The Impact of the Internet on the Dominant Logic of Marketing - Essay Example

The impact of internet on the dominant logic of marketing Introduction In this paper, I will expound the concept of marketing and in particular its modern and innovative approach. Internet marketing has become the major medium of marketing activities today and this can be elaborated by various online sites trying to entice and convey information to customers with their offerings. It is in this reason that the proponent of this paper tries to gather information about the basic concept of marketing and the probable impacts of internet on the dominant logic of marketing. Considering that the traditional-based marketing has become the basic idea of marketing just before the discovery of internet marketing, it is important to understand the level in which businesses or firms have eventually evolved based on their capacity to introduce their offerings to prospective customers. Part of this paper prior to arguing the impact of internet on the dominant logic of marketing is the discussion of the basic concept of marketing. The basic information about this portion is the basis of probable identification on the level if any; the marketing concept has evolved from the basic. The basic concept of marketing Marketing as we know about it is composed of sub functions such as selling, advertising and promotions. These sub functions are common areas where companies can actually establish their corporate advantage (Kotler and Keller, 2008). What makes marketing so alive today is due to underlying five orientations guiding any marketing effort of any organisation in their marketing activities. These five orientations involved production concept, product concept, selling concept, marketing concept and societal marketing concept. Products or services are two most common offerings of companies, but today some of them seldom get much attention because of poor communication of information given to people. Some might have encountered a certain product or service but do not care enough due to lack of details or familiarity about it. A market-driven strategy is therefore important in order to get the consumers acquainted with company’s offerings. One of the ways to depict a market-driven company is to observe their interaction with their target buyers. Companies are always looking forward to unfed needs of their customers and thus they usually reward them with corresponding solutions. This is the case of customer-centered way of dealing business with marketing (Kotler and Keller, 2008). However, what seems to be the most significant and contrasting part here lies on the capacity of each firm to convey or impart information to its prospective customers. The good thing about having marketing in the firm today is the good chance that people are buying products or services not because they actually need them but they are only convinced on how companies are telling them about their products. The basic concept of marketing is the meeting of needs of customers (Kotler and Keller, 2008). However, most firms nowadays are not directly serving the needs of the market but through the creation of needs for their products beforehand. The bottom line of course is still to focus on meeting the needs and satisfying their customers. However, this is way ahead after the need is set up. Firms are actually reinventing or even suggesting needs and this is the best role played within the bound of marketing concept. One reason of this evolution is competition. In a business growth strategy, companies are trying to be on top over the other competing companies. Due to competition, the direction of strategy in marketing has become so promising. There is a need to actually combine marketing and managing directions. These two usually gained misconceptions. They are not actually involving the art of selling but knowing what to make. Marketing function then involves managing customers by identifying and understanding their needs towards the creation of solutions that could deliver their satisfaction for both in the short and long run. In its totality, competition is getting fierce these days because of availability of good marketing mediums which have become the company’s way of life (Kotler and Keller, 2008). The internet-based firms Internet-based firms and traditional-based firms are the two types of firms currently in the market to show how marketing is working at present time. The coming out of internet-based firms is due to the fact that technology has slowly redefined business. Business can now be conducted online and because of this, the limitations of boundaries and geography are momentarily addressed. Marketing on the other hand can now be conducted in the virtual world and this means new demands for products and services as new distributors, suppliers and customers emerged. There are many important ideas that need to be taken into consideration prior to understanding the application of marketing in internet-based firms. The study of Siu (2002) in comparison of internet-based and traditional-based marketing in Taiwan showed that cyber entrepreneurs have higher level of marketing knowledge compared to traditional entrepreneurs. It was found that those firms operating both traditional and internet-based marketing are concentrating on sales, product planning and customer relationship. The traditional firms on the other hand showed great focus on quality control. However, internet-based firms remarkably consider product schedules, sales forecasts, sales control and marketing research. Hsu et al. (2001) found that the perception of Australian and Taiwanese advertisers of internet marketing significantly varies. They found that Australian advertisers on internet marketing can be categorised as optimistic tomorrow, cautious adopters, doubting laggards and technology realists. However, Taiwanese advertisers were either cautious adopters or technology realists. This finding only supports the idea that some countries are still having low belief about the future of internet marketing despite the fact that it is one of the widely viewed possibilities of product and service distribution of firms around the world today. This is obvious in hotels in Turkey which are not utilising internet and e-marketing to the fullest despite the common notion that the advancement in information technology provides ample opportunities especially in achieving competitive advantage (Baloglu and Pekcan, 2006). The impacts of internet on marketing From the past, internet transformed marketing strategy and marketing operations and they will be more extensively integrated in the internet-enabled market of the future (Vanadarajan and Yadav, 2009). This is the futuristic view of probable impacts of internet on how marketing will function in every firm relying on e-business strategy. Such strategy has long been viewed to meet the restrictions and limit set by various factors such as geography, culture, economy and other environmental factors. Just like traditional marketing approach, marketing in the internet involves customers, producers, selling behavior and negotiation strategies. Internet has significantly strong impacts on market size and structure, business buying and selling behaviour, negotiation strategies and pricing practices, not to mention further on distribution system and logistics (Lichtenthal and Eliaz, 2003). Due to its interactive structure and availability of information, the internet can be an effective medium to develop relationship marketing especially on the level of commitment, satisfaction and trust (Bauer et al., 2002). One of the most important parts in marketing is to develop strong customer relationship by providing satisfaction and development of trust. Some companies are developing this level of strategy through an online site. For instance, in services alone, Japanese are able to enjoy the advantage of online English tutorial through rarejob.com and other interactive online sites. The good thing about these sites is that they are ensuring their customers the quality of training and customer service. In the long run, this gives the company an opportunity to expand and cater wide range of segments in the market. The main point in here is the fact that everything works out under the basic concept of traditional marketing. What seems new in here is the inclusion of information technology which is advancing further in order to maximise customer service and support experience. On the other hand, various online companies are trying to market their product offerings through different online sites such as amazon.com, e-bay.com and many more. The future of marketing definitely goes online since internet has been widely accepted as effective communication medium. What is new in here is the fact that firms will no longer spend that much for infrastructure. Internet-based firms are given the opportunity to distribute their products across the globe to unlimited number or customers. Firms are remarkably using the potential of internet for creating value chain efficiencies, reduction of costs and enhancing both customer and channel relationships (Sultan and Rohm, 2004). The most challenging part however is on the part of developing customer and channel relationships. It cannot be denied that internet marketing is still different from traditional marketing but the underlying concepts are the same. However, what is most challenging about internet marketing is for it to significantly elevate further from the traditional way in order to ensure customer and channel relationship. Everything seems to go at the highest level even though the bottom line would still be the basic about traditional marketing. The business-to-business process of Dell using the internet compared to traditional approach of Compaq led the former to gain larger market share in the industry (Sharma, 2002). This is just a mere proof that compared to traditional marketing, the internet-based marketing has become so aggressive to the extent that innovating possibility has reached to the highest level just like in the case of Dell. However, the result of such move of the company was positively remarkable and it cannot be denied that internet marketing has become the highest level of marketing indeed. In fact, enhancing business’ marketing operation can be essentially developed with the potential of internet in enhancing its business competitive strategy (Kalaignanam et al., 2008). Another important impact of internet marketing can be observed on how countries sell their respective tourism industry. Countries in order to boost tourism industry have identified the potential of internet. Internet blogs have become tourism marketing medium where it is believed that website is able to generate desire to 45% of its readers (Lin and Huang, 2006). Internet therefore has a strong influence to people and the only way to increase it into a significant level is to make marketing online interactive just like the way traditional marketing system works. However, in doing so, there is a need to create a strong link with information technology. Traditional marketing may also involve the use of information technology but with internet marketing, there is a higher requirement for efficient and advanced information technology. Internet is momentarily integrating the world into one market economy. After all, the good thing about the internet is its ability to encourage firms to adapt their marketing strategies and new offerings using internet technology (Perry and Shao, 2005). The use of internet provides positive impact on sales management activities, activities on market-oriented product management, sales performance and efficiency (Avlonitis and Karayanni, 2000). In addition, the positive result of internet is thought to improve business performance and satisfaction of inter-firm (Rao et al., 2003). It is clear that with internet, marketing has moved to a new level. It is also clear that the basics about traditional marketing are still found on the specific pattern of internet marketing. However, many innovations along the way have been involved especially on the part of information technology. Information technology therefore clearly has to go along with internet marketing. In the absence of information technology, internet marketing cannot be supported to the fullest. In fact, the mere reason why internet marketing has flourished was due to the advancement and wide innovation covered under information technology. What needs to be done? Since information technology is vital and integral part to the success of internet marketing, then strategies have to be formulated and they must be ensured to cover broad concerns on technology and marketing concept. Internet marketing is a challenging activity considering that in order for every e-business to grow, customers must be provided with effective product awareness and chance to explore purchase commitment (Kwan et al., 2005). It is in this regard that customers have to be essentially studied and a great deal of focus on customer awareness must be implemented. One most important idea in marketing is the concept of customer behaviors. In internet marketing for instance, with clickstream data the behaviours of internet users can be studied. In particular this will create an impact on marketing research to further understand browsing and site usage behaviour on the Internet, the Internet’s role and efficacy as a new medium for advertising and persuasion and shopping behavior on the Internet (Bucklin and Sismeiro, 2009). Understanding customer behaviours is the specific move in customer-centered and market oriented business approach. One of the modern approaches in customer-centric marketing is the utilisation of the full potential of the internet by implementing internet coupons on targeted customers (Cheng and Dogan, 2008). In this way, not only customers are served by their needs but the needs are actually created. This is the same strategy applied in traditional marketing, what seems new however is the specific approach which is entirely based on the current trend in information technology. It seems every offering or product can be easily disposed via internet marketing. However, there are some products that could not be easily disposed online. On marketing residential real estate, it took a little while to sell through the internet (Ford et al., 2005). This is perhaps due to the fact that selling residential real estate needs more dynamic approach to convince customers. This is another area that internet marketing must essentially address. Some products or even most of them require dynamic and systematic approach in order to convince customers and suggest probable purchase of the offering. This is a challenge to combined information technology and internet marketing that needs to be addressed accordingly. On the other hand, product customization, availability, logistics and transaction complexity were identified important in understanding internet marketing because they can determine the success of firm’s online marketing (Kiang et al., 2000). In detail, internet consumer behaviour and marketing strategy needs to be critically considered in electronic marketing because they cover influence of trust and role of virtual communities, the role of electronic word-of-mouth, consumer reactions to pricing and consumer issues in marketing strategy (Laroche, 2010). Thus, just like traditional based marketing, there is a need to study the level of relationship marketing on the internet using the five-level model of Kotler and Armstrong (Klassen, 2002). There are some guidelines for managers to enhance their implementation of internet into their firm’s operations (Honeycutt et al., 1998). This means that electronic media such as the world wide web is a great opportunity for firms to be successful in internet marketing. Since there are guidelines to successfully implement internet into firm’s operation, it implies that internet marketing can be the best approach in the distribution of offerings. Aside from guidelines, there are new theories that need to be enriched in marketing modeling for e-business (Mahajan and Venkatech, 2000). This is to say that the idea about marketing in traditional marketing system cannot be sufficient enough to cover all the essentials for effective implementation of internet marketing. Aside from guidelines and theories, there is a need for business strategies in internet marketing considering that it is large enough and there are different approaches on how organisations respond to it (Angelides, 1997). Firms seem to be rushing through different marketing approaches. One of the significant reasons of this is the shift in marketing and information technology (Brannback, 1997). Due to this shift of marketing and information technology, Chinese turn to the internet to search information prior to their purchase. What makes them different from those in Western Europeans are their cultural, behavioral, economic and technical orientation plus their corresponding characteristics (Vuylsteke et al., 2010). Thus, information technology and internet marketing and their impacts would also depend on some important environmental factors. Conclusion In the age of information technology, traditional marketing cannot just stay on the basic. It has to branch into another level in which the bottom line is to go for innovation of possibilities while addressing the need to satisfy customers. The basic concept of marketing is very useful in internet marketing because it serves as its foundation. However, the use of technology in internet marketing proves that the basic cannot just be sufficient. There is a need to further explore the wide coverage of information technology in order to master internet marketing. This is not just an easy task to do considering that these two combined different areas of expertise have to be essentially learned together. It is in this reason that the basic marketing model when combined with various concepts of information technology may possibly result to another model, concepts or theories in which the bottom line is to pave way to master internet marketing. References Angelides, M. C. 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