Internet marketing is no longer the domain of upstarts and envelope-pushers. Today, it's a mainstream corporate initiative, and as such it's gotten more complexââ,¬"and more difficult to be heard above the noise. And it's only going to get tougher to make an impression: Last year, Internet companies accounted for 69 percent of digital marketing, but Forrester Research predicts that by 2005 it will be traditional advertisers who dominate online marketing, accounting for 84 percent.
Gone are the days of slapping up a few Web banner ads, or sending out blind batches of mass email. These Net marketing ploys have lost their punch: Click-through rates for banner ads hover around 0.4 percent, and a glut of commercial email clogs customer in-boxes.
To stay ahead of the curve, businesses are embracing a new crop of innovative technologies: market-optimisation software that helps you make more informed decisions, wireless campaigns that transmit your message to handheld devices and cell phones, and email messages that actually let customers complete a transaction without going online.
With the help of new software, marketers can target specific potential consumers more accurately than ever. Lee Cooper, a business professor at UCLA's Anderson School of Business, believes this technology-enabled marketing optimisation is the most important trend in marketing. Several companies, such as Strategic Data Corporation, Net Perceptions, and Marketswitch, are perfecting such software. The applications use analytical models to provide real-time decision-making for Web-based marketing campaigns, such as email and banner ad programs. In simple terms, Cooper says, "Think of these companies as automating the process of making marketing recommendations."
Other industries, including airlines, have used optimisation technology for years, but marketers have only recently caught on. The software uses a mathematical formula to consider several variables that determine the effectiveness of a particular marketing strategy. For example, Marketswitch's optimisation software, called True Suite, is designed to pinpoint the best marketing strategyââ,¬"-including what customers to targetââ,¬"-as fast as possible. The program can even take into account business constraints, such as what inventory is in stock.
Pricing can be steepââ,¬"-ranging from US$300,000 to US$1 millionââ,¬"-so Marketswitch's clients tend to be larger companies, including America Online, AT&T Broadband, and MCI. Another client, credit card company Capital One, saw a 10 percent uptick in revenue, which translated into a US$5 million increase in its incremental bottom lineââ,¬"-all within the first six months of using the product.
