Chapter 2 Changes in Digital Market Place

There are several changes taking place in the market due to digital revolution. However, within the realm of digital marketing we will limit our focus on issues related to customer-firm relationships only.

  • Interaction
    • Mutual
    • Co-creation
    • B2C, B2B, C2C, C2B
    • Customers want to take part in production process too along with consumption
  • From Mass Marketing to Customization to Personalization
    • Product recommendation
    • Customer centric business model
    • Matching: Alignment of company’s offering with the preferences of its customers. One-to-one marketing
  • Marketing Mix Decisions
    • Price: price customization, pricing formats and tactics, price discrimination.
    • Promotion: Integrated marketing communication now includes traditional (e.g., tv), new (e.g., email), and social media, FGC, UGC etc.
    • Place: Multichannel marketing (e.g., online channel)
    • Product: Service oriented business model and personalized customization.
  • Customer Relationship Management
    • Database marketing
    • Marketing Analytics
  • Big Data Challenges -Volume -Variety -Velocity -Data Fusion Techniques
  • Drawing Concepts from Varied Fields -Economics -Psychology -Computer Science -Statistics

At the core of all these marketing issues lies information which acts as an activity, as a life form, and as a relationship.

Some of the fundamental changes that the Internet has brought and changed the traditional marketing models are as follow:

  • Networked model of competition dramatically increases the speed of change in every part and function of the organization, be it building and delivering a marketing campaign or altering product or service characteristics based on feedback. Thus, it leads to discontinuous innovation rupturing the existing models of marketing.

  • The Internet gives small firms the ability to extend the market reach and impact using technological excellence and know-how, and aggressive partnering strategy. Thus, successful digital business can scale dramatically threating existing market players.

  • The rate of innovation diffusion through the online medium is faster that through conventional channels, and thus requires firms to be acutely aware of their time to market'', and the time tomarket responses.’’

  • Digitally wired consumers’ purchase journey through Consider, Evaluate, Buy also now includes Enjoy, Advocate, Bond.Thus, they are extremely involved with consumption experience.

  • Customer-orientation is very important in digital marketing. In marketing we define customer-orientation in terms of shopping behavior of customers that includes their AIO (activities, interest, and opinion) variables. We classify customer-oreitnation into four categories:
    • Recreation Orientation:Customer shop for pleasure.
    • Experiential Orientation: Customer like to try, inspect, and feel the products before making a final purchase.
    • Convenience Orientation: Customer would like to minimize the time and efforts associated with the purchase process.
    • Economic Orientation: Customers do a lot of research before making a final purchase to obtains the best value for their money.