AD648 Nairobi Delta Air Lines Marketing Strategy & E Commerce Platform Analysis Describe and analyze the marketing strategy and the e-commerce platform of

AD648 Nairobi Delta Air Lines Marketing Strategy & E Commerce Platform Analysis Describe and analyze the marketing strategy and the e-commerce platform of the company Delta Air Lines

1. Content suggestions:

Describe the Marketing Mix.
Describe the company’s marketing communications strategy.

IMPORTANT: THESE INFORMATION CONSIDERATIONS ARE JUST GUIDELINES, YOU CAN INCLUDE DIFFERENT INFORMATION IN YOUR PAPER. YOU ARE NOT OBLIGED TO USE THE CLASSIFICATION OF BUSINESS MODELS I PRESENTED.

2.Style of the paper:

Include a title page.
Include a table of contents.
Include an Executive Summary.
Include page numbers.
Please use clear references for every work you used to write your paper. These references should also be in a bibliography at the end of your paper.
You can use the APA or MLA style for references
The paper should be 5-10 pages not including the title page, table of contents, and bibliography.

This paper is a team paper you just need to write three part

2.2.2 Display Advertising

2.2.3 Native Advertising

2.2.4 Content Marketing

here is an attachment is an example you can have a look and do your work and you should do the comprehensive Reference of your work. AD648 B1 Ecommerce (Fall 2018)
Assignment 2 – Groupon
11 November 2018
By Elaine Chen (U91366645), Serkan Goktas
(U61847301), Swarnata Prabhu (U86826479), Vatsal
Mehta (U77645993).
1
Index
Executive
Summary——————————————————————————————————– 2
Part 1: Marketing strategy and the e-commerce platform of Groupon———- —————- 3-7
Product———————————————————————————————————- 4
Price————————————————————————————————————– 4-5
Place————————————————————————————————————– 5-6
People———————————————————————————————————— 6
Promotion——————————————————————————————————– 6
Part 2: Company’s marketing communications strategy——————————————– 6-12
Offline Marketing Communication————————————————————————– 7
Online Marketing Communication———————————————————————— 7-12
Search Engine Marketing—————————————————————————- 8
Display Advertising————————————————————————————– 8-9
Native Advertising—————————————————————————————— 9
Content Marketing————————————————————————————–9-10
Email Marketing————————————————————————————— 10-11
Affiliate Marketing——————————————————————————————11
Viral Marketing—————————————————————————————- 11-12
Lead Generation Marketing—————————————————————————- 12
Customer Retention Strategy————————————————————————– 12
Social Marketing————————————————————————————– 12-13
Mobile Marketing————————————————————————————- 13-14
Local Marketing——————————————————————————————- 14
Conclusion and Recommendations———————————————————————– 14-15
Bibliography of References———————————————————————————-15-17
Appendix————————————————————————————————————- 18
2
Executive Summary
This paper analyzes the marketing strategy and marketing methods of Groupon, one of the
leading online retailers. Groupon was launched in Chicago in 2008 and rode the wave of the
first mover advantage in the local online marketplace. Today, Groupon has 49.3 million active
customers (Groupon Inc. Public Fact Sheet, 2018). Although it has an enormous customer
base and retailer portfolio, the company realized its first full year operating profit in 2018. In this
paper, we will provide an introduction and analysis of the marketing strategy and the
e-commerce platform of Groupon. This paper includes product, price, place, people and
promotion. Groupon focuses mainly on local marketplace and offers a large variety of goods
and services at discounted rates. Groupon has successfully diversified its product portfolio and
enjoys a healthy marketing mix that is vital to increase its profit margins. It is essential to
discuss the company’s strategies from the various marketing perspectives. Covering the
company’s marketing strategies involves an examination of the communication methods and
strategies. This part includes offline marketing communication and online marketing
communication. A strong online presence is vital for the company to compete in an online
marketplace budding with several strong competitors. Groupon, in addition to its online
marketing strategies effectively uses offline marketing mediums such as television, radio, print
and other outdoor advertising. Groupon successfully leveraged email notifications to market its
deals and is the leader in marketing deals through emails. Although email marketing is still
important in online marketplace, other online marketing communication strategies are also
becoming increasingly important and necessary to stay relevant and competitive. Search
engine marketing, display advertising, affiliate marketing, social, mobile and local marketing are
some of the leading marketing platforms and conduits used in the present day. We examine
and explain how the company uses these marketing communication strategies efficiently. The
paper provides a broad perspective about Groupon’s marketing and marketing communications
strategies.
1) ?Marketing strategy and the e-commerce platform of Groupon
Groupon is repositioning its brand in the market from an aggregator of merchant discounts to a
destination for local discovery (Liyakasa, 2016). To succeed in this competitive market by
repositioning itself, required implementation of improved targeted marketing strategy and
increased marketing expenditure. Groupon has more than doubled its marketing expenditure
since its IPO in 2011, Groupon invested $400.9 million towards marketing in the fiscal year
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2017 (Statista, 2017). Due to an increase in its marketing expenses, Groupon showed a
significant increase in sales but its profits were lacking. The initial years of losses were justified
by Groupon by stating that their marketing costs will help the business reach the scale and
attain a greater percentage of the market share, eventually resulting in reduced marketing
expense as a percentage of revenue (Carney, 2011). In 2017, Groupon started showing signs
of profits due to its successful implementation of marketing strategy that resulted in an increase
of its active customer base. The increase of its active customer base enabled Groupon to
reduce the marketing spend per new user even though the overall marketing expenditure
remains high. Groupon has focused on increasing its active customer base rather than
improving its revenues through improved customer sales. Groupon’s marketing spend remains
significantly high due to the fierce competition and to ensure it can achieve higher percentage
of market share.
a. Product: Groupon is an online hyperlocal marketplace where individuals find and save
money on local activities, travel, entertainment, restaurant, health, beauty, and product deals.
Launched in 2008 in Chicago, Groupon has continued to help local businesses attract, build
and retain clients by giving them customizable and scalable marketing tools (Groupon Inc.,
2018). Groupon acts as a mediator between local merchants and subscribers (Bhasin, 2017).
Groupon’s product portfolio comprises of three categories: Local Deals, Groupon Goods, and
Groupon Getaways. Groupon subscribers can access deals through its localized website and
mobile apps.
Groupon provides a platform and acts as a strategic partner for local merchants to
provide attractive and competitive deals to consumers (Twiss, 2015). Groupon has
considerably increased its current portfolio by partnering with third party deal sites and
organizations such as Grubhub, Major League Baseball, American Express, CourseHorse,
Viator, etc (Groupon Inc. Public Fact Sheet, 2018). Groupon deals enable individuals to
experiment with items and services, at a highly discounted rate, that they may otherwise not
have tried to buy (Gil, 2014). Groupon has a retailer base that exceeds a million in count and
this enables the company to offer low price coupons for several services and products
(Groupon Inc., 2018).
b. Price??: Groupon offers a large variety of goods and services, and these products have an
expansive range of price (Groupon Annual Report, 2017). By using Boomerang Commerce’s
Retail Price Performance Management tool, Groupon’s pricing strategy for their products and
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services varies with a myriad of external factors such as consumer demand, market elasticity,
competitor pricing, locality, demographics, season and culture (O’Shea, 2017). Internal factors
such as ?traffic, deal profiles and sell-through targets influence the pricing decisions and allow
the company to ?measure performance, compare results and assess pricing health (O’Shea,
2017).
Groupon’s strategic move to focus heavily on local marketplace offerings has enabled it
to increase its profit margins. The higher margins and product differentiation offered in its local
marketplace expands its local subscriber base (Henage, 2018). As the company offers a
myriad of products and services, the pricing strategy has to be flexible and accommodative of
the external and internal factors to maintain competitive pricing position within the industry. By
embracing a flexible pricing structure that involves discounts ranging from 30% – 90%, Groupon
is able to accommodate various clients and provide services accessible at a lower cost
(Bhasin, 2017). As a strategy for long term business sustenance, Groupon is considering
offering full priced options for products and services to fend market saturation and remain
competitive (Henage, 2018). As an incentive for the customer to purchase products at full
priced options, Groupon is considering providing better customer experiences. Groupon
currently enjoys a first mover advantage and has an established perception amongst its
customer base as a platform of discount deals and therefore it is recommended that Groupon
enhances its customer loyalty through additional benefits (such as rewards program) and focus
on enhancing customer experience.
c.Place: ?Groupon offers its services and products to about fifteen worldwide nations , in over
500 markets and has its central command base at Chicago in the United States (Bhasin, 2017).
In 2017, Groupon withdrew its operations from many countries, reducing the country count
from 47 to 15 (Rich, 2017). Reducing the geographic footprint meant major restructuring work,
but this in turn has helped Groupon to grow its business in markets which have further potential
for expansion. This allowed Groupon to expand its regional and global shared service centers
to provide better support services to customers and merchants and operate efficiently. These
efforts have helped them to reduce cost and better streamline their operations to focus on
providing better customer experience.
Groupon, being an online marketplace managed to reach global proportions due to its
first mover advantage, has managed to continuously evolve to retain its competitive advantage.
A leader in mobile-app downloads, with an excess of 171 million downloads, Groupon connects
5
many local manufacturers worldwide with customers via their e-commerce platform (Groupon
Inc. Public Fact Sheet, 2018). Groupon has strategically positioned itself as a platform for small
businesses that are motivated to take advantage of its subscriber base and grow their income.
By positioning themselves as an efficient partner for both retailers and consumers that want
greater online and mobile presence and service, Groupon touts its ability to provide a level
playing field for small businesses that aspire to compete with bigger established retailers (Rich,
2018). In this regard, Groupon continues to focus its transformation as a platform for small
businesses and local e-commerce.
d. People: ?Groupon has 49.3 million active customers (Groupon Inc. Public Fact Sheet, 2018).
The demographics of Groupon’s client base comprises mainly of female customers which is
around 77% with only 23% being men. 68% of the customers belong to the age group 18 and
34 years old and 48% comprise of customers who are single. Groupon caters mainly to affluent
population with nearly 70% of them earning a yearly income over $50,000. The customer
segment comprises mostly of well-educated people with 50% having a bachelor’s degree and
30% having a graduate degree (Lazar, 2016).
Groupon’s active client base uses both website and mobile app deals frequently. This
demographic distribution also directs company policies. Groupon was heavily reliant on email
communication but with the client base reliant on social media, Groupon has expanded its
communication and advertising platforms to include the most up to date mobile apps (Stanford,
2017). Groupon merchants have the benefit of a diverse demography, which they can exploit to
reach their business goals and profits.
e. Promotion: ?One of the most important elements of marketing is promotion and it defines a
product’s success or failure. The final sale is dependent on the effectiveness of marketing
which is critical to ensure the customer is aware and convinced of the value of the product.
Groupon’s primary promotion methodology has been focused on advertisement through
various mediums. Groupon has hired various ad agencies and ad networks to create, develop
and promote its products and services to its customers. Groupon works with different social
media platforms such as Facebook, Twitter, Blogs etc to promote its discount deals and offers.
Groupon was more focused on marketing its products to its customer base in the initial years
but has since also started creating ads and focusing its marketing efforts to help merchants
understand how Groupon can help their businesses grow (Lazare, 2017). The various
6
mediums
used
and
promotion strategy is further discussed under the marketing
communications strategy.
2) Company’s Marketing Communications Strategy
Groupon has taken a well-rounded and varied marketing approach to build and support its
brand by utilizing both online and offline marketing communication tools and techniques
effectively.
a. Offline Marketing Communication: ?Groupon has heavily utilized many offline marketing
communication tools to its advantage to promote its business, even though the traditional
medium of marketing is expensive and not easy to measure for its effectiveness. The offline
marketing expense for Groupon mainly consists of national television, radio, print and outdoor
advertising. The major spending in the offline marketing segment is on national television ads.
In 2011, Groupon aired a controversial Super Bowl ad in which Timothy Hutton makes a
plea for the people of Tibet and delivers a punch line “But they still whip up an amazing fish
curry” (Dallke, 2016). The ad was not well received and Groupon faced a severe backlash from
the viewers who expressed their displeasure on social media and several human rights groups
labelled the ad as crude and insensitive marketing gimmick that used the plight of Tibetans to
sell their services. Groupon initially defended the ad, highlighting their philanthropic cause
behind airing the ad but later the ad was pulled off air. The main problem with the ad was the
actual charitable effort to raise funds to support the Tibetan cause was not mentioned as part
of the ad. Even today the first national TV ad by Groupon is discussed as one of the most
controversial and tasteless Super Bowl ad ever made. After a 7 year break, Groupon returned
to air a Super Bowl ad in 2018 (See Appendix for commercial snapshot from ispot.tv), though
this time around, the ad was cautiously made to avoid another controversy (Lugmayr, 2018).
Groupon has created a million dollar ad campaign in 2016 to run TV ads to attract new
customers and currently continues to invest millions in TV ads and airs around 31 ads
nationally in United States. Groupon has worked towards expanding its international appeal by
investing more in television marketing outside of United States. Groupon ran a sensational
summer campaign in 2016 in UK to attract customers to its various local offers including
holidays, activities, spa and fitness; the television ad focused on how women can benefit from
all that Groupon has to offer (Gee, 2016). The television ad was also supported by social
media videos.
7
Groupon, in addition to TV ads, has utilized radio and print ads to promote its 2016
campaign which promote experiences over purchases, encouraging customers to buy more
products which can give them experiences to cherish. Groupon also promotes its brand by
utilizing billboards (see appendix for billboard image) or outdoor ad space, these ads use the
logo for the impact, are very creative and attract attention of those who are unfamiliar with the
brand. Groupon’s use of offline marketing mediums has helped Groupon significantly in
increasing its active customer base.
b. Online Marketing Communication: ?Groupon conducts most of its online marketing and
advertising using internet and mobile apps on Android, Blackberry and iPhone. Groupon uses a
behavioral targeted marketing strategy by analyzing the online behavior of its customers such
as the products they are purchasing, the apps they are using, the websites they are visiting and
search results online to understand their customers’ needs and personalize the ads
accordingly.
i. Search Engine Marketing: ?Search Engine Marketing is most effective marketing tool
wherein marketers place paid advertisements (pay per click) on search engines. Search
engines usually have an ad platform which is used for search engine marketing such as
google AdWords, Yahoo Search Ads and Bing Ads. SEM campaigns are successful only if
the company uses right keywords and those ads show up when consumers are searching
for the keywords. Groupon spends a lot of effort and money on search engine marketing
such as Google Adwords and Bing Ads, to ensure customers see an ad from Groupon at the
top of the search result when searching for any local merchant deals (Knox, 2016). This not
only helps Groupon build its own brand and business but also helps merchants promote
their products and helps businesses and customers find the product or service they need.
Groupon website is also well optimized for search engine results due to which the pages
and ads listed on Groupon appear as top search results. Groupon’s content attracts
customers to their website and allows them to effectively search for the merchant deals they
are interested in (Knox, 2016).
ii. Display Advertising: ?Display advertising is pay per click advertising wherein ads are
displayed on different sections of the website in different sizes and different forms including
traditional banner ads (see appendix for ad banner images), larger text billboard or videos
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(O’Brien, 2015). Different types of websites can be used for display ads such as blogs,
YouTube, email, etc. The aim of display advertising is to quickly convey the message about
the product or service to specific audience who are going to be interested in knowing about
the company and its offerings. Groupon utilizes display advertising successfully by
purchasing ad units from major display networks. In 2016, Groupon implemented a YouTube
campaign wherein they created targeted personalized video ads based on the consumer
patterns of YouTube users which helped Groupon grow its customer base. This campaign
helped Groupon acquire 5 million new customers in 2016. In 2017 they became much more
creative using a catchy jingle for the YouTube Video ad which gained both positive and
negative response from the audience (Unterberger, 2017). The success of such ad recall
rate is high when the jingle keeps playing in people’s mind which in turn builds a strong
brand image for Groupon. Though there is a need for Groupon to convert negative response
to their ads to positive res…
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