Estimated reading time: 6 minutes
Previously, we reflected upon the apparently bizarre optimism present in the professional online sector. So today we will discuss how this argument can also be sustained from a pure marketing perspective.
If we consider the economical crisis as obsolescence of previous models and systems gone by, it will not be too difficult for us to see the glass half full. Allow me to explain…
Economically unstable times are usually loaded with opportunities. With regards to the topic at hand (online), the apparent arguments support the idea that everything, even what is considered odd (Amazon is making millions out of this) can be sold on the Internet.
Microsegmentation of the audience (possible thanks to technology 2.0), the consequent long tail phenomenon (or the minority business), the power of the crowd (or online multitude) and Word of Mouth are treats for anyone who wants to make any difficult business into a profitable model with a good online strategy. To show that there is always a commercial opportunity in the digital world, we will outline a few cases of other quite different sectors that share some difficult factors.
How can I make use of the intangible product assets in order to sell tangible products and increase market potential?
Let us imagine a company that produces and sells music. Specifically a mellow kind of music as well as being against the system with the objective of waking consciences.
- Poorly differentiated product, of an intangible nature, subject to social clichés.
- Consumer typology outlined as tribal or closed community international and apparently a minority.
- Business model (music sales) steep and with a format crisis.
On the whole, intangible products (like perfume or music) rely on powerful emotional or philosophical incentives.
- The tangible aspect of this product (anti-system philosophy), goes much further than the product itself (musical style) and allows us to reach a much wider public. If we base strategy on the philosophical, we connect not only its style lovers if not a segment potentially identified as the Neither-Nor generation.
- The process consists of creating the brand based on the philosophy and commercialise it by means of tangible product merchandising. This process could be initiated by creating an entertainment content proposal in line with the Neither—Nor segment predominantly found on-line). This means to reinforce the philosophy into one character that represent the Neither-Nor mentality and disperse these reflections via 1 minute video capsules with a highly absurd take on them but always reflecting the brand and its moral (to awaken consciences).
- To reinforce this idea of the philosophical brand rather than a musical one, videos of the character are made viral on Youtube and mainstream social networks among young profiles.
- The Internet will become a monetizing space for the philosophy by means of merchandising sales (t-shirts, gadgets, etc) of the character and the brand. It will also include free music downloads, listening (an opportune alternative to the original model by Spotify) and track sales (iTunes model).
- In addition, it will include contextual publicity of activities and content (videogames, sports, travel cinema etc) in line with the target market as LKXA does with their infinite list of advantages for clients.
But, let’s put the icing on the cake with a more complex case…
How can I promote a product with unpleasant attributes online from a rational perspective?
A company that manufactures just one type of sauce with a strong and bitter taste decides to bring out a second type, even stronger and more ghastly than the other in order to achieve growth within the market. Bizarre…but feasible online.
- Product with rationally negative attributes (taste, colour, etc) apparently a minority.
- Great lack of consumer awareness (the distributor filter always separates nutritional products from the end consumer)
- Product restraints due to distributor power to purchase what sells the most and its own brands.
When a product is uncommon and a minority, its few consumers are usually loyal. If we consider this strength in order to illustrate the exclusivity concept, we will draw an efficient online strategy from this.
- The first thing to do would be to identify the heavy-users (those who consume in larger and more frequent volumes) via an online demonstration campaign as to their love for the sauce. Later (offline), they are invited to an exclusive event where they can try different possible versions of the new sauce.
- Based on this idea of exclusivity, the campaign continues with the online engagement creating a specific club where the real sauce lovers have to demonstrate their passion on a social basis in order to be acceptable. Specific social profiles are created (Facebook and Twitter) for the club as well as a microsite that requires a login. The microsite can be used for members to show and share their love for the sauce with photos, videos, texts, etc where other members can vote. The 200 most voted can be sent a simple of the new sauce and are asked to share their experience on the social networks so that the users can vote about what packaging and which flavours they prefer.
- The strategy is based on the strength of the heavy-user and on Word of Mouth (pull) as the main mechanism for the spread online. Without a doubt, the militant brand evangelists are capitalised on with the most effective publicity format there is: recommendation.
- The next round would be to capitalise on the strength of the detractors, dynamising rivalry between “gangs” on the social networks.
On one extreme of the seemingly unmarketable is this portal for private island sales. It is clear that there is something for everyone on the Internet, as well as for every pocket!
Solutions such as freemium, cloud, SaaS and internal management free software, promotion and online sale, join the opportunities scenario with free services or cost per user for businesses. This is the case for Google Analytics (free) for the conversion scorecard web metrics, Salesforce (cost per user) or Sugar CRM (free software) for knowledge and client management, Google Website Optimizer (free) or Hubspot (cost per user) for web and SEO optimization, Magento (freemium in the cloud) for e-commerce, Pentaho (free software) for Business Intelligence. Zyncro (SaaS freemium in the cloud) would be the umbrella application making its way towards integrating the best business productivity tools.
Another positive indicator for, is that only 11% of Spanish companies make sales via their websites (according to Information Technology studies in SMSs and Large Enterprises carried out in 2010 by the Department of Economic Affairs.
Internet is a business mine for businesses of all sizes because:
- All products can find their target market online
- A multitude of free online business tools exist at very reasonable prices.
- In the majority of sectors (except in tourism), online sales competition is inexistent.
Therefore this would be my personal choice of key points for a good online strategy:
- Identification, segmentation and dynamising of heavy-users 2.0 in order to provoke the (on and off) engagement and natural recommendation (WoM).
- Format and business model innovation in the sectors most affected by the economical crisis.
- Freemium, the cloud and free software for business development.
Do any of these cases sound familiar to you? Can you think of any that challenge or support this point of view?