A01 chaf6542 06 se fm indd

Chapter 8  Digital marketing

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Investment in online promotion techniques in comparison to offline promotion. A 

balance must be struck between these techniques. Figure 8.24 summarises the tactical 

options that companies have. Which do you think would be the best option for an estab-

lished company as compared to a  dot-  com company? It seems that in both cases, offline 

promotion investment often exceeds that for online promotion investment.

There will naturally be a variation in spend on online marketing tools depending 

upon level of adoption of e-commerce by a company and its customers. Factors that will 

affect the proportion of online media spend in any organisation include:

● 

Proportion of customers in a segment that can be reached through traditional or digi-

tal media.

● 

Proportion of customers in target market in researching and purchasing products online.

● 

Propensity of customers to purchase products using traditional channels.

● 

The relative  cost-  effectiveness of different online media (see Chapter 9) in comparison 

with traditional media such as TV and print.

There is a delicate balance to be struck between driving visitors to a website where they may 

be less likely to convert, but the cost of sale will be lower. With any medium there is a point 

of diminishing returns where more spend on that medium will not result in improved 

results. It seems that many companies are following a strategy of gradually increasing their 

digital spend since they want to find this inflexion point without overstepping it too far.