In this world of digitization, digital marketing is a vogue that is sweeping across the whole world. The trend of digital marketing is growing day by day with the concepts of Internet marketing that is turning into an important platform of digital marketing along with electronic gadgets like digital billboards, mobile, tablets and smartphones, gaming consoles, and many such gadgets that help in digital marketing.
Amazon with its innovative digital marketing has created a niche market in online stores competing with conventional stores showing the power of online marketing.
The case study analyses how Amazon.com has brought in an array of digital and online marketing strategies to succeed and make it big in the digital marketing sector. The case also discusses how Amazon has had a huge success in the online marketing sector as it brought new insights into the digital marketing field.
And a few years from now it will be eventually seen that conventional marketing is being replaced by digital marketing. Digital marketing is going to be top on the agenda of many marketers, and they might be looking for innovative ways to market online, reduce cost per lead, increase click-through rates and conversion rates, and discover what’s hot in digital marketing.
Introduction to digital marketing
Digital marketing is a broad term that refers to various and different promotional techniques deployed to reach customers via digital technologies. It is embodied by an extensive selection of service, product, and brand marketing tactics, which mainly use the Internet as a core promotional medium, in addition to mobile and traditional TV and radio.
Digital marketing is also known as Internet marketing, but their actual processes differ, as digital marketing is considered more targeted, measurable, and interactive. Digital marketing includes a raft of Internet marketing techniques, such as search engine optimization (SEO), search engine marketing (SEM), and link building.
It also extends to non-Internet channels that provide digital media, such as short messaging service (SMS), multimedia messaging service (MMS), callback and on-hold mobile ring tones, e-books, optical disks, and games.
A key digital marketing objective is engaging customers and allowing them to interact with the brand through servicing and delivery of digital media. This is achieved by designing digital media in such a way that it requires some type of end-user action to view or receive the motive behind that media’s creation. For example, to receive a free e-book, a customer might be required to register or fill out a form, benefiting the advertiser with a valuable customer or lead.
Digital marketing communications can be distributed at a faster rate and broader reach than traditional marketing communications. While this idea is undoubtedly true, reaching a mass audience quickly by using digital technology does not constitute Digital Marketing.
Reaching a more targeted audience iteratively is a clear definition of Digital Marketing Marketing executives are most supportive of Digital Marketing because of the ability to easily track and measure the results of the marketing communication. Because of the use of digital technology, the results of a digital marketing effort can be tracked by reach, views, clicks, visits, response rates, purchases made, and so on.
I will explore the details and importance of these types of measurement techniques in the coming weeks, but for now, understand that Digital Marketing requires the ability to measure the results of a digital marketing campaign.
The use of digital technologies to create integrated, targeted, and measurable communications which help to acquire and retain customers while building deeper relationships with them is digital marketing. It must be digital because of the technology.
It is targeted because of the value in the technology allows it to be. It must establish relationships because marketing using digital technology generally requires input from potential consumers. It must be measurable because measurability is inherent in the use of digital technology and inherent in the use of marketing.
India has around 13.5 crore internet users today whereas the number of homes with Cable and Satellite (C&S) television is 10.5 crore. The expected internet users will reach a figure of 30 crores by 2015 and C&S homes are expected to be 14 crores by 2015. Thus India has tremendous internet growth and with the customers getting accustomed to e-commerce, the future of the e-commerce sector is rosy.
An approximated 25 lakh people have transacted online this year, the number is all set to increase with time. Also to mention most Amazon customers use the internet from PC’s/Laptops to order goods. The use of mobile internet is very less at the moment, but with the advent of smartphones, the use of mobile internet for e-commerce transactions will soar with time. India’s digital journey is one of exuberance. The country had the world’s second-largest internet population at over 749 million users in 2020. Of these, 744 million users accessed the internet via their mobile phones. Estimates suggest that this figure would reach over 1.5 billion by 2040.
Case study of Amazon.com
An Analysis of Amazon.com's Business Model
- They always provide great customer service. Amazon customers are happier than with some of their competitors like Tradus.in, Indiaplaza.com.
- Their website is great, easy to use, easy to browse through the products, add products to a wish list or a cart, get product reviews and opinions, pre-order products, make payments using different methods, in short hassle-free and convenient.
- A very important point is that they introduced the option of cash on delivery and card on delivery. This way people demonstrated more confidence in buying products. An interesting fact, today Amazon sells 20 products/min and has a massive customer base; still, more than 60% of Amazon’s customers use Cash on Delivery and Card delivery methods. This is because of two reasons, one is many people do not know how to make payments online. And secondly, people do not have immense trust in e-commerce in India. Amazon also provides a 30-day replacement guarantee on its products and EMI options to its customers for making payments.
- Amazon’s reason for success is that it has a great customer retention rate, it has around 15 lakh individual customers and more than 70% of customers are repeat customers i.e. they shop various times each year. The company targets to have a customer base of 1 crore by 2015.
- The investment in social media has been in terms of time and effort. Almost everyone at Amazon monitors social platforms.
The digital marketing strategy of Amazon
Amazon has been using digital for both building the brand and acquiring consumers. Amazon has been mostly marketed by word-of-mouth advertising. Customer satisfaction has been the best marketing medium for them.
Amazon very wisely used SEO (Search Engine Optimization) and Google AdWords as the marketing tools to have a far reach in the online world. Amazon.com’s official Facebook page has close to 10 lack ‘likes’. Amazon recently launched a series of 3 ads with the tagline – “No Kidding No worries”.
Kids were used to creating adverts to send out the message – if a kid can do it, you can also do it. From a brand preference point of view, if the message is complex, the traditional medium works better as there are some restrictions in terms of innovation on digital.
But that doesn’t mean that traditional media is imperative and is a must for building a brand. Social media has guaranteed a large reach for companies. Today, one of the primary reasons that people are coming on to the internet is Facebook.
The objective of social media is to build a deeper engagement with the audience on these platforms. The company has built a great brand name, they just have to maintain and enhance the same. It needs to keep introducing more products, adapting to the changing needs of the customer with time.
The entry of Amazon.com in 2012 into the Indian e-commerce space has been cited as a big challenge to Amazon. However, Amazon is a respected Brand name in India and should be able to compete with Amazon. Amazon is a very big company that can bring serious competition to Amazon since Amazon can bear more losses in the beginning to gain a customer base.
But again Indian market is growing at a rapid pace as access to the internet increases and people become more aware of e-commerce sites and start trusting the same; hence Indian market is sufficiently big at least for these two giants to co-exist beneficially. The company is currently valued at around $1401 billion ($1.4 trillion) in 2022 i.e. 106 Lakh Crore.
More importantly, Amazon has ushered in the e-commerce era in India. This has generated massive interest in the e-commerce sector; people are opening websites to sell anything from shoes to apparel to jewels to baby care products etc. This has helped in creating a lot of job opportunities and thus helps Indian Inc.’s growth story as well.
The digital marketing strategy of Amazon
1. Shift from Tactical SEO to SEO Strategy
Last year, with the launch of the Hummingbird update from Google, search engine behavior changed and search engine algorithms improved for the better. Therefore, SEO has to evolve now from a tactical approach to a long-term SEO strategy. SEO strategy is the basic to
- define the target audience,
- focus on keywords that are relevant to the audience not search
- enhance the quality of the content
- improve the presentation of search engine listings with markups
- reach the audience wherever they’re online engage an audience and help boost user-generated content
- integrate SEO with a complete digital strategy
- Concentrate on all organic such as organic SEO, organic link building, etc.
2. Rise of Social Media Marketing in India
With 82 million monthly active users, India is the second-largest audience base for Facebook in the world and it may dethrone the US on Facebook soon. India is positioned second for the user population of LinkedIn at 20 million users, while for YouTube and Twitter user population from India goes up to 52 million and 42 million. There is easier and more cost-effective access to middle-class to upper-middle-class people in India, that are mostly young and capable to spend large amounts, and
they are the target audience of almost all brands. Interestingly, local businesses are using social media, especially Facebook to sell online in India. Hence, we can expect an unprecedented growth in social media users in India that will help social media marketing to experiment and become a more popular tool for branding, online selling, and customer engagement among businesses/brands.
3. Content Marketing
Content Marketing will be in limelight. In India, people are extensively searching, researching, and consuming content – text, audio (not that popular), images, and video. Largely, social media networks are pushing for improved, meaningful, and creative content marketing.
Text is the foremost tool in SEO that will easily help you acquire higher ranks, reach a targeted audience, engage your audience and convert them. It’s at the top of all the games that you may be planning. Images are usually subordinate to text and complement it, and they are highly popular among Indians.
Images are known to trigger imagination and help in building trust. In 2021, YouTube’s user base in India amounts to approximately 459.23 million users. The number of YouTube users in India is projected to reach 833.03 million users by 2025.
Brands in India are now realizing the power of video marketing and now developing creative and innovative video marketing campaigns to build their brand identity. All – text, image, and video – constitute your content marketing. And more and more brands, businesses, and organizations in India will understand its importance and will use it optimally in the coming years.
4. Viral Video Marketing
With up to 658.0 million Internet users in India, it’s easy to go viral with something awesome. Brands and businesses will be planning to use viral video marketing with the help of social media networks more effectively to reach a large audience in India.
Essentially, with video marketing in India, it has become easier to build brand identity, improve brand storytelling and engage the audience, and enhance brand loyalty. Viral video marketing will increasingly find many takers in India, given
many advantages. At present, big brands, Indian cinema, Indian music, the government of India, political parties, Indian educational organizations, and many others are successfully using video to entertain, educate and emotionalize audiences in India.
5. Responsive/Mobile Marketing
Firstly, the easy availability of smartphones, tablets, phablets, and touchpads is redefining mobility in India. Secondly, there is a large audience (approx 750 million) in India accessing the Internet through mobile devices.
Thirdly, India has 54 percent and was estimated to reach 96 percent in 2040. Fourthly, India’s mobile video consumption has doubled and more than 65 percent of Indians are sharing videos on mobile. Lastly, according to Facebook, 239.65 million Indians are accessing Facebook through mobile. Mobile is the way forward in India, to reach Indians across India.
In 2022, mobile applications, mobile advertising, mobile video marketing, and marketing on popular mobile networking apps such as WeChat, Line, Whatsapp, Vine, Snapchat, Instagram, and others will increase exponentially.
Return on mobile marketing investment will remain an issue that may disturb marketers. However, with e-commerce, mobile payments, and innovations by Google India, Amazon, and many other market leaders, some breakthroughs could be seen that would increase ROI on mobile marketing.
In India, localization has become endemic. It will gain further ground with the help of Google India search engine, Google Maps, online classifieds (e.g. Quicker), local online search engines (e.g. Just Dial), local listing websites (e.g. Grotal), vertical search engines (e.g. Zomato and ThinkVidya) and others. Moreover, websites will increasingly localize as well.
In the digital marketing industry, localization will increase among brands/businesses. Many local joints, bars, clinics, superstores, shops, restaurants, clubs, pubs, companies, organizations, etc. will also invest in digital marketing to reach their audience online and specifically on mobile. In localization – timing, limited budget, content strategy, mobile marketing, and advertising – will be great challenges that may disturb marketers.
Personalization will evolve into much larger. However, there are privacy issues attached to it, but despite that, there are many takers for personalization to improve customer experience and delight. Google acquired NEST labs for US$ 3.2 billion.
NEST Labs manufactures a smart home thermostat. Google uses NEST to know more about its customer for a better customer experience.
The point is personalization will not expand the world, but also in India at a much higher speed, especially in the e-commerce industry. As all are trying to enhance the customer experience to push sales, by providing them with more personalized services.
For effective personalization, businesses have to deeply understand their customer behavior and clickstream, and analytics will help them a lot to understand this.
A variety of analytics and testing will be used in further years such as heatmaps, deep analytics, customer journey, A/B testing, etc. in order to know what their customers’ wants, needs, and requirements at any particular time, season, and moment.
8. Online and Social Customer Relationship Management
Many Indian e-commerce websites, portals, and others do not have effective online customer-relationship management systems. Moreover, many customers are now comfortable with chat, email, mobile chat, and social media.
Therefore, companies are expanding their outreach to improve their CRM systems and enhance customer delight. Social CRM would be strategic of all, as many Indians are comfortable using social CRM on the go.
9. Conversion Rate Optimization and Testing
Recently, conversion rate optimization and testing in the digital marketing industry of India is picking up fast due to the e-commerce boom in India.
Conversion rate optimization and testing will be strategic to improve digital strategy, enhance outcomes and sales, and perk up customer delight. In India, many SEOs and digital marketers tend to ignore analytics, but in the future, analytics will regain its due importance in digital strategy. Moreover, deeper analytics is bound to take place as Google has
improved Google Analytics for a deeper understanding of customer online behavior and background. In addition, analytics will largely drive CRO and testing in India.
The CRO in mobile in India might also take place, as we know it increasingly in India users are purchasing through mobile apps on their smartphones and tablets. The biggest challenge for CRO and Testing will be the limited budget and ignorance.
10. Innovations in Online Payment System
There are lots of innovations in the online payment system with new launches expected this year and a boost in the Indian e-commerce industry. Just recently, Visa and MasterCard launched new mobile payment services.
With this technology, you can make payments through KitKat OS and NFC-powered smartphones. It uses the Host Card Emulation feature of Android to save card details remotely in encrypted form and can be disabled remotely if the phone is lost.
In 2013, Amazon launched ‘PayZippy’, which is an online payment system made for Indian e-commerce websites. Similarly, PayU India also emerged as a prominent contender, which is increasingly becoming popular among small/niche vendors.
PayPal will have to optimize its system according to the Indian situation and needs. For the digital marketing industry, all these happenings will help them increase the conversion rate of e-commerce websites and improve customer delight. Because most of the time in India, cart abandonments take place because of the limitations in the online payment systems.
11. Ad Micro Targeting and Re-Targeting/Re-Marketing
In India, online advertising is set to reach INR 7,000 crore by 2015, according to an Indian e-Retail report. This growth will be further fueled by improvements in ad targeting and re-targeting.
In social media, Facebook has introduced promoted posts, customization in the audience, whereas Twitter, improved interest, device selection, geo-targeting, and others of the promoted post, and LinkedIn, also improved targeting.
More customization, micro-targeting, and re-targeting features and tools can be expected from these popular social media networks. Google also has improved its re-marketing/re-targeting capabilities, and many special and exciting updates can be expected in the future.
At present, the e-commerce industry in India is extensively using re-marketing and micro-targeting online. In India, businesses are spending huge in advertising, therefore, there would be a rise of many startups offering innovative solutions in advertising itself.
12. Ever-Evolving UX and Web Designs
In the world of digital marketing, user experience and web design are ever-evolving, where interactivity, rich content, and speed are essential components. There are some innovations in user experience and web designing.
Mostly, e-commerce websites in India will drive these innovations, and more will jump on the bandwagon. In CRO and testing, user experience and web designing are strategic, which directly enhance incredible conversion rates with simple and innovative changes and improvements. In India, news sites and e-commerce have been experimenting with web and user experience design.
13. Humanization of Digital Marketing
Digital marketing will humanize further, where rands/businesses will understand the importance of conversations and engagements. Moreover, Google ranks higher only those content
that has higher likes, shares, comments, and other customer engagement signals. Companies will try to connect and converse more through digital marketing with their target audience.
And we can expect, this will only increase customer retention, brand loyalty, and word-of-mouth. Digital strategies in the future will be based on the co-creation and collaboration concept, where humanization of business, interactivity, and engagement will help in delivering value.
14. Multi-Channel/ Integrated Marketing
In India, multi-channel/integrated marketing will grow in popularity and effectiveness. As many brands/businesses in India are increasingly embracing this concept to attract and engage customers on all online and offline platforms.
All businesses/brands in India will try to integrate their marketing efforts, especially their digital marketing with offline marketing. In India, brands are realizing of importance integrated marketing communications, in which conveying a single message across all platforms helps them to improve brand experience, brand loyalty, keep the brand top-of-the-mind, and increase sales.
However, there are challenges such as mobile and disintegrated marketing teams, which are plaguing the effectiveness of integrated marketing leading to no credible business value generation. Nevertheless, given the advantages of multi-channel marketing/integrated marketing, a large number of businesses in India will embrace it.
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