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Strategic digital marketing

Week 1 plenary

Sunday, 9 January 2022

Learning outcomes of today’s session

•

Understand digital marketing and the content of the course.

•

Reimagine digital marketing strategy

•

Understand digital platforms and its characteristics

•

Understand marketing through the lens of service dominant logic

Defining digital marketing

“the marketing of products and services using digital channels”.

“An adaptive, technology-enabled process by which firms collaborate with customers and partners to jointly create, communicate, and deliver value for all stakeholders” (Kannan and Li, 2017)

• The definition we will use in this course: Digital marketing is the application of digital technologies to not only address the needs of the firm’s customers and its immediate stakeholders, but also address the needs of the society and the planet.

Digital tools to facilitate learning: Miro

Digital tools to facilitate learning:

Mimic pro

Mimic pro is a digital marketing simulation designed to apply analytics, SEO and digital advertising. You will be responsible to manage the digital campaigns of a camera brand.

The GSM has paid for the Mimic pro subscription (see modules)

Digital tools to facilitate learning:

Powtoon

Digital tools to facilitate learning

Live client: Foodprint

Agenda for the rest of today’s session

· Reimagine digital marketing strategy

· Understand digital platforms and its characteristics

· Understand marketing through the lens of service dominant logic

Reimagining digital marketing strategy

•

Marketing strategy focuses heavily on the firm

and its immediate stakeholders. Marketers

usually strive to solve “business problems” to

enhance economic profits.

•

We need to reimagine marketing strategy to

address the needs of the society and the planet.

Marketing strategy now needs to align to the

UN sustainable development goals.

•

In this course, we will learn how we are going to

apply digital marketing and digital technologies

to solve pressing problems in the world.

Principles to reimagine digital marketing strategy

Responsible

principle

Respectful

principle

Resilient

principle

Responsible principle

Responsible principle focuses on taking a “balanced approach” of addressing the needs to firm, its stakeholders, as well as the society and the planet.

Respectful principle

Respectful principle embraces equality, diversity and social inclusion in marketing practice. As a result, vulnerable, disadvantaged, and previously marginalized communities are empowered to make their own meaningful contributions in society.

How can digital technologies help people with limited mobility (e.g., due to spinal cord injury or cerebral palsy) do everyday life activities such as texting, calling a cab, controlling tv or do online banking?

de Ruyter et al., 2021

Resilient principle

Resilient principle focuses on ensuring “longevity” and “sustainability” of our digital solutions amidst disruptions in the business environment caused by for example, COVID19, natural disasters, political and cultural barriers.

Online education has helped marginalized, excluded communities access education that would not have been possible otherwise.

Principles to reimagine digital marketing strategy

Responsible

principle

Respectful

principle

Resilient

principle

In-class discussion session

Think about digital solutions for the following problems in the society:

· Youths with hearing impairment are finding it challenging to participate in education and team-based activities in colleges and universities.

· There is inequality in the quality of health care for people living in cities vs in villages.

de Ruyter et al., 2021 17

For further inspiration

de Ruyter, K., Keeling, D. I., Plangger, K., Montecchi, M., Scott, M. L., & Dahl, D. W. (2021). Reimagining marketing strategy: driving the debate on grand challenges. Journal of the Academy of Marketing Science, 1–9. Advance online publication.

https://doi.org/10.1007/s11747-021-00806-x

Digital platforms: What

are they?

Platforms facilitate interactions between

different stakeholders (or “sides”) who may

not have been able to interact otherwise

(

Mcintyre

and

Srinavasan

, 2017). Each type

of stakeholder represents a “side” hence

platforms are multi

sided in nature.

We are hopping into strangers’ cars (Uber), welcoming strangers into our spare rooms (AirBnB), eating food in their dining rooms (Feastly). We are letting them rent our cars (Turo, Getaround), our boats (Boatbound), our houses

A glimpse of the influence (HomeAway). We are entrusting complete

of platforms strangers with our most valuable possessions, our personal experiences –

and our very lives.

Jason Tanz (Journalist)

Platforms have disrupted traditional industries and facilitated the creation of a sharing economy.

Stakeholders involved in digital platforms (Android)

Characteristics of platforms: Network effects

· Network effects is the ability of a platform to expand the number of companies (hotels, airlines) and/or customers (tourists) participating on the platform, so that all parties benefit from a larger marketplace (Bahar, Nenonen and Starr Jr., 2022).

· Would you join Instagram if none of your friends were on it?

· Would you use Ctrip if the choices of hotels were less?

The value of platforms will only increase based on network effects (e.g., Whatsapp was sold for 19 billion dollars).

Characteristics of digital platforms: Network centrality

•

Platforms are “intermediaries” and hold a central position in the

business network as it is a hub through which all interactions different

stakeholders take place (Bahar, Nenonen and Starr Jr., 2021).

Characteristics of digital platforms: Matchmaking

Matchmaking is the ability of a platform to efficiently enable

connections between firms (e.g., hotels) and customers (e.g., tourists)

based on specific criteria such as location, price, and customer service

levels (Benoit et al., 2017; Halaburda et al., 2018).

Characteristics of platforms: Capacity utilization

•

Platforms enable the use of resources that would not be fully utilized

before.

Parking spaces

Holiday homes

Characteristics of platforms: Modularity

•

Modularity relates to creating a portfolio of services on the platform.

· In the hospitality industry, platforms are replacing the use

Platforms disrupting of traditional travel agents. In fact, more than 50% of all different industries hotel bookings are done via platforms (Rossini, 2015).

· Uber is replacing the use of taxi services.

Dark side of digital platforms

High bargaining power is usually abused:

· Charging high fees (e.g., Hotels pay more 25% commissions)

· Enforcing rules (e.g., rate parity clause)

· Replicating high demand products at lower prices.

Bahar, Nenonen and Starr Jr., (2021, 2022)

Digital platforms address UN SDG goals

Pathao

in Bangladesh addresses the UN goal

enabling decent work

and economic growth.

Ghana's

Esoko

addresses the UN SDG goal

reducing poverty and

enabling economic growth.

Foodprint

in New Zealand addresses the UN goal

#12

ensuring

sustainable consumption.

For further insight and inspiration

Parker, G., Van Alstyne, M., & Choudary, S. (2016). Platform revolution: How networked markets are transforming the economy—and how to make them work for you. New York, NY: W.W. Norton & Company.

A service dominant logic to marketing

The focus is on the company’s goods

and improving its sales:

How can we

help customers use our credit cards

more? How can we increase customer

acquisition for our credit cards?

American Express was touted as the

“next best [credit card] product”

The focus is on helping customers get

a job done:

How can we work with our

partners to help customers make

better purchases? What solutions can

we offer customers to make

purchasing more seamless?

Traditional logic

Service dominant

dominant logic

Our thinking needs to shift from focusing on goods and what is currently

produced by the firm to developing solutions that helps customers get the

job done more efficiently.

A service dominant logic to marketing

Value is defined as units of output.

Value is defined as an experience.

Value depends on context.

Traditional logic

Service dominant

dominant logic

Our thinking needs to shift from focusing on value as units of output to

value as an experience and value in context.

A service dominant logic to marketing

Service is an “add on” or an

augmentation of goods:

for example,

after sales support provided to

customers for the goods purchased.

Service takes a backstage and is an

after thought of the product.

Service is always what a company

offers.

Direct service

banking, education.

Indirect service

provide via goods,

printing service provided via printers.

Goods are the vehicles of service.

Traditional logic

Service dominant

dominant logic

Our thinking needs to shift from considering companies as

“manufacturing companies” to “service companies”

A service dominant logic to marketing

Customers are passive recipients of

products.

Customers are involved in value co

creation to get the job done.

High participation: Weight loss

programs

Low participation: Insurance service

Traditional logic

Service dominant

dominant logic

Our thinking needs to shift from considering customers as passive

recipients of products, to active participants in value co

creation.

So, what is service?

•

Service

is the application of skills, knowledge and competences to get

the job done.

•

All firms and individuals integrate resources to get an entire job done.

•

Operant resources

are primary resources (knowledge, skills) and

operand resources

(

devices, computer software) are only valuable in

combination with operant resources.

Bettecourt et al. 2014

Essential reading

•

Bettencourt, L. A.,

Lusch

, R. F., & Vargo,

S. L. (2014). A Service Lens on Value

Creation: Marketing’s Role in Achieving

Strategic Advantage.

California

Management Review

(1)

–

SD logic thinking by Stephen Vargo

Learning outcomes achieved

•

Understood digital marketing and the content of the course.

•

Reimagined digital marketing strategy: responsible, respectful and

resilient.

•

Understood the characteristics of digital platforms

•

Understood marketing through the lens of service dominant logic