Web 2.0 As A Marketing Tool
Web 2.0 can be used effectively to raise the levels of customer engagement, which, in turn, is known to help increase loyalty. There are sufficient statistics available to prove that retaining customer loyalty is imperative for any brand.
The following should help to illustrate this further:
1. An increase of customer loyalty of 1 percent is equivalent to a 10 percent cost reduction (source: Bain & Co.)
2. The probability of selling to a new prospect is only 5 percent to 20 percent while the probability of selling to an existing customer is 60 percent to 70 percent (source: Marketing Metrics)
3. Customer loyalty accounts for 38 percent of margin, 40 percent of revenue growth and 38 percent of shareholder value (source: Accenture Research).
Employing Web 2.0 to gain greater loyalty from customers:
Increasing the degree of engagement with the customer can lead to an increase in customer loyalty. Among the ways and means that are available in this day and age, for engaging successfully with the customer, Web 2.0 is among the most effective ones. So, the marketers who build their strategies around it, along with other marketing tools, are likely to reap substantial benefits in terms of customer loyalty. These technologies are moving fast towards the mainstream and those who do not incorporate these into their arsenal are likely to have to rely mainly on price-competition in order to increase sales.
The Web 2.0 technologies enable marketers to reach out to potential customers or clients in ways that are more interactive and through which they can contact a larger number of people than methods that are more traditional in nature, besides being able to analyze the results effectively.
This has made it easier for businesses that are midsized or small to compete with larger ones, more than ever before. Online videos, wikis, blogs and other such applications allow them to interact with existing and prospective clients or customers, in more ways than before and more economically, as well, as these are less expensive than methods used traditionally. Some of the ways in which marketing can be done through Web 2.0, while making the best use of the funds allocated for the purpose, are as follows:
Sites for social networking:
As the average Internet user tends to use social networks more and more often, it has become possible for companies to benefit from the creation of user-groups centered around their services and products and try and have existing as well as prospective clients or customers join these. Through such networks or groups, not only can the users ask questions from company representatives or from each other, but also invite those known to them to join. Information regarding new service or product offerings can also be posted there, in addition to making announcements in real time.
In addition to that, a younger target group that often does not take sufficient notice of services and products that are advertised traditionally can be reached out to through sites like MySpace, Facebook, YouTube, etc. However, even as it is fairly simple to create content on any of these sites, it is essential to refresh the concept periodically, in order to retain interest.
Blogs not only help customers differentiate a company’s products and services from the alternatives available, but also to do so at a negligible cost for the company. This enhances their appeal as tools for a company’s marketing effort to reach out to prospective clients or customers and to begin to establish relationships with them.
Therefore, blogs have the potential to provide an advantage to those businesses that make use of the medium of communication that these provide, over those that do not.
Here, too, fresh content has to be provided regularly, in order to retain interest.
Press releases have become a marketing tool for communicating directly with consumers, as news websites, among which Google news and Yahoo news are quite prominent, have caused the syndication of news to become much simpler and more prevalent. These sites carry huge amounts of content in terms of press releases. Since substantial results are unlikely to be attained through news that is boring, even if it is optimized quite well, it is important to announce something that is newsworthy. Also, the message might get diluted if the keywords being focused upon are too many and the information being provided is too much.