requirements to see products, obtain human advice and to distribute products, bolt-on systems help to expand business to areas suitable for virtual selling. The author underline that this connection between good levels of customer service and good levels of customer satisfaction and retention underpins the common association of customer service with keeping, rather than winning, customers. Customer service therefore plays a pivotal role in relation­ship marketing. Getting this role right, and to a standard of expertise that is superior to that of competitors and sustainable in the longer term, requires an in-depth understanding of the nature and nuance of customer service. Changing customer buying patterns have long forced companies in certain industries to seek competitive advantage by focusing on the development of enduring relationships with customers. However, information technologies, in particular the website, have provided additional incentives for firms to adopt such strategies. Consequently, it is important to realize that network technology cannot only be used to manage information, but can also be used to manage customer relationships. The main disagreement between what we have learnt and what the author discusses is that online marketing differs from traditional one. The author vividly portrays and proves that the Internet and online marketing use the same tools as traditional one. For this reason, companies should improve their site design in order to attract new customers and makes it easy for a loyal group of clients to access available information. There is no two customers with the similar equipments, that is why service quality often includes substantial measurement and analysis of internal processes as well as changing environment. It is important to note that “Marketers are eager for insight into what the crowd is doing. We can provide that insight” (Schneider, 2006). Taking into account information described by the author, it is evident that the key to any successful relationship marketing program is detailed information and its design. Another feature, which is closely connected with this one, is that the better information that a firm has about a particular customer, the more value that firm will potentially be able to provide that customer. Only a well-constructed and easy-to-use website can attract more customers in contrast to sophisticated one where customers spend more time and efforts to find information they are interested in. The mix of simplicity, vividness and full range of services helps Sonyericsson to attract new customers, ensure customers satisfaction and increase sales. The Websites of the company promote products and services, they inform and educate consumers about those products and services, or persuade them to try new and improved one. For the marketer, technologies with the help of Internet are most effective tools when developed as a carefully planned process for increasing penetration of international markets. A company website is not strictly an advertisement in the conventional sense since money is not exchanged to place the content of the website on a medium owned by a third party. An internet retailer can use similar approaches to traditional market, but different methods to influence their potential customers. References 1. Schneider, K. Word of Mouth Helps Them Fly Off the Shelves The New York Times. November 1, 2006, pp. 45-48. Article Word of Mouth Helps Them Fly Off the Shelves Karmaloop Boston got a boost online from favorable remarks on its clothes. Начало формы Конец формы Sign In to E-Mail This Print Single Page Reprints Save By KEITH SCHNEIDER Published: November 1, 2006 IT’S been a big start to the holidays for Shawn Smith, his wife and creative partner, Jennifer Brody, and their Wee Ninja doll. Ever since the third week of August, when the new social shopping site ThisNext.com spotlighted the Wee Ninja — “Can’t resist his tractor beam of cute,” wrote one contributor — the couple have been unable to make enough of the cuddly black dolls with the cream-colored faces. The retail Web sites that the couple rely on to help sell the Wee Ninja — ThinkGeek.com and MyPlasticHeart.com — are already out of stock. “From October through December last year, we sold a total of 200,” said Mr. Smith, who designs and assembles the $19.99 dolls in the couple’s five-year-old Shawnimals studio in the Bucktown neighborhood of Chicago. “From October through December this year we’ll sell at least 600, and probably 800. That’s huge for us.” Mr. Smith credits the online trend spotters at ThisNext.com, and more recently at Stylehive.com, for giving the doll a holiday boost. “Until August, we were just getting our normal orders of a few dozen at a time,” Mr. Smith said. “Then came the mention on ThisNext.com. All of a sudden, stores are ordering hundreds at a time.” Americans are expected to spend $100 billion online for retail goods this year, $32 billion of that during the holiday season, Jupiter Research says. Though PriceGrabber.com, Shopping.com and Shopzilla.com may be the Internet sites that consumers turn to most often to compare prices, some new Web sites are trying a different approach: harnessing the idea of digital word of mouth. Besides ThisNext.com and Stylehive.com, the sites include StyleFeeder.com, Crowdstorm.com and kaboodle. They are as much about personal taste and online conversation as they are about buying itself, although no products are sold on the sites. They are also more elaborately designed, functional and interactive than regular chat rooms. Visitors can read about what’s popular and what’s hip in often surprisingly bright prose written by the visitors themselves. They can get ideas for their Christmas shopping lists, and store that information as bookmarks. They can find links to interesting, distinctive products they wouldn’t find in most storefronts. And they can become members and contributors, posting pictures and comments to describe themselves and the clothes, makeup, shoes, bags, electronics, games, movies and even dolls they think are worth a look. Internet market analysts say these so-called social shopping sites, most of which sprang up in the last year, are still too new for analysts to assess their staying power or the soundness of their business plans. “The challenge is to build traffic to their Web site,” said Sucharita Mulpuru, an online retail analyst for Forrester Research, a technology and market research company in Cambridge, Mass. “They are going to have the same acquisition costs that every e-commerce site has. I don’t know if that is going to happen.” Patti Freeman Evans, a senior retail analyst at Jupiter Research, added: “Shopping tends to be a social experience in the offline world. These sites are trying to answer the question of how to bring that experience into the interactive online world. On the Internet, if you have five friends, you might also have five million friends. How do you harness the power of consumer-created content to drive retail sales? Whether these sites have a huge impact on retailers remains to be seen.” They have certainly had an effect on at least one other small retailer besides the couple selling Wee Ninja. In Boston, Giovannah Chiu, the 25-year-old director of lifestyle marketing for Karmaloop.com, an online and brick-and-mortar clothing retailer, has felt the influence of social shopping sites. Earlier this year, Ms. Chiu said, she learned about Stylehive.com, which is based in San Francisco, where the conversation is generally focused on women’s fashions and interests. She signed up and posted some of Karmaloop’s clothing. “We didn’t really know what Stylehive was,” Ms. Chiu said, “but quickly realized it was a huge community, so big that we posted on a daily basis for a while. It attracted some attention. Now all kinds of people are posting about Karmaloop.” “That site does real well for us,” Ms. Chiu added. “I’d say they send about 300 to 400 visitors a week to our Web site, and probably account for an average of $400 a week in sales. We expect more as the Christmas season really gets going. For us, that’s amazing since we don’t advertise there. It’s all word of mouth. And when that happens people tend to come back.” ThisNext.com, Stylehive.com and the few other social shopping sites share similar business pedigrees, and have been well financed by venture capital firms. ThisNext and Stylehive, for example, were started by West Coast Internet entrepreneurs in their late 30s who had already succeeded with other technology and Internet ventures. Gordon R. Gould, ThisNext’s 37-year-old founder and chief executive, started a blogging company, was chief operating officer of the Silicon Alley Reporter, worked for a time for Sony and was involved in a breakthrough cybercast of a Rolling Stones concert from Madison Square Garden in the 1990s. Anthem Venture Partners and Clearstone Venture, Los Angeles venture capital companies, provided Mr. Gould and his 16-member staff $3.5 million to get ThisNext started. Page 2 of 2) Michael Carrier, the 39-year-old co-founder and chief executive at Stylehive, started Fort Point Partners early in his career to build large retail Web sites for clients like J. Crew. He then founded Totality, an Internet service company that maintains the large Web sites and which was later bought by Verizon. Stylehive, arguably the most colorful and inviting of the social shopping sites, is Mr. Carrier’s first try at the retail online world. Lightspeed Venture Partners in Palo Alto, Calif., provided $4 million in start-up money. The site has 30 employees. Many of the social shopping sites have similar strategies, generally aimed at attracting a piece of the $250 billion that vendors and retailers spend each year on brand marketing. Mr. Gould and Mr. Carrier, for instance, say that ThisNext.com and Stylehive.com will earn their revenue from a combination of fees generated by marketing agreements with vendors and retailers, display ads and selling proprietary market and trend information gleaned from visitors’ comments at their sites. “Advertisers, vendors and retailers are very interested in the shopping context,” Mr. Gould said. “Marketers are eager for insight into what the crowd is doing. We can provide that insight.” Indeed, each site appears to have deliberately attracted and built distinctive cultures of interest to advertisers and marketers. StyleFeeder attracts a young 20s informal city crowd interested in nonconformist products. Stylehive is all about the shoes, clothes, jewelry, decorating tips, furniture and accessories that women with disposable income may desire and talk about. On Stylehive, it’s as if MySpace.com had merged with the coffee shop at Neiman Marcus. Kate Chung, a 38-year-old mother in San Francisco, is a daily visitor to Stylehive, which she has used to compile Christmas lists for her 2-year-old daughter, Alexandra (the Land of Nod kitchen set is a favorite), and 5-month-old son, Elliott (the Melissa and Doug wooden tool set). She is preparing her own list to e-mail to her husband, which includes jewelry from Frank Gehry’s collection for Tiffany & Company. “It’s become a practical tool,” Mrs. Chung added. “I can look on the site at the most popular postings. It’s a good way to cull for great stuff.” ThisNext.com, which features gadgets and housewares, seems to cater to upper-income people over 30. John Polinsky and Rose Poirier, who design fiberglass furniture in Los Angeles and contribute to ThisNext, like to recommend good movies as well as display their own creations. Ms. Poirier, who is 49, says she spends several hours a day on the site. “The cool thing is, you put a movie out there and then you go back and look if anybody saw it and also is making a recommendation,” she said. “I like the concept of peers, people like me, referring each other to interesting things. It’s more trustworthy.” Read More