Knowing You, Knowing Me - marketing on the Internet - Panel Discussion

Chief Executive, The, April, 2001 by Bob Woods

Use the Net to learn about your customers, and you might learn something about your company, too.

There's an old marketing adage about return on investment: You know you're wasting half your money, you just don't know which half.

Old, and maybe outdated, now that CEOs are beginning to recognize the marketing value of the Internet. More than any other marketing tool, the Net opens the door to identifying and communicating personally with your customers. With permission-based e-mail marketing, customers are allowing -- even asking -- companies to talk to them. Knowing your customers can help you fine-tune pitches and products.

Currently, about 40 percent of U.S. households are online, and the rest of the world is promptly joining them. With broadband and wireless communications just around the corner, more novel ideas for interacting with customers are sure to follow.

To explore this virtual and still largely uncharted territory, an E-Conference panel of experts shared their unique perspectives with a roomful of business leaders. The panelists: Michael Kubin, founder and co-CEO of Leading Web Advertisers, which has a proprietary tracking system that allows advertisers, agencies and publishers to gather competitive data; new media pioneer Tom Nicholson, chief creative officer of Icon Medialab, an interactive ad agency; and Pam Alexander, CEO of Alexander Ogilvy, one of the leading public relations agencies representing technology companies. Following are the major topics discussed, along with some practical advice from the panelists.

How is the Internet redefining traditional marketing?

"Web marketing allows you to go from initial message to sale and beyond, all the way out to customer relations," remarked Kubin. "It's accountable and measurable -- the perfect direct-response medium. If 50 percent of advertising isn't working, with the Web you know which 50 percent."

Nicholson advocated using the Internet to engage customers. "Invite the customer into your company to become a partner," he said. "Companies must take that idea and look at how to deliver greater value to the customer. It's about satisfying customer needs."

What is the evolving role of public relations in the Internet economy?

No longer is the function of PR merely to disseminate information to the press and to Wall Street. "It's not that communicating to the media and analyst community isn't important anymore," Alexander explained. "It's that the priorities have shifted so that Web strategy is focused more on communicating with customers, as well as with employees. The explosion of information on the Internet means that reaching key media people, in the business and consumer press, may be more difficult than ever before, because they're inundated with information:

To work the Web more effectively, the panel suggested combining the dissemination of information with the kind of relationship marketing "that happens at conferences like this," said Alexander. "That is a very powerful tool to begin to break through the clutter and reach the opinion leaders and influencers in your market segment."

Does Internet marketing demand different tactics in the B2B world than those used in B2C?

"I actually don't differentiate too much between the two categories for the purposes of Web strategy," Nicholson said. "When it comes to customers, it's a question of looking at each constituent and figuring out what his needs are -- the value propositions, whether he's an employee, a supplier, a partner or an end customer."

Regardless of whether you're operating in the B2C or B2B marketplace, use the Net to get information back from the customer. "Understand exactly what the customer wants and needs and is about, and then shift your enterprise to adjust to that," Nicholson added. Technology or not, those are traditional rules of doing business.

Is the Internet, then, essentially a high-powered conduit for classic relationship marketing?

Marketing still comes down to understanding your product and your customer and then figuring out the right tools for the job. "A huge challenge for the marketer on the Web," Kubin contended, "is to integrate everything. It's not just about driving traffic to your site or branding. It's a combination of things. It's not one size fits all."

To make sure your product fits every customer, Kubin emphasized using the Internet to facilitate better understanding of key customers and then to tailor personalized dialogues with each one.

Speaking of Internet marketing tools, the most ubiquitous are the banner ads that adorn pages all across the Web. Their effectiveness is often questioned, so how can they be maximized?

Banner ads are a big part of Kubin's business. "It kills me to see how little thought goes into a lot of them," he lamented, "because it's wasting dollars." For instance, a site with a light green background will feature light green banners, in effect camouflaging the ads.

Nicholson argued, however, that the Internet has not yet proven to be a terribly successful true advertising vehicle, that it's really more of relationship vehicle. "I'll go on record as saying that all the trend lines are down when it comes to the direct marketing piece [of the Internet], and even the branding piece to some degree, if you just focus on the things we'd call traditional advertising, such as banners and interstitials."