Internet Marketing: A critical Study By Bhavani N

INTRODUCTION

The foundation of the Internet has offered new advanced business transactions and models for the world economy. Internet marketing is born to adapt to this rapid development of online business.  Online marketing is a new field in marketing that is related to the world of internet. Performing marketing related activities by using internet medium for conveying a message or information to target customers is called online marketing. It is also called digital marketing, internet marketing, e-marketing, search marketing and web marketing. Especially, online advertising has been achieving many successes  The  extent to which internet marketing is important to the success of an organization cannot be determined accurately. It depends on the nature of one company business line.¹ There are many companies currently using the Internet as their main business transaction such as DELL, AirAsia, etc… It is a new medium for advertising and PR (Public relationship) and a new product distribution channel. In addition to this, Internet marketing offers new opportunities for developing new international markets without the existence of representative or sales offices and agents. The Internet also provides new methods to improve customer services and is considered as the most cost-effective marketing tool as it reduces paper works and number of staff as well as bypasses operating offices. The internet is transforming from information and communication media to business media as many companies across the world perceived the potential of this magic media to reach potential consumers in leaps and bounds of the world.²

 This form of  marketing was born not too many years ago, became very popular in the late 1990s and than settled down to normal growth rate in the 2000s. Online marketing is here to stay and can only grow in the future. It will become better, more cost effective, and more exciting as additional individuals and businesses gain access to high-speed Internet networks. Internet is growing at a faster rate, virtualization taking place everywhere. In this situation engaging in online promotional activities can help the business a lot to achieve company goals and marketing objectives. Internet marketing has revived marketing techniques and tools for attracting the target market. Millions of people are earning billions of dollars by availing internet marketing facilities. Its cheapness, affordability, easy to use and convenience has made this medium one of most attractive and feasible for marketers and businesses. From SME's (Small and Medium Enterprises) to big companies, internet plays its role either in spreading awareness or promoting products. Many people believe that internet marketing is good only for virtual businesses which is quite wrong. In reality, physical businesses get more benefits from online marketing because it allows a marketer to get engaged  in a new thing that has boundless opportunities. It can increase your consumers, revenues and profits on long term basis. Online marketing is a vast sector that includes email marketing, banner ads, SEO (Search Engine optimization), SEM (Search Engine Marketing),  Social Media and mobile advertising. 

DEFINITION OF INTERNET MARKETING

Marketing has pretty much been around forever in one form or another. Since the day when humans first started trading whatever it was that they first traded, marketing was there. Marketing was the stories they used to convince other humans to trade. Humans have come a long way since then and marketing has too.  Marketing is the product of the meeting between modern communication technologies and the age-old marketing principles that humans have always applied.

Internet marketing is defined as the application of the Internet and related digital technologies in conjunction with traditional communications to achieve marketing objectives³ . It refers to the application of marketing principles and techniques via electronic media and more specifically the Internet. The terms eMarketing, Internet marketing and online marketing, are frequently interchanged, and can often be considered synonymous. Internet marketing is basically marketing efforts done solely over the internet.

ADVANTAGES  OF INTERNET MARKETING

 ·    The cost incurred in internet marketing is quite less when compared to traditional marketing. With internet marketing companies can reach a wide audience for a small fraction of traditional advertising budgets.⁴ This medium of marketing allows consumers to do research and purchase products and services at their own convenience. Internet marketing has been more effective when measured on the aspect of product meeting the eyes of an end user. Another advantage of Internet marketing is that one can easily measure statistics and it is quite inexpensive too. It is quite  possible to trace, measure and test all aspects of internet marketing campaign. Here are some ideas of methods that advertisers may use such as pay per impression, pay per click, pay per play, or pay per action. In this way marketers can easily determine which messages or offerings are more appealing to the audience. In order to measure and track the results of campaigns immediately, online marketing initiatives usually require users to click on an advertisement, visit a website, and perform a targeted action. On the other hand, such measurement cannot be achieved through billboard advertising, where a person will at best be interested, then decide to obtain more information at a later time. ⁵ It has proven to provide a clear cut communication between the customer and the service provider.

·         Internet marketing leads to product innovation. Vendors are informed about the preferences and likings of the end user and they manufacture or present the services in a desired manner. Internet marketing has  boundless universal accessibility  as it can be accessed by persons in all parts of the world. In this medium of marketing there is increased exposure of products and services to the consumers.

DISADVANTAGES OF INTERNET MARKETING

·         Internet marketing depends heavily on technology.

·         In Internet marketing there is no proper protection of the privacy of consumers  as their personal information can be sold or used for any other purpose without their consent by the websites.

·         The internet marketers have to face worldwide competition through globalization.

·         One of the challenges that internet markets face (as does the general public) is that many internet products are outright scams or promoted with deception making it difficult to know what one is buying. While the quality of products has improved in the past few years, ethics is still often missing in internet marketing.

·         The consumer is not in a position to physically feel or try on the product which can be a limitation for certain goods. 

·         Marketer will not be able to use the x-factor/human touch factor to influence the audience as the marketing is completely based on the advertisement and the information that the advertisement might lead to websites, blogs and other channels.

ONLINE MARKETING METHODS AND CHANNELS

1.Attention Marketing :  The idea of this is simply communicating your message to grab attention whether it is in a headline, an email subject line, the first paragraph of the article. The strategy is simply to capture and sustain consumer,s attention.

2.Affiliate Marketing: This method rewards one or more affiliates for each visitor or customer brought about by the affiliate’s own marketing efforts. It overlaps with other Internet marketing methods to some degree ,and plays a significant role in e-retailers’ marketing strategies, although it is a bit slower to develop than other types of marketing strategies online.

3.Alliance Marketing : A strategy that involves partnering with a product, service or company that is compatible with, but not a competitor of the business. This method adds value ( bringing you a “ value-added”   brand) to your service or product and can provide an enriched experience.

4.Article Marketing: This is a type of advertising in which articles are written related to the  respective industry. These articles are made available for distribution and publication in the marketplace. Well written content articles released for free distribution have the potential of increasing the authoring business’ credibility within its market as well as attracting new clients. These articles are often syndicated by other websites and published on multiple websites.

5.Cause Marketing : This method links a company and its products and services to a social cause or issue.

6.Content Marketing : This term is  an umbrella term that encompasses all marketing formats that  involve the creation or sharing of content for the purpose of engaging current and potential consumer bases. This method subscribes to delivering high- quality, relevant and valuable information to prospects and customers which drives consumer action. Unlike micro-blogging providing rich content  helps in retaining reader attention and improving brand loyalty.

7. Conversation Marketing: This is about selecting and conversing with the public. It’s a two-way dialogue between the business and the audience. This makes use of more interactive media. The business  delivers a message, the audience respond. The business can then  modify your web site, banner ad, or landing page after days, hours, or even minutes of beginning a campaign. This approach is for a marketing/PR campaign with the purpose of selling something..

8.Email Marketing : A form of direct marketing which uses electronic mail (email) as a means of communicating messages to an audience. The purpose is to enhance the relationship of a business with its current or previous customers, to encourage customer loyalty and repeat business, or to acquire new customers or convince current customers to purchase something immediately. Online businesses are finding that direct e-mail is less expensive and results in more responses than “click-through”  banner ads on websites. Generally, though direct,  e-mailers  should be careful not to cross the line between permissible and impermissible e-mailings. They should not indulge in sending spam . Bulk, unsolicited e-mail (junk e-mail) sent to all of the users on a particular e-mailing list is called spam. Because spam can waste user time and network bandwidth ( the amount of data that can be transmitted within a certain time), attempts have been made by certain organizations to curb its use.⁶

In the following Antispam case, an ISP (Internet Service Provider)  argued in a federal district court  that spamming is trespassing.

CASE: Compuserve Inc, vs. Cyber Promotions, Inc.⁷

Facts: Trough a nationwide computer network, CompuServe Inc operates a communication service that includes e-mail for Compuserve subscribers. E-mail sent to the subscribers is processed and stored on ComServe,s equipment. Cyber Promotions Inc is in the business of sending unsolicited e-mail  ads, or spam, to internet users. CompuServe subscribers complained to the service about Cyber Promotions ads and many canceled their subscriptions. Handling the ads also    placed a tremendous burden on CompuServe,s equipment.  CompuServe told Cyber Promotions to stop sending ads to its subscribers. But Cyber Promotions ignored their demand and stepped up the volume of their ads. CompuServe filed a suit against Cyber Promotions in a federal district court seeking injuction on the ground that the ads constituted trespass to personal property.

DECISION: The court held that spamming is trespassing. The court issued an injunction ordering Cyber Promotions to stop distributing its ads to e-mail addresses maintained by CompuServe.

Search Engine Marketing (aka “Search Marketing) – A form of Internet marketing that seeks to promote websites by increasing their visibility in search engine result pages through the use of search engine optimization, paid placement, contextual advertising, and paid inclusion.

Social Media Marketing – Social media marketing programs usually center on efforts to create content that attracts attention and encourages readers to share it with their social networks. Social Media Optimization (SMO) benefits organizations and individuals by providing an additional channel for customer support, a means to gain customer and competitive insight, recruitment and retention of new customers/business partners, and a method of managing their reputation online. Key factors that ensure its success are its relevance to the customer, the value it provides them with and the strength of the foundation on which it is built.

INTERNET MARKETING- JURISDICTIONAL ISSUES

Any business selling goods online must keep in mind that the internet is international in scope. This ability of the internet to bypass national boundaries undercuts the traditional geographical basis for a court to assert jurisdiction. Considering this fact, some observers speculated that setting up a website could subject the owner to a lawsuit anywhere in the world. Another view was that a  presence on the web alone would not be enough to support jurisdiction over a nonresident defendant. The standard that is emerging in the world,s courts echoes the requirement of “minimum contact” applied by the U.S courts. ⁸To compel a defendant to appear most courts are indicating that a physical presence is not necessary but that minimum contact i,e doing business within the jurisdiction , for example is enough. The effect of this standard is that a business firm has to comply with the laws in any jurisdiction in which it targets customers for its products. The jurisdictional issues in internet marketing can be further understood with the help of a case.

CASE- International League Against Racism and Antisemitism vs. Yahoo Inc.⁹

Facts: Yahoo!, Inc, operates a Yahoo Auctions website that is directed principally at customers in the United States. Items offered for sale have included objects representing symbols of Nazi ideology. In France the act of displaying such objects is a crime and is also subject to civil liability. The International League Against Racism and Antisemitism and others filed a suit in the Tribunal de Grande Instance de Paris (a French court) against Yahoo and others seeking injunction and damages. The court ordered Yahoo to take all necessary measures to dissuade and make impossible any access by persons in France or French territory via yahoo.com to the auction service for Nazi merchandise . Two months later Yahoo returned to the court arguing that the court did not have jurisdiction.

Decision: The court held that it had jurisdiction to  try the case because upon making a connection to its auction site from a terminal located in France it responds by transmitting advertising banners written in the French language. Thus according to the court a sufficient basis is established for a connecting link with France as Yahoo was addressing French parties.

  

ADVERTISING ON THE WEB

An Advertisement may be defined as paid-for communication, addressed to the public or a section of it,the purpose of which is to influence the opinions or behavior of those to whom it is addressed.   This definition would also include  any communication which in the normal course would be recognized as an advertisement by the general public even if it is carried free of charge for any reason.¹⁰ In a developing economy like India, advertising has a profound impact on how people understand life , the world and themselves, especially with regard to their values, choices and behavior. Advertising is considered to be the cornerstone of our socio-economic system. Advertising may be viewed as the lifeline of free media, paying costs and making media widely accessible. In India advertising both traditional and online has grown in a major way.

Online advertising is the most recent form of advertising that’s gaining popularity in India.  Online advertising is a form of advertising using the Internet and world-wide-web to deliver marketing messages and attract customers.

Deceptive Advertising:

Advertising would be deemed deceptive if the consumer would be misled by the advertising claim. Vague generalities and obvious exaggerations are permissible. These claims are known as puffing. Advertising that appears to be based on factual evidence but that in fact is not will be deemed deceptive.¹¹

Some advertisements contain “ half-truths” meaning that the presented information is true  but incomplete, and it leads consumers to a false conclusion¹². A major challenge in today,s legal environment has to do with deceptive advertising practices on the internet.

In India, due to severe restrictions on advertising certain products like alcohol, tobacco products,

medicines and baby food, a whole genre of misleading / surrogate advertising has emerged. In such advertising, a brand is endorsed using a product different from the actual product being promoted.¹³

The Consumer Protection Act 1986 , advertising Code, Censor Board and working group on Misleading Advertisements set up by the Consumer Affairs, Food and Public Distribution Department, Government of India, have all dealt with the issue of misleading advertisements. The preferred solution is to ask the advertiser to issue a corrective advertisement to neutralize the effect of misleading advertisements.¹⁴

REGULATION OF ADVERTISING IN INDIA

The Government of India has not set up a regulatory body in India to regulate advertisements.Depending on the nature of the grievance ,s the power to regulate advertisements may be exercised by a vast variety of authorities including the courts, central and state governments, tribunals or the police authorities.

India however does have a self regulatory body dealing with online and other forms of advertising. This is the Advertising Standards Council of India.

 Advertising Standards Council of India.

 To monitor certain standards and fairness in the domain of advertising, Advertising Standards Council of India was established in India in 1985. Advertising Standards Council of India (ASCI) is a self regulatory voluntary organization. The role and function of the ASCI is to deal with complaints received from consumers and industry against advertisements which are considered as false, misleading, indecent, illegal, leading to unsafe practices or unfair to competition and in contravention to the advertising code laid down by the ASCI. While safeguarding consumer interests; ASCI  also  monitors and guides the commercial communications of practitioners in advertising.  ASCI adopted a Code for Self-Regulation in

Advertising, which is committed to honest advertising and fair competition in the market-place. It stands for the protection of the legitimate interests of consumers and all concerned with

advertising - advertisers, media, advertising agencies and others who help in the creation or

placement of advertisements.

CONSUMER PRIVACY ISSUES IN INTERNET MARKETING

 Modern technological developments and in particular the so called convergence of computer and telecommunications technologies have created an environment in which there is inexpensive and ready access to an ever growing pool of personal information. The internet marketing is an exciting new marketplace for consumers. It offers easy access not only to a vast array of goods and services, but also to rich sources of information that enable consumers to make better-informed purchasing decisions. This information-rich medium also serves as a source of vast amounts of personal information about consumers. One of the major concerns of consumers in recent years has been the increasing value of personal information for online marketers- who are willing to pay a high price to those who collect and sell them such information¹⁵. Indeed, in today,s online world privacy rights are becoming a thing of the past. Commercial Web sites collect personal information explicitly through a variety of means, including registration pages, user surveys, and online contests, application forms, and order forms. Web sites also collect personal information through means that are not obvious to consumers, such as cookies¹⁶. Upon visiting any mainstream Web site, a small text file called a “cookie” is deposited on the computer. When the user  comes  back to the site at another time, the site recognizes the cookie, and can customize the page to fit the user,s browsing habits. Cookies are how sites such as Amazon.com remember user,s  account name whenever they  visit. Web publishers also often allow “third-party” advertisers to place cookies on the user,s computer that collect information such as their IP ( Internet Protocol)   address.¹⁷  Cookies on their hard drives allow internet user,s web movements to be tracked. Technology is now available that makes it possible to connect previously anonymous Internet users to actual geographic locations. Furthermore, any person who wants to purchase goods from online merchants or auctions inevitably must reveal some personal information, which may include the purchaser,s name, address, Social Security number, and credit card number.

The  Doubleclick Inc, Problem¹⁸ in  U.S brought online privacy to the forefront.

Doubleclick Inc was one of the largest online advertising intermediary companies which sold banner ads, button ads, flash ads, and other kinds of ads used online.  Any person who opened such ads had a cookie set on  his or her hard drive that allows Doubleclick and its advertisers to track the user,s online movements. In particular, it can be learned whether a web surfer comes back to a particular Web site on which he or she has clicked on ads before. Doubleclick wanted to use this information in a more profitable way. It merged with Abacus Direct Corporation in a deal valued at $1.7 billion. Abacus had developed software that would link data it collected online, through the use of cookies, to consumers real names and addresses collected offline. But the public got wind of what Doubleclick was planning to do and it had to abandon its plans to use the consumer information database that it had acquired through its purchase of Abacus.

CONSUMER PRIVACY  IN INDIA

According to the Consumer Protection Act, 1986, a consumer is a broad label for any person who buys any goods or services for consideration with the intent of using them for a non-commercial purpose.¹⁹ Certain services that consumers use may, by their very nature, put an extraordinary amount of sensitive personal information into the hands of vendors. Consumer privacy is concerned with accuracy of how a consumers information is collected and used. Because a consumers relationship with another entity is based on an exchange along consented terms, a breach in consumer privacy can be constituted as an action that was not agreed to. In the age of data collection – a breach in privacy occurs when information is used in different ways than was intended. Consumer privacy in India is determined at the sectoral level, and differs depending on the services that is provided for. As corporations sell data banks, ISP's expose consumer habits, or ones personal information falls in the wrong hands – the consequences are far reaching, and can result in spamming, unwanted marketing, theft, or the violation can impact an individual's ability to buy a home, potential employment opportunities, or gain access to credit.²⁰ In India no proper and comprehensive legislation has been framed for the protection of privacy. The law is yet to develop in this field.  However the consumer privacy to some extent can be regulated after the   Information Technology Amendment Act, 2008  came into force .  Under the Information Technology Act, 2000  intermediary was defined as any person, who on behalf of another person, receives, stores or transmits that message or provides any service with respect to that message. However, the Information Technology Amendment Act has clarified the definition “Intermediary” by specifically including the telecom services providers, network providers, internet service providers, web-hosting service providers in the definition of intermediaries thereby removing any doubts. Furthermore, search engines, online payment sites, online-auction sites, online market places and cyber cafés are also included in the definition of the intermediary²¹.  These intermediaries could be punished under Section 72A for disclosure of personal information of any person where such disclosure is without consent and is with intent to cause wrongful loss or wrongful gain or in breach of a lawful contract. The punishment for such disclosure is imprisonment extending upto three years or fine extending to five lakh rupees or both. This provision introduced under IT Amendment Act, 2008, is aimed at protection of privacy and personal information of a person.

Certain precautionary measures should be taken to protect and safeguard the personal information of consumers. Companies involved in Online marketing should lay down a strict and clear privacy protection policy  which should be adhered to by all its employees.

 A Web site operator must post a clear and prominent link to a notice of its information practices on its home page and at each area where personal information is collected from children. The notice must state the name and contact information of all operators, the type of personal information collected from children, how such personal information is used, and whether personal information is disclosed to third parties.²²

CONCLUSION:

In the 21^st century all operations and activities are carried out through the internet. The internet has become  an inalienable part of people,s lives. It has made living very easy and convenient for the people. Online marketing has emerged as a result of this advancement in technology. It has many advantages but also suffers from certain disadvantages. Hence this medium of marketing should be used in a manner which is beneficial to the marketers, consumers and all other persons involved in the process of online marketing.

 BIBLIOGRAPHY

Books:

1.     A.M Sakthivel Bishnupriya Mishra, Role of Cyber Marketing in Influencing Consumer Buying Behavior,Ed 2005,Mahamaya Publishing House, New Delhi

2.     Nandan Kamath, Law Relating to Computers Internet and E-commerce, 4^th Ed 2009, Universal Law Publishing Co, Delhi

          Websites:

1..Wavelengthtarot.com,

2.http://www.brandonsheley.org/feed/15

3. nextsbd.com

4.finding.dulcinea

           Articles:

1.Sujai Singh, Online Advertising in India- Regulations: Self and Otherwise,

2.Prasad Krishna, Privacy Matters- Consumer Privacy

3.Pavit Singh Katoch, Liability of Intermediaries under the amended Information Technology Act, Law in Perspective

           Thesis:

 1.Nguyen Phuong Linh, Internet Marketing, Lahti University of Applied Sciences.

BHAVANI N

V yr BA.BL(HONS)