Internet Marketing Strategy at Backcountry - Essay Example

Running head: Internet Marketing Strategy of Executive summary Internet marketing refers to the process enabling consumers to buy goods and services through the Internet. The most common forms of internet marketing are business-to-consumer and business-to-business transactions. This form of shopping has penetrated many aspects of our life, especially since the 1990s, linking us to a capitalist way of life in our everyday living. Internet marketing enables us purchase whatever we require, whenever we require it. Internet marketing is capable of attracting potential customers to a company’s website, and increasing the number of customers for a company. It is therefore important that the companies come up with clear strategies for them to succeed their Internet marketing. Backcountry came to this realization and developed a number of strategies that saw them succeed greatly. The success of Internet marketing highly depends on various factors including developing good business plans, having simple websites, involvement of customers in the design of the website, choosing suitable technology and using Internet marketing tools. Moreover, the Internet marketer must establish correct relationships, adopt end-to-end solutions, acknowledge legal responsibilities, properly utilize customer data and incorporate the Internet channel. Retailers who go Internet are set to reap greatly from it, owing to its global market and efficient management information systems. However, they must also take the necessary measures to avoid the negative effects of the technology such as privacy concerns and security issues. These challenges not withstanding, Internet retailing seems to be the future trend and the sector must fully embrace it. For greater success in the future, and in view of the rapidly changing technological world, Backcountry needs to adopt various new strategies to retain or improve its market niche. 1.0 Introduction Internet marketing refers to the process enabling consumers to buy goods and services through the Internet. The retailers of these goods and services are referred to as a virtual store, Internet store, web-store, web-shop, internet shop, and e-store or Internet shop. There are various types of Internet marketing sites, depending on the nature of the organization. They include Business to Consumer-B2C, BusinesstoBusiness-B2B, and Business to Employee-B2E, Government to Consumer or Citizen-G2C and Consumer to Consumer-C2C. The most common forms of internet marketing are business-to-consumer (B2C) and business-to-business (B2B) transactions. This form of shopping has penetrated many aspects of our life, especially since the 1990s, linking us to a capitalist way of life in our everyday living. Internet marketing enables us purchase whatever we require, whenever we require it. Internet stores have the advantage of convenience since they are available round the clock and the buyers can access them from the convenience of their homes and workplaces (Rayport and Jaworski, 2003). This is unlike the traditional physical stores that can only be accessed during the official working hours. Moreover, many Internet stores give links to supplementary product information like manufacturer’s specifications, demonstrations, safety procedures and instructions (O’Connor et al, 2004). This form of shopping also enables a consumer to search and compare prices among various vendors by use of search engines. 2.0 Internet marketing strategies 2.1 Backcountry’s Internet Marketing Strategy: A case study Backcountry was founded in 1996 with a mere $2,000 capital as a purely Internet retailer focusing on outdoor gear. It started making its profits in 1997, exactly a year after its founding, experiencing a triple digit growth six years in a row that culminated to 134 per cent in the year 2003. In 2004, Backcountry’s sales revenue stood at $27.5 million dollars, an 84 per cent increase from the previous year’s $14.7 million. These figures further rose by 89 per cent in 2005, settling at $52 million. Backcountry earned great reputation for providing good quality outdoor gear on its website www.backcountry.com. Moreover, the company created niche sites aimed at addressing specific needs of its target groups and catering for distinct customers. For instance, the price-sensitive athletes had their own website www.explore64.com, bargain seekers www.SteepandCheap.com and www.backcountry.com, snowboarders www.dogfunk.com while hardcore skiers had www.tramdock.com. In the year 2002 Backcountry implemented a new customer service solution known as ‘click-to-chat technology.’ This earned the company many chatting interactions that resulted to improved customer satisfaction ratings as well as increased sales volumes. The company was therefore among the very first Internet retailers to adopt the live-chat technology, earning itself the title of an established industry innovator. The company however soon realized that this technology only improved customer satisfaction levels without translating to increased sales. In order to leverage its employees’ expertise and maximize its profitability, the retailer ventured into transforming the chat deployment to a proactive sales tool from a purely customer service one, which had a big impact on its sales (Silverstein, 2001). Internet marketing is capable of attracting potential customers to a company’s website, and increasing the number of customers for a company (Rayport and Jaworski, 2003). It can help in enhancing the branding of the company and its products. It is therefore important that the companies come up with clear strategies for them to succeed their Internet marketing (Chaffey et al, 2009). Backcountry came to this realization and developed a number of strategies that saw them succeed greatly. Backcountry first created a good website promotion for its Internet marketing. Its website design and development strategies were also very effective. This enabled the company to create a good foundation for its Internet marketing right from the start. Backcountry always ensured that it is ranked among the top in key search engines, while at the same time ensuring that their search optimization techniques are good. This made their website easily accessible and easy to use compared to other Internet marketing sites. This was a great contributor towards its success. Email marketing was a very strong tool used by Backcountry in its Internet marketing endeavours. This facility, which is still in use even today, enables the company to reach out to its clients by sending them e-mail messages about their products, offers and discounts as well as product attributes. Through email, the company is able to communicate effectively with their clients and potential clients. The success of Backcountry can be partly attributed to its introduction into the market of associate, reseller and affiliate programs. The company sells a variety of products to a variety of clients through its various websites. In so doing, it is able to expand its market share by serving a wide variety of clients. For instance, Backcountry provides good quality outdoor gear to the price-sensitive athletes, snowboarders and hardcore skiers through various websites. Backcountry regularly seeks the services of Internet marketing consultants for analysis of its ventures. This is a very important aspect in Internet marketing since it enables the company to get an informed analysis and opinion on its strategies (Chaffey and Smith, 2008). This has proved to be a very important asset for the company over the years. These strategies have gone a long way in lifting Backcountry to a leading online shop over the years. Backcountry is therefore a true depiction of great success in Internet marketing. It now needs to remain in touch with its clients and potential clients for even greater success. 2.2 Success of Internet Marketing Strategy The success of Internet marketing highly depends on a number of factors such as developing good business plans, having simple websites, involvement of customers in the design of the website, choosing suitable technology and using Internet marketing tools (Laudon and Guercio, 2003). Moreover, the Internet marketer must establish correct relationships, adopt end-to-end solutions, acknowledge legal responsibilities, properly utilize customer data and incorporate the Internet channel (Huang, 2000). A realistic business plan, which answers the question of why the proprietor is doing whatever he or she is doing, is essential for success in Internet marketing. These proprietors must understand how Internet marketing strategically fits with the other aspects of the business and understand the objectives and how they will be measured. For instance, one may pursue the objective of simply generating Internet revenue while another may be striving to maintain a market share or improve customer service (Meyerson, 2005). Internet marketers should maintain simplicity of their websites and not be swayed by the latest web features in the market, since the most important thing is to ensure that customers purchase products or services with as few clicks as possible (Gay et al, 2007). Before marketers make any changes to their websites, they should ask themselves whether this will translate to improved sales or not (Chaffey et al, 2009). In addition, they should bear in mind whether this advancement will improve meet a legal obligation or improve customer surfing through the site (Kumar et al, 2004). Companies must involve their customers when designing their sites and assess the customers’ interaction with the site to make it easily understandable. This is because the customers can point out the flaws for elimination, hence reducing the number of customers leaving the site dissatisfied. This will go a long way in increasing average order values and the amount of orders taken through the website (Peterson et al, 1997). Internet marketers must choose a suitable technology since each one of them has different specific needs and what works for one retailer may not work as effectively for another (Chaffey et al, 2009). The choice of technology for Internet retailers entirely depends on the size of the business as well as its needs. For instance one retailer may require an incorporated solution linking into other aspects of the business such as the back office system while another may find a till system providing basic Internet services sufficient. Internet marketers must adopt a proactive approach with their clients by utilizing Internet marketing tools alongside other tools. Internet marketing tools recommend some of the products or services that customers are likely to be in need of and even go a step further by predicting when the customer is likely to purchase them. The retailer does not have to be a big one since this software can be bought cheaply and integrated into the site. Companies will do themselves a big favour by making good use of customer data since this facility offers immense data on customers including their patterns and habits of shopping. The companies can group this data and target the customers better with regard to personalizing marketing activities as well as timing. By improving the content, personalizing and timing of marketing materials, the retailers will have ensured utmost return on their investment and increased loyalty. Internet marketers must furnish themselves with the various regulations in the Internet trading sector. For instance some regulators demand that SMS on Internet marketing can only be offered to a customer who willingly opts in and has the opportunity of opting out. Some more regulations insist that these services must also be accessible to persons with disability, particularly those with visual impairment. Companies that do not make deliberate attempts cater for these provisions risk being prosecuted. Companies that wish to go to Internet trading must integrate it with the other business units such as the catalogue and store in order for customers to get the same feedback regardless of the channel they use. Moreover a well developed Internet strategy takes into account the complete customer experience needs from initial stages of ordering to delivery and returns if necessary (Chaffey et al, 2009). Internet marketers should create the right relations with their partners especially if they lack resources, knowledge and skills for integrating their Internet retailing. This is because third party professionals can make Internet trading to succeed since they have the necessary infrastructure, expertise and skills. It is important that Internet marketers know who their customers are. They should also know the expectations of their customers in terms of service delivery. Moreover, these marketers should know the factors affecting demand for on-line services and the type of on-line services they should provide. It is also vital for online marketers to know the key considerations in the development of e-retailing strategies (Schneider, 2002). 2.3 Internet retailers versus traditional retailers Traditional retailers have a segmented market while their Internet counterparts have a worldwide market. Whereas the traditional retailers only target a particular physical market, the Internet retailers cross boundaries to access a global market (Peterson et al, 1997). The traditional retailers must be positioned in a particular place of operation unlike the Internet retailers who can operate from anywhere including the convenience of their homes and reach a global market. Internet marketing is more efficient than the traditional marketing methods (Chaffey et al, 2009). This is because the consumer does not have to travel all the way to the retailer to get information about the product being sold. Similarly, the retailers are able to reach their customers at the click of a button without going through the many bureaucratic processes. The retailers can also communicate directly with their customers about new product arrivals, discount arrangements and product specifications. Internet marketing offers an interactive and two-way communication between the retailers and their clients. This is unlike in the traditional marketing where only the retailers pass information to their potential consumers, and the consumers do not have chance to communicate back. Internet marketing has the privilege of customer data, which can be used to predict when and what they are likely to buy, and then communicate with them (Jarvenpaa et al, 1997). On the other hand, traditional retailers are not in touch with their customers and cannot accurately predict their customers shopping habits and patterns. Internet retailers therefore utilize this special relationship with their customers to market themselves, unlike their traditional counterparts (Bigne, 2005). 2.4 Types of Internet Marketing Sites There are numerous types of Internet marketing sites that a company may adopt. They include transactional e-commerce sites, relationship building sites and brand building sites. The choice of sight mainly depends on the target market, the nature of business and nature of products or services being offered (Turban, 2004). Transactional e-commerce sites are mainly meant to enable online transactions between the retailer and the consumer (Turban, 2004). They give product specifications, the price, the mode and procedure of payment. The company then organises for the products or services to be delivered to the consumer. Relationship building and services-oriented sites are aimed at building relationships between retailers and their customers. This is mainly through the various forms of interaction that the sites offer. Relationship building sites mainly serve public relations functions of the company. Brand building sites are mainly used to build the brand name of the products and services offered by the companies. Through these sites, the companies may ask their clients to participate in the design and development of the products or services. 2.5 The Future Strategy in Internet Marketing Information and Communications Technology, ICT, is having a great impact on businesses of various forms, including the retailers. Retailing is experiencing big changes in technology that it must adopt to remain in business (Chen et al, 2005). EPOS equipment, widely used in banking has found its way into the retail business. This is a very sophisticated digital positioning technology that brings positioning technologies to domestic electronics. This is going to revolutionize this industry just like it has done in the financial services and the banking sector (Cumming et al, 2006). 3.0 Conclusion Retailing is rapidly experiencing great technological changes that will see Internet trading more common than it is today. These retailers have come to the realization that this is the only way to survive today’s cut-throat competition and widen their market base. Internet stores have the advantage of convenience since they are available 24 hours a day and the buyers can access them from anywhere. This is unlike the traditional physical stores that can only be accessed during the official working hours. Information and Communications Technology is having a great impact on businesses of various forms, including the retailers. Retailing is experiencing big changes in technology that it must adopt to remain in business. Many companies have realized that embracing technology is no longer by choice, but a must. Retailers who go online are set to reap greatly from it, owing to its global market and efficient management information systems. However, they must also take the necessary measures to avoid the negative effects of the technology such as privacy concerns and security issues. These challenges not withstanding, Internet retailing seems to be the future trend and the sector must fully embrace it. 4.0 Recommendations For even greater success in the future, Backcountry will have to adopt a number of new strategies to retain or even improve its market niche (Chaffey et al, 2009). These strategies are in view of the rapidly-changing world of technology. The company should consider building a responsive email list that gives the clients the option to get in and out. This will go a long way in building client loyalty and improve interaction between the company and the clients. The company should then use this email list to market and promote its brands among its customers and potential customers. Backcountry should also consider publishing articles or getting listed in news stories on numerous websites. This will greatly help in boosting the company’s popularity, particularly among those who may not have a direct interest in its brands. Through this move, many potential clients will notice them and their products. Similarly, Backcountry should consider writing and publishing online press releases (Schneider, 2002). These press releases should cover a number of issues affecting the society, but oriented towards the company’s brands. Backcountry should also consider facilitating and running contests and give-aways through its website. This will no doubt attract numerous participants, some of whom may end up as clients. In addition to increasing the company’s client base, these promotions can greatly help in building customer loyalty. Backcountry should introduce blogging on its website in order to interact with its visitors. This is because these visitors are potential clients, and the first impression created by the website will greatly influence their future decisions with regard to the company’s products. Blogging will also make the website more social and friendly to not only visitors, but also regular clients. 5.0 References Bigne, E (2005) the Impact of Internet User Shopping Patterns and Demographics on Consumer Mobile Buying Behaviour, JECR Chaffey, D et al (2009) Internet marketing Strategy, Implementation and Practice, FT Prentice Hall Chaffey, D and Smith, P (2008) eMarketing excellence, Elsevier Chen, S et al (2005) the assessment of usability of electronic shopping-A heuristic evaluation, International Journal of Information Management Cumming et al (2006) Management Information Systems, McGraw-Hill Ryerson, Canada Davis, S (2001) Culture Works the Political Economy of Culture, University of Minnesota Press, and London Huang, M (2000) Information load- its relationship to Internet exploratory and shopping behaviour, International Journal of Information Management Gay, R et al (2007) Online Marketing, a customer-led approach, Oxford University Press, Oxford Jarvenpaa, S et al (1997) Consumer reactions to electronic shopping on the World Wide Web, International Journal of Electronic Commerce Kumar, R et al (2004) User interface features influencing overall ease of use and personalization, Information and Management Laudon, K and Guercio, C (2003) E-commerce, Addison Wesley, London Meyerson, M (2005) Success Secrets of the Internet Marketing Superstars, Kaplan Publishing O’Connor, J et al (2004), Electronic marketing, Prentice Hall Peterson, R et al (1997) Exploring the implications of the Internet for consumer marketing, Journal of the Academy of Marketing Science Rayport, J and Jaworski, B (2003) Introduction to e-commerce, International Edition, McGraw-Hill Schneider, G (2002) Electronic commerce, Thomson Course Technology, Australia United Kingdom Silverstein, B (2001) Internet Marketing Success for Information Technology Companies, Maximum Press: Florida Turban, E (2004) Electronic commerce 2004, Pearson/Prentice Hall, Upper Saddle River Read More