So what exactly is eMarketing? By definition, it is the use of modern communications technologies for marketing purposes. Although it technically refers to all forms of electronic communication, the term has become synonymous with internet/online marketing. eMarketing has several advantages over traditional marketing - it is cheaper, faster, and can attract a global audience. If done properly, the return on investment can be substantial.

Power of the internet

According to the online market research group Internet World Stats, there are around 1.2 billion internet users worldwide, or 19% of the global population as a whole. Moreover, the advent of widely-available highspeed internet access has meant that information can be transferred almost instantaneously across the globe, at minimal cost. The internet is, therefore, an incredibly powerful platform for a modern business.

In fact, some of the modern world's most successful businesses have been built up entirely around a website. For example, consider Amazon. Amazon was founded in 1994 by Jeff Bozos, who believed that an internet bookstore would offer more choice to its customers, as it would not be limited by shelf-space and could be searched instantly. Bozos started the Amazon.com website the next year, shipping books from his garage to customers all over the world. The business quickly expanded to offer a wide selection of consumer products, including VHS tapes, DVDs, CDs, electronics, computer software and clothing.

A significant factor in Amazon's success is the so-called Long Tail principle. Basically, what this means is that Amazon actually makes more from selling obscure items in small volumes than it does from selling popular items in large volumes. This works because even if an item only appeals to a limited section of the public, a small fraction of the online population can still be a significant number of people. Moreover, an internet seller like Amazon does not have to worry about renting in a prime high-street location - its goods are stocked en-masse in large warehouses, and shipped directly to the customer.

Amazon has capitalized on its appeal to niche markets by using several strategies to further drive sales of less well-known products. For example, return customers are given buying recommendations based on their previous purchases. Customers are invited to rate and review products, and make lists of their favourite items. The result is that every item that you view, there will be links to dozens of other, similar items that you might be interested in. The company has even taken over popular information-based websites, such as IMDb.com (The Internet Movie Database), clearly showing the value that they place on the encyclopaedic volume of instant information that the internet can provide.

Of course, not all companies use websites for retail purposes. There are many different online business models, that depend on whether a website is intended to engage in retail, provide a service, provide information/ entertainment (and recoup advertising revenue), or simply to enhance brand awareness. What is common to all these models is that they harness the immense power of the internet - the ability to reach a large number of people quickly, effectively, and at minimum cost.

Increasing internet traffic

Once a website is operational, the next task a company faces is getting people to come and visit. Constructing and maintaining a website is an expensive process, and if site traffic is low, then there will not be a sufficient return on the investment. Even traffic is by itself not the most important factor. What really counts is the conversion rate, or the percentage of visitors who have completed a desired action (such as making a purchase or subscribing to a newsletter).

The most effective way to increase site traffic is to improve the visibility of the website on the results pages of internet search engines such as Google, Yahoo! and Microsoft Live. Search engines are incredibly significant - internet users generally turn to a search engine as their first point of reference when they are seeking information. Moreover, research has shown that links that turn up in the top six results of an internet search will have the most response from users. Given that the typical search will give back thousands of results, it is clear that the search result ranking of a website is critical. Search Engine Marketing (SEM) uses a variety of techniques to achieve this aim.

First of all, there are a number of ways in which the design, organisation and content of a website can be used to improve its rank in a search engine search. Search Engine Optimization (SEO) involves using the nature of the algorithms used by search engines to improve the ranking of a website in an internet search. There are two distinct methods of doing so: "white-hat" and "black-hat" SEO.

White hat, or traditionally "honest" and fully transparent methods are those recommended by search engine companies themselves as being elements of good website design. They make it as easy as possible for the search engines to do their job and give an accurate rating of the site's quality and popularity. These include identifying relevant keywords and highlighting them in articles, creating "inbound" links to link relevant material together, and creating a clear, organized "site-map" which is then passed on to search engine companies so that they know where to look. On the whole, the advice from search engine companies is to make a website as user-friendly as possible: provide good content, and make it easy to navigate. This will naturally lead to increased popularity and a higher ranking.

So called Black hat methods, on the other hand, are generally frowned upon, and could lead to a website being penalized by search engines. The term black hat in this context describes attempts to redirect online traffic towards a chosen site by using variously underhanded and misleading tactics such as mirror sites, viral marketing and playing on keywords. For example, a German automaker was temporarily removed from Google's search lists in 2006 when it was discovered that they were using "doorway pages" filled with popular search keywords to redirect users to their main website. The company promptly apologized and removed the suspect pages, and has since been reinstated.

The main benefit of SEO is that it can be completely free but still produces great results, and thus is an ideal solution for a company with a limited budget. Although there are companies that provide paid SEO services, it is fairly straightforward for SEO to be implemented "in house", as an aspect of web design. Search engines such as Google provide a wealth of information on good SEO practices that are remarkably simple to implement.

However, SEO can take a long time to be effective, as the quality score of a website depends to a certain extent on its reputation and popularity. For a new or recently re-launched website, it is often advisable to take out a paid advertisement on a search engine results page to give an instant boost to the number of visitors. Most popular search engines offer paid advertising spots, normally located above or beside the unpaid search results. These links work on a "pay-per-click" basis: the advertiser only pays when a link is followed by a user. Such ads are sold by silent auction - companies bid for key search terms, and their links are ranked by a number of factors, including the maximum amount the company will pay per click, the relevance of the page they have linked to, and the popularity and quality of the site.

The money side of electronic marketing

There is more to eMarketing than maintaining a website and getting people to view it, however. At the end of the day, the goals of eMarketing are the same as those of traditional marketing - to increase the profile of a company and its products, with the ultimate aim of increasing profits. Spending on internet advertising is growing every year, and may soon exceed spending on advertising in more traditional media.

Many businesses take out display ads, or banner ads. These work in a similar way to traditional print advertising - you pay for the space your ad takes up on the page, at a rate that depends on the popularity of the page in question. This is traditionally calculated on a Cost Per Mille basis; in other words, for every thousand impressions on a web page, you pay a set price. This price can vary greatly depending on the site in question.

The typical range is USD1-USD20, but the CPM rate can sometimes reach up to USD200 for high-end websites. CPM is still the standard method of pricing for display ads, although many advertisers now prefer to work on a Pay Per Click or Cost Per Action basis, as these methods guarantee that you only pay when the ad has achieved a desired result.

Another common and effective form of online advertising is email marketing, where newsletters or promotional messages are sent by email to a targeted audience. It should be stressed that this is not the same as spam. Spam refers to marketing emails which are sent out en-masse to recipients who have not requested any correspondence. Such emails are rarely if ever effective, as most internet users are now savvy to such practices, and most email providers screen messages and block suspected spam. In Hong Kong the government recently enacted the Unsolicited Electronic Messages Ordinance, which legislates against unwanted correspondence by email or any other electronic medium. Offenders will be liable to pay a fine of up to HKD1 million, and will face a possible 5 year jail sentence.

Email marketing is typically an "opt-in" service - internet users sign up to a company's mailing list, providing their email address, and have the option to leave this list as and when they chose. This means that messages can be targeted to an audience which actually wants to receive such information, and also allows companies to maintain a relationship with long-time customers.

Finally, rich media advertising is a more recent phenomenon which takes advantage of high-speed internet connections to provide media enhanced advertising. Such adverts are often in video format, and hence are clearly related to television advertising. The potential for such advertising is enormous; Google paid around USD1.5 billion to acquire the popular internet video site YouTube, in the belief that this site could be a key source of advertising revenue in the future. Rich media advertising is often used as part of a viral marketing campaign, where the goal is to attract a large amount of attention primarily through word-ofmouth. For example, in 2004 Burger King mounted an incredibly successful campaign revolving around a simple website, subservientchicken.com, which featured a man dressed in a chicken suit in what appeared to be a live webcam feed. Visitors were invited to "get chicken just the way they like it" by entering a command into a text box at the bottom of the page. The chicken would respond either by obeying or, in the case of a vulgar command, reacting angrily. The website, which had discreetly placed links to Burger King promotions, became hugely popular, especially amongst students.

Market research

The nature of the internet makes it an ideal platform for market research. First of all, its users are predominantly middle- or upper-class, with a significant spending power, and so fall directly into the group that is of most interest to manufacturers and retailers. Secondly, internet users tend to congregate in online social groups bound by a common interest, which makes it very easy to find specific target groups. Indeed, social networking sites such as Myspace and Facebook have become a treasure-trove of information for market researchers.

In fact, the popularity of Facebook, and the site's openness to working with outside companies and developers, has meant that Mark Zuckerberg's project has become an important marketing channel in its own right. Facebook users enhance their profile pages with a number of third-party "apps" which allow friends to interact in different ways, display personal interests and preferences, and generate an increasing amount of advertising revenue for their developers.

Web analytics providers, such as Google Analytics, allow webmasters to learn a huge amount about where site visitors come from, how effective their online advertising campaigns have been, and also the all-important conversion rate - just how many people have joined a mailing list, filled in a survey, or made a purchase as a result of eMarketing.

Conclusion

As you can see, there is a lot more to eMarketing than simply putting up a few banner ads and sending out mass-emails. The internet is more than an abstract concept; it is a vast and expanding population of potential clients, spanning the globe and covering all segments and sectors of the population. A successful eMarketing campaign can bring international success to even the smallest of companies.