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 The importance of Web Analytics |
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New Online Marketing Paradigm
Since the widespread utilization of the internet for marketing campaigns, the academic world and the business world have engaged in a debate particularly about the definition and attributes of online marketing.
Is online marketing merely attaching “online” to the existing marketing principle or the beginning of a whole new marketing paradigm?
One school of thought contends that internet utilization is not a new marketing revolution, but rather a new tool. This faction asserts that marketing campaigns carried out online does not represent a transformation of traditional marketing. Korea Marketing Association defines marketing as “transaction of certain items by organizations or individuals for own objective; act of defining and managing market for maintenance.” By this definition, online marketing is only a tool that enhances existing marketing campaigns.
In contrast, the opposing camp considers online marketing the new paradigm, a principle unlike any of its predecessors. After the radio and the telephone were invented, mass marketing and direct marketing were separated by 20-30 years. Thus, the internet might serve as a tremendous marketing opportunity, and should not be minimized as just a tool.
【Table 0-1 Changes in Marketing Paradigm】
| Current Marketing Paradigm |
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New Marketing Paradigm |
| one to many communication |
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many to many communication |
| Mass marketing |
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Personalized marketing |
| Monologue |
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Dialogue |
| Branding |
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communication |
| Mega brand |
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Diversity |
| Supply-side thinking |
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Customer-side thinking |
| Target as customer |
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Partner as customer |
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Views shown above reflect the recent trend in marketing: most people consider online marketing as the new paradigm. Mass media constantly features internet-related stories. The academic world sees the internet as the driving force behind the new marketing paradigm and continues to conduct studies and reveal results. Thus, the public is starting to understand and recognize online marketing as essential to a successful business.
Online Marketing vs. Traditional Marketing
There are many differences between online marketing and traditional marketing.
In 1997’s Corporate Internet Planning Guide, Richard J. Gascoyne and Koray Ozcubukcu organize the differences between online marketing and traditional marketing in the following four categories: (1) marketing environment, (2) keys to marketing success, (3) role marketing within company, (4) perspective on customer.
【Marketing Environment】
| Traditional Marketing |
Online Marketing |
| Marketing rule features precise time period, clear and uniform definition. |
Marketing rule continues with further technological development. |
| Market with national or regional boundaries |
Market without boundaries. |
| Hard-to-define niche market |
Niche market can easily generate new common scale business opportunity |
| Enterprise-based marketing |
Customer-centric marketing |
| High advertising costs |
Low advertising costs |
| Information system provides little help to marketing execution |
Information system plays an important role in marketing campaigns; interaction between marketing department and IT personnel is vital |
【Keys to Marketing Success】
| Traditional Marketing |
Online Marketing |
| Recognition of product and service determines success. |
Under the assumption that recognition of product and service exists and is very important. |
| Earlier entrants to market possess definite level of compensation and maintain advantageous position over later entrants. |
Earlier entrants to market create commemorative value for customers and maintain greater competitiveness over later entrants. |
| Cooperation between companies or departments is marketing essential. |
Cooperation between other departments is marketing essential. |
| Creativity is essential to uniqueness. |
Innovation is essential to uniqueness; many ways to achieve innovation. |
| Limited interaction with customers is acceptable. |
Interaction with customers is frequent and vital. |
| Provides advertising related to product and service. |
Provides training and know-how. |
【Role of Marketing within Company】
| Traditional Marketing |
Online Marketing |
| Product development dictates marketing. |
Marketing department integrates with sales and technical departments. |
| Marketing department in charge of front-end role. |
【Perspective on Customer】
| Traditional Marketing |
Online Marketing |
| Customers possess little knowledge and information about product and service. |
Customers possess more knowledge and information and customer feedback is instantly and easily stored. |
| Able to estimate customer patterns and expectations. |
More complete contents for new customer patterns, expectations, and interests. |
| Views customers as a group or organized unit. |
Views customers as individuals rather than a group, customizes products for different customer needs. |
Importance of Online Marketing Analysis
Online is drastically different from traditional marketing in many aspects and steadily maturing into the focus of various large enterprises. Online marketing performance is easy to test and measure. Thus, many companies have begun to use every existing analytics solutions to analyze marketing effectiveness.
Even though there have been numerous research and studies related to online marketing, the wide range of these studies and their emphasis on brand image and product promotion suggest that measuring effectiveness must be done accurately.
The goal of online advertising is obviously to increase the level of brand recognition, but definitively evaluating member conversion rate, marketing campaign planning, merchandise introduction, etc. can more accurately define and quantify advertising goal.
Thus, in the online marketing domain, web analytics is the means to measure marketing success and the key to modifying marketing theory and planning new marketing campaigns.
Thus, aside from the differences listed on the previous page, the biggest advantage for online marketing is that it is quantifiable and easy to utilize in new marketing plans.
This cyclical marketing theory has become one facet of the new online marketing paradigm. With customer relationship based on this cycle, the new paradigm also provides personalized analysis.
The growth of online marketing and the development of solutions have led to a continuous proliferation of analytics solutions and theories about personalization, but the industry has yet to arrive at its expected results.
Personalized marketing, the core aspect of the online marketing paradigm, in most cases is an undeniably complex domain.
For example, American online bookseller Amazon.com (www.amazon.com) analyzes the books that customers purchase and implements a book recommendation system, creating a revolutionary marketing paradigm in online shopping mall. However, this method has its share of unsuccessful cases. Even though this type of recommendation system can be used for books, films, and music, it is highly ineffective for large shopping malls where a wide variety of products make customer preferences less discernable.
However, if unable to define this type of online marketing analysis perspective and execute actual personalization, the internet might not be able to provide true marketing paradigm.
Conclusion
Characteristics of online business and various restrictions of web log must be considered when discussing about web analytics. Thus, improvements must be made to compensate and correct web log data, generating complete and accurate data that fit the online marketing paradigm and assist analysis and utilization not viable offline.
Aside from online marketing, web analytics service can help you overcome current web log data obstacles in the online business field. It offers analysis and flexibility that fit the characteristics of online shopping mall, introducing independent log generation.
Further understanding of this type of log is not only accurate, but can also be designed to fit the analysis perspective of online shopping mall. Analysis of the new marketing paradigm can thus be provided. Moreover, this type of data offers practical and sensible customer segmentation, helping achieve the objective of online marketing analysis: increasing sales.
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