Recently, I have completed a course "Marketing in a Digital World" on Coursera. I have learned so much from this course and have decided to share them with you guys. Hope it'll be of help!

1. MARKETING IN A
DIGITAL WORLD
Prepared by Mahir Mahtab Haque

2. Marketing overview
 According to the American Marketing Association, ‘Marketing’ can
be defined as ‘the activity, set of institutions and processes for
creating, communicating, delivering and exchanging offerings
that have value for customers, clients, partners and society at
large’.
 In essence, marketing is the enactment of a mutually beneficial
exchange between two parties, a seller and a buyer.
 The 4Ps (aka marketing mix)
- Product
- Price
- Place
- promotion

3. Product
 A product must have a distinctive/unique selling proposition which is referred to as a product’s positioning.
This positioning can be either functional, based on actual product differences or symbolic, based on how the
product is perceived.
 Firms that create new products and new business models are referred to as firms engaging in a radical
innovation, which disrupt traditional practices. On the other hand, most firms engage in what is known as
incremental innovation, which focuses more on improving existing products rather than creating entirely new
ones.
 A brand is a name, symbol or design that differentiates a firm’s product from its competitors. This differentiation
can be either tangible or intangible.
 Strong brands help customers decide what to buy and provides them not only greater confidence but also a
sense of identity. Brands are also beneficial to firms. Strong brands usually charge higher prices, enjoy greater
loyalty and experience higher profitability. This results in brand equity, which is the value of a brand over a
generic product in the same category. Brand equity is a substantial intangible asset for many firms.
 Given this high value placed on brand equity, most firms placed considerable emphasis on building strong brands
by carefully choosing brand elements such as a brand name, color, building strong associations through
advertising campaigns and protecting brands through their trademarks.

4. Co-creation
 Customer co-creation: Contributions made by
customers that assist a firm in the design and
development of a new product offering.
 Steps involved in co-creation:
- Customers must submit contributions
- Select a few valuable contributions from a
larger set
 Motivate customers to engage in co-creation
through:
- Social recognition
- Financial reward

5. Co-creation
 Types of co-creation:
- Collaborating (selection activity: customer
led, contribution activity: open)
- Co-designing (selection activity: customer
led, contribution activity: fixed)
- Tinkering (selection activity: firm led,
contribution activity: open)
- Submitting (selection activity: firm led,
contribution activity: fixed)

6. Co-creation
 Design crowd sourcing: The practice of soliciting functional design
solutions from the crowd.
 Studies have found that design crowd sourcing has a positive
impact on the sales of new products that are low in customer appeal
but have no effect on the sales of products that are high in customer
appeal. Moreover, studies have also suggested that crowd sourcing
can be a beneficial tool for companies under certain conditions,
especially for those who have complex technological products that
have a low degree of initial customer appeal.
 Practical recommendations regarding co-creation:
- Rule of 1
- Authenticity is critical
- Patches and badges

7. Sharing economy
 Sharing economy are ‘technology-enabled platforms that
provide users with temporary access to resources that
may be crowd sourced’.
 Characteristics of sharing economy:
- Inherently digital in nature and run on technology
platforms
- Grant temporary access rather than permanent
ownership
- Resources are often owned by external individuals
 In essence, the sharing economy connects individuals
who have things they want to share with others who need
these things.
 Example: Uber, Airbnb

8. Sharing economy
 Further aspects:
- Two-sided platform: A firm must recruit both customers and
providers. Some platforms are now owning their own supply
of resources.
- Crowd source supply: Suppliers are not employees and
platforms have limited control over them. Thus, quality of
offering is less consistent. Therefore, platforms have opted
for 3 strategies: careful selection, training and rating system.
- Access not ownership: Customers can try products and
services that they can’t/don’t want to own. Brands are also
less important in the sharing economy.

9. Sharing economy
 2 important dimensions:
- Consociality: the degree to which members of the platform can
engage in social interaction
- Intermediation: the degree in which the transactions flow through a
provider
 Types of sharing economy:
- Forums (high Consociality, low platform Intermediation) connect
actors. Example: CarpoolWorld
- Matchmakers (high Consociality, high platform Intermediation) pair
actors. Example: Uber
- Enablers (low Consociality, low platform Intermediation) equip
actors. Example: PoshMark
- Hubs (low Consociality, high platform Intermediation) centralize
exchange. Example: LendingClub

10. Sharing economy
 Recommendations:
- Leverage your prosumers: Prosumers are
individuals who provide crowd sourced resources.
- Employ reverse ratings: Customers rate
providers and vice versa.
- Ride the surge: Surge pricing increases the price
of a shared service in a particular area when the
demand is high.
- Position on price: Marketing offerings as a way
of saving money rather than saving the world.

11. Promotion
 Promotion covers the methods of communication that a
marketer uses to provide information about his
products. Typically, we think of this information as being
persuasive in nature with a goal of getting customers to buy
your product instead of your competitors. This information, it
can be built verbal and visual. Thus, a promotional strategy
can influence consumers by appealing to either their intellect,
or their emotions.
 Key concepts of promotion:
- Personal selling
- Sales promotions
- Word-of-mouth

12. Promotion
 Advertising
- Goal of advertising is to elicit a response
- Firms usually hire an ad agency to create an
advertising campaign and then will carefully
pretest these ads before they are shown
- Once the campaign is launched, the firm will
usually have a marketing research company
track the ad to assess its effectiveness of the
campaign and help decide when it needs to
develop a new marketing campaign

13. Promotion
 Persuasion
- Some persuasion tactics: celebrity
endorsements, humor and scientific claims
- Elaboration Likelihood Model (ELM): This
model suggests that there are two main routes
to persuasion, the central route (cognitive) &
peripheral route (emotional)
 Remember: “Marketing is moving from
selling products to telling stories”

14. User-generated Content (UGC)
 This occurs when a product’s customers create and
disseminate online ideas about a product or the firm that
markets it.
 3 characteristics of UGC:
- Contribution is by users of the product rather than the
firm
- Creative in nature and adds something new
- Posted online and generally accessible
 Typically, UGC is noncommercial in nature and doesn’t make
any direct types of promotional appeals. Thus, it is very
indirect, subtle and also an authentic form of product
promotion.

15. User-generated Content (UGC)
 Types of UGC:
- Blog postings
- Product reviews
- Various submissions through firm based invitations
 Motivation for contributors:
- Social recognition
- Financial incentives
 Benefits of UGC:
- Low cost promotion
- Positively related to product sales
- Customers trust UGC more than traditional promotions
- Keeps content fresh

16. User-generated Content (UGC)
 Motivating UGC with performance feedback:
- Cooperation – impact of UGC on others
- Individualistic – which is feedback about the
quality of your ideas
- Competition – which is feedback about how much
better your UGC was than that of others
 Experimental results:
- Impact of feedback depends on an individual’s
gender
- For women, cooperation was the strongest
motivator; whereas for men, it was competition

17. User-generated Content (UGC)
 Creating UGC on smartphones vs. desktops:
- On smartphones, UGC is much shorter and less detailed; whereas on
desktops/laptops, UGC is longer and more detailed. Moreover, UGC is
more emotional and positive in nature on smartphones.
- Research suggests that the content of UGC is affected by the type of digital
tool that is used to create it.
- Firms should encourage creation of UGC on smartphones rather than
computers
 Recommendations:
- Ask to share: Direct customers’ efforts toward your brand rather than your
competitor. Also, remember that promotional activities should be a two-
sided conversation between the firm and its customers.
- Be responsive: Provide feedback/rewards to customers who provide UGC.
This way higher levels of UGC can be obtained.
- Remember the Pareto principle: 90% of content is created by the 10% of
users
- Integrate UGC with traditional promotion

18. Doppelganger Brand Images
(DBI)
 Doppelganger brand is an alter-ego of brand that is negative
in nature.
 Doppelganger brand image is a collection of disparaging
images and stories about a brand circulated in popular
culture by a loosely organized network of anti-brand activists,
bloggers and opinion leaders. These are usually focused on
well-known brands that are viewed as lacking authenticity and
trying to create false/misleading emotional appeals through
their promotional activities.
 Motivations for creating DBI:
- The perception that a brand is being inauthentic by claiming
to be something that it is not or disguising its true
nature/effect

19. Doppelganger Brand Images
(DBI)
 Types of brands susceptible to DBI:
- large, well-known brands with a high degree of
brand awareness and familiarity
 Where are DBI found:
- Individual blogs/social media platforms
- Larger digital media outlets like
Reddit/BuzzFeed/digg/news channels
- Websites that create DBI

20. Doppelganger Brand Images
(DBI)
 Tips to combat and leverage a DBI:
- Monitor digital cues – view DBI not only as threat but also as an
opportunity to stay relevant; monitor industry and brand-related
websites; use tools to track brand-related conversations such as
Google Alerts/Topsy/Brandwatch
- Identify and track brand avoiders – once avoiders are identified,
conduct research to determine which DBI meanings resonate most
strongly
- Develop and test a new story – craft a new story that either
addresses the DBI or bypasses it entirely; remain true to the brand,
inauthentic stories will be quickly detected and exploited
- Vaccinate your brand from the threat of DBI

21. Placement
 It focuses on making the product conveniently accessible to
potential customers.
 Key concepts:
- Inventory management
- Logistics
- Sales force management
 Distribution:
- Typically outsourced to a series of independent firms
- Each member is typically independent and wants to maximize
profit
- Must carefully select and monitor channel partners

22. Placement
 Retailing:
- Typically the final step in the distribution channel
- Selecting the type and number of retailers is an important decision
as it affects the type and number of customers that can acquire the
product (luxury vs. low-priced goods)
- Retailers also vary in terms of their degree of customer service
(self-service vs. full-service)
 With the rapid advancement in technology, digital tools are now
capable of not only replacing the retailer but the entire distribution
channel.
 Newly emerging tools such as 3D printers are now making it
possible to eliminate the distributor, by allowing a firm to ship a
digital design rather than a physical product.

23. New Retail
 Websites allow customers to collect product
information and purchase online.
 New emerging trends/new retail:
- Best Buy vending machines
- Tesco virtual stores (Tesco app)
- B8ta
 New Retail can be defined as a collection of
strategies (both physical & digital) that physical
retailers are using to react to the changes of
operating in a digital world.

24. New Retail
 3 key observations:
- Location – Online retailing is heavily influenced by location. Online
shopping is more likely among customers living in small towns.
- Purchase vs. information – Consumers visit digital retailers for
both purchasing and collecting of information. Showrooming takes
place when customers first visit the physical store and then order
online. Webrooming occurs when customers first collect product
information online and then buy it in a physical store.
- Digital & physical – Blending of the digital and physical channels is
often referred to as omnichannel marketing. Benefit of physical
retail include returning of products and customer service. Benefits of
online retail include conducting product research and getting the
best price.

25. New Retail
 Virtual reality retail benefits:
- Visual-spatial cues – visualize a product in 3D space
- Interactivity – rotate and examine a product in virtual space
 Virtual reality:
- Allows shoppers to gain more information and be more playful with a product
- Increased sense of playfulness
- Increased customers purchase intentions
- Investments in VR technology may be a wise strategy for physical retailers
 Recommendations:
- Market to shoppers – By employing shopper marketing, marketers can understand and
influence shopper behavior once they enter a physical store
- Enhance the physical by adding the digital – Digitize the in-store experience
- Use the power of touch – Customers are more likely to buy products that they are able to touch
- Tiny & temporary – Reduce risk and save money by setting up pop-up stores, which are small
retail stores that exist for a limited amount of time. These stores have low fixed costs and
generate substantial attention and traffic.

26. Self-manufacturing
 Desktop 3D printer is an electronic device that is capable of
turning digital designs into physical objects through an
additive process.
 How does 3D printing work:
- 3D printers are computer-controlled devices that contain a
print head and various electronic motors that move the print
head or the print platform in three different dimensions.
- The movement of this print head is determined by a digital
design file, which is read by the printer's motherboard.
- These design files could come from a variety of sources. It
could be created using a 3D modeling software
package, such as Google SketchUp, it could come from a
digital scan, it or could be a digital download from a file-
sharing website such as Thingiverse. Thus, if you can
download a file, you can create a 3D printed object.

27. Self-manufacturing
 What’s special about 3D printing:
- Sustainable manufacturing approach; no material
waste
- Files can be shipped electronically and printed
locally; no shipping costs
- No set-up costs or economies of scale
- Makes complex objects that are already
assembled
 How will 3D printing change business:
- From physical to digital: Can be created and easily
accessed by anyone with digital tools. Customer
production and modifications change the role of firms

28. Self-manufacturing
 Academic insights:
- 3D printing can help retailers by reducing their inventory, by replacing physical products with digital
designs
- 3D printing can harm retailers by enabling customers to create their own products rather than
buying them from a retailer
- 3D printing is primarily a method to create new, standalone objects rather than existing
components
- Individuals who printed their own objects felt more closely connected to them and displayed a
higher sense of perceived ownership
 Recommendations:
- Make the physical digital – turn physical products into digital designs. These digital designs are
especially helpful for replacement parts, which are costly to store and difficult to transport.
- Let consumers customize your designs – offer a basic template and then let customers design
a product to fit their specific needs. Digitization can satisfy a broad range of customer preferences.
- Cut out the middleman – digital distribution saves time/money and allows greater control over
the distribution process. Post digital files of products online.
- Done is the ‘engine of more’ – desktop 3D printing is relatively cheap and easy, requires no
extensive planning. If you have an idea, you can design it and make an initial prototype at your

29. Price
 It is the amount a customer pays for a product. It
captures value for the firm in the form of financial
payment.
 The development of a pricing strategy is a complex
decision and often entails considering a products cost
of production, what customers are willing to pay for it
and the prices of competing products.
 Key concepts:
- Break-even analysis
- Price elasticity
- Reference prices

30. Pricing Strategy
 It is a firm’s basic approach to how it prices its
products.
 Common strategies:
- Cost-plus pricing - It is based upon the cost of
manufacturing or acquiring the product, plus a
commonly accepted markup percentage
- Competitor-based pricing – It is based upon
closely matching the prices of relevant
competitors
- Value-based pricing – Focuses on the added
value that a product delivers to its customers

31. Price Knowledge
 Knowledge about prices is important because
this knowledge helps set price expectations
and also gives consumers more power in the
marketplace.
 In this new digital marketing environment, we
are shifting from fixed prices to more flexible
prices.

32. Pay what you want (PWYW)
 This is a pricing strategy that lets customers
decide how much they want to pay for a
particular product. Although a firm may
suggest a price, its customers are free to pay
less or more than this price, including paying
even nothing.
 Pay what you want appears to be an approach
that is a good change of pace. But not
sustainable as a long term pricing strategy.

33. Pay what you want (PWYW)
 Recommendations:
- Set a reference price – Display price of a
comparable item. Decrease the temptation to pay
less/nothing.
- Focus on marginal cost – Products with low
marginal costs. Digital goods have a low marginal
cost. Pair with a digital product.
- Try a limited rollout – Limit the product offerings or
the duration of PWYW. Reduces the risk of PWYW
strategy while still benefitting from the attention it
receives.
- Use charity appeals – Signals that the seller is
generous and also encourages the customers to
behave similarly.

34. Freemium model
 It allows customers to access a portion of the
product/service for free, and then pay only for the
added offerings they would like to have. This is
quite common for smartphone apps.
 Freemium is a digital product /service that offers
a set of basic features for free, but charges a price
for a set of premium features.
 This model can work well for digital products and
services due to the fact that the marginal cost of
adding a new user is close to nothing.

35. Freemium model
 3 key features about this pricing:
- 5% rule of thumb – a small percentage of paying customers
must provide enough revenue to serve all the free customers.
Most freemium platforms have a conversion rate between 2%
- 5%
- Zero price effect – balance free features to attract new
customers and premium features behind a paywall. Zero
price effect occurs when the free options provide so
much value that there is little to no incentive to obtain
the premium version. To reduce this effect, it needs to allow
free users to temporarily see/use the features available to
premium subscribers.
- Twin roles – Freemium customers provide value in 2 ways:
upgrading to premium membership & through positive word-
of-mouth.

36. Freemium model
 Why pay a premium in freemium services:
- Quality
- Enjoyment - this value was negatively associated with intention to purchase a
premium offering
- Social value – only this value was positively associated with intention to purchase a
premium offering. Social value is the strongest predictor of whether a customer
will upgrade from a free to premium features.
- Economic value
 Takeaway for firms: Firms that employ a freemium model should consider the value
that their premium features provide in terms of enhancing social value and also
realize that this form of value, the social aspect, maybe more important than offering
price and quality.
 2 potential factors that influence the zero-price effect:
- Free mentality – the perception that all of the features of a freemium should be
freely available. This will strengthen the zero-price effect.
- Price-quality inference – the perception that the free offering may be of lower
quality than the premium version. This will weaken the zero-price effect.

37. Freemium model
 Firms that employ a freemium model should clearly communicate the quality benefits and
features of the premium version in order to gain a higher level of conversion.
 Recommendations:
- Add new features - Most freemium platforms find it is easier to convert early free subscribers
into paying customers than it is to convert later adopters. So they need to make their offerings
more appealing over time by adding new features.
- Be sticky – The more sticky, the harder it is for customers to switch to a competitive offering.
Freemium platforms can be sticky in 2 different ways: Network effects, which occurs when the
value of an offering increases as it gains customers & Switching costs, which make it difficult to
leave a platform for another provider.
- Be restrictive – Freemium platforms need to offer some benefits that are restricted to only their
premium members. Two restrictive methods that can be used are: Restricted capacity &
Restricted features.
- Reduce your marketing costs - A freemium model allows firms to greatly reduce this up-front
marketing cost because a free nature of their offering is low-cost and effective in terms of quickly
acquiring a large number of customers. If we get something for free, we often tell our
family, friends, and colleagues about it. So freemium platforms often obtain a high degree of
positive word-of-mouth, which helps attract even more customers. Thus, firms that employ a
freemium model should be able to spend much less upfront on marketing compared to more
traditional type of business.

38. The End