how companies can react to the changing of digital marketing environment

HOW DIGITAL TOOLS ARE CHANGING MARKETING MIX?III.. Marketing mix is made through digital business, which is creating new business designs byblurring the digital world and physics.. the g

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How digital tools are changing marketing

II HOW DIGITAL TOOLS ARE CHANGING MARKETING MIX?

III HOW COMPANIES CAN REACT TO THE CHANGINGOF DIGITAL MARKETING ENVIRONMENT?

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Along with the development of the internet,businesses have changed the way they marketand build relationships with customers to themarketing mix.

The marketing mix is the “tool kit” thatmarketers use to do their job It consists offour elements: product, price, place, andpromotion The marketing mix givesexecutives a way to ensure that all elementsof their program are considered in a simpleyet disciplined fashion.(HBR 1985)

The COVID - 19 epidemic has a major impacton companies and businesses, economicactivities of businesses around the world thathave been severely affected by sales anddeclining profits Global shares in flux aregreatly affected

According to the Financial Times StockExchange Group (FTSE), FTSE is down 14.3%in 2020, the worst performance since 2008.The IMF estimates the global economy toshrink 4.4% in 2020 The organizationdescribes the decline as the worst since theGreat Depression of the 1930s (BBC 2021) Fordeveloped and emerging economies, theInternational Monetary Fund (IMF) estimatesthat national output will contract by nearly6% in 2020.(Forbes 2020) According to a newUnited Nations report, the influence of theepidemic to international tourism cost asmuch as $4 trillion for the years 2020 and2021 The steep drop in international arrivalsled to a $2.4 trillion loss in 2020

(Forbes 2021).

The pandemic has also changed the waypeople behave, receive and processinformation Therefore, companies andbusinesses have gradually adapted to newcircumstances and ways of working to copewith the effects of COVID-19

I Introduction

Marketing mix is made through digital business, which is creating new business designs byblurring the digital world and physics It promises to open up unprecedented convergencebetween humans, businesses and things that break up existing business models - evenbusinesses that are born from the age of the internet and electronics.

A transformation of marketing is underway as we spend more time on our mobiles, tabletsand laptops The challenge for brands is to connect with customers through all these devicesin real time and create campaigns that work across social media, display advertising and e-commerce Marketers need to update their skills in order to make the most of these fast-moving, and highly relevant campaigns through digital (the guardian 2014)

The following will go into two major issues including the impact of digital tools onmarketing mix(4p) and how companies can react to the changing digital marketingenvironment.

II How digital tools are

changing marketing mix?

Digital media has changed the way market business Newconsumption trends change the business model oforganizations Advertising strategies have been replacedwith new forms of display and various opportunities anddifficulties A good commodity meets the needs or desires ofa customer An item is not only the item of the owner, itcan also be a help or a thought Products include qualityproducts, company management products and supportservices Innovation is a key factor in the development andsuccess of most products (Marketing in a digital world) Inthe age of technology, digital is moving from products andbrands created by companies to co-creation products andthe sharing economy.

Co-creation is about encouraging cultural change withinthe organization This mentality shift can be difficult toaccomplish and is subject to the capacity of topadministration to embrace a modest, compassionate, andparticipative authority style ( Forbes 2018 ) To put itanother way, the act of transforming new businesses byusing the knowledge, skills, and resources of externalcontributors, particularly from their consumers Anincreasing number of businesses are using the company'sweb platform to solicit customer input and pick ideas forfuture items As such, in our new digital age, customersdon't just buy products, they can help design and developthem.(Marketing in a digital world)

The French postal assistance, La Poste, is a representationof a multi-accomplice co-creation effort

La Poste's organization chose to expand theirmovement business as their very postbusiness fell rapidly in light of the Internet.They ran into three issues: transporters whoweren't convinced or adaptable; clients whoexpected to remain for a long time; anddisappointed close by chiefs, all of whichachieved lower benefits and extra timewasted

La Poste pioneers chose to welcome tellersand postal administrators to converse withnearby clients concerning how to accomplishthose objectives A significant stage incatching the consideration of tellers is to givethem a say in their own plans for gettingwork done The outcome: Redesigned maildepots have decreased client stand by timesby half Consumer loyalty is presently on theascent Occupation fulfillment among tellersand chiefs has soared (Harvard businessreview 2010)

Threadless, a T-shirt company in Chicago,products are born from designs contributed bycustomers The Internet-based company asksconsumers to submit shirt designs they'vecreated - it receives up to 300 submissions aday and lets consumers vote on the modelsthey like best It pays winners $2,000 for theircreations The company picks out the mostpopular t-shirt designs, screens them, andsells them on its website for three to eightweeks for $18, and releases seven new designseach week.

Threadless, where they can exchange ideas ideas that go beyond designing t-shirts.Threadless gained 1.5 million Twitterfollowers and 100,000 Facebook fans in 2009and uses the social network to advertise itsbusinesses to attract designers They haveconsumers who voted on 150,000 designs Thisbusiness model brought in nearly $30 millionin revenue in 2009 (Forbes 2010)

-In addition to co-creation, one of the most important features of the digital revolution is theability to connect individuals Digital tools make everything connected easier An importantpart of this increased connectivity is the sharing economy A shared or sharing economy isan economic system in which assets or services are shared between peers or businesses forfree or for a fee.(Forbes 2019) The sharing economy connects individuals who have thingsthey want to share with those who need them.

Everyone has participated in this economy insome way The sharing economy is expected togrow from $15 billion in 2014 to $335 billion by2025 Businesses are moving into the world of thesharing economy.(Forbes 2019)

Sharing economy firms are disrupting traditionalindustries across the globe Airbnb at $10 billion,Uber is currently valued at $18.2 billion relative toHertz at $12.5 billion and Avis at $5.2 billion.Beyond individual firms, there are now more than1,000 cities across four continents where peoplecan share cars The global sharing economymarket was valued at $26 billion in 2013 and somepredict it will grow to become a $110 billionrevenue market in the coming years, making itlarger than the U.S chain restaurant industry(Harvard business review 2014).

Uber's ride-hailing service has exploded in 58countries in the five years since its launch, thoughnot without hiccups But it grows very quickly.Uber delivered nearly 1 million rides a day inChina, and in 2014, Uber's China business doubledshortly thereafter The number of trips in Chengduis 46 times greater than in New York at the sameage Nine months later, Chengdu - China has 479times more trips than New York (ABC news 2015).That shows the development of the sharingeconomy in today's digital society

II How digital tools are

changing marketing mix?

This aspect of the marketing mix covers the methods ofcommunication that a marketer uses to provideinformation about his products Promotion persuasive innature with a goal of getting customers to buy yourproduct instead of its competitors This information, itcan be built verbal and visual Thus, a promotionalstrategy can influence consumers by appealing to eithertheir intellect, or their emotions (Marketing in a DigitalWorld)

The Internet's growth has made it possible for companiesto stand out and reach out to customers Businesses andconsumers now have the chance to communicate morepersonally and emotionally in order to foster strongerconnections The business mainly promotes internet postsand diverse user-generated content and differentiates thebrand image with the development of a distinctive andattractive brand image from the Doppelganger brand Inmarketing, user-generated content refers to content madeby someone who is not an official representative of thecompany but is interested in the brand It could be postson social media or something else with a brand identityfor communication purposes.

Cola is a great example of using user-generated content for communication Cola's marketing team came up with the idea to start a 'share a can of coke' campaignthrough social channels and advertising Overnight, it started to receive great feedback fromgeneral customers across the globe Twitter and Facebook posts with images of Coca-Colabottles and cans are on the rise and both carry the hashtag #shareacoke to encourage users topromote their brands online.

Coca-In Australia in 2011 and produced some impressive results Consumption of young peopleincreased significantly, up 7% The campaign also garnered a total of 18,300,000 mediaimpressions and traffic on the Facebook Coke page increased by 870%, with page likes up39% In the UK, Coca-Cola has seen its Facebook community grow by 3.5% and globally by6.8% The hashtag has also been used 29,000 times on Twitter (The Guardian 2013)

Similar to Coca-Cola, in 2014, Starbucks ran a White Cup Contest campaign, encouragingcustomers to draw some artistic doodles on their white cups and post them on social mediawith the hashtag #WhiteCupContest Within just 3 weeks, it received a tremendous responsewith about 4,000 withdrawal cups being sent to Starbucks by users (Forbes 2017)

A doppelganger brand is a family of disparaging images and stories about a big brand that arecirculated in popular culture by a loosely organized network of consumers, anti-brandactivists, bloggers, and opinion leaders in the news and entertainment media The worddoppelganger is a word that is German in origin, and actually a combination of two words,doppel, which means double and ganger, which means walker Thus in essence, adoppelganger is a double walker (Marketing in a Digital World)

Pepsi introduced a new logo back in 2009 They paid a famous design firm a million dollars tocreate this new logo, which as you can see, is really just a modification of its prior logo, notmuch different Nonetheless, this new logo was heavily criticized by several Internet blogs asbeing a waste of money In addition, several graphic artist created their own doppelgangerversions of this logo to represent an obese man as a means of protesting against Pepsi's effecton our health This doppelganger campaign quickly became an Internet meme and increasedattention to the negative consequences of drinking Pepsi (Marketing in a Digital World)

II How digital tools are changing marketing mix?

This aspect of the marketing mix focuses upon the amount thata customer pays for a product A pricing strategy is a firm'sbasic approach to how it prices its products Now, firms employa very broad range of pricing strategies Three of the mostcommon pricing strategies are cost-plus pricing, competitor-based pricing, and value-based pricing (Marketing in a DigitalWorld) Price is considered an important element of themarketing mix as it determines the survival and profitability ofa company Currently, it is free to pay for products andservices, such as paying according to the ability and desire ofconsumers such as pay what you want and freemium.

Many marketers have considered using a Pay What You Wantpricing scheme to sell their products On the face of it, it seemssuch an alluring idea, predicated on human decency andreciprocity PWYW pricing is simple: Provide a good-qualityproduct to customers, let them enjoy it, and then give themcomplete discretion to pay whatever they want for the product.No bills, no claims , pay if you want to, don’t if you don’t(Psychology Today 2017).

Panera Bread expands pay what you want experiment, companylaunched the first of five pay-what-you-want cafes Paneracalls it the Meal of Shared Responsibility and says the potentialbenefit is twofold: Above-the-cost proceeds go to cover mealsfor customers who cannot pay the full amount and to St Louis-area hunger initiatives; and for those in need, the 850-caloriemeal provides nearly a day's worth of nutrition at whateverprice they can afford If the experiment works in St Louis, itcould be expanded to some or all of the chain's 1,600 bakery-cafes across the USA (CBS News).

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Radiohead produced the album In Rainbowsand sold it on a pay what you want method tosell for whatever price fans were willing topay In a study that examined traffic toRadiohead's In Rainbows Web site during thefirst 29 days of October, 38% of those whodownloaded the album at the site paidsomething to get the album, while 62% paidnothing Of those who paid, 17% paid $4 orless, 6% paid between $4.01 and $8, 12% paidbetween $8.01 and $12, and 4% paid morethan $12 Put another way, those who paidmore than $8 accounted for about 79% of therevenue generated from the site (Forbes 2007)A freemium is a digital product or servicethat offers a set of basic features for free butthen charges a price, usually a monthly oryearly subscription, in order to obtain a set ofpremium features.

Freemiums combine free and premium andthis model can work well for digital productsand services due to the fact that the marginalcost of adding a new user is close to nothing(Marketing in a Digital World).

Dropbox is a master of this model Thecompany has 500 million registered users whoreceive two gigabytes of free storage Oncethey exceed that capacity, however, customersare offered the option to upgrade to oneterabyte for a monthly or annual subscriptionfee With this model, Dropbox generated $1billion in revenue in 2017 from 11 millionpaying individual and business users andcontinues to grow its user base (Harvardbusiness review 2019)

The “freemium” model used by Spotify to amass60m users and 15m paying subscribers around theworld

The Spotify business model relies on attractingusers to a free service that offers a selection ofmusic but with limited functionality, with the aimof converting those users to paying subscribers.Spotify generates some revenue around the freeservice but makes more via paid subscriptions.Ad-supported free streaming generated $295m inthe US for music labels in 2014, much less than thenearly $800m generated by paid subscription.(Financial Times 2015)