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Retail Management Institute Newsletter - Spring '07
Living in the Digital World: A New Formula for Marketers and Retailers
by Debra Black
 Ten years ago, it was hard to imagine that e-Commerce would grow to redefine the retail industry. Today, what began as a revolution in computer communication has completely evolved the concept of marketing and building relationships with customers. As a result, marketing education aims to mirror these changes. Santa Clara University Professor Kirthi Kalyanam along with Stanford University Professor Ward A. Hanson have responded to the need for new material by collaboratively writing a textbook.
Just released this year, their book, Internet Marketing & e-Commerce, sheds light on the latest concepts of the digital world. The following interview provides a more thorough glimpse of the work:
1. What particular changes in the retail climate inspired the concepts detailed in the textbook?
Marketers and retailers have adopted the Internet to serve their customers.
Professor Kirthi Kalyanam, director of Internet Retailing and co-author of Internet Marketing & e-Commerce.
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They started with what was familiar to them-marketing techniques that work in the analog world. However, what we are finding is that the digital environment works in a very different way. This book examines the basic principles of marketing and retailing in digital environments.
2. Are these principles different from the traditional Four P's?
The four P's are always important, but the Internet requires marketers and retailers to make decisions about a number of additional variables. The new formula is 4P's+ (2P's+2C's+3S's). The additional 2 P's are Personalization and Privacy. The 2 C's are Community and Customer Service. The 3 S's are Site, Security and Sales Promotion.
3. The Internet provides an incredible body of data. What are we learning from this?
One of the great advantages of the Internet is the tremendous amount of data it provides. So Internet marketing is a very heavily data and metrics-driven process. Companies track data in three broad categories: Traffic Sources and Cost of Traffic, Site Usability and Conversion Rates, and Loyalty and Retention, which includes response to e-mail marketing. Surveys of retailers show that the search engine optimization and marketing, affiliate marketing, and shopping comparison engines are the three tactics that fall into the magic quadrant-very effective and very widely used.
4. Does this textbook reflect the changing curricula of marketing education? And if so, how?
Definitely. If we go back to the 4P's discussion earlier, the new curriculum should provide coverage of the 4p's+ model. The book also highlights data sources in Internet marketing and how this data can be transformed into intelligence-all essential topics to a marketing curriculum.
5. To whom do you think this book would prove helpful? Students, small business owners, corporate retailers, or all of the above?
The whole area of digital marketing is so new that many different types of people are hungry for a good overview of all the concepts in this area. The other day I was talking to a person who works in business to business marketing. He wanted to read the book because he thought he would learn from these techniques. Internet marketing is very relevant for B2B.
The Internet has also been a boon for small business owners. Think of all the people who now run a business out of their garage and sell on eBay. I think this book can serve as a great equalizer. You can read this book and walk into a room of Internet types and be very, very confident that you have a good overview of the business. In fact, you will probably have a broad-based overview of many aspects of the business, perhaps more breadth than anyone in the room.
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Retail Management Institute - Santa Clara University
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