What do marketers think about social media marketing platforms and their applications for their business?

Most of the people and most likely all of the readers of this blog know what is meant by social media marketing. But to make it official: social media marketing is business use of selected social media channels to understand customers and to engage them in communication and collaboration in ways that lead to the achievement of ultimate marketing and business goals. In other words, social media aims to create value for both, the company and the customer.

To avoid a painfully long blog post embedded with table charts about social media, you can check the most relevant statistics about social media in general from Mediabistro. (Recommended!)

Social media is a pretty vague term that entails various platforms, which can be harnessed for different marketing purposes and in different ways. I ran into an interesting survey made earlier this year (2014) by Social Media Examiner. It tells what the marketers think about the different social media platforms and their emphasis now and in the future: it also shows on which social media platforms the marketers are lagging behind and which ones they see as the trending ones:

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What Marketers think about social media marketing. Adapted from Social Media Examiner’s Social Media Marketing Industry Report, 2014.

So what is the conclusion? The no-brainer is that all social media is trending, regardless the platform or use. The blustering of marketers suggests that that the marketers would have embraced and understood the importance of social media, but yet all of the marketers are lagging in  implementing and using the social media platforms in their marketing efforts. To me the one surprising fact was how trending is the Podcasting: the number of marketers that wanted to increase and invest in Podcasting activities was over three-fold compared to the amount of the actual users.

So what comes to social media marketing, marketers seem to have the will, but not the know-how. Fortunately, we are blessed with experts and consulting companies like Atkins Marketing Solutions, who have the know-how, and who can help the companies to excel in the trending social media marketing.

Sources:

http://www.socialmediaexaminer.com/SocialMediaMarketingIndustryReport2014.pdf

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Online Business Models Revisited

The development in Internet technologies have enabled the companies to transactions to be conducted electronically to make e-business. Electronic business is about executing company’s business processes, over open networks, such as Internet, in order to substitute information for original handwork business transactions. The accelerating growth of e-business has initiated an increased interest to examine the transformation from traditional business models towards e-business models and their integration on the companies’ traditional business models.

So what is the definition of a business model? If you search Google you will find 459,000,000 results. I like the way Alex Osterwalder & Piqneur put simple: “A business model describes the rationale of how an organization creates, delivers and captures value”. Since this blog focuses on online marketing, I wanted make a classification of online business models in particular, which are being presented in the picture. Osterwalder’s and Piqneur’s definition applies well to online context, if you just add “through Internet” in the end 🙂 I will depict the characteristics of the models and elaborate on how such companies typically make money. I will also bring in some real life examples of companies using those models in B2B and B2C context. The very same models apply to non-profit organizations as well.

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Classification of Online Business Models, adapted from Roberts’ and Zahay’s book of Internet Marketing: Integrating Online & Offline Strategies (2008).

This is just one approach to online business models. Online business models are evolving rapidly at this point and we can still see some major disruptive innovations in the e-business environment. This when we come to one of my favourite topics, business model innovation, which refers to the search for new logic of the firm and new ways to create and capture value for its stakeholders; it focuses primarily on finding new ways to generate revenues and define value propositions for customers, suppliers, and partners. Business model innovation represents a new frontier in innovation beyond just product or service innovation. Though technology is an important medium for business model innovation, it is not all about just introducing and implementing new technology, but it can be thought through any kind of reassessment and reconstruction in the organizations value creation, and hence, new business models themselves can represent a form of innovation. One way to approach business model innovation is to merge several business models together and make it a success, like many of the before mentioned companies, such as Amazon have already done.

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Amazon’s retail initiative; A revised strategy or just another publicity stunt?

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I wanted to start my blog by blogging about the eCommerce Juggernaut we all know; Amazon and its retail plans.

Roughly a month ago, I made a brief analysis for my retail marketing strategy class about Amazon’s plans to open up a physical retail outlet in Manhattan, New York, just in time for the holiday shopping season. It had already opened pop up stores in San Francisco and Sacramento. I concluded my article by saying, “I wouldn’t be surprised if this was another publicity stunt from Amazon”. The holiday season is over and there was never signs of Amazon opening a retail outlet in Manhattan.

Amazon has been planning to embark the brick and mortar retail for years and it has been frequently under a discussion in the media. Amazon’s strategy is typically to disclose little to no information about its new initiatives. Amazon is a giant company, and a the trailblazer in eCommerce, so when the company itself or any other facet hints that it’s about to do something, the people and the media start on speculating on the topic, and so the snowball starts rolling.

“We want to do something that is uniquely Amazon, and if we can find that idea, and we haven’t found that idea yet, we would love to open Amazon stores.” -Jeff Bezos

I guess yet the time wasn’t right. Perhaps Amazon is never going to do retail, but rather just initiate a buzz around the company. We all remember the buzz about the drones, coincidentally on Cyber Monday? This year the timing was not too bad either as we were getting closer to Black FridayCyber Monday, and Christmas shopping season, initiated by Manic Monday. I would call this “Online Guerrilla Marketing”.

So lets take a quick analysis about why Amazon should or should not embark brick and mortar retail:

Three distinct organizational goals could be considered as Amazon’s motivators: First of all, Amazon’s new desire could be to capture more sales of electronic gadgets like tablets through the physical outlets, since more hands-on experiences would lead to more sales. Amazon’s own devices such as the Kindle and the Fire smartphone are of higher margins, hence making it reasonable for the eCommerce giant to take such kind of actions to boost their sales. Secondly, Amazon could also try to complement its fulfillment by offering its customers the option to pick up and return items in a physical outlet. The third goal of Amazon would be to engage more with the relationship retailing by marketing the Amazon brand, and to increase the brand personality through the in-store experience.

Amazon’s long-term strategy could be shifting from a “Web-only retailer” to a multi-channel retailer, which would dramatically interfere with their core business model as an online merchant. There is lots of room for speculation about Amazon’s “new” marketing mix, such as the retail locations, merchandising and assortment, e.g. how streamlined their selection would be. No matter the concept, the retail outlets are at least going to be devised to promote and communicate the brand of Amazon.

I would consider Amazon’s physical outlets as a pilot scheme, through which it tries to figure out if it could have a foothold in the physical retail. For Amazon, there would be definitely a learning curve. Amazon, which relies heavily on data and automation in the online environment, does not have information about their consumer’s offline shopping behavior. Hence, the new initiative could be considered as a way to harvest the offline consumer data. Amazon’s excellence and value proposition are based on factors like “the world’s biggest assortment”, low prices and various fulfilment options, all of which would be very challenging to duplicate in the physical world. Furthermore, running a physical retail outlet causes overheads, and increased costs and that’s something that the investors would not be happy to hear about, since Amazon has been trading off its profits for growth for a long time.

The question is, that since most of the brick-and-mortar retailers have struggled in creating a seamless omnichannel retail experience, how would an online retailer thrive in it?

Sources:

http://online.wsj.com/articles/amazon-to-open-first-store-1412879124

http://www.forbes.com/sites/deniselyohn/2014/10/17/so-amazon-thinks-it-can-do-retail/

http://www.cnet.com/news/fight-or-flight-amazon-gets-tough-with-the-faa/

http://goodereader.com/blog/electronic-readers/jeff-bezos-confirms-amazon-retail-store-ambitions

http://en.wikipedia.org/wiki/Black_Friday_%28shopping%29

http://en.wikipedia.org/wiki/Cyber_Monday

http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11278463/Manic-Monday-spending-could-overtake-Black-Friday.html

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