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A Report Submission

On

Digital Marketing: How is it different from Traditional


Marketing?
To

Prof Dr. Sanjay Patro


For
Marketing Management
II Term II
BM 2016-18

Submitted by:

Ashutosh Munjal

B16013

Gaurav Taneja

B16018

Pulkit Aggarwal

B16035

Contents
Executive Summary3
I. Literature Review4
A. Traditional/Conventional Marketing..4
B. Advantages of Traditional/ Conventional Marketing.....5
C. Disadvantages of Traditional/ Conventional Marketing6
D. Different methods of Digital Marketing7
E. Advantages of Digital Marketing.10
F. Disadvantages of Digital Marketing.............................................................................11
G. Digital Marketing and Consumer Behaviour...12
II. Impact of Digital Marketing on Different Sectors in India.15
A. Sector Wise Impact..15
B. Emergence of New Jobs due to Digital Marketing..16
III. Development of Metrics.17
A. Guiding Metrics...17
B. Measuring Metrics...18
IV. References.20

Executive Summary
With the rapid development of the digital space and increasing digital footprint of the global population
companies are looking at different methodologies which are cheaper and much more efficient to market
their products. One such technique is Digital Marketing which involves promotion and marketing being
done on the digital platform vide websites, blogs, emails, SMS etc. While many companies adopt both
traditional and digital marketing, the real differentiation can be seen in the companies which have
shifted from one form to the other.
This paper begins with understanding what Digital Marketing is and how it is applied in todays world.
This has been augmented by the different platforms through which digital marketing can be achieved,
where we analysed the current methodologies being adopted by different firms either in the form of Email, blogging, Social media etc. Further on, the study highlights the advantages and disadvantages of
Digital Marketing giving a suitable outline as to when it is appropriate to use it.
During our study, Digital marketing was also compared thoroughly with its Traditional Counterpart.
We saw how Traditional marketing is being deployed by firms i.e. the methodologies. Further to our
analyses, we have enumerated various pros and cons vis--vis Digital Marketing.
With the advent of the search engine and the proliferation of digital marketing media, the consumer
decision process has also evolved. The concept of the funnel is quickly becoming obsolete especially
in industries where digital marketing is the norm. The digital marketing analogous is the Customer
Decision Journey which explains how consumers behave pre and post purchase.
Basis the initial analyses, we identified various sectors where Digital Marketing has been successfully
employed. Right from the basic nuances to the major personalisation and customization that are
deployed in digital sense. The various industries under the scanner are E-Commerce, Travel, FMCG
etc. Though the digital marketing has become the revenue/profit centre of the company, it also has
various hidden benefits such as job creation, development etc.
Digital Marketing is still not the best choice for all brands. A brand needs to consciously decide which
the best channel is for promotion and engagement of customers. And the best channel may not be digital.
Metrics like business model, budget, TG, and location become important in deciding the ideal marketing
budget allocation. If a brand does deploy a digital marketing campaign, it needs to measure the success
of the campaign. Metrics like reach, sales and power of message conveyed become important.

I.

Literature Review

A. Traditional/Conventional Marketing
There are multiple marketing channels that companies have used for many years. These marketing
channels are called traditional channels and have been known to every consumer. It is a broad category
that incorporates many forms of advertising and marketing. The different methods of Traditional
Marketing methods are given below:
1. Newspapers
Newspapers are one of the oldest methods of marketing used by companies to market their
products and services. The advantages of using newspaper advertising that it reaches a large
amount of circulation and the impact of the message can be huge. The disadvantage of
newspaper advertising is that it is costly and has a shelf life of 24 hours. Most of the companies
use newspaper marketing to communicate their marketing communications and product
launches through newspapers.
2. Magazines
Magazines have less circulation as compared to newspapers but can be targeted more precisely
as compared to newspapers. There are various categories of magazines which can be used to
advertise your product. Most of the magazines are targeted towards a particular segment having
common interest for example, Forbes or Business today is targeted for Business professionals
whereas magazines like Overdrive are targeted at driving enthusiasts. Magazines generally have
more shelf life as compared to newspapers and therefore sometimes preferred more by
companies. Another interesting fact is that people take more time to read a magazine then
reading a newspaper and therefore have more time to look at various marketing
communications.
3. Brochures
Brochures are generally used by companies to spread their specific marketing communication
to its target segments through direct interaction at various targeted segments touch points.
Brochures are also used to spread marketing communication by tying up various third party
companies which transfer the brochures to prospective customers. Normally Brochures
advertisement is cheaper than newspaper and magazine advertising as it is most localized and
personalized according the target segment where it is being distributed. The disadvantage of
brochures is in measuring the effectiveness of the brochure as most of the people throw
brochures without reading.
4. Face to face communication
Face to face selling is one of the oldest marketing technique one and is still used in many
companies where sales personal is sent to meet the potential customers. The customer
communicates directly with the sales person and is told about the various products and features
used by the companies. This type of marketing is mostly used in services industries such as
insurance, chit funds, and expensive products such as Rolex etc. Most of the Business to
business companies to sell their products to various companys owners.
5. Radios
Radios have been used by marketers by since a long time to market their products. Before
television was invented Radio was extensively used by companies to market their products and
services by creating interest jingles and short communications. Nowadays, radio advertising

still attracts a lot of companies as the time people spend in travelling by cars in metros and have
increased and therefore radio finds its unique proposition during such scenarios. Also, radios
are also used by many small companies to market themselves through local radio channels.
6. Television
Television is one of the most effective ways of Traditional Marketing. Although television
marketing is expensive but it can be customized according to the channel target segments by
companies to communicate their marketing communication. Since most of the people are able
retain visuals more than texts and can be deeply impacted by effective marketing campaigns,
television remains of the preferred mode of marketing. For FMCG companies, Television
advertising forms one of the major sources of marketing fund. With the advent of digital
marketing, companies have started increasing its spend on digital platforms to target their
customer segments more efficiently, but for rural segments Television still remains the
preferred platform.
7. Telemarketing
Telephone marketing, or telemarketing, is defined as the practice of convincing consumers to
buy a product or service by delivering sales messages over the phone. Telephone marketing is
regarded controversial in the modern age, with many telemarketers using aggressive sales
tactics. People use mobile apps like Truecaller to block the various telemarketing calls and most
of the times excessive Telemarketing bring bad name to the companies.
8. Direct mail
Direct mail marketing comprises of sending printed material like postcards, brochures, letters,
catalogues, and fliers sent to attract consumers through postal mail. One of the earliest and
renowned example of direct mail is the Sears Catalog, which was first company to mail
customers directly 1888. Generally, the letters sent for marketing communication can be an
offer, announcement or reminder for Customer Loyalty Program. Many companies still use
Direct mail to acquire customers, especially small firms who target homes in the area of their
service. Most of the service companies like credit card companies, insurance companies etc.
also use direct mailing to acquire new customers which might get interested after reading the
mail in their leisure time.

B. Advantages of Traditional/ Conventional Marketing


1. The biggest benefit of traditional marketing is remarketing and brand awareness. When a
company produces a new product in order to enter to the market need to have a lot of marketing
efforts until to keep on the customer mind and then can move towards new market. Traditional
marketing has the reach to create such impact.
2.

In order to reach to the special group of customers traditional method can be more useful
compare to other ways. For example, if a company would like to retire CEOs or share financial
health of the company, no need to utilize the internet or social media channels.

3.

Face to face communication is one of the most effective ways to influence the customers as it
creates a personalized effect. The benefits can be seen in the business to business marketing
communications.

4. Traditional marketing promotes hard copy objects for its marketing communication. This gives
customers tangible printed material which they can flip at time of their leisure.
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5. Television and radio provide effective marketing platforms which can influence the customers
about the products and services of the companies irrespective of their literacy level by
communicating in their national language.

C. Disadvantages of Traditional/ Conventional Marketing


1. Costs
Traditional marketing methods are very expensive as it reaches a large number people. The
problem may arise when the target segment of the company is small proportion as compared to
the population and hence therefore the company has to pay a high to spread its marketing to
target segment.
2. Customization
With traditional ads, it is difficult to target a specific customer for the products and services of
a company. It is possible to target specific market segments, but not an individual. For example,
an ad may target young women or Corporates. The ad may show young women or corporates
interacting and create brand association with particular segment. On the other hand, Dynamic
adverts can be used to target the customers with the products they have seen earlier.
3. Pricing Options
Customized promotions can introduce extraordinary deals and valuing. Nonetheless, it is
normally harder to offer complex package evaluating. Most print advertising doesn't have the
space to clarify all the diverse evaluating varieties that may be provided to customers. Hence
traditional marketing is suited to companies which have more uniform pricing
4. Effectiveness of Marketing Spend
It is difficult to quantify the results of marketing through various channels of traditional
marketing. Most of the times the huge amount paid for traditional channels is spent hoping that
the amount spent will soon into sales, but the customer acquisition cost through cost of
marketing spend is tough to calculate.
5. Less Involvement of Viewers
And maybe the main shortcoming of traditional marketing is stagnant which means there is no
way to intermingle with the viewers. The advertisement is given with the hope that information
is dropped in the presence of people, hoping that they will make a decision to do act based upon
one-way communication.
6. Market research
It is expensive to conduct market research using traditional method of costing as compared to
Digital marketing. Traditional marketing market research require a lot of resources.

D.

Different Methods of Digital Marketing

With the rapidly changing technology there have been platforms which have been employed for digital
marketing. These methods and techniques are as below:

1. Online Advertising
It uses the methodology of interruption. It utilizes the virtual space available on the net and other
third party websites. Just similar to methods offline marketing and other types of online marketing,
the major objective of online advertising is to increase sales and build brand awareness. It employs
displaying promotional messages at strategic locations on the net. In addition to images, pictures,
logos etc. other different methods now used in this field including interstitial banners, pop-ups and
pop-unders, map adverts, floating advert, banner advert. While it doesnt force the user to pay
attention but definitely tries to persuade and attract the customer by placing it amongst nonmarketing content.
2. Email Marketing
Considered as one of the most effective forms of digital marketing, E-mail marketing entail sending
emails to internet users. Termed as the cheapest form of marketing, it is believed to have high
response rates. However it is plagued by some deficiencies such as being ignored by the recipient,
mails being transferred to the spam folder or simply unsubscribing themselves from the mailing
list. To transcend problems of email-marketing is permission email marketing. "Permission
marketing" has been coined by Godin. In this method recipients are asked for their permission to
receive marketing messages from the commercial marketers. So unless the recipients have not
expressed their consent, they will not send commercial emails.
3. Search Engine Optimization (SEO)
While perhaps every company nowadays has a website, but just having a website wont increase
the number of visits and subsequently the revenues. A website needs to be augmented by a
methodology called Search Engine Optimization. Search engine optimization can be described as a
cluster of strategies and techniques used to increase the amount of visitors to a website by obtaining
a high-ranking placement in the search results page of a search engine. The principle is that as many
users make use of search engines like Google etc. to navigate through the web, companies have
developed ways to rank their websites higher for each search done by the user. The purpose of SEO
strategies is to place a given website among highly listed entries returned by search engines which
in its turn produces more traffic. So, "Web site owners, webmasters and online marketers want
search engines to send traffic to their site. Therefore, they need to make sure that their sites are
relevant and important in both the eyes of the search engines and the users."
4. Affiliate Marketing
It is the process of gaining online presence through a symbiotic relationship with another company.
The company which displays the ads on its websites charges a commission for the ad space. With
respect to its definition, "affiliate marketing is simply defined as : A web-based marketing practice,
often using automated systems or specialized software in which a business rewards their affiliate
for each visitor, customer, or sale which is brought about as a result of affiliate's marketing efforts.

5. Social Media Marketing


Social media is a group of Internet-based applications that build on the ideological and
technological foundations of Web 2.0, and that allow the creation and exchange of User Generated
Content. According to Nielsen the top social media websites visited are Facebook, Twitter and
Blogger. Users spend time on these websites much more as compared to any other type of website.
Unlike other sites, social media sites are accessed at all times and from anywhere. Nowadays the
opinions, tastes and preferences are driven by peers and global pool of friends. According to a study
by Nielsen 70 percent of the social media users hear others experiences online, 65 percent learn
about brands, products and services, 53 percent compliment brands,
50 percent express concerns and complains about brands and
services, and 47 percent of them share monetary incentives.
The influence of social media marketing is maximum in AsiaPacific, Middle East and Latin America. Approximately 30 percent
of users in these regions used social media on a daily basis to learn
more about brands, products, and services.

It is the most significant and recent development in digital marketing and perhaps the most
significant. It can be seen that social media represents a great opportunity for companies and brands
to gain positive favor with consumers. Marketers can impact their business by using the adoption
and influence of social media, and harness the growing incomes of emerging markets such as Asia,
Latin America, and the Middle East.
6. Blog Marketing
It involves marketing on independent web based journals where people publish news, product
reviews, posters experiences and opinions. Ads on blogs can be in the form of banners, text links,
streaming video, audio clips, flash animation and even plain text. Most blog-based advertising
involves payment in some way or the other to the blog owner. Owners of popular blogs will
typically capitalise on their readership numbers via a combination of ad formats and Google
AdSense ads. A nod from a trusted blogger can result in considerably higher sales for the recipient.
Trusted figures in industry, popular product reviewers and critics often maintain blogs where they
provide information about their experiences with some products and services. Readers tend to trust
these reviewers and critics more as they are often unbiased. Businesses, however, do pay popular
bloggers to review or mention their products.

7. Pay-Per-Click Marketing
This is also known as sponsored search or paid search. PPC marketing offers to the potential for
marketers to bid for placement in the paid listings search results by choosing relevant search terms
for their business. Companies pay the amount of their bid only when consumer clicks on their
listing. Google Adwords and Google Analytics are the most well-known tools for PPC. Pay per
click advertising can generate traffic right away. Its simple: Spend enough, get top placement, and
potential customers will see your business first. If folks are searching for the key phrases on which
you bid and youve placed a well-written ad, you will get clicks the moment the ad is activated. So
PPC advertising is fast: With some systems, such as Google AdWords, you can generate targeted
traffic within a few minutes of opening an account. PPC advertising is also nimble: Where organic
search engine marketing or other forms of advertising can lag weeks or months behind changing
audience behavior, you can adjust most pay per click campaigns in hours or days. That provides
unmatched ability to adjust to market conditions and changing customer interests. PPC can also be
a bargain: Sometimes, you can find keyword niches for which the top bid is a fantastic deal. These
are longer, highly specific phrases that not everyone will have taken the time to pursue; long-tail
search terms. In this case, PPC is a great option because you can generate highly targeted traffic
to your site for a fraction of the cost of any other form of paid advertising.
8. Article Marketing
Article marketing is one of the oldest strategies used by online marketers to acquire new visitors
and increase sales on their websites. The practice typically involves writers and publishers as
primary participants, with article marketing services working as intermediaries that help match
writers with interested publishers. The fundamental purpose of article marketing is to attract wider
online audiences and increase the number of sales opportunities for products or services offered on
websites. The most popular articles support an authors or companys reputation as an expert in a
specific field, and help cultivate a loyal audience. Increased site traffic boosts where their web page
ranks in search engine results, which means more people will see the site and have the opportunity
to buy what the author is selling.
9. Pay for Inclusion
Paid inclusion is a search engine marketing model in which Web site owners pay a search engine
company to guarantee their sites will show up in search results. In addition to guaranteeing that a
client's Web site will be indexed, paid inclusion may ensure that the search engine's crawler
software visits the client's site more frequently, and may also give clients the option to submit
information about their pages more often. According to proponents, paid inclusion will help to
improve the relevancy of results because it enables the indexing of Web pages that are difficult to
access otherwise. Opponents argue that paid inclusion will skew search results, making the ranking
less relevant. Although other practitioners claim that paid inclusion doesn't affect the ranking of a
paid link, the mere inclusion of links that would not otherwise be in the results is likely to change
the rankings of some other links.
10. Dynamic Adverts
Dynamic creative is simply any creative that changes automatically based on information about the
user, whether this is related to their behaviour, location or context. Though its use continues to
grow, many advertisers struggle to find a place for it, anxious to avoid any risk of damaging their
brand and uncertain as to what the possibilities are. There are numerous types of dynamic creative
that can be employed to fulfil different functions. The biggest difference in types is the difference
between prospecting and retargeting dynamic creative. When used in a prospecting campaign, the
aim of dynamic creative is to use the increased relevance of the message to attract users to the site.
Examples include creative with different messages depending on the users location or the context
of the page. For retargeting, by contrast, the goal of dynamic creative can vary from simply aiming
to drive a conversion, to a focus on increasing order values or frequency of shop.

E. Advantages of Digital Marketing


The industrys constantly changing, and were constantly learning. We love to experiment and analyze.
But ultimately, we love growing companies. We see that aspect alone as vitally important and deeply
fulfilling. With Digital Marketing, you can bring immediate value to the customer and to the business.
Whats more exciting than that? Clearly the world of technology, digital marketing and social media is
having a significant impact on how we behave socially, act as consumers and how we do business so it
could be fair to say that any business that does not adapt to the new era of marketing and
communications is in danger of losing out. There are number of benefits of Digital Marketing are
enumerated below:
1. Empowerment of Small Businesses
The most prominent benefit of Digital marketing is the democratized environment which it creates
so that even small firms have a good chance of promoting their brand and products. It should be,
therefore, stressed that "internet has created unprecedented opportunities for small businesses to
engage in national and international marketing campaigns which could have been unaffordable due
to the huge amount of resources required". Internet can extent market reach and operational
efficiency of small and medium enterprises. Thus with digital marketing its not the manpower and
other resources which are the differentiators, but instead it is how you use the digital marketing
channels in this levelled playing field.
2. Elimination of Geographic Barriers
Digital marketing removes geographic limitation and opens up both the domestic as well as the
international market. Earlier, due to exorbitant costs, reaching global was only a possibility of
multinational firms. Overcoming the geographic barriers, marketers are now able to present
products and services to different groups of costumers across the universe with the simple condition
that they have access to internet.
3. Digital Marketing Can Reach Targeted Customers More Effectively
What digital marketing offers is personalisation and customization. It enables you to target specific
groups who are looking for particular brands, products or services. With a specific target it has
better results on conversion when compared to traditional marketing.
4. Digital Marketing delivers better and immediate results
With real time interaction with the consumer and a targeted approach, digital marketing connects
more efficiently where the results are above-average conversions to either leads or sales every time
a targeted customer visits your landing pages or websites.
5. Digital Marketing is Cost Effective
Unlike traditional marketing which requires high investments for mass media marketing, digital
marketing is very cost effective and in some cases websites generate traffic for free.
6. Digital Marketing Results are measurable
While traditional marketing uses vague metrics and inaccurate surveys to measure the efficacy of
their marketing, Digital marketing results are easily measurable and available in real time. Each
click or visit to a landing page or websites, sign ups, and online purchases can actually be measured
very accurately allowing digital marketers to easily gauge which particular Internet marketing tool
will work for them and bring the best results. On top of that, Internet marketing analytics data can
also give digital marketers a better insight about their targeted customers purchasing behaviour
among other things.
7. Digital Marketing is personalised
Not only is Internet marketing highly targeted, offers and programs can be customized or
personalized based on the profiles and other consumer behaviours your targeted audiences exhibit.
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This will give your customers better value for what they have paid for as well as a better insight of
the kind of products and services your customers need and are looking for which your business
can provide or develop.
8. Digital Marketing is available 24/7
The World Wide Web never sleeps and so does Internet marketing, allowing business with little
resources to sustain a physical 24-hour operations to compete in the digital marketplace using
Internet marketing tools that can run virtually 24 hours a day and 7 days a week.
9. Better Research Quality
Nowadays everyone has a footprint online, whether be it social media or e-commerce, hence
gathering user data has become very simple. The pattern of usage for each person can now be easily
captured and their preferences recorded. This helps in targeting people with personalised
advertisement for better conversion. It also enables them to serve the customers efficiently with
upcoming products and services as a pattern or a trend can easily be identified through the research.
10. Credibility of Blogging/Article Writing
As customers we are always moved whenever a credible source shares opinions or reviews about
any product or service. Blogging and article writing compared to traditional marketing has this
inherent property of being highly credible. People who have been following the blog or articles of
writers, business magnates etc. hold their opinion in high stead. This not only results in better
conversion results but also associates your brand with the likes of these people.

F. Disadvantages of Digital Marketing


Everything has its vices and digital marketing is no exception to it. The disadvantages which plague
digital marketing are:
1. Digital Marketing Campaigns Can Be Copied
With no dearth of money any successful marketing campaign can be easily copied by competitors.
False trademarks and logos can be used to deceive people and take away market share for example
PUMA and POOMA. Moreover the reputation of the company can also be maligned and hence
result in loss of market share.
2. Digital marketing can lose out due to too much information
With many companies targeting the same group with similar products, spamming and trolls can
result in the customers out rightly ignoring such ads making authentic ads and business lose
valuable traffic and subsequently business.
3. Digital Marketing will not be taken seriously if not done professionally
Since there are so many competitors in the online space, the one which is most creative yet
professional will capture user attention. Consistency and uniqueness of the campaign is what
increases the success rate of digital marketing.
4. Digital Marketing; is it right for your product?
Some brands, products or services have targeted audiences that may not be reached by Internet
marketing channels. Some products and services target the elderly and only a few percentages are
tech savvy and may not have access or do not even know how to get online. If thats the case, you
will only be wasting time and resources marketing your products or services through Internet
means.

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5. Bubble reputation due to feedback


Feedback in digital marketing can be both a boon and a bane. However due to negative feedback
the reputation of the firm could be maligned especially if it comes from a very credible source.
Hence be sure to adopt digital marketing if the product being marketed is of superior quality.
6. High dependence on Technology
Digital marketing is highly dependent on technology. Any glitches as such could throw your
campaign off course. Non-working links to important landing pages, pay buttons that do not work
and other similar stuff like can ruin your hold of your targeted audiences and lose good business.
7. Lack of trust
Trust in virtual environment can be defined as follows: "online trust includes consumer perceptions
of how the site would deliver on expectations, how believable the site's information is, and how
much confidence the site commands".
Even with the digital space growing more and more
secure rapidly, there are still apprehensions in the customers mind regarding the security and
authenticity of the product being promoted and various other ancillary services. Continuous efforts
need to be made in the digital space to build trust and add value to the campaign.
8. Digital Marketing not embraced by all
While digital marketing has taken the world by storm, there still remains a large number of people
who do not have a digital footprint and form the bottom of the pyramid class. To target this huge
market segment using digital means is a futile effort. Hence efforts need to be made to digitize the
entire global population.

G. Digital Marketing and Consumer Behavior


Digital Marketing brings many new ways to engage the modern customer. In a world of options, as
marketers look for new ways to engage with customers, consumers also are engaging with brands in
new ways, some traditional ways of marketing are slowly becoming obsolete. Slowly, the traditional
way of marketing is becoming unsustainable. This is because consumers who evaluate their options via
digital marketing sometimes do not consider brands who have stuck to only traditional marketing.
A lot of new channels have propped up which are now beyond the control, and sometimes beyond the
knowledge of the marketer. With the emergence of social media, this is an important consideration for
the modern marketer. Furthermore, according to HBR, customers made a purchase decision by
considering and evaluating the brands in their knowledge set. However, with the emergence of the
search engine, and digital marketing, brands get added to the decision process during the process as
well. Consumers expand their pool of brands and then narrow it. Consumers also find it easy to stay
engaged with brands. Moreover, word of mouth and advocacy are taken to a new level because of the
ease of online communication. This communication happens outside the control of the marketer.
Therefore, in the digital age, consumer behavior is radically different from the arena of traditional
marketing. A brand needs to monitor and adapt according to what consumers are saying about it online.
There is now the need to understand consumer behaviour in the digital world. While the golden
principles of branding, marketing mix, loyalty etc. stay as they were, the emergence of new touchpoints
has led to a new problem for the marketer: understanding the purchase decision and the consumer
decision cycle.

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One mainstay of the marketing concept was the funnel.

The Traditional Funnel [HBR]

With new touchpoints where the brand and the consumer can communicate, and new behaviour, the
need is to influence customers at many stages and not just at consideration stage. A new approach is the
Consumer Decision Journey (CDJ) from Mckinsey Quarterly. The CDJ was developed by examining
the purchase decisions of over 20,000 consumers across various geographies and industries. The key
advantage of the model is that it is not linear, but circular. This is more representative of the real world
behaviour as re-purchase and talking about a brand are actual consumer behaviours.
A detailed view of the model in published in HBR. A summary of it is:
Consider & Buy: This is the most overemphasized stage in Traditional Marketing. Awareness does
increase the chances of purchase significantly, however, ignoring other stages is highly unwise.
Evaluate & Advocate: These stages have gained increased importance in the digital marketing era.
Evaluation is slowly being driven away from heuristics (opinions from family or friends) to active
search and evaluation. Creating channels where customers can discuss about a brand is one way to
facilitate this digitally. With brands increasing their presence on social media, the advocacy stage is
being addressed well.
Bond: Bonding with the brand is important to drive re-purchase. The bonding stage manifests into
loyalty, where the customer is the best advocate of the brand.
According to the CDJ, the point of decision is not when the work of the marketer ends. This is because
the post-purchase behavior is when the opinion the brand is shaped. Every subsequent decision is reevaluated, especially for high involvement products.

The Customer Decision Journey [Mckinsey Quarterly]

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The biggest question is then how to align marketing with the new paradigm of the CDJ? The most
important part is to develop insights about customer behaviour. Identifying the key points where the
decision can be influence is key. With various channels, it is key that money is not wasted on points in
the CDJ where decision cannot be affected. Consumers need to be given with the right information at
the right time. Search Engine Optimization becomes essential to attain this goal. Search Engine
Optimization is a great way to realize customer oriented marketing, giving information when the
customer demands it. On-demand marketing is another term used in the article Beyond the 4 Ps: A
New Paradigm Emerges.
There are different industries where the critical point of decision lies in one of the phases. The marketing
budget should then be focused on converting customers at that point.

One implication of this is that the traditional marketing mix optimization is slowly becoming obsolete.
Traditionally companies have been focusing on how to allocate their marketing spend across TV,
radio, newspaper ads, online etc. In the new digital paradigm, marketers need to influence customers at
the right point(s) in the Customer Decision Journey. According to HBR, 70% to 90% of spend goes to
affecting the customer at the consider and buy stages. However, consumers are often affected during
the evaluate and enjoy-advocate-bond stages much more. Many papers talk about the need to retain
customers as equally important as the acquiring new customers, from a profitability point of view.
Moreover, a loyal customer is the best advocate of a brand. S/he can be the biggest impetus for a family
member, friend or colleague to buy the product. Another important feature is the online reviews. While
spending on creating awareness may generate top of the mind association, a set of bad reviews online
will instantly turn the customer away.

Another important implication is that of marketers budget being a fixed construction to fulfil the
marketing strategy. This is quickly becoming an outdated construct as marketing is no more a one-way
communication exercise. Marketers now have control over two sets of media: owned media and earned
media. Owned media refers to the channels a brand controls such as its website. Earned media refers to
customer created channels like a community of brand enthusiasts. A larger portion of media budget is
being spent on earner channels to talk to already engaged customers. An example is the co-creation
model of Harley Davidson, as written about Kotler.

Therefore, the major learning is that marketers should focus their budget on allocation of spend in
various target stages of the decision journey.

Criticism of the CDJ: Some marketers see the CDJ as incomplete. While decisions are the core concern
of the brand and the marketing strategy, customers generally focus on experience. The focus of the
model therefore, needs to shift to experience. There are other marketers who see relationships are the
key determinant of the model.
Experience: Experience a brand is not limited to purchase. Live events, content marketing, social media,
and word-of-mouth are some of these ways. While only a handful of people own Tesla cars, there are
over a million Facebook likes for their page. Even across geographies where Tesla has not launched
yet. There are many such examples. Therefore, Marketers who think that advocacy comes after purchase
are missing the new world of social influence.

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Purchase and advocacy disconnect: Via social media, people advocate products that they do not even
purchase. So, a product that can project itself to be cool in the moment, it will be talked about.

II. Impact

of Digital Marketing on Different Sectors in India

Internet has revolutionized every aspect of life, especially economy and marketing. This report has shed
light upon opportunities and challenges of Digital Marketing and Traditional Marketing. As the Internet
continue to grow, new technologies in Digital marketing will emerge and new ways of ways of
marketing products and services will come up. Getting a better understanding of the power of Digital
marketing will help companies develop a winning market strategy for the future.

A. Sector Wise Impact


1. E-Commerce
E- commerce has been transformed by digital marketing. Most of the ecommerce companies like
Amazon, Flipkart, Myntra, Jabong, Myntra etc. have been extensively using Digital marketing
methods to market their products. Search Engine Optimization, pay per Clicks, Online Banners,
Affiliate Marketing are used by E- Commerce companies to make their products visible to the
online customers. Dynamic Adverts have become very popular in E commerce industry so that
online customers are shown already seen products on E-commerce portals to increase the
probability of buying. Blogs and Article Marketing are used by E-commerce players to boost the
products which they have exclusive selling rights and also to provide honest product reviews to
the customers. E- commerce players also use mobile apps to sell their products.
2. Travel Industry
In India, earlier the Travel industry operated only through travel agent offices and mostly
traditional marketing methods were used to by Airline service providers and Travel agents to
market the various services. But with the emergence of online travelling websites and internet
boom, digital marketing became a major driver in increasing Traveling industry revenues. Search
Engine Optimization, pay per Clicks, Online Banners, Affiliate Marketing are used by ECommerce companies to make their products visible to the online customers searching for their
services. Dynamic Adverts help customers in keep showing customers trips and flights they have
searched earlier. Email marketing is used to send them customer loyalty program offers and
referrals codes. Blogs and Article Marketing are used by Travel service providers to encourage
travelling and to provide travelling blogs.
3. On-line Taxi Aggregators
Online taxi Aggregators have used Digital Marketing platforms to market their services because
their target segments generally use digital platforms. Search Engine Optimization, Affiliate
Marketing are used by Uber and Ola for marketing their services. They also used blog and article
marketing to sell the advantages of the services to the customers. They also use referral marketing
and build customer Loyalty programs through emails and Mobile Apps. Social Media platforms
are used to gauge consumer insights and resolve consumers complaints. Brand campaigns are also
promoted through various digital platforms.
4. FMCG Industry
Digital marketing is extensively used by FMCG industry companies to spread their brand
campaigns effectively to the digitals users of India. FMCG giants like HUL, P&G, Marico, Nestle
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etc. are extensively using YouTube and social media platforms to spread the awareness of the
products. Moreover, various promotional offers and online competitions are also done by FMCG
companies to keep their customers involved. Also lot of consumer behaviour and consumer
insights are gained from various digital trends of the online users, which help FMCG to develop
new products and products augmentation.

B. Emergence of New jobs due to Digital Marketing


Digital marketing has provided new job opportunities for companies in India to capitalize on the
new wave of digital marketing. Below are the roles companies are now recruiting for handling the
digital marketing campaigns.
1. Digital Marketing Head:
Consumer touch points are owned-media channels, like the companys website, packaging,
customer service and sales. Marketing is usually never in control of all these touch points.
However, consistency is the most aspect for any brand. Therefore, the message put out by all
these must be consistent and thereby originate from a single source. Some firms have an
orchestrating team or a single person, for example the Chief Marketing Officer who has the job
of making sure the message across all channels is the same.
2. Content writers and content supply chain Manager:
There is a lot of content being generated by marketers and copywriters today on a global scale.
Sometimes marketers have to create content acting in real time to put out communication. There
include videos, social media promotions, and content for servicing. With such a large amount
of content, the chances of discoordination. This would lead to inefficient communication and
will undermined the brand image. To avoid this, few companies have created central roles and
systems required to manage their content supply chain. This is beneficial as research has
shown clear signs that when communication originates from a single source, consumers
understand the brand better.
3. Marketplace intelligence leader:
As data is exploding both in terms of volume and sources, it is essential that it be leveraged and
mined to understand consumer behaviour in the best possible way. However, often it is the IT
teams that control the data gathering. While it is unfair to generalize, but IT may not have the
necessary understanding in terms of marketing to steer resources and prefer to work in the
traditional efficient way instead. Therefore, this calls for a skill which is at the intersection of
marketing and IT. This can be achieved, as is being done by modern firms, by training IT in
marketing as well. Another way to achieve this is, as done by large pharma firms, to hire
consultants.
4. Social Media Marketing Expert:
Social media marketing has two functions. One of the functions is to spread company owned
content via social media channels. However, to run a paid advertising campaign on Social
media requires some expertise. For example, advertising on Facebook, twitter and other
platforms has become a complicated task for marketers. New features and targeting options are
added everyday and therefore a social media marketing expert is required for this function.
5. Search Engine Marketer / Specialist
Search engine marketers are needed to report to digital marketing managers in big firms. In
small firms the work of the search engine specialist manager is done by the Digital Manager.
The responsibility of a search engine marketer is to the analysis of target number of leads and

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clicks from the spent marketing budget. Most of the work is involves in analysis, bid
management, keyword research, ad copywriting and split testing the ad campaigns.

III.

Development of Metrics

In this age, the marketing function of every firm ponders over the question: how much to spend on
digital marketing and how much to spend on traditional marketing. Whereas some firms engage in
only one of the two, a lot of firms today have to decide how to effectively allocate their budgets
between the two.
A. An important set of metrics given below are a guide to let a firm know which the best
strategy is for them, out of the two:
1. Business Model and Point of Purchase: Businesses where the point of sale is online need to
focus on digital marketing. This is logical because asking a customer to go online after
watching/reading an offline ad will increase the cost and difficulty of the transaction and the
chances of an impulse purchase will be as good as zero. However, an online ad can drive the
customer to impulsively purchase the product or service being advertised.
This, however, does not automatically mean that traditional marketing is the best option for a
business where sale is offline only. Digital can still be a better option as explained by the metrics
below.
For dual point of sales however, digital marketing is a must. Whether the business engages in
offline marketing is another decision.
Some examples are Amazon which uses both digital as well as traditional marketing, be it
affiliate advertisement, TV ads or newspapers ads. Despite being an online only business (in
India, unlike the US where they recently opened brick and mortar stores), the brand engages in
newspaper ads, and even full front page ads.
2. Target Group: Different brands have different Target Groups (TG). A great example to contrast
is that of an online cab service versus a brand of clothes for old-age people. In the first case,
the TG could be the working population who will book a cab online. Here, internet access is a
must, as well as having a certain level of skills to use the web. Therefore, the likely candidate
is digital marketing channels like email marketing, affiliate marketing and social media.
However, in the case of the old-age clothes business, the TG is such that access and
understanding of the internet is not guaranteed. The best way to engage the consumer in this
case will be to use traditional channels like newspapers or brochures, depending on the other
qualities of the TG.
Hence, to engage the customer, it is important to segment the customers as well, and see which
channel the target segment is using.
3. Marketing Budget: Digital Marketing is a way to reach many customers at a relatively lower
cost compared to traditional marketing channels. For a firm with a low marketing budget, where
there is presence of the relevant TG online, it is wise to stick to online marketing only so as to
maximize returns. However, there are various models to effectively allocate the marketing
budget. While Marketing Mix Optimization is the classic way to decide marketing spend, it is
not the best way in case of digital marketing. With the ever changing scenario, online marketing
campaigns should not rely on historical data. On the contrary, real time tracking and adjustment
is how the best marketing campaign can be created.

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However, spend on each channel can be optimized using the Law of Diminishing Returns. This
law says that for each marketing dollar spent, the return progressively decreases. Therefore, the
optimum spend is where the marginal return equals marginal spend. This is the point of
maximum profit. While applicable, this must be closely monitored regularly in online
campaigns to suitably adjust spends.

An Illustration of the Law of Diminishing Returns

4. Competition: It is important to consider what the competition is doing. Not engaging the
customer through any channel where the competition is present is a source of disadvantage
arising from competition.
5. Number of Products/Variants: One great advantage that digital marketing affords is
customization. Different consumers have different online behaviour, which is tracked by
website using cookies amongst other mechanism. This gives brands the opportunity to adapt
their promotion to suit the needs the customer. Affiliate marketing is one way to effectively
achieve this. An example is Flipkart. After searching for a particular product, say a mobile
phone, many websites which are affiliated to Flipkart through a third party service provider will
show the same mobile phone or a similar product. This is a way to segment and target each
individual separately, compared to traditional marketing where there are <10 segments and a
brand is advised to stick to one or two segments to target.
Hence, with a wide variety of offerings, it is best to target the customer according to his needs.
6. Brand locations: Digital marketing transcends regional and national boundaries. Because of this
reason, brands with a global presence are much more suited to deploy a large scale digital
marketing campaign. Something noticed is that these brands deploy a standard global digital
campaign and a locally suited traditional marketing campaign. This gives a cost effective
presence to brands, as well as the option to make local adjustments.
Finally, the best way to decide is to find out which channel is driving the sales the most. This can be
achieved by asking customers which channel they engaged with the brand through, something that is
commonly seen today.

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B. Measuring Digital Marketing Performance


Like a traditional marketing campaign, it is essential to track performance of a digital marketing
campaign. The way and speed with which a digital marketing campaign is measure is significantly
different from how a traditional marketing campaign is measured.
The important metrics to look at while measuring a digital marketing campaign are:

1. Reach: The primary benefit of a digital marketing campaign. How many customers are engaged
through a campaign is possibly the most important metric to judge the health of a campaign, be
it online or offline. Online has the advantage of being technologically enabled, thereby making
it much easier to track, in real time, the engagement. Websites are embedded with a visitor
counter, all affiliate marketing campaigns are slowly moving towards pay-per-click (PPC),
thereby again making it easy to track clicks. E-mail and marketing campaigns have secondary
research data available, where a percentage of the customers are actually engaged by the
messages.
Based on these insights, a campaign can be changed or adjusted very quickly.
Another measure to gauge reach is social media. Hashtags, retweets, and likes are the
commodities of digital media. They provide quantitative measures in real time.
2. Power of Message: While it is important to gauge how many people are engaged, it is even
more important to ensure that those engaged are getting the intended message. With the vast
diversity present, the message can be differently interpreted by different people. A good way
to measure this is sentiment analysis tools which capture social media comments and turn them
into insights. Brands can then analyze which words are generating a positive message and which
are sending the wrong message. This affords the opportunity to tweak the campaign on the fly
in real time.

3. Channel specific measurement: While a campaign can be hit on one social media channel, it
may not work on other channels. Therefore, selection of right channel is important.
4. Sales: The top line is why the marketing effort is undertaken. Best measured for brands with
online sales, the customer journey can be tracked, whether the customer made the final purchase
after coming to the website through an affiliate medium, through social media or directly on
the website.
5. Bounce Rate: This is a way to measure the goodness of the campaign rather than the brand.
Bounce rate is a measure of the number of customers who visit the link or website and leave
within a very short span of time. This is an indication that the website of campaign is not being
liked by visitors.

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