E-mail and viral marketing

MARK 430

Today’s class will cover:

Marketing communications Email marketing How to get your email delivered and opened Understanding SPAM legislation Viral marketing

Putting it all together Case study of Lord of the Rings (website and viral

marketing)

E-mail (direct marketing) Marketing-related e-mail is 22% of a typical Internet

user’s in-box (conservative estimate) More than half of this is spam (marketers have

abused and misused email?) Advantages

Cheap Direct (include hyperlink to website for click-through)

Disadvantages Bad reputation because of spam Emails keep changing No direct correspondence between person and email

address as there is with physical mail

  E-mail Postal Mail

Delivery cost per thousand $30 $500

Creative costs to develop $1,000 $17,000

Click through rate 10% N/A

Customer conversion rate 5% 3%

Execution time 3 weeks 3 months

Response time 48 hours 3 weeks

Source: Jupiter Communications as cited in “E-mail and the different...”

Metrics for Electronic and Postal Mail

Why does SPAM continue?

Cost to sender is minimal Very low response rate (0.025%) required to

make SPAM profitable Nature of the worldwide global network

enables SPAM Legal penalties difficult to enforce

Permission marketing (opt-in versus opt-out direct marketing) Seth Godwin coined the term “permission marketing”

to describe “opt-in” Ask people what they are interested in Ask permission to send them information Then do it in an entertaining, educational, or

interesting manner

Opt-in techniques will grow considerably because it is seen as an effective way to reach people who have been made skeptical of traditional marketing techniques

eMail marketing challenges

Even with opt-in, there are considerable challenges in

Getting your email to the recipient (spam filters etc)

Getting them to open it when they get it

Some tactics to help get your email delivered and opened

Double opt-in subscription process No pre-checked boxes Visible “update email or preferences”

link A recognized, expected, consistent

sender name “Branded” subject lines and subject line

content

Based on How Nongeeks Can Increase eMail Delivery

Some tactics to help get your email delivered and opened (cont’d)

Be aware of how content (spam) filtering works

Message proofing and pre-testing Personalization and segmentation Think about images instead of text

(downside!) Manage user expectations Select appropriate send time

Based on How Nongeeks Can Increase eMail Delivery

Stay legal

Canadian legal position no legislation in place yet Being considered by the Spam Task Force

US law – the “Can Spam” Act – came into force on Jan 1, 2004 Requirements for commercial emailers

Viral marketing (word-of-mouth direct marketing)

Any strategy that encourages people to pass on your message to others

Let the users of the Internet do your marketing for you

It works, and it’s free Hotmail used this technique to raise product

awareness Be careful of customer perception that they

are being “used” – people are increasingly sophisticated and cynical

Elements of a viral marketing strategy

Free products or services Easy to pass on to someone else

(Recommend it; email to a friend etc) Build in scalability (get ready for the rush) Build on common motivations and behaviours Understand and exploit existing

communications networks Some examples of virals from Lycos Cheeky

Emails

Marketing communication: Putting it all together

Case Study: Marketing Lord of the Rings

Based on information taken from Internet Marketing: Building Advantage in a Networked Economy. 2nd Ed. Rafi A Mohammed et al. Irwin/McGraw Hill. 2004.

The marketing plan for Lord of the Rings

Framing the marketing opportunity - the LOTR brand was already well known before the films, so the strategy had to build on that

Marketing opportunity analysis: understanding customer needs film has elements that appeal to several audiences

(action, romance etc) existing fan base was already very active online - good

opportunity for viral marketing website could serve various interests

hard core fans could get behind-the-scenes info others could find out about actors others may be interested in the cultural aspects of Middle Earth

Risk was that fans may not like the movie, in which case the Internet could be a liability - bad reviews travel fast

The marketing plan for Lord of the Rings

Marketing strategy Segmentation: the potential audience varied in

demographics and psychographics. Hard-core fans were targeted separately from general movie goers, women targeted separately from men

Targeting and timing: the strategy was to target core LOTR fans first - these

would eventually become evangelists for the product. Need to instill trust early on, and encourage viral marketing. Community building with established Tolkien websites was also done

Secondary groups and mass audiences were targeted using website, and conventional mass media

The marketing plan for Lord of the Rings

Marketing strategy Positioning:

once the audience segments were defined, the positioning of the movie was decided, with online and offline positioning working together to provide consistency

best positioning determined to be “a stunning action/adventure with a classic good-versus-evil story that focuses on a ring with great powers”

a lot of focus on ‘the ring’ in communications lot of focus on the setting, the landscape, the costumes

and the creatures online and offline advertising campaigns were separately

tailored for male and female audiences

The marketing plan for Lord of the Rings

Implementation: The Marketing Program viral marketing formed the core of its

communication strategy - powerful tool for generating awareness. Used pre-existing fan base LOTR newsletter (click-through rate of >50%

and forwarding rate of 25%) Partnering and shared content - content

provided to other websites - “advertorial” material - increased market reach

heavy use of downloadable viral content on website (eg. preview footage)

The marketing plan for Lord of the Rings

Implementation: The Marketing Program Official website: raising awareness - first preview

footage April 2000 - objectives show early adopters that the film would be of high quality -

generate early buzz among key fan group “give something to the fans” - keep them excited drive awareness of website and the movie

Execution - “co-ordinating the power of the community” - used other Tolkien sites, daily email alerts, and “countdown” image releases. Intention was to create high expectations for the exclusive launch

1.7 million downloads within first 24 hours 10 million downloads within 21 days

The marketing plan for Lord of the Rings

Use of official website Many people who use the site are already

committed to the brand The customer experience at the site had to satisfy

the committed fan, yet encourage exploration by novices had to make newcomers feel welcome - not as though it

was an exclusive club

The other marketing challenge was to integrate online and offline materials

The marketing plan for Lord of the Rings The customer interface of the website - the 7

Cs Context: highly visual style, inviting look and feel, topic-based interactive interface

Content: focus on filmmaking, wealth of material: photos, audio, clips etc

Customization: Low, no registration

Stages of Desired Customer Experience on the official website

Experiencing Functionality

Trailer and video materials for viewing readily available Navigation is simple and clear for downloads, community, cast and

crew information Easy sign up for e-mail and promotions on homepage Direct links for actions including ticketing, online ship sales and

merchandising

Experiencing Intimacy

Website visitors articulated the value they derive from the site experience

Consumers “trust” the information they find on the site Strong community has developed within site areas E-mail interaction allowed for open, clicking and forwarding to others

Experiencing Evangelism

Strong evangelical support from the user base Trailer and new content postings are seeded throughout community

areas as well as on other sites and posting boards Creates a strong sense of consumer ‘ownership’ of the brand The website becomes a trusted friend