In order to gain customer trust, companies must select the best suited media channel to establish an effective web presence. Choosing a strategy can be critical for an online-only firm because it does not have a physical presence. The only contact a potential customer might have with an online firm could be the image it projects through the media and through its Web site. The challenge for online businesses, especially new online businesses, is to convince customers to trust them even though they do not have a physical presence.
Trust and Media Choice
Figure 4-2 shows the level of trust achieved by three different media models: Mass media, the Web, and Personal Contact. Using the Web results in cost savings of mass media while allowing the advantages of personal contact selling.
Fig. 4-2 Trust levels in three dissemination models
Mass media is still widely used because it is a relatively cheap method to reach many potential customers. Since the audience is passive, they may not actively evaluate the message and succumb to the advertisement. One disadvantage of this method is the “overuse of superlatives” which has lead to distrust. In addition, not all viewers are interested in the message conveyed and will elect to skip the message entirely. This method of communication is not very successful on the Web because the audience is actively engaged and more likely to evaluate the message. For this reason, the personal contact selling model is preferred because it is based on trust.
To bypass the disadvantages of mass media, companies began to practice market segmentation. This involves the demographic segmentation of the market based on age, gender, marital status, income level, and geographic location.
Micromarketing refers to further segmentation of the market into smaller groups. This technique increases advertising costs per person and also suffers from the same weaknesses seen in the mass media model.
Markets can be divided based on three categories:
- Geographic segmentation: potential customers are divided into groups based on nation, state, city, or even neighborhood. Another alternative is by urban, suburban, or rural consumers.
- Demographic segmentation: some web sites are devoted to women’s issues, teenagers, etc.
- Psychographic segmentation: groups are segmented based on social class, personality, or life style. This technique has grown significantly in the past years.
Companies match their advertising message to each segment targeted. They also build a sales environment for their product or service to correspond to a particular segment. Fig. 4-3 shows the relationship between television programs and the corresponding advertising methods:
Types of Television Advertising
Type of Advertising
|Children’s cartoons||Children’s toys and Games|
|Daytime Dramas||Household goods, pet foods|
|Late-night talk shows||Snack foods, nonprescription drugs|
|Golf tournaments||Golf equipment, investment services, insurance|
|Baseball and football games||Snack foods, beer, autos|
|Documentary films||Books CDs, educational videos|
Fig. 4-3 Television advertising messages tailored to audiences
Market Segmentation on the Web
In Web design, companies use various techniques to suit the demographics of their clients. For example, when targeting young, fashion-conscious buyers, designers use a variety of typefaces, bold graphics, and brightly colored photos. As in retail stores, Web retailers can “provide separate visual spaces for different market segments”.
Offering Customers a Choice on the Web
Dell’s web site is an example where clients are given a number of different ways to conduct business. The Home page has categories for different groups and each customer is offered its own Web site with negotiated prices for products they use. Even employees within a company can create their own page within the company’s Premier pages. This techniques is known as one-to-one marketing.