The essential

guide to marketing
in a digital world

Red & Yellow

7th Edition
EMARKETIN
First edition published 2008
G
by Quirk eMarketing (Pty) Ltd.
This edition published 2022
by The Red & Yellow Creative School of Business
97 Durham Avenue, Cape Town

© 2008, 2009, 2010, 2011, 2013, 2018, 2022

Red and Yellow Holdings (Pty) Ltd.

ISBN: 978-0-6397-0780-8

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Dear Reader,

Since our 10th Anniversary Edition of eMarketing: The Essential Guide to Marketing in a
Digital World, we have witnessed a global wave of change that has had an undeniable
impact on how we live, connect, and communicate worldwide. There is no doubt that the
COVID-19 pandemic has, and will continue to have, a lasting effect on human reality. With
this in mind, we are incredibly proud to present the 7th Edition of our textbook.

The pandemic has sped up digital transformation and technologies by several years, which
is why we’ve adopted an alternative approach to revisiting the contents of this textbook.
Every digital marketing element has changed significantly since our last edition, and for this
reason, we have aligned this textbook with the latest trends and developments in evolved
marketing structures. Consumer and user-experience continue to influence all strategic
marketing decisions, while technology and data-driven insights fuel decision-making to
accelerate results for businesses.

We’ve revisited each part and changed the titles to Planning, Claiming, Creating, Uniting,
Advertising and Analysing – a slight departure from our previous edition – to focus on the
integration of technology and data in every aspect of marketing to enhance customer
experience and secure business success through meaningful engagement and
connections. We have reorganised the contents of this edition with updated statistics and
new case studies.

You will notice that we have elaborated on planning and strategy to set the context and
framework for digital marketing, with a strong focus on content as an essential part of
Creating. The structure of the textbook explores why customers and data have become so
essential to marketing, and how brands can use customer data to market more effectively.
We have also included dedicated chapters like Content marketing and value and
Content creation as the primary means to connect and engage with customers. Because
of the evolution of technology and data-driven insights, we’ve dedicated three chapters to
Advertising to unpack the extent of opportunities that have progressed over the past few
years. An exciting new chapter titled Future of advertising, looks at how technology has
and continues to change advertising into the future, as well as how marketers and
business owners can take full advantage of authentic content and online connections to
build brand presence and foster loyalty.

All the content has been critically reviewed by our experienced panel of subject matter
experts who have given their time and expertise freely to deliver this comprehensive and
insightful edition. Their commitment and support, thereby giving back to the digital
community, made this possible. We are incredibly proud of this achievement, and we thank
every person who has contributed. We are humbled by the relentless pursuit to deliver this
book, despite the copious amount of work it has taken. We believe that knowledge is
power and developing the skills to action this power is what sets the achievers apart from
the rest. We believe that for education to have an effective future, it needs partnership
between the private and academic sectors to ensure students are being taught the latest
thinking from the coalface of business innovation. By making our textbook available for free
online, we hope to ensure that the very
 iii
best education is as accessible as it can be to as many people as possible. In fact, less
than 10% of the many institutions who use our book pay for it, and we are delighted by
this. We want to make a lasting impression, and this is an important part of us achieving
that.

We hope you enjoy our book and remember, the most important thing any human can do is
teach, even if you’re not a teacher. Share your knowledge and make the world a better
place.

If you want to go quickly, go alone. If you want to go far, go together.

African proverb
iv
ACKNOWLEDGEMENTS
The 7th Edition was updated and written by Dionne Solomons, Tania Kliphuis and Michelle
Wadley on behalf of Red & Yellow. They worked tirelessly to ensure that the information in
this title was updated and accurate, as well as enjoyable for the reader.

Multiple experts have contributed to the various chapters in this edition. Our great
appreciation and thanks go to:
 • Kyle Singh is an established social media
• Carlos Menezes is a digital leader with 15
expert with a thirst for knowledge. Kyle is
years’ experience across classical marketing
always looking for new ways to innovate and
consulting, digital marketing, brand strategy,
strategise.
and advertising. His industry experience
• Lana Mouton is a Google Ads and Digital
extends from SaaS to media and
Marketing Transformation specialist with
entertainment, and everything in between.
over eight years’ experience with digital
• Chloé Holenstein is a digital marketing and
agencies, in-house and direct consulting.
strategy specialist with more than eight
She has worked with, and digitally
years’ experience. She focuses on building
transformed, over 60 businesses, both
purpose-driven brands that promote action
locally and internationally.
within their communities.
• Leila Davies has been in the digital industry
• Craig Strydom is a copywriter, creative
since 2005. She is a bit of a digital nerd and
director, and all-round content writer with a
proud of it. She has experience in multiple
career spanning over 20 years. He has
industries, from retail, oil and gas to
worked for nine ad agencies in three
hospitality, and education.
countries and on two continents.
• Lee-Roy Wright is a digital marketing and
• Daniel Cilliers is a full stack developer in
content specialist with a solid understanding
FinTech and wants his code to help make
of the digital world. He currently heads up
people’s lives easier. To him, code is like
the Social Media Marketing department for a
building with Lego – the possibilities are only
large tech company.
limited by your creativity.
• Megan Singh has more than 15 years’
• Elizabeth Lee Ming is passionate about
experience assisting brands across various
digital, CRM and driving thought-leadership in
industries with their digital content and
cus tomer-centricity. With over 17 years’
marketing strategies. She focuses on
experience in marketing, she has worked in
harnessing data to present insights that
SA, the UK and the USA at a number of blue
enable fast and better decision making.
chip organisations.
• MJ Khan is one of the foremost digital com
• Fred Felton is a communications strategist,
munication and marketing executives in
social media specialist, keynote speaker,
South Africa. His two-decade career spans
and facilitator. He currently works for a
academia, agency, and corporate.
media agency in Durban, South Africa.
• Stephen Sandmann practices effective and
• Glenn Gillis is the co-founder and CEO of
award-winning SEO, with experience leading
Sea Monster. He has been a senior
brands at Ogilvy, Quirk (Mirum), and as the
executive, consultant, and entrepreneur
head of Search Marketing at Vodacom. He
with growing knowledge-intensive
now continues his SEO work as a
businesses for 25 years. He is a
consultant for more of SA’s top brands at
thought-leader on how serious games,
Sandmann Digital.
animation, and immersive technology can
drive social and business goals at scale.

v
CONTRIBUTORS
This 7th edition is our first edition in a post-Covid world and arrives in a world that has seen
dramatic change and acceleration in all things digital. It is also the first edition we’ve
 produced following Red & Yellow’s acquisition by Honoris United Universities in 2020.

As has been the experience of so many tertiary institutions and businesses, the last two
years have brought about great change for our school. Whilst many of the people who
have worked on this edition are new and have brought with them fresh ideas and
perspectives, they are also fortunate to have stood on the shoulders of the marketing
giants who have preceded them. We will forever be grateful for the efforts of each person
who played a role in the evolution and continued success of this textbook. We want to
acknowledge the following people in particular:

Ashton van den Bergh Keryn Brews

Linah Maigurira
Bianca Carebern
Marcel Nel
Dr Carla Enslin
Matt Willis
Carmia
Melody Maker
Lureman-Norton
Michael Oelschig
Catherine Scott
Michael Walker
Craig Raw
Michaela Kissack
Daniel Kolossa
Mike Stopforth
Daniel Neville
Nic van den Berg
Emma Carpenter
Nikki Cockcroft
Emma Drummond
Peta Broomberg
Georgina Armstrong
Reino Jansen van
Gerard du Plessis
Rensburg Richard Mullins
Graeme Stiles
Richard Palmer
Heidi Ocker
Richelle Chapman
Heléne Lindsay
Rob Stokes
James Lennox
Sam Beckbessinger
James Mckay
Sarah Blake
Jean du Plessis
Sarah Manners
Jeandri Robertson
Scott Gray
Jo Glover
Shae Leigh
John Beale
Su Little
Jonathan
Taya Botha
Gluckman Justin
Tim Withers
Spratt
Wendy Shepherd
Katharina Scholtz
Wouter de Vos
Kathryn McKay

vi
CONTENTS PAGE
First words . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v Contributors . . . . .
................................................................................
. . . . . . . . . . . . vi Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . viii

PART ONE: Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Chapter 01 Introduction to marketing . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Chapter 02 Importance of the customer . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Chapter 03 Market research . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Chapter 04 Strategy . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

PART TWO: Claiming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . 97 Chapter 05 Search engine optimisation (SEO) . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 99 Chapter 06 User experience design . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 135 Chapter 07 Web development and design . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 169 Chapter 08 eCommerce . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 209

PART THREE: Creating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . 243 Chapter 09 Content marketing strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 245 Chapter 10 Planning your content . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 265 Chapter 11 Content creation: Copy . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 295 Chapter 12 Content creation: Video . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325 Chapter 13 Social media . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353

PART FOUR: Uniting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . 415 Chapter 14 Social media strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 417 Chapter 15 Customer relationship management (CRM) . . . . . . . .
. . . . . . . . . . . . . . . 447 Chapter 16 Direct marketing: Email and mobile . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 481

PART FIVE: Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . 517 Chapter 17 Social media advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 519 Chapter 18 Search advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 559 Chapter 19 Online and display advertising . . . . . . . . . . . . .
 . . . . . . . . . . . . . . . . . . . . . . 589

PART SIX: Analysing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . 619 Chapter 20 Tracking and analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 621 Chapter 21 Conversion optimisation . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 653 Chapter 22 The future of advertising . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 673

Anticipating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 705 Enter the metaverse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 707

Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 733 Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 749vii

REVIEWS
Reviews for previous editions
In teaching my postgraduate course, eMarketing has been the textbook of choice for years.
It presents a great blend of marketing strategy information with detailed but digestible
technical explanations of the digital space. The material is presented in a way that remains
current and relevant, despite the constantly evolving world of digital marketing. Students
also appreciate the open-source content, making it a go-to resource each semester.

Prof. Anne Cramer (Professor, Fashion Faculty of Business, Humber Institute of

Technology and Advanced Learning)

eMarketing: The Essential Guide to Marketing in a Digital World provides rich detail without
overwhelming the reader with technical jargon. Overall, the author does a great job in
presenting somewhat more complex issues in user-friendly ways. The book situates some
examples in a South African context, but it should be meaningful in any cultural context.

Dr. Reto Felix (Associate Professor of Marketing, University of Texas Rio Grande Valley,
Department of Marketing)

This book has been put together by some of the sharpest minds in the digital marketing and
education fields, and the combination of deep subject matter expertise and pedagogic nous
is powerfully telling. The book is at once informative, accessible, and practical - a must read
for anyone looking to enter the industry or to better come to grips with an ever-changing
dynamic landscape.

Carlos Menezes (Digital Marketing Specialist and Global Solutions Partner at FAANG Company)
PART ONE
PLANNING
 PLANNING

INTRODUCTION TO PLANNING
Advertising and marketing were once the domain of a few powerful people who told
customers what they wanted. Customers are no longer told what they want. The
pervasiveness of digital technology has empowered the customer when it comes to
making purchasing decisions. They tell businesses what they want, how, and when.

Marketing and digital marketing, in particular, has created a symbiotic relationship between
businesses and their customers. The proliferation of digital tools and the internet has
opened a free-flowing, two-way marketing channel into our daily lives.

Digital marketing does not deviate much from traditional marketing. However, it does offer
unique opportunities that used to be more difficult to execute. For example, marketing
campaigns can now be easily tailored to target specific customers, ‘attention for value’ can
be leveraged to create consumer demand, and the customer experience can be
personalised and leads to a far higher return on investment.

All of this means that planning is an essential part of an effective marketing strategy that
has impact. If you don’t plan, you risk a sloppy marketing campaign, one that is
inconsistent in its messaging, and carries reputational risk. As the cliché goes: ‘If you fail to
plan, you plan to fail’.

Planning means taking a big picture view of your customers, and then using these insights
to further distil what makes your product special, and how to target your customers. For
example, you need to consider the way people use their devices before you even consider
what medium you will use to target your customer.

While existing and operating in a digital world has its risk, the opportunities are huge. There
are immense advantages to digital marketing that can guarantee higher rates of return on
investment. Digital marketing can be low cost, flexible, convenient, and targeted.

Chapter 1: Introduction to marketing tackles how the internet has changed marketing
and how to think about digital audiences. You will learn how to leverage the advantages of
digital marketing and through data analytics, discover that there is no excuse for not
reaching your audience and getting your product or service into their hands.

Chapter 2: Importance of the customer focuses on the use of demographics and psycho
graphics to develop user personas, and how extrinsic and intrinsic motivators encourage
brand recognition and loyalty.

Chapter 3: Market research discusses the importance of conducting market research and
how to use this research and data to inform your strategy.
 Chapter 4: Strategy defines business strategy with the goal (other than making your
customer happy) to use research to inform your plan of action. You will understand how
consumer behaviour affects strategy and ultimately, get to a place where you understand
the how and the why, and to use the why to realise the how.

0
1
Introduction to marketing
INTRODUCTION TO
MARKETING
In this chapter, you will learn:
 • What the internet is and how it has changed marketing
• How to define and distinguish marketing and digital marketing
• How to think about digital audiences
• About the importance of data-driven decision making.
3
PLANNING

1.1 INTRODUCTION
Where there is a product or service, there must be a way to get it into a customer’s hands.
Some of the primary functions of marketing include planning, promoting, persuading,
managing channels and information, pricing, product service management, and selling.
Digital marketing offers a unique opportunity to tailor marketing campaigns to target
specific customers. If done properly, this can result in a higher return on investment (ROI),
which is the ratio of cost to profit. Digital marketing also allows for more scope in terms of
branding and public relations through content marketing. However, this also poses risk.
The internet moves fast, and reputational damage is possible in a heartbeat if campaigns
and digital marketing strategies are not carefully thought out and planned. In this chapter,
you will be introduced to digital marketing, creating a foundation on which you can build
your digital marketing strategy.

1.2 KEY TERMS AND CONCEPTS

Table 1.1
Term Description

Sales When a company enters into a direct commercial transaction

with customers.

Advertising The payment to place promotional images in a variety of online and

offline media.

Public relations The process of creating a positive impression of the brand and
(PR) its activities among the general public.

Distribution The process of ensuring products and services are available where
and when they are needed.

Content Happens when sharing valuable, entertaining content that is not

marketing directly aimed at generating sales.
 Packaging The process of reflecting the product’s qualities and benefits in
an appropriate and effective way through physical packaging.

Events The hosting or sponsoring of events that enhance the brand’s

reputation, raise awareness, and reflect its values.

1.3 WHAT IS MARKETING?

Marketing is the creation and satisfaction of demand for your product, service, or idea. If
marketing is successful, it will create demand; this demand should translate into sales and,
ultimately, revenue. Kotler (2012) described marketing as follows:
4
Introduction to marketing

The science and art of exploring, creating, and delivering value to satisfy the needs of
a target market at a profit. Marketing identifies unfulfilled needs and desires. It defines,
measures, and quantifies the size of the identified market and the profit potential.

The American Marketing Association (2017) defines marketing as follows:

The activity, set of institutions, and processes for creating, communicating, delivering,
and exchanging offerings that have value for customers, clients, partners, and society
at large.

The design of the product or service itself is, arguably, a function of marketing – this is
where meaningful benefits and value for the customer are created. Once the product or
service exists, you need to get it into customers’ hands and motivate them to pay for it.
Even better, you need to convince the customer that your product, service, or organisation
is superior to your competitors. To do this, you need to convince the customer of your
product’s benefits and value. The value that a marketer should seek to create should be
equal to or even greater than the cost of the product to the consumer. Doing this often and
consistently will grow trust in and loyalty towards the brand and create strong brand equity.

1.3.1 Business goals

The goal of a business is to sell services and products to generate a profit. Marketing is the
sum total of activities and strategies that a business undertakes to encourage people and
other businesses to buy (and continue buying) its products and services. Every business
benefits from marketing, and each one needs to create a tailored mix of approaches and
tactics that suit it, its budget, its offering, and its target customers.
 Marketing enables customers to buy products by fulfilling the following roles:

• Awareness: Marketing lets people know about brands and products. Customers can’t
buy something they don’t know about. Therefore the first essential role of marketing is
to raise awareness of an offering among the target group who is likely to buy it.
• Information: Marketing tells people when, where, and how to buy products. Once a
person knows about a product, they need some basic information in order to buy it. A
brand’s marketing strategy should always include information that enables customers
to easily make a purchase.
• Persuasion: Marketing makes people want a product. Once someone knows a product
exists, they need to be convinced that it is worth their time, money, and effort to obtain it.
Marketing strives to create an emotional connection between person and product or
brand.
• Affinity: Marketing makes people love brands and products. A customer is much more
likely to buy a product that makes them feel great, shares their values, and entertains
them. Many established brands focus their marketing efforts on building and improving
sentiment – just think about how passionate Apple, adidas, or Tabasco fans are about
their favourite brands, and what an impact this can have on their success.

5
PLANNING

The role of marketing is to inform, entice, educate, excite, and persuade people to buy
services or products. Marketing aims to influence the perceptions of people in favour of the
brand and its offering, with the ultimate goal of getting them to make a purchase (and
continue to make purchases in the future and to become return customers). It does this
through two complementary approaches:

1. Factual: This approach appeals to the intellect and relies on clear facts, features,
benefits, and rational arguments that indicate why a product is a good choice, for
example: “This solar heater lets you save 60% off your monthly electricity bill.”
2. Emotional: This approach relies on tapping into people’s feelings, aspirations, hopes,
fears and dreams to encourage emotive, impulse purchases, for example: “This solar
heater could be your contribution to saving the environment and protecting the planet
we live on.”

One of the most important concepts for marketers to internalise is that people don’t buy
products; they buy what the product can do for them, how it makes them feel, or what it
says about them.

Nobody buys a hammer for the sake of owning a hammer; they are buying the ability to
 repair a broken appliance, enjoy some hobby DIY, or appear capable. A TAGHeuer
wristwatch doesn’t do anything a Casio couldn’t, but it indicates a person who values
masculinity, innovation, and precision.

Extrapolating from this, marketing is about showing your potential customers how your
offering can make them awesome, successful, and better.

The first step to developing a marketing strategy is to understand your environment, your
customers, and how to access these customers.

1.4 UNDERSTANDING YOUR ENVIRONMENT

Your brand does not exist in a vacuum. There are multiple factors affecting your business
right at this very moment. Your business has control over some of these elements, while it
has no control over others.

1.4.1 Micro factors

Micro factors are mostly internal elements or factors that you and your business have some
control over, such as your brand, your brand or product’s unique selling point (USP), and
any digital offerings.

It should be noted that, while you have some control over micro factors that affect your
business, these are informed by macro factors. It is important to keep this in mind when
you are doing any kind of strategic planning, or simply day-to-day brand management. You
could say that macro factors are the ‘bigger picture’, while micro factors are the details.
You need to keep an eye on the bigger picture without losing sight of the details, and vice
versa.

6
Introduction to marketing

Let’s take a closer look at this.

MACRO

ECONOMIC FACTORS
PUBLIC POLITICAL
INTERNATI
MICRO AND
NATURAL
ONAL GOVERNME
NTAL
FACTORS
FACTOR
S
SUPPLIERS CUSTOMER
BUSINESS
 S ORS

COMPETIT
FACTORS
SOCIO CULTURAL
INTERMEDIARIES
MARKETING C FACTORS

ENVIRONMENT
ENVIRONMENT
DEMOGRAPHI
FACTORS

Figure 1.1 Micro and macro factors affecting a business

Your brand
Your company or business is the factor that you have the most control over. You decide
how the brand comes across to the world – your brand identity. Here are some important
questions to ask yourself about your brand:

🖲 Who are you?

🖲 Who are you for?
🖲 What does your brand stand for?
🖲 What does your brand stand against? how do you advertise online?)
🖲 What is your USP?
Watch this video of Professor John Simpson

🖲
NOTE explaining USP: vimeo.
How do you find customers? (i.e., Do com/284613311/9d3ca7d8f4
you have a website/app? Which social
media platforms do you use? Where and

🖲 How do you treat customers (past, existing, and future)?

Aside from the product or service you offer, your brand is your most important currency. It is
the thing that people will remember (for better or for worse). However, it is easy to fall into a
trap of insincerity. Ensure that your brand is aligned to your company’s values. Exposure for
the sake of exposure is not always a good thing. Your brand must be sensitive to macro
factors, as well as your own internal values and goals.

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1.4.2 Macro factors
You can control what you present to the world, to a degree. Unfortunately, there is little you
can do about how the world sees you.

Macro factors are aspects that are beyond your business’s control. Macro factors are the
opportunities as well as the threats to your business. These can include:

• The state of the local or global economy MARKETING?

• Current trends
E
• Current events NOT in greater detail in Chapter 4:
• The opportunity or threat presented by a Strategy. Opportunities and risks will be
specific thing ‘going viral’.
explored

1.5 WHAT IS DIGITAL

How does digital marketing fit into this definition? There is, in fact, no difference between
‘traditional’ marketing and digital marketing. They are one and the same, apart from digital
being specific to a medium.

Ultimately, the aim of any type of marketing is to keep and grow a customer base and
stimulate sales in the future. Digital communication tools contribute to connecting
and building long-term relationships with customers.

What is digital?

A participatory layer of all media that allows users to self-select their own experiences,
and affords marketers the ability to bridge media, gain feedback, iterate their
message, and collect relationships (Caddell, 2013).

Digital is a way of exploring content and ideas (for users) and connecting with and
understanding customers (for marketers).

Digital marketing is powerful in two fundamental ways. Firstly, the audience can
be segmented very precisely, even down to factors like current location and recent brand
interactions, which means that messages can (and must) be personalised and tailored for
them.

Secondly, the digital sphere is almost completely

measurable. Every minute and every click by NOTE
 a customer can be accounted for. In digital Cumulatively, access to data
marketing, you can see exactly You will learn more about data-driven decision
how various campaigns are performing, making throughout this textbook. Data-driven
decision making is a powerful tool for all aspects of
which channels bring the most benefit,
marketing and brand management.
and where your efforts are best focused.

that measures the whole customer experience should lead to data-driven decision making.

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Introduction to marketing

1.5.1 The digital audience

In the simplest terms, a digital audience is your online target audience.

The COVID-19 pandemic resulted in a marked shift in the way people access the things
they want and need. While people were increasingly moving online in many parts of the
world, they were looking for specific products and services. People still sought out many, if
not most, products and services in traditional ways. For example, a person may do bulk
shopping on a website such as Amazon, but do their daily grocery shopping at an actual
store. Or, a person may from time-to-time purchase clothing on sites such as Alibaba or
Shein, but still visit clothing stores for unique pieces.

However, during the lockdowns that followed the outbreak of COVID-19, people were
forced to move most, if not all, of their shopping online in some way. For instance, there
was a huge spike in on-demand grocery delivery services, as this was safer and more
convenient. In South Africa, one of the largest supermarket chains, Checkers, launched
their on-demand delivery app and service, Checkers Sixty60, months before hard
lockdown was announced in March 2020. This service met the needs of a population but,
more than that, it simplified a chore that is generally quite tedious.

The service was a huge success, with competitors scrambling to catch up. Even after
lockdown regulations were eased, many customers continued to use the service regularly.

Convenience and speed are driving customers online more and more. The rise of social
media and the internet of things (IoT) has also increased the rate of a migration to digital.
Customers have certain expectations, and one of these is that they are able to investigate,
access, acquire, and talk about a product or service online.

Like any target audience, it is important to be as specific as possible when it comes to

reaching out. It is tempting to consider your digital audience as a homogenous group and
only one segment of your overall audience, but the past decade has shown that this is not
 an effective strategy.

1.5.2 Data-driven decision making

A benefit of digital marketing is that you do not have to theorise, guess, or rely on ‘gut feel’
in pursuit of customers who want and will pay for your product or service. The internet
provides real-time data, which you can use to improve your business and marketing
decisions.

You can use data to be:

• Descriptive: Use raw data to describe the market.

• Diagnostic: Find out ‘why’ and look for patterns.
• Predictive: Analyse data, both past and current, to predict future sales, revenue, and
market changes.
• Prescriptive: Use the findings of the previous three types of data analytics to determine
a possible solution to a problem, thereby delivering value.

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In addition to having access to more raw data than ever before, which is current and based
on user behaviour, the internet makes it possible
for a business to pivot, or to change desires.
direction, NOTE
Learn more about data-driven decision making in
far more quickly. This agility allows for a Chapter 20: Tracking and analysis.
business to meet actual needs and current
trends, rather than perceived needs and

Two major data-collection trends that are relevant and useful for digital marketing are the
rise of social media and the ‘internet of me’.

Social media
Briefly, social media refers to social networking sites and apps, such as Facebook, Twitter,
Instagram, and TikTok. The content on these platforms is, by and large, user generated,
however, social media advertising has been a fast-growing marketing option since the
mid-2000s.

Social media allows customers to be part of a conversation, which can drive interest to a
business’s social media profile, their website, or even a brick-and-mortar store. In addition,
social media makes it possible for the collection of big data, as well as user-specific data.

The internet of me
 The ‘internet of me’ is a broad term, which refers to technology that allows people to take
their bodies and minds online. At present, this includes:

• Self-tracking technology on smartphones or smartwatches (i.e., Clue or Flo, which a

woman can use to track their menstrual cycle).
• Wearable technology (i.e., Apple watches, Garmin, Fitbit, which track everything from a
user’s sleep patterns to their heart rate throughout the day).

Tied to the ability to gather and mine more data, the ‘internet of me’ is also creating unique
opportunities for marketers to find, target, impress, and retain customers. Smartwatches,
for example, allow users to input data to track everything from exercise to menstrual cycles
to calorie consumption. Many smartwatches also track personal data in the background,
such as sleep or heart rate.

1.6 MARKETING AND THE INTERNET

The complete scope of digital marketing is practised on the internet. Products and services
are positioned and promoted, purchased, distributed, and serviced. The web provides
consumers with more choice, more influence, and more power. On the internet, brands
constantly have:

• New ways of selling

• New products and services to sell
• New markets to which they can sell.

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Introduction to marketing

Digital marketing helps to create consumer demand by using the power of

the interconnected, interactive web. It enables the exchange of currency but, more than
that, it enables the exchange of attention for value.

Product or
service

Data Attention
 Money

Figure 1.2 An exchange of value

If marketing creates and satisfies demand, digital marketing drives the creation of demand
using the power of the internet and satisfies this demand in new and innovative ways.

A brand on the internet can gain value in the form of time, attention, and advocacy from the
consumer. For the user, value can be added in the form of entertainment, education, and
utility. Brands build loyalty among users who love their products or services and must align
with users’ values and aspirations. Users fall in love with products and services when their
experience is tailored to their needs, and not the needs of the brand. The internet makes
this possible by closing the gap between who creates the product and who uses the
product. In this way, customers themselves become part of the marketing project.

1.6.1 Understanding the internet

There is no doubt about it: the internet has changed the world we live in. Never before has
it been so easy to access information, communicate with people all over the globe, and
share articles, videos, photos, and all manner of media.

But, what is the internet? And how has it changed marketing?

The internet is, simply, a network of networks. Its proliferation has led to an increasingly
connected communications environment. Not only does the internet offer marketers wider
audience reach, it also allows for tracking and data gathering, which can inform future
campaigns and, even, product development. What started as pop-up ads on basic
webpages has become far more sophisticated and powerful. The internet has certainly
moved on from its early beginnings, and marketers are well positioned to reap the benefits.

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The internet is almost ubiquitous in today’s world. Even in less economically developed
countries, digital marketing is possible, and effective, because of social media access. This
is primarily driven by the rise in smartphones and more affordable data in most countries.
People who were previously excluded from using the internet because they did not have
access to a computer or internet connection, now have access to the internet and social
media on their phones.
 Look at Figure 1.2 below, which shows the number of unique mobile phone users, internet
users, and active social media users. Almost 60% of the world’s population uses the
internet, and just over 50% of the world’s population is active on social media.

Figure 1.3 Digital use around the world

1.6.2 How people access the internet

People connect to the internet and access content in many different ways. When it comes
to the physical connection to the internet, the market presents a number of options, such as
Dial-up, 3G, 4G, and 5G connection, wifi and WiMAX, Broadband, and ADSL.

The devices people use to access the internet vary from mobile phones and tablets, to
personal notebooks and desktop computers.

The environment that people are in when they access the internet also differs. People can
access and use the internet:

• At home
• At the office, or place of work
• At a library
• At school, college, university, or other education centre

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Introduction to marketing

• At an internet café
• On the go (using portable devices, such as mobile phones, laptops, or tablets).

Not only do these environmental factors affect how people use the internet, but their
reasons for using the internet also have an effect on how they interact online.

For some people, the internet is primarily a communications channel, and their online
activity is focused on social media or their email inbox. For others, it may be a
research channel, with search engines playing a large role in their online experience.

1.6.3 What does the internet have to do with marketing?

The growth of internet usage has resulted in declining distribution of traditional media, such
as television, radio, newspapers, and magazines. These were once important marketing
channels, as they offered a way for marketers to connect with audiences.

Consider this example: In the late 1980s through the early 2000s, many families watched
television on a daily basis. They had limited options when deciding how, when, and where
to watch programmes on television. Over an hour, the show may have had six to seven ad
breaks, which the viewer was forced to watch – they did not have the ability to fast-forward
through the ads. However, as the internet has become more and more ubiquitous, and as
data has become more affordable, streaming has become the preferred way to watch
television. When a viewer is streaming a show, there are no ad breaks or, at least, the
viewer has the option to fast-forward and ignore them.

So, where marketers once had a captive audience (the television viewer), this model has
changed, necessitating a shift in how companies tell customers about their products. The
rise of streaming platforms, such as Netflix, has necessitated a shift in how marketers reach
customers that they previously would have had contact with through TV advertising.

The way people use their devices, such as their laptops, mobile phones, or desktop
computers, also influences marketing activities and campaigns. For example, if your target
audience is the parents of small children and your research has turned up the fact that
most of your customers use a social media app, such as Facebook, after their children
have gone to bed, it would affect your scheduling. In this case, hosting a live Facebook
event at 6 p.m., when most parents are cooking dinner and getting children ready for bed,
would not be well attended and would not have the desired reach. However, scheduling it
in for 8 p.m. will be far more successful. It may also mean that all parents attend, instead of
just the primary caregiver. In this example, you want to give parents less to worry about.
Your scheduling should therefore be practical, and the technical aspects of the event
should be seamless. If parents struggle to log in or register, they will rather not bother; it’s
just one more thing to add to their to-do list.

By really considering your target audience, you can eliminate potential problems before
they even arise. This will result in a successful campaign and goodwill towards your brand.
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1.6.4 What makes online marketing so special?

This is not to say that advertising should be solely online. Your online and offline marketing
efforts are not separate. These two should ideally work in conjunction with each other. You
may think that you don’t need to put effort into your digital marketing because people don’t
buy as much online, but this is rapidly changing. Many brands are starting to concentrate on
their online presence as much as their offline presence.

Over the past few decades, marketers have begun to wake up to the power of the internet,
both as a platform for communication and as a way of tracking conversations. Marketing is
about conversations, and the internet facilitates these on a global scale.

As shown in Table 1.2 online marketing has definite benefits that do not apply to offline

marketing. Table 1.2 The benefits of online marketing

Low cost: Online marketing allows for Flexibility and convenience: The
lower production costs, speed-to-market, marketer can switch creatively
cost-efficient customer feedback, and mid-campaign, based on instant feedback.
wider advertising reach at lower costs Consumers can also research and
than offline marketing. purchase products and services at their
leisure. This means businesses need to
offer them what they want and use careful
targeting to ensure they are reaching the
right people.

Targeting: Online marketing offers More options: Advertising tools include

exceptionally specific targeting, including pay per-click advertising, email
demographic, geographic, browser, marketing, local search integration, and
channel, and behavioural and interest much more.
targeting, helping to reach the right people
in the right place and at the right time, to
encourage conversions.

Analytics: The best part of online marketing is how measurable it is. You can measure pretty
much everything you do online. Consider traditional marketing: You might purchase a
billboard. You have an idea of how many cars drive past that billboard each day, and you
hope that the people in those cars notice it. With digital, you can place a social media ad or a
banner ad, and you’ll know exactly how many people had the opportunity to see it and what
their reactions were. Google Analytics and other free analytics tools make it easy to measure
the performance of marketing efforts and optimise them for the best results.
 1.6.5 What are the affordances of digital?
On a surface level, it is good to know what type of digital marketing is available to your
business. However, it is also important to understand the properties of digital, in other
words, its properties and what it is used for. This is known as the affordances.

For example, the affordance of a banana is eating. The banana exists, and we can explain
what it looks like, but unless we understand what it is used for, it is not useful to describe it.

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Introduction to marketing

In a similar way, digital marketing offers opportunities for tailoring how you target and
engage with customers. There are several ways to think about the affordances of a
particular digital marketing tool. Firstly, understand the affordances of digital as a whole
which offers:

• Information
• Connection
• Community
• Convenience
• Power and influence
• Feedback.

Then, consider the affordances of particular platforms below:

Business’s website Business’s social media accounts
(Facebook, Twitter, Instagram, TikTok, etc.)

Information Information

Convenience Connection

Community

Convenience

Feedback

Taking the time to properly consider the affordances of digital allows for businesses to be
more human-centric, driven by data to gain insight into customers’ lives, opinions, needs,
desires, weaknesses, and more to inform design and approach.
 1.7 WHAT IS A COMMUNICATION CHANNEL?
A communication channel is the route through which a business or brand communicates
with the customer.
Television, radio, print
advertising
Business or

brand Customer

Digital marketing
Business or

brand Customer Figure 1.4 The communication

channel

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Digital marketing makes it possible to put the customer at the centre of your digital
marketing strategy. This is because there is a greater sense of community online. Whereas
a radio advert is one-way communication, digital marketing, particularly on social media
platforms, allows for two-way communication.

It is important to factor this in when you are

developing your marketing strategy. will depend on your product,
E
There is a time and place for both NOT Chapter 4: Strategy.
forms of communica tion, however, this You will learn more about this in

the customer, your budget, and your strategic goals.

1.7.1 Employing an omnichannel approach

It is tempting to stick with what you know, especially when it comes to a form of marketing
that is as ever-evolving as digital marketing. However, your customers are not homogenous
in their dreams, desires, ambitions, or lifestyles. Digital marketing offers you an opportunity
to find a common thread between all of these potential and existing customers and to pull at
that in order to convert attention into sales. By sticking with one approach, you risk missing
 a segment of customers entirely or frustrating a segment of customers who are used to
choices.

The term ‘omnichannel’ refers to a business strategy that offers “seamless and effortless,
high quality customer experiences that occur within and between contact channels” (Frost
& Sullivan, 2020).

An example of this is a retailer who has both an online presence (web store, social media
store), as well as a brick-and-mortar store. This retailer offers customers multiple options in
terms of purchasing products, including:

• The ability to shop online, with delivery to their door

• The ability to shop in person, which allows
SPRINT
NOTE
them to browse and possibly try the product You will explore the omnichannel approach in
• The ability to research online, ahead of greater detail in Chapter 22: Future of
advertising.
visiting the brick-and-mortar store.

1.8 CASE STUDY:

AN OMNICHANNEL APPROACH TO INCREASE

SALES
Sprint Corporation was an American telecommunications
company, which has now merged with T-Mobile. Before
the merger, Sprint was the fourth-largest mobile network
operator in the USA.

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Introduction to marketing

One-line summary
In 2017, Sprint, a US-based mobile network operation, performed an experiment
with Google Ads to test how digital advertising impacted the business’s revenue.
 The problem
Executives at Sprint were interested in how digital marketing spend impacted digital
and in-store sales. Acknowledging the challenges that traditional marketing campaigns
presented when quantifying sales and impact, Sprint decided to isolate the impact that
paid Google search would have on driving sales.

Initially, Sprint looked at its normal marketing approach and predicted its online and
offline sales. They looked at consumer behaviour, trends, and seasonal purchasing
cycles. Once the company put this data together, creating a ‘control,’ Sprint increased
its investment into paid search by a set amount over its usual budget.

The mobile network let it run for eight weeks and then compared the actual sales with
their predicted sales.

The solution
Sprint found that not only did online sales increase, so did retail sales. Compared to
predictions, Sprint saw a 20% increase in digital sales and a 32% increase in in-store
sales.

What this highlighted for the company was not that digital marketing should take
precedence over traditional marketing, but that Sprint needed to ensure a consistent
omnichannel approach. To quote Rob Roy (Sprint Chief Digital Officer) and Wouter
Blok (Sprint Vice President of Digital Marketing): “Are you actually limiting the power of
a digital campaign if you build it with the assumption that it will only affect online sales
or underestimating the impact it has on in-store sales?”

The results
Following the experiment, Sprint increased its digital experimentation budget by 20%,
with the aim of reaching new customers and collecting data to drive their business
strategy of signing up new subscribers. The company also focused on consistency
across the brand, so that customers who saw a campaign online would be able to
walk into a store and access the exact same offer.
(Source: Roy and Blok, 2017)

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1.9 CASE STUDY QUESTIONS
1. Why was it useful for executives to understand how digital marketing spend impacted
overall sales?
2. Describe what an ‘omnichannel’ approach means.
3. What did Sprint’s omnichannel approach look like?
4. What was the key learning for Sprint after successfully completing the experiment to
increase sales?

1.10 THE BIGGER PICTURE

Digital marketing in the past has felt like a shiny, new toy that few people knew how to use
properly. It is important to understand that at the heart of all of your marketing activities –
whether on-line or offline – is the customer and their experience of your product or service.
No amount of fancy digital marketing will make a poor experience feel better. It is, therefore,
important to approach your marketing strategy holistically. Do not forget about the
fundamentals of marketing – these have not changed; it is simply the delivery that has
changed. Data-driven decisions have the power to change your business and to ensure
that your customer is satisfied and talking about your product or service. Used properly,
digital marketing is a powerful tool that you can leverage to promote, persuade, set pricing,
manage services, and sell.

1.11 SUMMARY
Marketing is the creation and satisfaction of demand for your product, service, or ideas. If
marketing is successful, it will create demand; this demand should translate into sales and,
ultimately, revenue. Digital marketing offers an opportunity to tailor marketing campaigns to
target specific customers. It also allows for more scope in terms of branding and public
relations through content marketing. Digital marketing is a two-way communication
between the brand and the customer, providing the business with valuable data that it can
use to inform better product and service design.

The affordances of digital go beyond traditional modes of advertising and marketing. As

well as information, digital marketing affords community, connection, feedback, and
convenience. This makes digital marketing a powerful tool, if used properly.

1.12 CHAPTER QUESTIONS

1. Why is it important to consider the business context when planning your marketing
strategy? 2. How has the internet affected marketing and the models we use to understand
 it? 3. Do you agree with the idea that customers are more empowered than they were
before digital communications were so prevalent? Justify your answer.

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Introduction to marketing

1.13 FURTHER READING

Positioning: The Battle for Your Mind – This book by Ries & Trout published in 2002
offers excellent advice about claiming space in the minds of consumers. smithery.co – A
marketing and innovation blog that teaches professionals to “Make Things People Want,
rather than spend all their energy and resources trying to Make People Want Things”.
www.adverblog.com – A digital marketing blog that collates ideas from marketing
campaigns around the world.
www.gigaom.com – GigaOM’s community of writers covers a wide range of
technological copies.
www.sethgodin.typepad.com – Seth Godin’s popular blog provides regular insight and
food for thought.

1.14 REFERENCES
Brilliant Noise, 2012. Brilliant Model: The Loyalty Loop. [Online]
Available at: brilliantnoise.com/brilliant-model-the-loyalty-loop/#more-3873
[Accessed 28 February 2022].
Dowd, M., 2015. Case Study: Vectors of Disruption – The Uber Story. [Online]
Available at: www.linkedin.com/pulse/vectors-disruption-uber-story-marc-dowd
[Accessed 5 March 2022].
Houlder, V., 2016. Uber faces huge UK tax liabilities if drivers not ‘self-employed’.
[Online] Available at: www.ft.com/content/c7da2d92-a1c3-11e6-aa83-bcb58d1d2193
[Accessed 5 March 2022].
Kokalitcheva, K., 2016. Uber Now Has 40 Million Monthly Riders Worldwide.
[Online] Available at: fortune.com/2016/10/20/uber-app-riders/
[Accessed 4 March 2022].
Kotler, P., 2012. What is marketing? [Online]
Available at: www.kotlermarketing.com/phil_questions.shtml#answer3
[Accessed 28 February 2022].
Noesis Marketing, 2011. Building a Brand Pyramid. [Online] [Image]
Available at: www.noesismarketing.com/building-a-brand-pyramid
[Accessed 22 May 2022].
Porter, M., 2008. The Five Competitive Forces That Shape Strategy in Harvard Business Review, January
2008, p86–104.
YouTube, 2017. Statistics. [Online]
Available at: www.statista.com/topics/2019/youtube
[Accessed 22 May 2022].
 Roy, R., Blok, W., 2017. The digital halo is real, but it requires an experimental approach. [Online]
Available at: www.thinkwithgoogle.com/future-of-marketing/digital-transformation/omnichannel
marketing-digital-spending-experiment-measurement/
[Accessed 17 January 2022].
Sowden, T., 2021. Five Strategies to Build a Digital Audience Post-Pandemic. [Online] Available at:
www.forbes.com/sites/forbestechcouncil/2021/08/25/five-strategies-to-build-a-digital
audience-post-pandemic/?sh=5ef477273293
[Accessed 1 February 2022].

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1.15 FIGURE ACKNOWLEDGEMENTS

Figure 1.1:
www.businessmanagementideas.com/business-environment/environment-of-business-micro
and-macro
Figure 1.3: datareportal.com/reports/digital-2021-global-overview-report
Sprint logo: en.wikipedia.org/wiki/File:Sprint_Corporation_Logo.svg
20
0
2
Importance of the customer
 IMPORTANCE OF THE
CUSTOMER
In this chapter you will learn:
• Conceptual tools for understanding your customer
• Key concepts for thinking about your target audience
• Some behavioural economic theories
• How digital has affected customer behaviour
• About customer data.
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2.1 INTRODUCTION
Although marketing is a business function, it is primarily an exercise in applied human
psychology. The role of marketing is to address customer needs and provide value. In
either case, success requires a nuanced understanding of how people think, process, and
choose within their environment.

To achieve this, one must strike a balance between awareness of global shifts and how
these impact people’s behaviour and the fiercely intimate motivations that determine how
and where individuals spend their time and money. This chapter outlines an approach for
understanding customer behaviour, and introduces some conceptual tools used to frame
and focus how you apply that understanding to your marketing efforts.

2.2 KEY TERMS AND CONCEPTS

Table 2.1
Term Description

Attention The idea that human attention is a scarce commodity, i.e., seeing
economy attention as a limited resource.

Customer A visual representation from the beginning to the end of the purchase
experience map experience from the customers’ perspective, including their needs,
wants, expectations, and overall experience.

Customer A detailed description of a fictional person to help a brand

persona visualise a segment of its target market.
 Global citizen A person who identifies as part of a world community and works
toward building the values and practices of that community.

Tribe A social group linked by a shared belief or interest.

Product An item sold by a brand.

Story A narrative that incorporates the feelings and facts created by your
brand, intended to inspire an emotional reaction.

2.3 UNDERSTANDING CUSTOMER BEHAVIOUR

The study of consumer behaviour draws on many different disciplines, from psychology and
economics to anthropology, sociology, and marketing. Understanding why people make the
decisions they do forms part of a complex ongoing investigation.

22
Importance of the customer

Marketing and product design efforts increasingly focus on a customer-centric view. Rather
than simply making people want stuff, successful organisations are focused on making stuff
people want. Given the plethora of options, product or service attributes, pricing options,
and payment choices available to the connected consumer today, competition is fierce.
Only the most highly considered brands will succeed. To achieve this, brands need to offer
customers value, and this relies on understanding consumer behaviour.

No point of engagement with your brand occurs in isolation for your customer. Their life
events, social pressures, and motivations impact their experience with your brand.
Something happened before and after they bought the product, and their experience with it
does not start or end at the point of sale. It starts well before they purchase and continues
long after the sale is completed.

For example, think about a specific type of cereal. A customer stands in front of the shelves
at the supermarket to choose a box of cereal. Purchasing decisions start before the
customer even steps foot into a store.

Before the purchase, the customer relies on a host of preconceived ideas and personal
preferences and goals to make their decision, for example:

• Nostalgia: “I ate this cereal as a child.”

• Brand loyalty: “My family has always eaten this brand.”
 • Visibility or interest: “I’ve heard about this cereal on social media.”
• Goals: “I need to increase my fibre intake.”
• Budget: “What can I afford?”
• Value: “Can I get a deal?” (For example, 150 g free or a hidden toy)
• Appeal and personal preference: “I don’t like the flavour of bananas.”

After the purchase, they will experience the product until it is finished. At this point, as they
say, ‘the proof of the pudding is in the tasting’. The customer will either re-purchase the
product based on a positive or neutral experience, or they will not re-purchase the product
based on a negative or neutral experience. Consider Figure 2.1 below.
Likelihood that customer will purchase again, or stay loyal to the brand

Unlikely
Likely

Positive Neutral Negative Customer experience

Figure 2.1 The customer experience determines the probability of re-purchase

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2.4 KEY DIGITAL CONCEPTS INFLUENCING

CUSTOMER BEHAVIOUR
The pervasiveness of digital has changed the way that customers make purchasing
decisions. For one thing, information is constantly at their fingertips and available to them.
Whereas customers would perhaps see a new product in a magazine ad or hear about it
on the radio, they are now bombarded with targeted ads, banner ads, and more, whenever
they open their browsers or inboxes. Whereas ‘word of mouth’ used to refer to a person’s
friends, family, or neighbours, it may now refer to the people they follow on social media —
and they may not even know these people personally.

This is, however, not to say that the customer is a passive recipient of this information and
content. Digital tools, such as the internet and social media, enable customers in a way that
they have not previously been empowered. They can research more widely, they have
access to products and services that may not be available locally; and they have more
recourse if the experience is not a positive one.
 Marketers now have more power, too. By analysing customer data, they can improve
customers’ experiences and increase engagement rates and conversions. Access to this
data is perhaps one of the most integral uses of digital to connect with customers and
create more brand awareness and loyalty.

There are three main concepts that you should understand when considering customer
behaviour:

1. The impact of digital, or digital disruption

2. Global citizenship and the idea of global ‘tribe’
3. The attention economy.

2.4.1 The impact of digital

Digital disruption, which is discussed throughout this book, can appear in many small and
large ways. If there’s one thing the past 20 years have taught us, it’s that there is constant
disruption and upheaval in the digital world. How we communicate with one another, how
we shop, how we consume entertainment, and how we see ourselves in the world, has all
changed because of digital. And these changes are accelerating.

One of the results of digital tools and media is a destabilising of the status quo. All
industries are vulnerable to change when a product or service comes along that meets
user needs in an unprecedented way. Netflix has disrupted the media industry, airbnb has
changed travel, and Uber has dramatically impacted what individuals can expect from
transport options. At the core of their offerings is personalisation. Customers want to be
treated as individuals, not as users, accounts, or prospects. Personalisation is a chance to
use behaviour as the most important clue about what people want and more importantly,
what they need (Godin, 2014).

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Importance of the customer

Figure 2.2 Netflix, Uber, and airbnb fundamentally changed the way that
consumers watch television, travel short distances, and find
accommodation

All three of these tools use customer data in some way to offer, improve, or price their
services. Consider how Netflix recommends particular shows or movies based on previous
viewing history. The catalogue is too vast for people to be able to find what they will enjoy
without assistance. Therefore, an algorithm has been developed to push relevant content
to the fore, making it easier to access; ultimately, the user experience is less frustrating and
disappointing. Uber uses data to either reduce or increase ride prices based on demand in
a particular area, and at a certain time.

Take into account that people born after 1985, more than half the world’s population, have
no idea what a world without the internet is like. They only know a rapid pace of
advancement and some tools that serve them better than others.

The internet seeks no middlemen. Established industries or organisations can be bypassed

completely when people are in control. Your customers can find another option with one
click, and are increasingly impatient. They are not concerned with the complexity of
technical aspects of how the site functions; they are simply interested in the fact that it
does. People will use the service that best serves them, not what best serves an industry
or existing regulations.

2.4.2 The global citizens and their tribe

Coupled with these empowered digital consumers, who are changing digital and driving
disruption as much as digital is changing them, is the contradiction evident in the
relationship between a global citizen and increasingly fragmented and differentiated tribes
built around interests. National identity, given global migration and connectivity, has shifted
as the world becomes smaller. The internet has created space for people to create, form,
support, and evolve their own niche communities. This duality forces marketers to keep
cognisant of international shifts while tracking and focusing on niche communities and
specific segments within their market. It is important to remember that tribes are fickle and
nomadic; you need to feed their passions and beliefs.

Figure 2.3 offers a simplified view of parenting

Internet users are moving from sharing as a method
communities and how global trends filter
down, of broadcasting themselves, into a way of sharing
that has community at heart. Online communities
encourage connection around common interest,
from a global community to a more are more trusted, and give participants a sense of
personal, NOTE belonging in the digital world.
local level.

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Local communities
Parent support groups, local social media influencers/
 communities, friends and family, healthcare professionals,
schools, teachers, etc.

Wider community of like-minded parents

Influencers on social media, internet message boards, etc.

Global shift to ‘conscious parenting’

International media, books, podcasts, magazine, and internet
articles (coupled with more general global trends, events
and research, for example, psychiatric studies into how early
parenting/familial relations can impact people into adulthood).

Figure 2.3 How global trends filter down to local communities

2.4.3 The attention economy

Attention is a resource — a person only has so much of it.

(Matthew Crawford)

The attention economy describes attention as a scarce resource, and considers the ways
that it can be captured and retained long enough for information to be absorbed, or for a
customer to make a purchasing decision. Media forms and the mediums through which they
can be consumed have exploded over the last decade, and it’s increasingly difficult to get
the attention of those you are trying to reach. Your customer is distracted and has many
different things competing for their attention.

If a customer is not interested, they will quickly disengage. Likewise, if they feel that
something is not relevant to them, they will turn their attention to something else.

2.5 TOOLS FOR UNDERSTANDING YOUR CUSTOMER

Despite the complexity of the customer landscape, various tools and frameworks are
available to consider your customer. The goal with many of these is to inform your decision
making and help you think from the perspective of your customer.

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Importance of the customer
2.5.1 Developing user personas
To understand all your customers, you must have an idea of who they are. While it’s
impossible to know everyone who engages with your brand, you can develop
representative personas that help you focus on motivations rather than on stereotypes.

A user persona is a description of a brand-specific cluster of users who exhibit similar

behavioural patterns in, for example, their purchasing decisions, use of technology or
products, customer service preferences, and lifestyle choices. We will revisit the user
persona at multiple points during this course, as it shouldn’t be seen as an end in itself.

A user persona is a consensus-driving tool and a catalyst that can be applied when you try
to understand your entire customer experience, or when you decide on the implementation
of specific tactics. Every organisation should have four to five user personas to help
strategists target their efforts.

To create a user persona and inform decisions with your customers’ point of view, one must
prioritise real information over your team’s assumptions and gut feelings.

Desktop research, drawn from sources such

as existing reports and benchmarking available to you elsewhere through online
platforms like
studies, NOTE
Market research methodologies are explored in
help you to frame the questions you need more detail in Chapter 3: Market research.
to ask when delving deeper into the data

your website or social media presence. The internet provides an increasing number of
viable alternatives to offline primary research.

A combination of habits and specific needs are combined into a usable overall picture. A
key feature of the user persona below is how it accounts for customer motivation. Summer
is driven by emotion, rich storytelling, and social belonging. This knowledge should drive
how the brand communicates with her and how her brand experience is tailored to make
her feel like part of a community.
 Figure 2.4 User personas are a consensus-driving tool
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To build a robust user persona, you should consider the demographics, psychographics,
and motivators for your customers.

Demographics and psychographics

Understanding customers can involve two facets:

1. Understanding the physical facts, context, and income of their ‘outer world’, i.e., their
demographics. These include their culture, subcultures, class, and the class structures
in which they operate, among other factors.
2. Understanding the motives, desires, fears, and other intangible characteristics of their
‘inner world’, i.e., their psychographics. Here we can consider their motives, how they
learn, and their attitudes.

Both facets above are important, though some factors may be more or less prominent
depending on the product or service in question. For example, a women’s clothing retailer
needs to consider gender and income, as well as feelings about fashion and trends equally,
while a B2B company typically focuses on psychographic factors as their customers are
linked by a job function, rather than shared demographics.

Demographics can be laborious to acquire but are generally objective and unambiguous
data points that change within well-understood and measurable parameters. For example,
people get older, incomes increase or decrease, people get married or have children. Data
sources like censuses, surveys, customer registration forms, and social media accounts
are just a few places where demographic data can be gathered, either in aggregate or
individually.

Psychographics, however, are fluid, complex, and deeply personal because, after all, they
 relate to the human mind. On top of that, there are other elements to consider: those
‘human traits’, habits and thought processes that apply to all of us, but play out in unique
ways. This information is very hard to define, but when complementary fields work
together, it’s possible for marketers to uncover a goldmine of insight.

2.5.2 Understanding motivation

People make hundreds of decisions every day and are rarely aware of all of the factors that
they subconsciously consider in this process. That’s because these factors are a complex
web of personal motivating factors that can be intrinsic or extrinsic and positive or negative.
Positive
I want to do
If I do this, this to feel
I’ll get a reward good
Extrinsic Intrinsic
I need to do this
If I don’t do this,
or I’ll feel bad
I’ll face a penalty

Negative

Figure 2.5 Extrinsic and intrinsic motivators

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Importance of the customer

Extrinsic motivators
Extrinsic factors are external, often tangible, pressures, rewards, threats, or incentives that
motivate us to take action even if we don’t necessarily want to. For example, a worker in a
boring or stressful job may be motivated to keep going by their pay check, and drivers are
motivated to obey traffic rules by the threat of getting a fine or hurting someone.

Marketing often uses extrinsic motivators to provide a tangible reward for taking a desired
action. Some examples include:

• Limited-time specials and discounts: The customer is motivated by a perceived cost

saving and the urgency of acting before the offer is revoked.
• Scarcity: The limited availability of a product or service is used to encourage immediate
action.
• Loyalty programmes: They typically offer extrinsic rewards like coupons, exclusive
access, or free gifts in exchange for people performing desired behaviours.
• Ancillary benefits: They can include things such as free parking at the shopping centre if
you spend over a certain amount at a specific store.
• Free content or downloads: They can be obtained in exchange for contact details, often
 used for subsequent marketing activities.

Booking.com, for example, uses a range of extrinsic motivators to encourage customers to

book quickly, including a price discount exclusive to their site and urgency through the use
of the words “High demand”, “Only three rooms left” and, “There are two other people
looking at this hotel”. All of these factors nudge the customer to book quickly to avoid
missing out on what is framed as a limited-time opportunity.

Figure 2.6 A screenshot of Booking.com using extrinsic motivators

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The problem with extrinsic motivation is that a customer can often perform the desired
action to get the reward or avoid the threat without fully internalising the meaning or
marketing message behind the gesture. Or worse, the required action becomes ‘work’,
diminishing the enjoyment of the task and the reward.

Some people will, for example, swipe in at the gym with their membership card to avoid
losing their access, but won’t actually exercise. Some might log in to a website every day to
accumulate points without actually looking at the specials on offer.

Kohn (1987) summarised the three risks of extrinsic rewards:

1. “First, rewards encourage people to focus narrowly on a task, to do it as quickly as

possible and to take few risks.
2. Second, people come to see themselves as being controlled by the reward. They feel
less autonomous, and this may interfere with performance.
 3. Finally, extrinsic rewards can erode intrinsic interest. People who see themselves as
working for money, approval or competitive success find their tasks less pleasurable,
and therefore do not do them as well.”

Intrinsic motivators
Somebody who is intrinsically motivated performs an action for an intangible benefit simply
because they want to, or for the pleasure, fun, or happiness of it. Intrinsic motivators are
much subtler and more difficult to quantify, but are also more powerful and longer-lasting
drivers of human behaviour.

Some common forms of intrinsic motivation include:

• Love: This includes not just romantic love, but also the love of an activity or outcome. •
Enjoyment and fun: Few intrinsic motivators are as powerful as the desire to have a good
time.
• Self-expression: Some people act in a certain way because of what they feel the action
says about them.
• Personal values: Values instilled through cultural, religious, social, or other means can
be powerful motivators.
• Achievement or competence: When people challenge themselves, take a meaningful
personal risk, or attain a long-desired goal, they are acting because of an intrinsic
motivation. • Negative intrinsic motivators: Fear, embarrassment, and inertia are some
powerful drivers that rely on negative emotions.

The following ad (Figure 2.7) combines multiple intrinsic motivators to drive home a
message. It appeals to pet owners’ love and sense of responsibility for their pets, as well
as testing their competence as a ‘good’ pet owner. It also touches on negative motivators:
fear for the pets’ health and a sense of shame if they are not feeding their pets an
appropriate diet.

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Importance of the customer
 Figure 2.7 This advert for a brand of dog food, reads “Stop treating your dog like a
trashcan”

2.6 Finding the right motivators

Many brands develop elaborate marketing campaigns with gimmicks and rewards, but find
that these fail. This is often because of a misunderstanding of the motivators that drive
customers to take action in the first place. Marketers tend to overvalue how much people
like, understand and care about brands, which can lead to a disconnection from the
audience.

The most important factor to consider in choosing a customer motivator is relevance to the
customer, to the brand, and to the campaign. Ask yourself, “Is the incentive you are offering
truly relevant and useful?”

Most complex human actions involve a combination of factors. For example, we work
because of the external pressure to earn money, and some also get an intrinsic reward in
the form of achievement, self-expression, or making a difference in the world. Both factors
are important, and if one is missing, the other needs to compensate strongly for this; i.e.
interns working for free to get ahead quickly in their careers; people being paid more to
stay in a difficult or unfulfilling job.
 The success of your customer persona will depend on how carefully you interrogate
assumptions about your customer, how carefully you draw on research, and how you
prioritise understanding their motivations and the way decisions are made.

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2.6.1 Knowing your customer

One tool to understand your customer is to examine a day in the life of (DILO) the
customer. DILO is a useful marketing tool, because it can help you uncover certain
motivations, triggers, stress points, and opportunities.

Consider a brand that is aimed at lower income families. Once you analyse this customer’s
DILO, you would realise that:

• You would need a mobile app or at least a mobile-friendly website, because the majority
of lower income families do not have access to a PC or laptop
• Your app or website would need to have very low data demands
• Your campaigns would be aimed during the early mornings or early evenings, when
people are likely to be commuting and, therefore, on their mobile devices
• Your campaigns would need to be very clear on pricing and value.

Can you recognise how, by understanding the customer’s day, you can make better
marketing decisions? Knowing your customer puts your product or service in their line of
sight and allows you to save money and resources, while also maximising impact.

2.6.2 Decision making and behavioural economics

One significant shift in understanding customers over the past few years has come from the
fields of psychology and economics. This area of inquiry, behavioural economics, looks at
what assumptions or behaviours drive decision making. An understanding of individual
motivations and interactions between customers and your brand can help you cater to what
your market really wants or needs.

As an example, industrial designer Yogita Agrawal designed an innovative and

much-needed human-powered light for people in rural India. Although the product
ingeniously took advantage of the locals’ mobile lifestyle – the battery is charged through
the action of walking – and the idea was well received, initially no one actually used the
product. Agrawal eventually discovered the simple reason for this: the device had a plain,
ugly casing that did not match with the vibrant and colourful local dress at all. When she
added a colourful and personalisable covering to the device, usage shot up dramatically.
Although she had found the big insight, that walking can generate energy to power lights in
areas not served by the electrical grid, it took a further understanding of regional
preferences to truly make the device appealing.
 If marketers can apply this insight to their strategies and campaigns, it means that they may
be able to get more customers to take desired actions more often, for less cost and effort.
This is the ideal scenario for any business.

Biases
Cognitive biases
Cognitive biases are our own personal prejudices and preferences, as well as common
ways of thinking that are inherently flawed. A classic example is confirmation bias, where we
take note of information that confirms our beliefs or worldview, but discount or ignore
information that doesn’t. 3 2
Importance of the customer

Try it for yourself! The next time you are driving or commuting, pay attention to all the red
cars on the road. Does it begin to seem like there are more red cars than usual?

Below are some of the most important biases that marketers should be aware of (Taylor,

2013). Table 2.2 Biases that marketers should be aware of

Category Bias Elaboration

Information Knee-jerk bias Making a quick decision in a circumstance where

slower, more precise decision making is needed.

Occam’s razor Comparing two competing ideas, the simplest one is

usually preferable or true.

Silo effect Using a narrow approach to form a decision.

Confirmation bias Only focusing on the information that confirms your

beliefs (and ignoring disconfirming information).

Inertia bias Thinking and acting in a way that is familiar or comfortable.

Myopia bias Interpreting the world around you in a way that is

purely based on your own experiences and beliefs.

Ego Loss aversion bias Tending to favour choices that avoid losses, at the
risk of potential gains.

Shock-and-awe Believing that our own intelligence is all we need to

bias make a difficult decision.

Overconfidence Having too much confidence in our own beliefs,

effect knowledge, and abilities.
 Optimism bias Being overly optimistic and underestimating
negative outcomes.

Force field bias Making decisions that will aid in reducing perceived fear
or threats.

Planning fallacy Incorrectly judging the time and costs involved in

completing a task.

Pricing biases
There is also a lot of bias around the price of an item. Generally, we perceive more
expensive to be better, and we can actually derive more psychological pleasure from them,
even if the cheaper alternative is objectively just as good.

A classic example of this is wine-tasting, where in repeated experiments participants agree

that the more expensive wine tastes better where, in fact, all the wines were identical.
Taken even further, researchers discovered that people tasting the more expensive wines
actually had a

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heightened pleasure response in their brains, showing that researchers could generate
more enjoyment simply by telling participants they were drinking an expensive wine (Ward,
2015).

Loss aversion
One of the most powerful psychological effects is the feeling of loss, when something we
possess is diminished or taken away. The negative feeling associated with loss is far
stronger than the positive feeling of gaining the equivalent thing. In other words, we feel the
pain of losing R500 more acutely than the joy of gaining R500.

Marketers can use loss aversion very effectively in the way they frame and execute
marketing campaigns. Here is an example: Consider giving a customer a free trial version
of a service for a long period. This then becomes so useful and important to them that they
would rather pay to avoid losing it. On-demand TV service Netflix, uses this to great effect
with its 30-day free trial, especially since they ask for credit card details upfront so that
shifting over to the paid version is seamless.

Heuristics
 A heuristic is essentially a decision-making shortcut or mental model that helps us to make
sense of a difficult decision-making process, or to estimate an answer to a complex
problem.

Some classic examples include:

• The availability heuristic: We overemphasise the likelihood or frequency of things that

have occurred recently because they come to mind more easily.
• The representativeness heuristic: We consider a sample to represent the whole for
example, in cultural stereotypes.
• The price-quality heuristic: We consider more expensive things to be better quality. A
higher price leads to a higher expectation, so this can work both to the advantage and
disadvantage of marketers. For products where quality is measurable and linear, the
price needs to correlate, and a higher price needs to be justified tangibly. For products
or services where quality is less tangible or more subjective, such as food, drinks,
experiences and education, in many ways the price can heighten the perceived quality
and experience even on a neurological level.
• Anchoring and adjustment heuristic: We make decisions based on relative and recent
information rather than broad, objective fact. In marketing, this can be used to steer
customers to the package or offer that the brand most wants them to take.

Choice
Choice in its simplest form, is the ability to make a decision when you have two or more
pos sibilities. How do people choose? This is a difficult question to answer because people
decide based on irrational, personal factors and motivators, objective needs, and their
immediate circumstances.

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Importance of the customer

Word of mouth or peer suggestions

We are very susceptible to the opinions of other people and tend to trust the opinions of
friends, family, trusted experts, and ‘people like us’ over companies or brands. We are also
much more likely to join in on an activity like buying a specific product if we see others like
us doing it first. This is the notion of social proof. Human beings generally rely on early
adopters to lead the way, with the vast majority waiting for a new product or service to be
tested before jumping on board.

This is why many brands use spokespeople or testimonials. They act as a reassurance to
the potential customer that other normal people actually experience the benefits that are
promised. This also highlights the importance of positive online word of mouth. The Zero
 Moment of Truth (ZMOT) is the moment that occurs after the customer has been exposed
to your brand, but before a purchase is made. People do extensive research online before
important purchases and can have their minds swayed by the reviews, experiences, and
opinions of others who are often strangers.

Consider the rise of #BookTok, a subcommunity on the social media platform TikTok, which
focuses on book reviews and recommendations. Globally, publishers are seeing tangible
results and an uptick in sales directly related to #BookTok. Interestingly, backlist titles (in
other words, books that are not new releases) are also seeing a rise in sales directly
influenced by ‘BookTokkers’. This is partly due to how quickly and easily accessible these
reviews are. However, there is also a level of trust in the reviews, particularly if the review
comes from one of the more popular accounts.

Personal preferences and history

Some of our decisions are based on very personal factors, such as a favourite colour, a
positive past experience, or a historical or familial association. For example, some people
may choose to buy the same brand of breakfast cereal that they remember eating as a
child, regardless of the price or nutritional benefits. For them, the total experience and
good feelings form part of the overall value they derive. This is why many brands place
emphasis on their long and prestigious histories.

Habits
Habits form when we buy the same thing because we’ve always bought it, and it’s simply
the easiest option.

Habits are typically triggered by an outside or environmental factor (the cue), which then
causes us to act out our habit (the action), after which we receive a positive boost (the
reward). This sequence is referred to as the habit loop.

In marketing, the goal is to get a customer to form a habit loop around purchasing or using
the brand’s offering. For example, many snack brands try to associate the environmental
cues of

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hunger or boredom with their products, such as KitKat’s “Have a break” or SNICKERS’
“You’re not you when you’re hungry” campaigns.

Loyalty programmes can play a key role in helping customers solidify a habit. For example,
given the choice of two similar coffee shops on the morning commute to work, a person
may be more inclined to visit the one offering a free coffee once they’ve collected a card
 full of stamps (even if that means going out of their way or paying a bit more for what is
essentially a small discount). Eventually, the routine becomes set and it becomes easier to
stick to the safe, familiar option.

Below are some examples from brands that encourage habit

formation. Table 2.3 How brands capitalise on habits

Brand Cue Routine Reward

Starbucks Walking to work in Get my regular A caffeine hit and a friendly

the morning coffee order interaction with the barista

Nike Mobile app Put on Nike Endorphins, satisfaction at

reminder to go for shoes, go to living a healthy, aspirational
a run the gym lifestyle

Movie Smell of popcorn Buy a snack set Tasty snack, experiencing the
theatre from the counter ‘full’ movie-going experience

How do habits form? To create a habit, you need to perform a repeated action many times
in a row. The harder the action, such as going for a jog each morning, the longer and more
consistently you need to practice the behaviour. Once the habit sets, it becomes a mental
‘shortcut’ that will take conscious effort to override in future.

Decision load
Making decisions is difficult, even if the decision is a low-stakes, low-impact one. Generally,
psychologists agree that we have a certain quota of decisions that we can make every day,
after which subsequent decisions become harder and more taxing, and often result in
poorer outcomes called ‘decision fatigue’. This is why leading thinkers try to cut out as
many trivial decisions as possible. Steve Jobs of Apple famously wore the same
blue-jeans-and-black
turtleneck outfit every day to save himself making that one extra decision every morning.

This is also why we tend to subconsciously eliminate unnecessary decisions and stick to
reliable, tested habits. This is especially true for the fast-moving consumer goods (FMCG)
sector. Consider your habits when buying toothpaste. Typically, you will purchase the same
brand you always do without really thinking about it. Unless you had a terrible experience
with the product, one toothpaste seems as good as the other and there’s no incentive to
switch. You certainly won’t pause for five minutes in front of the shelf each time to carefully
study each option before making your decision. It doesn’t matter enough to get the best
one.
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 Importance of the customer

Now imagine that your usual brand is out of stock. Suddenly, instead of relying on the
existing habit, you are forced to make the decision from scratch at which point marketing
factors and price can play an important role. However, crucially, it is the experience that the
new product delivers that will be the deciding factor. If the new toothpaste is similar or
inferior to the usual brand, there’s no incentive to change the buying habit.

Defaults
Providing a ‘default option’ can be a powerful decision-making shortcut, because it removes
the need to make an active decision. Defaults work for a number of reasons.

• They offer a path of least resistance: The default setting is perceived to be the one that
is good enough for most people, and requires the least amount of thought and
customisation. This is ideal for reducing effort.
• They serve as a social signal: The default is seen as the socially approved option, as
the presumption is that the majority will choose this, and there is safety in aligning with the
majority. • They offer assurance: Similarly, we also presume that the default choice has
been selected by an expert because of its merit to the end user.
• They take advantage of loss aversion: When it comes to sales and marketing, effective
default packages typically include more products or services that are strictly needed to
increase the value and therefore the price. This is done simply because opting for a
more basic version involves the customer taking elements away, and therefore suffering
a loss. Once the default price has been anchored in the customer’s mind, there is less
incentive to remove unwanted elements, even if the price gets reduced. For example,
when buying a new laptop, the customer may be offered a package deal that includes
antivirus software, a laptop bag, a wireless mouse, and other related accessories.

Choice architecture
You can simplify your customers’ decision-making processes by cleverly designing the
choices you offer. This is called choice architecture.

While the following are guidelines only, they should be tested thoroughly based on your
own individual context, brand, and customers. Generally speaking, a good choice
architecture has the following characteristics:

• A small number of choices: Usually not more than five choices are offered, though
ideally three. The smaller the number of options to choose from, the easier it is for the
customer to distinguish the differences between the options and to avoid a feeling of
missing out.
• A recommended or default option: Because people consider expert advice and social
 preferences when choosing, highlighting one option as ‘the most popular choice’ or ‘our
top-selling package’ can direct people to the option you most want them to take.
• A visual design hierarchy: Typically use colour and size. To make your preferred option
stand out, one easy trick is to make it bigger and brighter than the options around it.

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Mixpanel strongly emphasises its business plan as the ideal choice, not only is it highly
emphasised compared to the surrounding options, it includes a ‘best value’ assurance.

Figure 2.8 Mixpanel highlighting their business option as the ideal

2.6.4 Customer experience mapping

Once you have carefully crafted personas to
guide you around who your customer customer has (or could have) with your
groups are, you need to understand how company and
and where they are engaging with your Customer experience mapping is a broad view of
the customer’s interaction with your product or
brand. This is NOTE service. A user experience map (primarily used in
where customer experience mapping designing website or app functionality) focuses on
comes into play. that part of the user journey. You will learn more
about this in Chapter 6: User experience design.
A customer experience map visually
identifies and organises every encounter a

brand. These interactions are commonly referred to as ‘touchpoints’ (Kramp 2011).

 You can use it as a tool to map your entire customer experience or to drill down into detail
for particular parts of that experience. Examples include in-store purchasing or someone
trying to buy something on your website.

The customer experience map should detail how customers are feeling at various points in
their interaction with you and also highlight any pain points that they may be experiencing.
Identifying these problems or dips in their experience presents opportunities for
engagement and also helps to explain your customer behaviour in context.

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Importance of the customer

Towards creating your map

Figure 2.9 An experience map highlights opportunities

for improving your customer experience

Customer experience maps should vary from business to business, so one shouldn’t just
follow a blueprint. Evaluate the customer journey from consideration through to purchase
and hopefully, loyalty. The experience map looks at the progression from consideration
through to post purchase in great detail and visually synthesises your customer’s behaviour
and motivations at every point of contact with your brand. Look at the example above,
which includes some key sections:

• Phase: Where is your customer in their interaction with your brand? • Doing, thinking,
feeling: How does what they are feeling and doing vary from stage to stage? • Channels:
What channels or contact points are involved in facilitating this stage of their journey?
 • Opportunities: What opportunities exist to solve pain points for your brand?

2.6.5 Customer data

Digital marketing offers marketers a unique
opportunity for timely and useful data marketing campaign or future product
collection, particularly about customers. development.
Once again, the importance of data is emphasised.
Collecting the NOTE
This is arguably the most critical takeaway from a
data, however, is one thing. The way to course in eMarketing: marketing decisions can
really make it worth your time is to analyse and should be made using real and up-to-date
and learn from it, either to inform a data.

39
PLANNING

Figure 2.10 A customer experience map of buying a car

There are five basic steps to data collection.

1. Establish the goal: Decide what data you are collecting and why you are doing it. 2.
Impose a timeframe: Data collection should have a set timeframe. 3. Pick a data
collection method: Choose how you will collect data based on your goals and set
timeframe.
4. Collect the data: You can do this via surveys, online tracking, transactional data
 tracking, online marketing analysis, and collecting subscription data.
5. Analyse and learn from the data collected: This is the most crucial part of this
exercise. There is no use collecting data if you are not going to use it.

2.7 MEASURING SUCCESS

The ultimate test of how well you understand your customers is evident in the success of
your product or service. Targeted and relevant communication about a well-positioned
project can drive sales.

Data on the success of your campaigns, from

E
NOT Chapter 20: Tracking and analysis.
social media analytics through to site success and feed into course
visits and customer service feedback, You will learn more about this in
should both act as measures of

correcting your marketing efforts or, where applicable, the nature of your actual product or
service.

Every measure and data source discussed throughout the rest of this book should feed into
your evolving picture of your customer. Personas and customer experience maps should be
living documents and tools.
40
Importance of the customer

2.8 CASE STUDY: CHECKERS SIXTY60

Checkers is a FMCG retailer founded in
1956.

One-line summary
As part of their ‘strategy to grow and
monetise its ecosystem
of value for customers,’ South African grocery retailer,
Checkers, followed global trends towards on-demand,
‘quick commerce’ grocery delivery services, and are now
local market leaders with over 1.5 million app downloads.

The problem
 Checkers, a major grocery retailer in South Africa, observed a global trend towards
on-demand grocery services. Other grocery retailers, such as Woolworths Food and
Pick n Pay, were offering grocery delivery but customers had to pre-book delivery slots
with turnaround times of more than 12 to 24 hours, and the ordering mechanisms were
clunky and inefficient.

The solution
Checkers went in a completely different direction, choosing to focus on a more
convenient ordering and delivery process for the customer.

Figure 2.11 Ordering and delivery made easy

1. They launched a simple and easy-to-use app-based service called Checkers
Sixty60. 2. They reinforced their market position as a quality, high-value, affordable
grocer. 3. They localised ordering and delivery. Customers share their location so that
the app
can find the closest store to them. This means that customers’ orders can be
delivered faster due to proximity.
4. They employed their own delivery personnel (rather than relying on a logistics
company), most of whom use branded motorcycles and can therefore move
around towns and cities more easily.
41
PLANNING

5. They limited the number of items allowed to 30, which means that
turnaround/delivery times can be within 60 minutes and that people order more
often.

The results
Launched months before lockdown was enforced in South Africa due to the COVID-19
pandemic, Checkers Sixty60 has the lead on other retailers who launched later (for
 example, Woolies Dash and Pick n Pay Asap!). The service was very popular during
2020 but has continued to grow even as lockdown restrictions were lifted. This is as a
result of the value that customers derive from the service, as well as the positive
experiences before, during, and after ordering, live shopping (where customers can
make replacement decisions in the app if a product is unavailable), and delivery
(where customers can track the driver to their door).

Figure 2.12 Exponential growth of Sixty60 over a year

To further appeal to customers, the brand has also adopted an eco-friendly approach,
offering a recycling service. The driver will collect the brown bags from a previous
delivery when delivering the latest order.

(Source: BUSINESSTECH, 2021)

2.9 CASE STUDY QUESTIONS

1. List some intrinsic and extrinsic motivators that contributed to the success of Checkers
Sixty60.
2. What kind of data is important for the continued success of the service? How would this
be collected?
3. What can you learn from the launch of Checkers Sixty60 from a branding perspective,
but also from the perspective of paying attention to global trends?

42
Importance of the customer

2.10 THE BIGGER PICTURE

Customers are autonomous beings, who make decisions every day – what to wear, what to
eat, how to travel to work, what to use on their bodies, faces, and hair, what to feed their
children and pets, the list goes on and on. In a maelstrom of information, you need to make
your product and service stand out. This requires knowing your customer intimately, and
you can only learn about your customers by taking the time to get to know them. With this
knowledge, you can recommend a product to fit their needs or desires; or you can craft a
product or service to fit into their lifestyles; or, even more ambitiously, you can tell them and
show them what they never knew they wanted. Always put your customer front and centre.
Do not get so bogged down by your own concepts and preconceived ideas that you forget
that they are the people you are targeting and creating content and products for.

2.11 SUMMARY
People have come to depend on and shape the digital channels that enable connection,
individual interest, and the disruption of industries. Your consumers are connected,
impatient, fickle, and driven by a number of motivations and contextual realities. Only
through targeting and understanding specifically can you reach them and ensure the
success of your brand.

Some tools can help you paint a picture of your customers and their experience of your
brand by depicting complex motivations, both external and internal. These tools enable real
customer data and research, that consider the complex and sometimes irrational influences
on how people make decisions. Customer personas, customer experience maps, and the
field of behavioural economics can all help to shape your thinking and drive your approach.

2.12 CHAPTER QUESTIONS

1. What is behavioural economics?
2. What traps should you avoid when developing a consumer persona? 3. What is the
relationship between a consumer experience map that depicts your customers’ entire
journey and an experience map used in the user experience design discipline?

2.13 FURTHER READING

Bendle, N.T., Farris, P.W., Pfeifer, P.E., Reibstein, D.J., 2017. Key Marketing Metrics:
The 50+ metrics every manager needs to know (2nd edition). Pearson Education
Limited: UK. Eisenberg, B. and Eisenberg, J., 2006. Waiting for Your Cat to Bark?
Persuading Customers When They Ignore Marketing. Thomas Nelson Publishers: USA.
www.slideshare.net/philipdemeulemeester/behavioural-economics-in – This presentation
offers a good summary of the key topics and ideas within behavioural economics.

43
PLANNING
2.14 REFERENCES
BUSINESSTECH, 2021. Checkers is building something quite remarkable – and far bigger than
its competitors. [Online]
Available at: businesstech.co.za/news/technology/518878/checkers-is-building-something-quite
remarkable-and-far-bigger-than-its-competitors
[Accessed 22 May 2022]
Chernets, N., 2021. How to Collect Digital Marketing Data in 5 Easy Steps.
[Online] Available at: www.entrepreneur.com/article/386543
[Accessed 11 February 2022]
Culoso, A. & Kalhorn, K., 2021. The Next Literary Frontier: The Rise of BookTok.
[Online] Available at: thehoya.com/the-next-literary-frontier-the-rise-of-booktok/
[Accessed 9 February 2022]
Eisenberg, B. and Eisenberg, J., 2006. Waiting for Your Cat to Bark? Persuading Customers When They
Ignore Marketing. Thomas Nelson Publishers: USA.
Godin, S., 2014. ...different people differently. [Online]
Available at: seths.blog/2014/01/different-people-differently/
[Accessed 22 May 2022]
Gouillart, F. & Sturdivant, F.D., 1994. Spend a Day in the Life of Your Customers.
[Online] Available at: hbr.org/1994/01/spend-a-day-in-the-life-of-your-customers
[Accessed 7 February 2022]
Juarez, A., 2021. The Last Thing You Need to Read about Book TikTok. [Online]
Available at: electricliterature.com/the-last-thing-you-need-to-read-about-book-tiktok/
[Accessed 9 February 2022]
Kohn, A., 1993. Punished by rewards. Houghton Miffin Company, New York, New York.
Taylor, J., 2013. Psychology Today, 2013. Cognitive Biases Are Bad for Business. [Online] Available at:
www.psychologytoday.com/blog/the-power-prime/201305/cognitive-biases-are-bad-business [Accessed
10 March 2022]
Risdon, C., 2011. The Anatomy of an Experience Map. [Online]
Available at: articles.uie.com/experience_map/
[Accessed 9 March 2017]
Ward, V., 2015. The Telegraph: People rate wine better if they are told it is expensive. [Online]
Available at: www.telegraph.co.uk/news/shopping-and-consumer-news/11574362/People-rate-wine
better-if-they-are-told-it-is-expensive.html
[Accessed 31 August 2017]

2.15 FIGURE ACKNOWLEDGEMENTS

Figure 2.4: Profile with permission from Mirum, 2017. Image of person, Pixabay,
2018 Figure 2.6: Screenshot of www.booking.com
Figure 2.7: theultralinx.com/2014/07/40-striking-print-adverts
Figure 2.8: Screenshot, Mixpanel, 2017
Figure 2.9: Used with permission from Mirum, 2017
Figure 2.10: www.nngroup.com/articles/analyze-customer-journey-map/
Figure 2.11: www.sixty60.co.za
Figure 2.12: businesstech.co.za/news/technology/518878/checkers-is-building-something-quite
remarkable-and-far-bigger-than-its-competitors
Sixty60 logo: www.sixty60.co.za
44
0
3
Market research
 MARKET RESEARCH
In this chapter, you will learn:
• About key concepts in conducting market research
• About several methods for conducting online research, including
surveys, online focus groups, and data sentiment analysis
• About possible problems and pitfalls to look out for when researching online
• How to describe the design thinking process
• How to explain why design thinking is important
• When design thinking is useful
• How data is used to improve the user experience and increase conversions •
How knowing your customers is integral to improving their experience with
your brand.
45
PLANNING

3.1 INTRODUCTION
The internet is built for research. Whether it’s a consumer shopping around for prices, a
researcher exploring a topic, or a fan looking up their favourite band, the internet provides
new ways for gathering and analysing data.

Customers are able to research companies and products easily, gathering information to
compare prices and services with a few clicks. Customers can also share likes and dislikes
easily, with both companies and friends.

As a result, brands can study who their customers are, what they are interested in, how they
feel about the brand, and the best times and places to engage with them. Insights can be
gathered from ongoing market research, making it possible to course correct and apply
data-driven decision making. This chapter will focus on tools and methodologies for
gathering useful data.

3.2 KEY TERMS AND CONCEPTS

Table 3.1
Term Description

Bounce rate The number of people who view one page and then leave a
website without viewing any other pages. Data statistics and facts
collected for analysis.
 Data sentiment The systematic analysis of subjective materials, such as survey
analysis responses or social media posts, in order to determine the attitude
and intended emotional communication of the customer.

Focus group A form of qualitative research where people are asked questions in an
interactive group setting. From a marketing perspective, it is an
important tool for acquiring feedback on new products and
various topics.

Hypothesis A supposition that is tested in relation to known facts; a proposition

based on reason but not necessarily assumed to be true.

Listening lab A testing environment where the researcher observes how a

customer uses a website or product.

Observation/ When researchers immerse themselves in a

online particular environment in order to gather insights.
ethnography

Primary research The collection of data to present a new set of findings from
original research.

46
Market research

Qualitative data Data that can be observed but not measured. Deals with descriptions.

Quantitative data Data that can be measured or defined. Deals with numbers.

Research A community set up with the intention of being a source for research.
community

Research Methods employed in research to reach results.

methodology

Sample size The number of respondents in a sample of the population.

Secondary The collection of existing research data.

research

Sentiment The emotion attached to a particular mention, which is

positive, negative, or neutral.

Statistically A sample that is big enough to represent valid conclusions.

significant
 3.3 THE IMPORTANCE OF MARKET RESEARCH
The modern world can feel unpredictable. It is increasingly difficult to keep up with trends,
customer needs, popular opinions, and competitors. So, how can you keep your brand and
products relevant to ensure you are meeting your customers’ needs?

The answer is to conduct market research. Market research helps you make informed
business decisions. It involves systematically gathering, recording, and analysing data
about customers, competitors, and the market, and turning this data into insight that can
drive marketing strategies, product design and positioning, and communications strategies.

Online market research is the process of using digital tools, data, and connections to glean
valuable insights about a brand’s target audience. In other words, it’s the process of
learning about your audience by engaging and observing them online. Technology plays a
key role in gathering data and connecting with research participants, and can make the
whole process quicker and easier to manage than traditional offline research methods.

Traditional and online market research have the same goals and underlying principles, but
online market research has the benefit of using digital technology, which provides a range
of benefits:

• The internet is always on, meaning that data is readily available at any time. • Many of
the processes for finding, gathering, and storing data can be automated. For example, you
can get an automatic email alert if someone mentions your brand, or you can set up
self-administered digital surveys.

47
PLANNING such as web analytics and social media
data. All you need to do is access it.

• You have access to a large number of

participants around the world at the click of
a button.
Remember that comments made on social
networks cannot represent the views of your entire
target market. The validity of any data must be
considered in light of your research design.

NOTE
A lot of the information you will use is
already being automatically collected,
 People are often happy to share their own research, insights, and methodologies online, so
you can access this trove of resources to inform your own research.

Online market research can be much more cost effective and quicker to set up than
traditional research techniques.

There are many reasons why you should conduct regular market research, such as:

• Gain insights into your consumers, including:

• what customers want and need from your brand
• what customers like and dislike about the brand
• why customers buy the brand’s products or services
• why potential customers might choose your brand over another
• why customers do or do not make repeat purchases
• Understand the changes in your industry and business
• Discover new market trends on which you can capitalise
• Find new potential sales avenues, customers, products, and more
• Identify and engage new audiences
• Allow customers to help steer your business.

If you are able to understand your customers and the greater business context, you will be
able to market more effectively, meet their needs better, and drive more positive sentiment
around your brand. All of this adds up to happier customers and, ultimately, a healthier
bottom line.

3.4 DESIGN THINKING

Design thinking is a process that can be used by marketers to understand their users. By
applying design thinking, they understand, define, and redefine assumptions and problems
and create solutions for the market. The most important characteristic of design thinking is
that it is non-linear and iterative.

Because this process forces marketers to understand their users’ needs (and, in fact,
broader needs), it results in ideas that can be prototyped and tested. This keeps the
marketers close to the users and results in products and services that actually meet
people’s needs — not just what companies think people need.

48
Market research
The five stages of design thinking are: empathise, define, ideate, prototype, test.

Notice that there is emphasis on prototyping and testing, as well as empathising. This is
important because it is what makes design thinking so useful. Instead of working apart from
customers and putting a product or service in the market that falls short, this process allows
for more granular market research and iterative design.

Empathise Define Ideate Prototype Test

Figure 3.1 The five stages of design thinking

Because this process is non-linear, it could look like this:

Figure 3.2 Design thinking requires re-thinking

3.5 KEY CONCEPTS IN MARKET RESEARCH

While the research field can be full of complex terminology, there are four key concepts to
understand before conducting your own research:

1. Research methodology
2. Qualitative and quantitative data
3. Primary and secondary research
4. Sampling.
 49
PLANNING

Let’s consider each of these in turn.

3.5.1 Research methodology

Research methodology refers to the process implemented to conduct accurate and
valuable analysis. The research process should involve the following steps:

Step 1
Establish the goals of the project

Step 2
Determine your sample

Step 3
Choose a data collection method

Step 4
Collect data

Step 5
Analyse the results

Step 6
Formulate conclusions and actionable insights (e.g., producing reports)

Figure 3.3 The steps in the research methodology process

Most often, market research focuses on specific issues unique to a business or brand. It is
therefore not always possible to freely obtain comparable information to aid decision
making. This is why it can be useful to start from a distinct research problem or hypothesis
when kicking off such a project. Your question should guide your entire process, and will
determine your choice of data collection method.

Another approach involves ongoing data collection. Unbiased decision making is far more
accurately driven when aided by market insight. Many have argued that less expensive,
ongoing data collection is increasingly a route proven to be useful to organisations.
 3.5.2 Primary and secondary research
Research can be based on primary data or secondary data. Primary research is conducted
when new data is gathered for a particular product or hypothesis. This is where information
does not exist already or is not accessible, and therefore needs to be specifically collected
from consumers or businesses. Surveys, focus groups, research panels, and research
communities can all be used when conducting primary market research.
50
Market research

Secondary research uses existing, published data as a source of information. It can be

more cost-effective than conducting primary research. The internet opens up a wealth of
resources for conducting this research. The data could have originally been collected for
solving problems other than the one at hand, so they may not be sufficiently specific.
Secondary research can be useful for identifying problems to be investigated through
primary research.

The internet is a useful tool when conducting both primary and secondary research. Not
only are there a number of free tools available when it comes to calculating things such as
sample size and confidence levels (see section 3.8 Tools of the trade for some
examples), but it is also an ideal medium to reach large numbers of people at a relatively
low cost.

The internet and secondary research

Research based on secondary data should precede primary data research. It can be used
in establishing the context and parameters for primary research. The data can provide
enough information to solve the problem at hand, thereby negating the need for further
investigation.

Secondary data can provide sources for hypotheses that can be explored through primary
research. Sifting through secondary data is a necessary precursor for primary research, as
it can provide information relevant to sample sizes and audience, for example. The data
can be used as a reference base to measure the accuracy of primary research.

Companies with online properties have access to an abundance of web analytics data that
are recorded digitally. These data can then be mined for insights. It’s worth remembering,
though, that it’s usually impossible to access the web analytics data of competitors so this
method will only provide information about your own customers.

Customer communications are also a source of

data that can be used, particularly communi cations with the
customer service department. Committed
 customers who complain, comment dislikes. Customers can be particularly
vocal about
Consumer sentiment can be defined as an
economic indicator that measures how optimistic
consumers feel about their finances and the state
or compliment are providing information
of the economy. Consumers may be cash
that NOTE strapped, but they still expect value for money, and
can form the foundation for researching convenience. Millenials, Generation Zs and Xs are
customer satisfaction. also increasingly aware of the importance of
sustainability and the environmental impact their
Social networks, blogs, and other forms of shopping habits have.
social media have emerged as forums
where consumers discuss their likes and

companies and products. This data can, and should, be tracked and monitored to establish
consumer sentiment. If a community is established for research purposes, the resulting
feedback is considered primary data, but using social media to research existing
sentiments is considered secondary research. The internet is an ideal starting point for
conducting secondary research based on published data and with so much information out
there, it can be a daunting task to find reliable resources.
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PLANNING

The first point of call for online research is usually a search engine, such as google.com or
yahoo.com. Search engines have an array of advanced features, which can aid online
research. For example, Google offers:

• Advanced search: google.co.za/advanced_search?hl=en

• Google Scholar: scholar.google.co.za/schhp?hl=en
• Google Book Search: google.co.za/books?hl=en
• Google News Archive: news.google.com/newspapers

Many research publications are available online, some for free and some at a cost. Top
research companies now feature analyst blogs, which provide some industry data and
analysis free of charge.

Some notable resources are:

• econsultancy.com
• experian.com/hitwise
• pewinternet.org (US data)
• nielsen.com

The internet and primary research

 Primary research involves gathering data for a specific research task. It is based on data
that has not been gathered beforehand. Primary research can be either qualitative or
quantitative.

Primary research can be used to explore a market and can help to develop the hypotheses
or research questions that must be answered through further research.

Generally, qualitative data is gathered at this stage. For example, online

research communities can be used to identify consumer needs that are not being met and
to brainstorm possible solutions. Further quantitative research can investigate
what proportion of consumers share these problems and which potential solutions
best meet those needs.

3.5.3 Quantitative and qualitative data

Data can be classified as qualitative or quan
E
titative. Qualitative research is exploratory NOT can be analysed quantitatively.With
and seeks to find out what potential
larger sample sizes, qualitative data
consumers think and feel about a given
subject. Qualitative
research aids in identifying potential hypotheses, whereas quantitative research puts hard
numbers behind these hypotheses. Quantitative research relies on numerical data to
demon strate statistically significant outcomes. Quantitative data can be counted, or
measured and can tell you how many, how much, and how often.

The internet can be used to gather both qualitative and quantitative data. In fact, the
communities on the web can be viewed as large focus groups, regularly and willingly
sharing their opinions about products, markets, and companies.

52
Market research

In robust research studies, both qualitative and quantitative research can be applied at
different stages of the study.

The main differences between quantitative and qualitative research are represented in
Table 3.2 below.

Table 3.2 Differences between quantitative and qualitative data

Quantitative Qualitative

Data gathered Numbers, figures, Opinions, feelings,

statistics, objective data motivations, subjective data
 Questions answered What? Why?

Group size Large Small

Data sources Surveys, web analytics data Focus groups, social media

Purpose Tests known issues or Generates ideas and

hypotheses concepts – leads to
Seeks consensus, the issues or hypotheses
being tested
norm Generalises data
Seeks complexity
Puts data in context

Advantages Statistically reliable Looks at the context of

results to determine if issues and aims to
one option is better than understand
the alternatives perspectives

Challenges Issues can be measured Shouldn’t be used to

only if they are known evaluate pre-existing
prior to ideas
starting Results are not
Sample size must be predictors of the
sufficient for predicting the population
population

Both quantitative and qualitative research can be conducted online.

Web analytics packages are a prime source of data. Using data, such as search terms,
referral URLs, and internal search data can lead to qualitative information about the
consumers visiting a website. However, when data is measurable and specific, such as
impressions and clickthrough rates, it leads to quantitative research.

3.5.4 Sampling
Qualitative research is usually conducted with a small number of respondents in order to
explore and generate ideas and concepts. Quantitative research demands far larger
numbers, enough to predict how the total population would respond.

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PLANNING

You should ensure the sample is representative of the population you are targeting as a
whole. If your business transacts both online and offline, be aware that using only online
channels for market research might not accurately represent your target market. However,
if your business transacts only online, offline channels for your market research are
less necessary.

Because quantitative research aims to produce predictors for the total population, sample
size is very important. The sample size needs to be sufficient in order to make statistically
accurate observations about the population.

For example, if your website has 4 000 registered users you don’t need to survey all of
them in order to understand how the entire population behaves. You need to survey only
351 users to get a sample size that gives you a 95% confidence level with a ±5%
confidence interval. This means that you can be 95% sure your results are accurate within
±5%.

There are several sample size calculators mentioned in section 3.8: Tools of

the trade. 3.6 ONLINE RESEARCH

METHODOLOGIES

There are many online market research methodologies. This chapter touches on three of
the most popular and useful ones: surveys, online focus groups, and social media
monitoring.

Which methodology should you choose?

That depends on a variety of factors, from your research question and purpose, to your
budget and time. Here are some general pointers:

Surveys: Ideal for collecting large amounts of quantitative data and some qualitative data.
They are quick and easy to set up and can run automatically.

Online focus groups: Ideal for engaging consumers and collecting qualitative data, such
as opinions, ideas, and feelings about the brand. They require a larger time investment
and a willing group of participants.

Online monitoring: Ideal for collecting qualitative data on brand sentiment, and can also
provide some quantitative data around volume of interest in the brand. This data can be
collected passively, and there are several tools that can automate this process.

3.6.1 Surveys
Surveys are questionnaires that contain a series of questions around a specific topic. Their
 purpose is to gather large volumes of quantitative data easily, though they can also collect
some qualitative data.

Conducting surveys online allows for data to be captured immediately, and data analysis
can be performed easily. By using email or the internet for conducting surveys,
geographical limitations for collecting data can be overcome cost effectively.

54
Market research

Technology allows you to compile sophisticated and user-friendly surveys. For example, as
opposed to indicating impressions on a sliding scale, respondents can indicate emotional
response. The survey can also be tailored depending on previous answers, such as
questions being skipped if they are not relevant to the respondent.

You can run ongoing online surveys at minimal cost. Simple polls can be used in forums
and on blogs to generate regular feedback. Website satisfaction surveys are also an easy
way to determine the effectiveness of a website or marketing campaign.

Surveys allow for instant feedback on questions or ideas from an existing community, such
as a trusted group of thought leaders, your brand’s social media fans, or a pre-created
research community. Examples include Facebook polling apps and real-time mobile survey
platforms.

Designing surveys
How you design a survey and its questions will directly impact your success. A survey can
include any number and type of questions. More complicated questions should appear only
once users are comfortable with the survey. Be careful that you do not introduce bias by
asking leading questions.

Example:

Do you agree that this conference venue Rate your experience of our conference
is a world-class facility? venue from 1 to 10.

In general, you will also find that you get more accurate answers when phrasing questions
in the past tense than in the continuous tense.
 Example:

How many times a week do you buy In the past month, how many times did
take away food? you buy take-away food?

Questions in the survey should be brief, easy to understand, unambiguous, and easy to
answer. You can read more about survey questions here:
hotjar.com/blog/survey-questions.

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PLANNING
 Figure 3.4 An example of an online survey with different question types

Types of survey questions

1. Open-ended
Open-ended questions allow respondents to answer in their own words. This usually results
in qualitative data.

Example:

What features would you like to see on the website for the digital
marketing textbook? www.redandyellow.co.za/course/textbook/
 Type your responses here:

56
Market research

2. Closed
Closed questions give respondents specific responses from which to choose. These are
typically multiple-choice questions with either one or multiple possible answers. Broadly
speaking, closed questions can be answered with a ‘yes’ or a ‘no’. Alternatively, they can
be selected from a very specific set of responses that have been provided. This results in
quantitative data.

Example:

Do you use the digital Yes No

marketing textbook website?

or:

What features of the digital marketing textbook website do you use? Tick all that apply.

Blog

Case studies

Free downloads

Additional resources

3. Ranked or ordinal
These types of questions ask respondents to rank items in order of preference or
relevance. Respondents are given a numeric scale to indicate order. This results in
quantitative data. Broadly speaking, closed questions can be answered with a ‘yes’ or a
‘no’. Alternatively, they can be selected from a very specific set of responses that have
been provided.

Example:
 Rate the features of the digital marketing textbook website, where 1 is the most useful and 4
is the least useful.

Blog

Case studies

Free downloads

Additional resources

57
PLANNING

4. Matrix and rating

These types of questions can be used to quantify qualitative data. Respondents are asked
to rank behaviour or attitude.

Example:

Rate the features of the digital marketing textbook website according to the following

scale: 1 = love it, 2 = like it, 3 = no opinion, 4 = dislike it.

Blog

Case studies

Free downloads

Additional resources

3.6.2 Focus groups

Online focus groups involve respondents gathering online and reacting to a particular topic.
Respondents can be sourced from all over the world and react in real time, arguably being
freer with their responses since they can be anonymous in an electronic environment.

Online focus groups are ideal for having frank, detailed conversations with people who
have an interest in your brand. This means they result in primary qualitative data. This
information can then be used to create quantitative research questions.
 Online focus groups can be conducted using a range of technologies. The simplest is to
use a text-based messaging program or online forum. There are many options available.
More sophisticated tools allow for voice or video conferencing, and can make it easier for
the researcher to pick up clues from the respondent’s voice and facial expressions. Some
tools allow the researcher to share their desktop screen with respondents in order to
illustrate a concept or question. Jamboard offers an interactive whiteboard feature, which
can be very useful for brainstorming and for recording and grouping users’ responses.

Zoom also offers opportunities to separate

participants into breakout rooms, which can Zoom’s popularity soared in 2020, due to the
COVID-19 pandemic. As more and more people
be useful for forming smaller focus groups
return to the physical workplace, it will be
before coming together as a plenary. interesting to see what will stick and whether
Zoom breakout NOTE virtual meetings will remain commonplace. Read
this article: www.statista.com/
rooms allow you to split your Zoom chart/21906/zoom-revenue/
meeting in up to 50 separate sessions.

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Market research

Good options for conducting online focus groups include:

• Skype: skype.com/en
• GoToMeeting: goto.com/meeting
• Zoom: zoom.us
• Jamboard: jamboard.google.com

Focus groups are less formal than surveys, meaning the researcher will have
specific questions to ask, but the conversation usually grows and develops organically
as participants discuss their impressions. Usually running for between one and two hours,
focus groups are used to get consumer views on:

• New products or marketing campaigns

• Existing products and campaigns and how they can be improved
• Sentiment around the brand
• Views on a brand’s new direction or visual style
• Ideas for how the brand could improve its position or branding.

Online focus groups are excellent for collecting a lot of qualitative data quickly. When
setting up the group, try to include enough participants to keep the conversation alive, but
not too many so that some get drowned out by others (eight to ten is a good range). Also
consider that you may run into technical troubles if people are connecting from different
 locations and internet connections. Be prepared to do some basic troubleshooting if this
happens.

There are a number of different ways that you can recruit participants for an online focus
group. This could include inviting people from your existing customer database, going
through a traditional market research recruiting agent, or putting a call out on your website
or social media communities. It is common practice to offer a small incentive to people who
participate in a focus group, as it is a fairly time-intensive activity.

In-person focus groups are also an option, however, these are more time consuming and
costly. The venue, catering, stationery requirements, and more will need to be considered.
Aside from the logistics, you will need:

• At least one whiteboard

• Ample seating that is flexible and can be easily rearranged
• Large sheets of paper
• Post-its
• Markers.

In-person focus groups tend to be more lively and engaged than online groups. You will
need to determine what suits your budget and needs.

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3.6.3 Sentiment analysis

Finding out if people are talking about you is quite difficult in the offline world, but almost
effortless online. Rather than having to conduct real-world surveys and interviews, in the
digital world you can simply ‘listen’ to the conversation happening about you.

Keywords, the foundation to categorising and indexing the web, make it simple to track
conversations taking place online. Customers don’t always use channels designated by a
company to talk about that organisation, but the good news is that the internet makes it
easy for a company to identify and use the channels that customers have selected.

Online tools allow a company to track mentions of itself, its staff, its products, its industry
and its competitors, or anything else that is relevant. This is called online monitoring, online
listening, or data sentiment analysis. It involves using digital tools to find and tap into
existing conversations. The tool then gathers and collates all the mentions it finds, so that
you can analyse the data for insights.
 Figure 3.5 A sentiment analysis report
Typically, searches include the following main focus areas:

• Company
• Brand name
• Key products
• Key personnel (names, job titles, etc.)
• Key campaigns and activities
• Industry
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Market research

• Conferences
• Patents
• News
• Competitors
• Product launches
• Website updates
• Job vacancies
• Key people.

There are four different types of searches you can perform to track relevant
brand keywords. Each modifies the specific type of data collected and aims to improve the
quality and depth of the data you gather.
 The four operators are:

1. Broad match: For example, Apple Computers. This is when any of or all words must be
found in the mention.
2. Direct match: For example, “Apple Computers.” This is denoted by quotation marks and
dictates that the tool should find mentions only where the phrase appears complete and
in that order in the content.
3. Inclusive match: For example, Apple +computers. This is denoted by a plus
sign directly before a word or phrase. This will direct the tool to search for any mention
that contains both Apple AND computers, although not necessarily in that order.
4. Exclusive match: For example, Apple –fruit. This is denoted by a minus sign directly
before a word or phrase. This will instruct the tool to include only mentions that contain
the first word or phrase but not when the second word is also in the same mention.

Combinations of these four types of searches (operators) can be used to

improve accuracy. For example: “Apple Computers” +“Steve Jobs” –fruit.

Applying this theory to the groupings above, some keywords used for Apple might

be: Company

“Apple computers”
“www.apple.com”
Apple +MacBook, “iPod Nano,” “Macbook Air,” “iTunes” +music
–radio “Steve Jobs”

Industry

“Consumer Electronics Show” +“Las Vegas”

“CEBIT”
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Competitors

Microsoft
microsoft.com

It is also important to track common misspellings and typos, all related companies and
 all related websites.

Tracking the names of people key to a company can highlight potential brand attacks or can
demonstrate new areas of outreach for a company.

Brand names, employee names, product names, and even competitor names are not
unique. To save yourself from monitoring too much, identify keywords that will indicate that
a post has nothing to do with your company and exclude those in your searches.

For example, “apple” could refer to a consumer electronics company, or it could appear in a
post about the health benefits of fruit. Finding keywords that will indicate context can help
save time. So, you could exclusive-match words, such as “fruit”, “tasty” and “granny smith.”

Tools for data sentiment analysis

Thankfully, online listening does not entail
hourly searches on your favourite search that monitor the web and supply the results
engine to see what conversations are taking via email alerts or a web dashboard.
Free tools like those listed here can be very useful,
if somewhat limited. For larger brands, the
NOTE investment in a paid tool is often worth it, given the
place online. There are many different tools volume of conversation to be monitored.

Google has several bespoke search services and periodically adds more to the list.

Google Alerts: google.com/alerts. Google Alerts will send an email when the keyword is
used in either a credible news item or a blog post.

Google News: news.google.com. Google News searches all news items for mentions of a
keyword.

Google Patent Search: patents.google.com. Google Patent Search allows you to keep
track of all filings related to an industry, and searches can be done to see if there are
patent filings which might infringe on other patents.

Google Video Search: google.com/videohp. Video Search relies on the data that have
been added to describe a video and will return results based on keyword matches.

Twitter Keyword Targeting: This tool allows businesses or individuals to set and search
particular keywords in order to drive engagement and increase conversions.

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Market research

In addition to these mostly free tools, there are also a number of premium paid tools
available to make the process easier and more robust. See section 3.8: Tools of the
trade for more suggestions.

3.6.4 Other avenues for online research

Let’s look at other options for conducting online research:

Personal interviews
There are various tools available to the online researcher for conducting personal
interviews, such as private chat rooms or video calling. The internet can connect a
researcher with many people around the world and make it possible to conduct interviews
with more anonymity, should respondents require it.

Observation/online ethnography
Taking its cue from offline ethnography, online ethnography requires researchers to
immerse themselves in a particular environment. In this way, insights can be gathered that
might not have been attainable from a direct interview. However, they do depend more
heavily on the ethnographer’s interpretation and are therefore subjective.

Figure 3.6 The BeautyTalk online community

Online research communities

Although online communities are a valuable resource for secondary research, communities
can also provide primary data. BeautyTalk is an example of an online research community
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that helps gather research data. The community platform can be used as a means to elicit
feedback about products and can generate ideas for new products. This is qualitative data
that can aid the company in exploring their research problem further. In many cases, social
media can be used to gather insight about a brand or customer experience. It is important
to remember, however, that a representative sample is necessary for making solid
conclusions.

Listening labs
When developing websites and online applications, usability testing is a vital process that
will ensure the website or application is able to meet consumers’ needs. Listening labs
involve setting up a testing environment where a consumer is observed using a website or
application.

Conversion optimisation
Conversion optimisation aims to determine the
factors of an advert, website, or web page adverts to email subject lines and shopping
cart design, tests
that NOTE Chapter 21: Conversion optimisation covers tools
for running tests, such as A/B split testing and
can be improved in order to convert multivariate testing.
customers more effectively. From search

can be set up to determine what variables are affecting the conversion

rate. 3.6.5 How to get responses: Incentives and

assurances
As the researcher, you know what’s in it for you when sending out a survey. You will receive
valuable insights that will aid in making business decisions. But what is in it for the
respondents?

Response rates can be improved by offering respondents incentives for participating in the
research, such as a chance to win a grand prize, a discount or special offer for every
respondent, or even the knowledge that they are improving a product or service that they
care about.

Some researchers feel that monetary incentives are not always a good thing.
Some respondents may feel that they need to give ‘good’ or ‘correct’ answers that
 may bias results. Alternatively, you may attract respondents who are in it just for the
reward. One approach could be to run the survey with no incentive, with the option of
offering one if responses are limited.

Designing the survey to assure respondents that a minimal time commitment is required
and their privacy is assured can also help to increase responses.

3.6.6 Room for error

With all research there is a given amount of error to deal with. Bias may arise
during surveys and focus groups, for example, interviewers leading the respondents. Or
bias may be present in the design and wording of the questions themselves. There
could be sample errors or respondent errors. Using the internet to administer
surveys removes the bias that may arise from an interviewer. However, with no
interviewer to explain questions, there is potential for greater respondent error. This is
why survey design is so important, and why it is crucial to test and run pilots of surveys
before going live.
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Market research

Respondent errors also arise when respondents become too familiar with the survey
process. The general industry standard is to limit respondents to being interviewed once
every six months.

Sample error is a fact of market research. Some people are just not interested, nor will they
ever be interested, in taking part in research. Are these people fundamentally different from
those who do? Is there a way of finding out? To some extent, web analytics, which track the
behaviour of all visitors to your website, can be useful in determining this.

When conducting online research, it is crucial to understand who is in the target market and
what the best way to reach that target market is. Web surveys can exclude groups of
people due to access or ability. It is vital to determine if this is acceptable to the survey, and
to use other means of capturing data if not.

3.7 JUSTIFYING THE COST OF RESEARCH

Regular research is an important part of any business’ growth strategy, but it can be tough
to justify the budget necessary for research without knowing the benefit. Conducting
research can cost little more than an employee’s work hours, depending on their skills, or it
can be an expensive exercise involving external experts. Deciding where your business
needs are on the investment scale depends on the depth of the research required, and
what the expected growth will be for the business. When embarking on a research
 initiative, the cost to benefit ratio should be determined.

Testing should be an ongoing feature of any digital marketing activity. Tracking, a

characteristic of most digital marketing, allows for constant testing of the most basic
hypothesis: Is this campaign successful in reaching the goals of the business?

3.8 TOOLS OF THE TRADE

The following can be used for creating and managing online surveys:

SurveyMonkey: surveymonkey.com

Google Forms: accessed through Google Drive drive.google.com

Split test calculator: usereffect.com/split-test-calculator

Sample size calculator:

rogerwimmer.com/mmr/samplesizecalculator.htm Internet Usage World

Stats: internetworldstats.com

Google Think: google.com/think

Survey Swipe: surveyanalytics.com/system/survey-swipe.html

Premium online monitoring tools: DataEQ: dataeq.com, SalesForce Marketing Cloud:

salesforcemarketingcloud.com/

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3.9 ADVANTAGES AND CHALLENGES

Market researchers are increasingly turning to online tools in their research processes. The
internet allows for research at a far lower cost; it can also more easily cross geographic
boundaries and can speed up the research process.

This is not to say there are no downsides. While the internet makes it possible to reach a
far larger group of people without the cost of facilitators, it does come with some
challenges. For example, you cannot control the environments in which information is
being gathered. For an online sample, it’s important to focus on getting the correct number
of people to make your study statistically viable. If your questions are not carefully drafted,
confusing questions could lead to answers that are flawed or not relevant. Additionally,
online incentives could lead to answers that are not truthful, meaning that the value of the
data could be questionable. Certain target groups are not accessible via the internet, and
 so it’s important that you carefully consider who you are trying to reach.

The value of internet research should by no means be discounted, but it is important to

consider the nature of the study carefully and to interrogate the validity and legitimacy of
the data as a valid representation. Data is meaningful only if it is representative, so be sure
to establish goals and realistic expectations for your research.

3.10 CASE STUDY: SEPHORA

Sephora is a leading international beauty retail store
with over 2 600 stores across the US alone.

One-line summary
Material, a leading integrated marketing services company, was commissioned by
Sephora to conduct research towards understanding how racial bias affects the retail
sector, and to offer insights that support Sephora in becoming a more inclusive brand.

The problem
In an attempt to ensure that the brand was aligned with its stated values of inclusivity
and anti-racism, Sephora understood that racial bias could be implicit and widespread
throughout its stores, impacting the retail experience of BIPOC (Black, Indigenous,
People of Colour) customers and staff.

To fully understand how BIPOC experienced the retail portion of the Sephora
experience (and, more broadly, all retail experiences), they commissioned a study.

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Market research

The solution
Material, the company hired to put the study together, worked with their Growth
Strategy and Insights divisions. They conducted interviews with shoppers and
employees across the United States of America to compile a report that consisted of
both quantitative and qualitative.

The research consisted of the following:

• A review of academic literature to understand retail policies and practices that may
 affect racial bias and discrimination
• A contextual analysis of cultural insights to determine where racial bias may manifest
• An Online SmartCommunity
• Digital ethnographies
• Employee interviews
• Online survey among 3 034 shoppers and retail employees.

On the back of the findings, Material compiled ‘five truths’, which could be used to
develop an action plan across three key business areas: marketing and
merchandising, in-store experiences, and workplace environment. This was aimed to
better equip staff and head office staff to recognise and address bias and to eradicate
discrimination.

The results
In January 2021, Sephora released the Racial Bias in Retail study. In it, the ‘five truths’
were listed and an action plan put in place.

Sephora committed to the following:

• To double its Black-owned brands

• To showcase diverse backgrounds, identities, ages, and body types in marketing
materials
• To put in place a greeting system that will standardise the in-store experience for all
customers
• To increase the depth and frequency of anti-bias training for staff • To formalise and
intensify efforts to recruit, mentor, and develop programs for BIPOC employees
• To put in place zero-tolerance policies for matters of bias and discrimination.

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PLANNING
Figure 3.7. One of the initiatives that were put in place was a standardised greeting
when shoppers enter the store to ensure that all shoppers have a consistent
experience
The commissioning of the report and the initiatives that have emerged out of the
research will position Sephora as a market leader, placing them in a favourable brand
position. It also makes them an employer of choice, particularly for BIPOC.
(Sources: Material. Identifying retail truths and designing equitable experiences with Sephora.
[Online] Available at:
www.materialplus.io/work/sephora-dei
[Accessed 11 February 2022]

Material, in association with Pittman Claytor, C., Crockett, D., Dunlap Fowler, W., Raspberry, P., 2021. The Racial
Bias in
Retail
Study.
Available at:
static1.squarespace.com/static/5cd4841aaf4683aecca8
54d0/t/5ffcf05a5b7aeb58a721e
39e/1610412123813/Sephora_RacialBias_eBook_FInal.
pdf
[Accessed 11 February 2022]
 3.11 CASE STUDY QUESTIONS
1. Was it important for Sephora to insist on quantitative and qualitative research into racial
bias in retail?
2. How would Sephora measure the success of interventions that they implement as a
result of the report?
3. The research was two-fold: it focused on the customer experience but also staff
experience. What impact does the latter have on the brand and business?
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Market research

3.12 THE BIGGER PICTURE

Understanding your market is the foundation of every marketing activity, online or off. If you
don’t know who you’re speaking to or what your audience cares about, it’s unlikely that your
message will resonate with them.

Market research will define the content you create across channels like email marketing,
digital copywriting, SEO, and online advertising. It helps you find your audiences on social
channels by indicating where they spend most of their time and how they like interacting
with your brand. It also helps you meet their needs by defining the touchpoints they expect
from your brand, especially when it comes to creating web and mobile channels.

The more data you can gather about your audience, the better you will be able to optimise
and improve your marketing efforts. Market research is an excellent supplement to the quan
titative data you can gather through data analytics.

3.13 SUMMARY
Market research means gathering and analysing data in order to gain insight to consumers,
to understand a market, and make business decisions. Information can be gathered about
customers, competitors and the market.

Research can be conducted based on secondary data, which refers to information or data
that is already published, or based on primary data, which is data gathered specifically for a
particular research problem.

Research can also be qualitative or quantitative. The internet provides the tools for
gathering qual itative data, while online tools such as surveys and web analytics packages
are ideal for gathering quantitative data.
 Surveys, online focus groups, and online monitoring are three excellent ways to conduct
research online.

Analytics and online report tools play a big role in providing data. While these are digital
marketing tactics in themselves and are covered later in this book, keep in mind that they
also provide information that can feed into research conducted for a particular purpose.

3.14 CHAPTER QUESTIONS

1. Discuss the relationship between the ideas discussed in Chapter 2: Importance of the
customer and this one.
2. What is primary research?
3. What role does online research play in the overall market research toolkit?

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3.15 FURTHER READING

conjointly.com/kb/probability-sampling/ – Learn about probability sampling.
s3.amazonaws.com/SurveyMonkeyFiles/SmartSurvey.pdf – The Smart Survey Design
is a useful white paper that will help you master drawing up relevant web surveys.

3.16 REFERENCES
Damn, R.F., 2021. 5 Stages in the Design Thinking Process. [Online]
Available at: www.interaction-design.org/literature/article/5-stages-in-the-design-thinking-process

3.17 FIGURE ACKNOWLEDGEMENTS

Figure 3.1: canvas.unl.edu/courses/73802/pages/5-stages-of-design-thinking?

Figure 3.2: www.interaction-design.org/literature/article/5-stages-in-the-design-thinking-process
Figure 3.4:
www.surveyexpression.com/Survey.aspx?id=ad3eb730-1d74-4e78-8d12-a3b7d52bfabf Figure
3.5: www.brandwatch.com/blog/understanding-sentiment-analysis (2018) Figure 3.6:
econsultancy.com/six-successful-examples-of-online-brand-communities Figure 3.7:
pixabay.com/photos/sephora-shopping-store-makeup
Sephora logo: www.sephora.com
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0
4
Strategy
 STRATEGY
In this chapter, you will learn:
• How to define the business strategy and distinguish the marketing strategy •
About the integral role of digital technology in business today
• How the shift in customer behaviour affects strategy
• About the key building block concepts that are essential to any strategy •
About the questions that need to be asked when developing a digital marketing
strategy.
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PLANNING

4.1 INTRODUCTION
Every business needs a strategy. It directs the actions of and creates the vision for the
organisa tion to achieve its long-term objectives. The strategy involves consistent decision
making that guides the route of activities and approaches that a business will take over a
defined period after considering its operating environment, customers, product, and/or
service offering to achieve its set goals. It also outlines the tactics and plans that you will
use to execute this direction.

Typically, you will formulate your strategy based on your business goals and aspirations –
whether this is purely to make money, to help the environment, to help employees find a
way to contribute meaningfully to their communities, or a combination of all the above. Your
answer to ‘Why do we exist?’ or ‘Why do we do what we do?’ will provide the core purpose
of your business strategy, which will in turn direct how you will reach your goals.

In marketing, strategy starts by understanding what the business wants to achieve, what
problem it wants to solve, who the business serves (i.e., the customer), and how it will add
value to the market. It then considers the context in which the business and its competitors
operate to outline the key methods to gain competitive advantage and add value.

In 2020, the world changed. As a result of global lockdowns and international social
distancing laws, digital communication technology instantaneously facilitated the need to
connect, com municate, and operate without direct human contact. Digital quickly became
integral to every area of business to continue running – at least, for those businesses that
could still operate. As a result, it has become vital for companies to adopt a holistic
approach to planning their business and marketing strategies in a way that integrates
digital technology as a standard business practice, rather than just an add-on.

This chapter considers digital as an integral part of the strategy to reach customers and
 solve marketing problems, while focusing on getting the basics right.

4.2 KEY TERMS AND CONCEPTS

Table 4.1
Term Description

Analytics Information resulting from the systematic analysis of data or statistics.

Business The results of what the business aims to achieve.

Objectives

Campaign A series of actions that are organised and implemented to achieve a goal.

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