khera mam project

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SRI SHARADA INSTITUTE OF INDIAN MANAGEMENT-RESEARCH

(A unit of Sri Sringeri Sharada Peetham, Sringeri)

Approved by AICTE

Plot No. 7, Phase-II, Institutional Area, Behind the Grand Hotel, Vasantkunj,

New Delhi ± 110070 Tel.: 2612409090 / 91; Fax: 26124092

E-mail: [email protected]; Website: www.srisim.org

THE

PROJECT REPORT

ON

³Internet Marketing vs Traditional Marketing´

SUBMITTED TO SUBMITTED BY

Prof. Sartaj Khera Ankita (20100127)

Sarmistha Purkyastha (20100)

PGDM-2nd

YEAR



DECLARATION

I hereby declare that the project on ³Internet Marketing vs Traditional

Marketing´ ´ of ³ ´ of PGDM to Sri Sharada Institutes of Indian Management

Research is my own original work for the fulfillment of the requirement for nay

course of the study. I also declare that no chapter of the manuscript in whole or

part is lifted and incorporated in this report from any other work done by me or

others.

Place:

Date:



Acknowledgement

It is said, the most important single word is ³WE´ and the zero important single

word is ³I´. This true even in today¶s modern era .It is absolutely impossible for a

single individual to complete the assigned job without help and assistance from

others.

I would like to acknowledge to my sincere gratitude to our CMT& MD Rev.

Swami ji (Dr.) Parthasarathy and my project guide Prof. Sartaj Khera for

helping me in this project work.

I am thankful to all my friends and batch metes for their help in completing this

project work. Finally, I am thankful to my entire family members for their great

support and encouragement.

Ankita (20100127)

Sarmistha Purkyastha (201001)

PGDM (2010-2012)

Sri Sharada Institute Of Indian Management- Research



Table of contents :

Introduction

Traditional marketing ..................................................................................................

Product .................................................................................................................

Price ......................................................................................................................

Place ...................................................................................................................

Promotion ...........................................................................................................

Internet Marketing .....................................................................................................

Product ...............................................................................................................

Price ....................................................................................................................

Place ...................................................................................................................Promotion ...........................................................................................................

Traditional Marketing VS Internet Marketing ...........................................................

Product ...............................................................................................................

Price ....................................................................................................................

Place ...................................................................................................................

Promotion ...........................................................................................................

Comparison model«««««««««««««««««««««««««««

Analysis .................................................................................................................

Conclusion««««««««««««««««««««««««««««««.



INTRODUCTION

When companies start business, their main goal is to make profit and accomplish a

successful growth. Therefore different strategies are used to sell products or services

that they offer.Companies try to create, promote and sell products or services t

hat could

satisfy their targetcustomers. Marketing is a strategy that can make a business grow

and thereby become morepowerful. It is crucial to know what kind of marketing to use in

every area to achieve highsales rate, market share and the wanted image.

Marketing is considered to be a process of exploring, creating, and delivering value to

satisfythe needs and wants of a target market at a profit.1When Neil Borden introduced

the concept of the "4 P's" of the marketing mix (Product, Price, Place, and Promotion),

marketers wereoffered opportunities to exploit each aspect of those elements and

thereby satisfy their customers¶ needs and wants.

Marketing has to some extent stayed the same in many years but as technology has

developed,it has had its affects on marketing. Entrance of Internet into our lives has

brought many possibilities and that has also affected marketing. Since the evolution of

Internet, the Internet selling or e-selling has become ever more established in every day

life in the society and is even replacing the traditional medium, to some degree. It is a

new channel for communication which brings along new opportunities for marketing.

The concept of marketing is extensive and there is high number of studies done on this

subject. These studies discuss different tools of marketing and how to use them to

guide businesses to success.



Traditional marketing

Marketing is considered to be a collective process where individuals or groups can

exchange goods or services based on their needs and wants. The content of this

process was presented as marketing mix by Neil Borden for the first time in 1953,

representing the mixture of useful elements for marketing. This theory of marketing mix

has been analysed and rewritten about by many different authors through time. One of

the authors that have written about this theory and explained his point of view about the

elements of marketing is Philip Kotler, whose marketing mix is presented in this thesis.

He considers the marketing mix, a mixture of different tools or instruments for pursuing

a marketing plan. In traditional marketing the wants and needs of customers are being

discovered and satisfied, through traditional channels of communication such as face to

face communication,magazines, catalogues etc. The aim is to create products and

services which sell themselves by being what customers need and want.

³Marketing is the process of planning and executing the conception, pricing, promotionand distribution of ideas, goods and services to create exchange that satisfy individual

and organizational objectives.´The marketing mix theory of Philip Kotler, the 4Ps are

presented here in the following order,Product, Price, Place and Promotion.



Product

According to Kotler 20 Product is the solution to customers wants or/and needs. There

are different aspects of product that needs to be considered. Some examples of these

are the design, function and quality of the product. The marketer needs to know what

kind of appearance such as size, colour and generally design of product is wanted or

needed. It is also important to know what kind of functions the customer is looking for in

the product. To know what is required by the market, there is a need for research and

studying the market. There are 5 product levels, which create the customer value

hierarchy. These levels are called core benefit, basic product, expected product,

augmented product and potential product. Core benefit is the benefit of the product

which the customer would be buying. For example buying a spa ticket, one is buying the

benefit of it which in this case would be relaxation and rest. Basic product is the benefit

turned into a product, providing th

e needed tools to create the benefit for t

he customer.

Expected product is what would fulfil customers expectations mainly based on what is

promised by the marketer. Augmented product is a product that fulfils more than what

the customer expects. Potential product is the possible wanted or needed product by

customers. Service is also a part of this P. It is the intangible good that a company can

offer to its customers and it is difficult good to provide, for satisfying customers needs

and expectations. One reason for this is the difficulty of measuring it fitting the needs

and expectations. Offering warranty is part of this P too. By providing warranty, the

company is not only offering a good customer service but also showing that it believes

in its own goods.



Price

Compared to other Ps in the marketing mix, pricing is easiest and quickest to adjust. As

Kotler presents21 it is an important part of the marketing strategy and it sends out a

message

about the product, company and the image. The decision of pricing is dependent on

what goals the company wants to achieve. Does the company want bigger market

share, maximum profit or possibly a specific position in the market etc?

Setting a price is a process and based on the marketing mix theory there are 6 steps in

this process. These are Selection of pricing objectives, Determination of demand,

Estimation of costs, Analysing competitors¶ costs, prices and offers, Selection of pricing

method and Selection of final price. The firm should decide on the objectives that it

wants to achieve which would make the decision of price setting clearer and easier. The

demand and price are depended on each other and therefore it is an important point for

setting price. Different kinds of possible costs such as fixed costs, variable costs etc.

should be observed and estimated when setting the price. This is one of the issues that

have a large affect on price setting. Analysing competitor¶s costs, prices and offers is

also very important in order to be able to compete with them and not stay behind. Based

on the different steps of the price setting process mentioned above, the company

sh

ould decide on a pricing meth

od and set th

e final price accordingly.Payment terms are part of this P. The different type of payments, credit terms and

different payment periods are issues to decide upon in a marketing process. The

marketer should consider different options and figure out the best way for different

situations, depending on the wanted result and the needs and wants of the customers.

Place

Place in marketing can be about location in the means of store, factory and storage.

Also the decisions on distribution channels and transport are part of it.22 The company

should act on the goals they want to achieve by the location they choose. Some

examples of the factors that have an affect on this decision are the cost of the chosen



location, the amount the company can spend in this area, the profitability of it and the

space needed. The choice of place can be very radical for the success of the business.

For example, a company chooses a place outside the city because of the wide space

needed and the cost of it or a company that opens a new store and wants to get the

customers¶ attention by situating it in a very busy and crowded area where possible

customers would drop in when passing by.

Promotion

Promotion is one of the important Ps of 4 Ps of marketing mix. The focus is mainly on

how the company could reach its targeted customers and communicate its message to

them. The figure below demonstrates the objectives of promotion mix which will be

explained further on in the text.

Sales promotion is a key factor in marketing campaigns, creating an incentive for

customers to buy the product or service. Sales promotion contains offers such as free

trials, prizes, warranties, coupons and etc. These are the offers that can attract mainly

the customers that are looking for a new thing and they probably would not become

loyal customers. This strategy can be used in high brand similarity markets where the

seller wants to reach short term high sales response and not so high permanent gain in

market share. In a low brand similarity market, this strategy can have a more permanent

affect or gain on market share. The amount of existing brands has grown by time and

the competition is getting tougher. Another issue rising from this is the price-oriented

customers that are looking for t

he better offer. For companies to be not just one of t

he

brands they have to try more and present more interesting promotion offers or ³better´

promotion tools than the competitors are using. Promotion can be used in different

ways, for example by targeting the new customers or loyal customers or rewarding both

in different ways. The bigger or more exceptional the offer, the more attention the

company can get from the customers.



Sales f orce is the face of company towards customers when providing or offering

customers solutions in either services or products. Their working process has become

from just selling to more complicated task. The sales representatives are the ones that

bring the needs o fcustomers and the company together and create the mutual

satisfaction.

Public relations involve creating and planning a program or event where the company

can promote and in some cases protect the products or the image. Some examples of

these events are presenting news or important information about the company to the

press by having a press conference. Another example can be informing and advising

management about the public issues and company position and image in different type

on situations.

The aim is to prevent bad publicity and therefore it is important that the managers are

aware of what kind of practices they should avoid and what kind to get involved with to

present a good will for the company. The importance or effectiveness of this tool should

not be underestimated compared to the other tools in promotion mix. This tool plays a

great role in presenting and keeping the company image, values and position which is

very important.

Advertising ³is any paid form of non personal presentation and promotion of ideas or

good or services by an identified sponsor´.25 Advertisement can be done in many ways.

Advertisement is a way of communicating the offer to customers and it can be done in

different ways, in different shapes and through different channels. Most companies get

an outside help from the experts such as an advertising company, to make the

decisions about what the best way to do their advertising would be. The company that

needs the advertising should decide on the budget they have for the advertisement,

what is the message they want to give to the customers, which media they want to use

and how they want to measure the results. These are some important decisions to be



made and it can easily happen that some companies under- or over-spend for

advertisement.

Direct marketing involves using different channels to reach the customers. This

communication can be done through face to face meeting, mailing, telephone,

catalogue and Internet. With direct marketing the company seeks for a measurable

response from customers. This is one way of building long term relationship with

customers; for example, by sending customers a birthday card on their birthday,

information or club membership offers etc. Direct marketing creates a personal feeling

communication towards the customer. Companies can be more aware of how to target

which groups of customers. Face to f ace selling is the most original one and is still

used in many companies where they send out their sales personal to meet the potential

customers. The sales person communicates directly with the customer and the offers

and the deals are made.Then there is direct mailing where the company sends a letter

to the customer. This letter can be an offer, announcement or reminder. Direct mailing

tools have developed by time and these added tools are fax, voice mail and e-mail. E-

mailing is one effective tool because of the time and money that can be saved by using

it instead of sending the regular mail.In catalogue marketing, companies send their

catalogue to targeted potential customers where they have the opportunity to order and

purchase the products or services by responding through Internet, telephone, mail or e-

mail. This way of shopping has grown among customers because of the comfort of

shopping while being at home.

Telemarketing is another way of direct marketing where the sales personal call the

customers

and tries to sell a product/service making an offer and possibly a deal. Other way of

telemarketing is providing a service for those who are already a customer and need

support. So the communication goes in both directions in this situation, depending on

the purpose of either party. There are some media channels used for direct marketing



such as TV, radio and magazines etc. For example there can be a number mentioned in

these communications which customers can use for ordering something they might get

interested in. This way they are given the opportunity to act when they are interested to

purchase a good seen or heard through the media. This way of marketing gives

companies the opportunity to give different kinds of offers to different kinds of possible

buyers.

Internet Marketing

Internet is used as a communication channel as a part of direct marketing. It has had a

large impact on marketing since it was invented and realized to be an effective

marketing tool. But the meaning and usage of it has changed through the years. In the

beginning it has been used mainly for communicating to customers through e-mailing

and getting response from them. It has helped the companies to be able to target their

potential customers more personally and knowing more about them has helped in

knowing how to approach different customers to get to their needs.Nowadays the concept of Internet marketing has extended and opened more

opportunities to companies in their marketing. The website of the companies online has

got a lot of attention and has become a very common media for presenting the

company, its offerings and image. Internet has become a strong marketing tool in itself

which can be compared separately to other marketing tools. This growth can be seen

both on a technical level and accessibility of it for customers. Today many people have

access to the Internet. 65% of all male and 53% all female population of Sweden use

Internet daily.With this large amount of possible customers, the

companies have access to a larger audience. The technical development of the Internet

and computers has made it possible for businesses to communicate their message and

image with no limitations. Internet is a new marketing tool that can be used by

companies in order to reach their Customers. Internet marketing is defined as ³the



application of the Internet and related digital technologies to achieve marketing

objectives and support the modern marketing

concept´. Internet marketing is often presented as a new theory of marketing however

some argue that basic concepts from the traditional marketing are still valid. The basics

of marketing mix are still applicable and Internet offers new opportunities to adapt them.



Product

³The Internet leads to faster discovery of customer needs, greater customization of the

products to the customer needs, faster product testing, and shorter product life cycles.´

Internet offers the opportunity of developing new products or services. To develop a

product, there is a need for research on customers¶ needs. Internet provides the

opportunity of offering a core prodcut that satisfies the customers¶ fundamental needs,

but it also enables the companies to offer additional services such as interactivity or

more information about the company¶s core product. On Internet, a picture or

description will replace the physical product offered in the traditional marketplace or in

stores. Providing a complete and relevant product information is crucial in order for the

customers to get a realistic picture of the product and to make the product offered more

attractive. Since customers can not touch, feel or try the products chosen on Internet,

companies that have online shops should offer warranties for products sold.33 This

practice increases customers¶ confidence thereby their willingness to buy on Internet.

Companies that have an online store should offer services of high quality to their

customers. Services offered on Internet by a company should reflect the following

factors in order to satisfy customers: reliability, responsiveness, competence, ease of

use, security, and productportfolio.

Price

Compared to the other elements of the marketing mix, Price is the most flexible element

since it can be adapted quickly to the market¶s demand than other elements.

Price on the Internet has become very competitive. There are two reasons for that ; one

is price transparency on the Internet as it is much quicker and easier to compare prices

by visiting companies websites or by using price comparison sites.35 The other reason is

the ability to reduce costs such as store space and staff costs. In this sense, Internet is



considered as the most cost-effective marketing tool. Internet offers new methods of

payment. The online payment that uses mostly credit cards is seen as an efficient,

convenient and flexible payment method for both companies and customers. In fact,

customers are the ones who fill all the needed information such as their personal and

credit card information. This helps companies to save money and time by reducing

administration work. Moreover, customers have the possibility to pay their bills at any

time and any place they wish if only they have access to the Internet.38. However,

security and privacy issues make customers less confident when using this method.

Place

The Place element of the marketing mix traditionally refers to where the product is

distributed to customers. Internet offers a new way for distributing products through

online selling. Allen and Fjermestad argue that the Internet has the greatest implications

for Place in the marketing mix because it has a large market place.39 People can make

a purchase decision anywhere they are thanks to online selling. With Internet,

companies can expand from local market to both national and international markets.

Internet can also be used to exploit new markets. Companies can gain the advantage of

the low cost of advertising internationally without the necessity of a supporting

sales infrastructure in different countries.

Promotion

The Promotion element of the marketing mix refers to how marketing communications

are used to inform customers about an organization and its products. Internet can be

used to review new ways of applying each of the elements of the communications mix

which are advertising, sales promotions, PR and direct marketing by using new media

such as the web and e-mail.Internet offers a new, additional marketing communication

channel to inform customers of the benefits of a product and assist in different stages of

the buying process. By using promotional tools on the Internet such as online offers,



frequently updated information and direct e-mail reminders, companies can encourage

customers to visit their sites.

Internet Advertising: It is a form of advertising that uses the Internet to deliver

messages about a company and attract customers.

It can be done in two ways: by creating a website which can help a company to deliver

all information to the potential customers or by using banner advertisements which can

lead the visitor to the relevant website. It is critical for a company¶s website to be well

designed and informative in order to attract many visitors in the target group.

Sales promotion: With Internet, marketers have a great opportunity to offer sales

promotions such as competitions or price reductions to those who visit the company¶s

website. This can encourage the customers to visit that website again and this way of

interacting with the customers provides the means for the company to build a long term

relationship with their customers.

Public relations: Internet is a new medium for Public Relations (PR). Internet offers

companies the opportunity to publish the news directly while in traditional marketing

they would wait for periodical publications. They can use Blogs, Podcasts / Internet

radio shows, Online newsrooms and media kits.

Direct marketing: Internet provides companies with a new tool for direct marketing and

advertising that may be cost effective and provide maximum delivery to targeted

customers.By using e-mail addresses, the company can establish a continuous

dialogue with customers.



Traditional Marketing VS Internet Marketing

In this section the authors make a comparison between the main points of both

traditional marketing and Internet marketing. Here the 4 Ps are mentioned in

comparison to each other to give a clearer idea of different issues that either traditional

marketing or Internet marketing carry in their tools.

Product

Product in traditional marketing is tangible for the customer where as through a website

in Internet marketing is just a virtual image.The customer can not experience the quality

and size of the product by seeing it on the website in the same way as seeing the

product in a physical store. Not being able to reach and feel the product physically, can

create doubts for the customer and have an affect on his/her purchasing desicion.

When it comes to range of products offered t

hroug

hInternet compared to p

hysical

stores, there is an advantage of possibility for a company to offer a wide range of

products on their website. The issues that can appear here are cost and space for

inventory and store space itself, where there is a connection between cost and space.

One important issue to point out is the customer service and how it can reach the

customer. It is more difficult to provide customer service through Internet compared to

face to face contact when the customer visits the physical store. The customer can get

a quick response and reaction from the staff when getting a service in the physical

store, where as through Internet the customer is dealing with a so called fixed service.

And eventhough there might be possibility for communicating through e-mail or support

chat function, the response and communication of service will not be as personal and

quick as it could be when communicating face to face.



One issue that can affect the customers choice of purchase is the warranty of the good.

This gives comfort to customers, both in traditional marketing and Internet marketng but

most importantly it gives the secure feeling to those purchasing online. The customer

that can not see and touch the product when purchasing it would feel more sequre

knowing that there is a warranty on the product and this would make the choice of

purchase easier and less risky.

Price

The pricing of a product can be based on the costs of its process in reaching the

market.When a company does Internet marketing it has a bigger opportunity to save

costs and therefor possibility to have lower prices. One of the reasons for this is the cost

of space for keeping the products or the cheap way of communication through inernet

such as communication by e-mail.

When marketing through Internet, the competition is very though which affects the

pricing reasons. The competitors are a click away when a potential customer is

searching for information on the Internet.Since payments for purchase through Internet

are done by credit card mostly, there can be some security issues that create problems.

For example a customer would feel more secure

paying in the physical store where they can have more control over the payment

process, where as purchasing online they would be taking a risk when giving the credit

card details.



Place

In traditional marketing, companies have the opportunities to decorate the stores in

order to create a specific athmospher that can attract customers. Some attractive tools

to create that atmospher can be music, colors, etc, but through Internet marketing it is

almost impossile to create a real sensation since a website is just a virtual image.

Eventhough many of the websites try to create an atmospher by adding the same tools

for attraction, they can not create as real experience as can be created in the physical

store. The atmosphere of the store is mentioned to be very important for sales of the

products. For example if you see an unorganized store just filled up with some clothes

you hardly feel tempted to go in and look for anything. The way the store is decorated

gives a message about the company and its style.52 When one thinks about this, one

can realize the importance of the physical existence of the store. Think for example how

the company could offer the same atmosphere through the website. As an example we

can consider H&M, based on their website their aim is to have the same atmosphere on

their website that they have in their stores.But in the end the experience of stepping into

the store is different than clicking on computer when shopping. Internet helps

companies to be reachable at any time, regardeless of openings hours that phyical

stores require. Also the possibility for the customers to reach the store location online

and the range of customers that can do that is much wider compared to the physical

location of the store.



Promotion

When it comes to promotion, one thing is clear in difference between the

communication through traditional tools and Internet and that is the speed. Speed of

getting the message of advertisement, news or any type of information through to

customers is very quick through Internet. This is a very important issue in the

competetive world of business. Another difference between promotion by Internet and

promotion by traditional ways is the durability of the marketing message the marketer

wants to communicate with the customers. In traditional manner, the message would

receive attention during a limited amount of time,for example as it is aired on TV or sent

out as paper advertising. Where on the Internet, the marketer¶s message to the

customers can exist constantly on the company¶s website for example and it is

accessable by the customers 24/7.Through a website, a company can present itself in

many ways where the customer can study different aspects of the company and get to

know it well where as this is not possible in the same way through traditional tools for

promotion.56 For example the complexity of wide range of information can not be easiely

fitted into a magazine advertising or TV commercial etc. The tools for traditional

promotion can be used mainly in communicating the message shortly and consistantly.

There is of course the burden of maintaining a website or online commercials that

consumes time, resources and money. But th

is should be weig

hted out by t

he

accessability and opportunity they provide. Another issue is the damage that a failed or

crashed website or other Internet service can have on a companys image.57

A good website is very important for succeeding in online marketing. According to

Sunday Times, some important guidelines for a good website for a company are:

* ³Provide clear information on contacts, delivery and refund policies.´

* ³Think "user journey" rather than individual pages.´

* ³Let shoppers browse without having to register.´

* ³Keep sites simple and easy to use.´

* ³Offer an effective search engine.´

* ³Market the site online and link it to search engines.´

* ³Provide consistency of experience.´

* ³If the Internet does not offer the full bricks-and-mortar range, say so.´



* ³Give complaints ID numbers.´

* ́ Build trust.´

Nowadays a large group of consumers have the problem of time but have the money to

spend so therefore it can be easier for them to shop online, by saving time when

spending. The image, speed, design and generally every aspect of the website of a

company is very important and in a case of failure it can have big damages to the

company that can¶t be even compared to lost sales. Communicating through Internet

gives an opportunity to the marketer to reach the targeted group easily and have a

continues relationship with them.Of course there are some great advantages in

communicating through traditional tools of promotion such as face to face

communication with customers where the company can get

straight feedback and can measure the result more quickly. The communication in this

way is both sided where the customer has more opportunities to react on the

information or offer received.

The Comparison Model



ANALYSIS

Going through different aspects of both traditional marketing and Internet marketing, it

becomes obvious that the marketer uses both of them to reach the same goal. This goal

that is brought into attention in both theories of traditional marketing and Internet

marketing is satisfying customer¶s wants and needs. Even though all the marketing tools

were affected by the changes that came with Internet and the possibilities that it

brought, the main change is focused on promotion. Promotion is the tool used for

communication and Internet has provided marketers with a different channel for communication to the customers. A marketer can be communicating anything possible,

for example news or offers related to marketing tools such as product or place and for

that, it is crucial to choose the most effective channel for communication. So mainly it is

a matter of finding the best way of getting through to customers and make sure that the

chosen channel for communication enables the delivering of the wanted message in



most effective and profitable way. When Kotler presents the 4 Ps, he gives the

impression of the simplicity of the market and how it can be dealt with by going through

the steps of marketing mix. In this theory the complicated process of marketing might be

too structured and simplified. This provides a good educational material for marketing

students but may result in undermining the complexity of marketing in actual

companies. By going through the 4 Ps mentioned in the Internet marketing theory, it is

obvious that the entrance of Internet to the business world has changed the way the

marketer reaches the customers. This has introduced some advantages to marketing

that were not possible before. At the same time the entrance of Internet in marketing

has deprived some advantages, such as face to face communication with the

customers. As these theories try to create an understanding of usage and functions of

each tool, they show how they all are connected to each other . In the marketing mix

theory, the issues in one marketing tool can affect another marketing tool. The 4 Ps are

as one chain in the marketing process. For example, the location of the store can affect

the cost of the process and this can affect the pricing of the product. This can go on in

any direction between the 4 Ps which can be perceived by studying them deeply. This

connection becomes especially obvious when comparing different issues between

Internet marketing and traditional marketing.

Internet marketing

PROMOTION

Even though the companies interviewed have websites, not all of them seem to

consider it as very important way of marketing. A reason to this might be the lack of

direct feedback from the customers and thereby the lack of direct results. When they

mention the effectiveness of a marketing tool, they mention the ability of seeing its

results. They do believe that it is a useful tool that is added to other marketing tools but

it is considered as a complimentary tool mainly. The possibility of Internet marketing

being more effective than traditional marketing is not evident based on the answers of

those interviewed. Marketers can reach a wide group of customers fast and easy



through Internet. They can communicate their message to them either by e-mail or by

announcements on their website. Website is a very powerful tool for communication

from marketers to their customers. A company can present any information wanted to

be communicated about their history, offers, news, future plans etc. on their website.

This way they keep their customers always informed and involved. All of the interviewed

managers for this thesis have referred to the importance of their website mainly

mentioning that it has given them possibility to reach a wide range of customers easily

and fast. They all seem to appreciate the advantages of Internet and use it. There are

different advantages in both marketing in traditional ways and through Internet.

One can go through the different aspects of them and weight the importance of them in

different situations and depending on what the desired result is. Reviewing the answers

received from the interviewed marketers, we can notice that they consider the traditional

marketing tools of great importance in their marketing process. They do not imply that

the traditional marketing tools would be replaced by marketing through Internet, though

they all have added Internet marketing to their process. One of the interviewed

companies, Heart of Brands, considers the Internet marketing very powerful. Based on

the interview answers, Internet has given them great opportunities where they can not

see themselves succeeding without it.

PLACE, PRICE & PRODUCT

There are some advantages and disadvantages to Internet marketing that are

mentioned in the comparison model in chapter three. There are some possibilities given

to marketers by Internet that have added value to their business. Companies can

provide wide range of products on Internet since keeping them in some storage instead

of a store is much cheaper. This way they have two advantages connected to each

other, offering lots of products to satisfy a large and versatile group of customers, at the

same time cutting cost by having the products in a cheaper and larger space. Through

this strategy of being able to cut cost, the prices of the products can be low.

Furthermore, the competition between companies remains an issue; compared to the

competition that a company faces on Internet, the competition is less tough in traditional



marketing. When the customer is going through different competitive stores physically,

there are many things that can limit her/his visiting and finding out more about all the

stores. On the other hand, a customer searching for information and products through

Internet can easily and quickly find any product, offers and any information related to

prices etc.

Traditional marketing

PROMOTION

Going through the comparison model presented in the theory part in chapter three the

different aspects that differentiate traditional from Internet marketing become clearer.

The advantages pointed out about traditional marketing are to some extent

irreplaceable by any way of marketing through Internet. A face to face contact with the

customer is one important advantage that can not be performed through Internet and

can have a large impact on the customers¶ experience. It is a way of communication

and providing personal service that can create a relationship between the customer and

the marketer. Face to face communication creates an active marketing situation w

here

both customer and marketer have an opportunity to give and receive information and

feedback in person. This way the measurement of the result and feedback from

customers is easier and quicker. As it comes to attention, the advantages of traditional

marketing such as personal service, quick feedback, quick and easy way of

measurement of results and responses are connected to face to face communication

Most of the interviewed companies in this thesis seem to believe that meeting the

customer face to face is one of the most important and effective ways of marketing

where they can receive direct respond, feedback and have a more personal relationship

with the customers. Here we can realise how face to face marketing is separated from

what direct marketing through Internet is. The lack of face to face communication and

advantages followed by it are obvious, when we consider marketing through Internet.

The only company that did not put much emphasis on this matter of the face to face



communication was Heart of Brands. They do not consider this to be a big issue when it

comes to Internet marketing and it doesn¶t affect their decisions. It seems that by

considering the advantages of Internet marketing, they have found a balance between

the two marketing approaches. They seem to believe that the benefits of Internet

marketing are radical for their success.

Events seem to be a common marketing tool used by these companies. Events such as

store openings are mentioned to be very important for Tiger of Sweden because of the

atmosphere, feeling and generally the experience that it creates both for the marketer

and the customers. This is one clear point that separates traditional marketing from

Internet marketing. The communication in Internet marketing lacks the personal

relationship, personal service, direct response and sense of reality which are the points

that seem very important for these companies interviewed. The events are said to be a

great tool for building a personal relationship with customers. Especially one advantage

is mentioned to be very important, which is the possibility of measuring the responses

when communicating and getting sales results. When a company can easily measure

results and is able to connect it to the work done and the channel of communication

used, it creates appreciation of that marketing tool used for it. So the connection

between a marketing tool that is considered effective and the simplicity of the

measurement of its results can be noticed here. The easier to measure the respond of a

used marketing tool, the more convincing marketing tool it seems. Those companies

interviewed that do not have online store have been succeeding well by their sales

through their physical stores. Some have a plan for opening an online store in the

future and consider it as an expansion of their sales possibilities. What is considered

most effective point in Internet marketing is the possibility of giving the message out to a

large group of people very effectively.

PLACE, PRICE & PRODUCT

Another advantage mentioned in the comparison model is the physical access to

products. This is an experience that can not be replaced by marketing through Internet,



since it is impossible to feel the material, try it on and see the size, material and colour

fitted on you,through Internet.

The other advantage connected to this matter is the physical existence of the store itself

which can affect the customers by creating a pleasant shopping atmosphere for them.

There is a strong statement of opinion from the interviewed managers that the face to

face contact and communication, and physical existence of products and place is very

important for their marketing. As most of the interviewed marketing managers of the

chosen companies imply, and according to the annual report of H & M, the physical

stores are very important for their business. It is important that customers can feel the

products and try them on and also get direct service at the store. In this way, the focus

is on Product and Place and these market themselves. The atmosphere and existence

of the physical store were pointed out by the interviewed

managers to be very important matters. The atmosphere can strongly affect the

customers in their decision of entering the store and purchasing of products. The

atmosphere of the store can also communicate the firm¶s image to its customers. The

message and experience that the store provides for the customers can not be replaced

by other means such as Internet. These are some important points brought up by the

interviewed managers, which emphasis the differences between the physical location of

the store and the store on Internet. When it comes to payment of the purchase, the

issue of security is raised. The customer feels more secure when paying in the physical

store where he/she has more control over thesituation. When the payment is done

through Internet, the customer can not be as sure about the process after giving her/his

credit card number through a public web page. There are of course different payment

methods for purchases made on the Internet that provide a higher security, such as

paying after receiving the products or paying through the Internet banks¶ secure

solutions. Based on the statistical data presented in this thesis one can see that

purchase of goods through Internet is growing and the more common it becomes, the

more customers feel secure about it and they gain more trust in this way of purchase.



VIEWS ON INTERNET MARKETING VS TRADITIONAL MARKETING

As mentioned earlier the main focus in this subject appears to be promotion and the

channels used to communicate to customers. As it seems, the part of marketing that

has been put mostly emphasis on is events, public relations, magazines, catalogues, TV

advertisement and being in face to face contact with customers. All of these companies

have a website and some have also online stores. The impression given by the

interviewed people implies that they all put a lot of emphasis on traditional marketing.

There is though a comment from Heart of Brands which has a good point. The

interviewed person mentions that what tool is considered most effective depends on the

goals that the marketer wants to achieve. Based on her answer, different tools have

different purposes and are effective if used according to that purpose. The channels

mentioned to be used for promotion are both from traditional marketing and Internet

marketing. TV, magazines, catalogues, PR and e-mailing are used for some direct

marketing and websites are used as well. These are the direct way of marketing to

customers,communicating any message. It seems that websites are nowadays a part of

the marketing tools used but also treated just as one additional complementary tool. It is

though obvious for the marketers that websites can give good opportunities in reaching

customers anywhere and as appears in answers received from H & M, the extra sales

that can be made through the Internet is positive but not at a comparable level with the

sales in physical stores. Those companies interviewed that do not have online store

have been succeeding well by their sales through their physical stores. Some have a

plan for opening an online store in the future and consider it as an expansion of their

sales possibilities. What is considered most effective point in Internet marketing is the

possibility of giving the message out to a large group of people very effectively.

By getting some answers from those who work with different marketing tools everyday

and see the results of them, the connection between the two different approaches,

traditional and Internet marketing, and their comparison becomes clearer. The

advantages or lack of them found earlier among the theory of either one seems to be

matching with comments received from interviewed people.



There are different comments on what is considered a successful way of marketing

based on these interview answers. As H & M marketing manager believes that the

combination of both internet marketing and traditional marketing is helping them

towards success, even though their most effective tools are their catalogues and

physical stores. The comment from Vero Moda¶s marketing manager is that there is no

specific way to success but until now as it seems they have relied mainly on the tools of

traditional marketing even though they do use Internet marketing. The manager of Heart

of Brands has a strong faith on Internet marketing and seems to believe that it has

radically added value to their business and affected their success. When it comes to

face to face marketing, it is clear that Tiger of Sweden relies a lot on it and believes that

it is an irreplaceable way of marketing when it comes to its effectiveness. Polarn

& Pyret seems to put great emphasis on their physical store as their marketing channel.

Ref erring to advantages of Internet marketing

Following advantages were referred to by VeroModa, Polarn & Pyret, H&M and Heart of

Brands:

-Fast speed of communication,

-Possibility to present the company

-Easier to reach more customers

-Communicating with target group

CONCLUSION

we can not generalize and suggest which approach is better than the other after

comparing Internet marketing with traditional marketing. Depending on companies¶

goals, products and target group etc. the right choice of marketing tools can differ There

are many sides to different ways of marketing, the advantages and disadvantages that

they can have. There can also be different goals to achieve and different types of target

groups to reach, which can affect on the right choice of marketing tools. Even though it

can seem confusing but it appears as all aspects in the marketing process depends on



each other and affect the decisions made about marketing approaches used. There is

no meter to measure the efficiency of either way of marketing to give a 100% correct

answer that we are looking for. All that is available is theories that support specific ideas

about this subject, some marketers¶ experience and point of views. In the frame of this

thesis with the possibilities available keeping in mind the limitations, there has been

some relevant data gathered that has helped the authors and hopefully the readers of

this thesis to come to a conclusion. It has become more and more clear that the

combination of both traditional marketing and Internet marketing would be the most

effective approach but if there is a need of making a choice between the two, a

company should consider what is to be achieved and which approach would be

appropriate specifically for reaching that goal and target group. Placing both traditional

marketing and Internet marketing against each other to figure out the more effective one

was difficult because they complement each other. There are different kinds of benefits

in using either one which makes it difficult to weight them against one another.

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