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The E-Marketing Mix:

A Contribution of the E-Tailing Wars


Kirthi Kalyanam
Shelby Mclntyre
Santa Clara University

In the context of the wars between the upstart Internet re- companies has been the focus of considerable attention
tailers and the existing bricks-and-mortar retailers, many from the business press as well as scholarly research
e-marketing techniques were invented. This article devel- (Mahajan, Srinivasan, and Wind 2002 [this issue]), How-
ops a single unifying and theoretically based taxonomy for ever, in the short period of their existence, these e-tailers
e-marketing techniques: the e-marketing mix. Drawing on developed and introduced new Internet-based marketing
the paradigms of exchange, relationships, and digital in- techniques at a furious pace, essentially creating a new
teractions in networks, 11 e-marketing functions are iden- world for marketing. While these techniques were mostly
tiffed that form the elements of the e-marketing mix. Nine developed in the context of e-tailing, they are being widely
of the 11 e-marketing functions are considered basic, used by other business-to-consumer and business-to-busi-
while 7functions moderate the effects of others and are ness organizations as well. In other words, the marketing
termed overlapping. The 11 e-marketing functions provide techniques that were pioneered by e-tailers have evolved
a categorization of the e-marketing techniques. Compared into e-marketing. Today, few if any marketing plans can be
to the conventional marketing mix, the e-marketing mix complete without a blending of the e-marketing tools into
has more overlapping elements and directly represents the traditional mix to form an effective marketing strategy.
personalization, an aspect of segmentation, as a basic A great deal has been written about e-marketing, and it
function. The existence of multiple elements that are basic is widely felt to have high potential over the long run.
and overlapping in the e-marketing mix indicates that inte- However, depending on the area of interest, the marketing
gration across elements should be more commonplace community has developed a very selective view of these
compared to the traditional marketing mix. Internet marketing techniques. To Web developers and
technology integrators, Internet marketing is about build-
ing Web sites that are robust and scale with traffic (Frost
and Strauss 2002). To the advertising industry, it is about
In the 5-year period beginning about April 1995 and Internet advertising and its impact on driving Web traf-
ending in April 2000, an era known as the dot.com boom, fic and brand building (Breakenridge 2001). Auction-
hundreds of businesses that used the Internet as a primary oriented sites such as eBay have grown through word of
means of transacting with consumers (e-tailers) were mouth and have emphasized community building (Hagel
taken to initial public offerings (IPO). In what is referred to and Armstrong 1997). Customer relationship manage-
as the dot.com bust, from April 2000 to December 2001, ment (CRM) interest groups have emphasized personaliza-
the common stock issued by these companies, in virtually tion (Kasanoff, Peppers, and Rogers 2001). E-marketing
all cases, was trading below its issue price. Subsequently, books (Coupey 2001; Hanson 2000; Strauss and Frost
many of these companies terminated operations or ceased 2001) serve as a single source on various e-marketing top-
to exist as an independent entity. The dramatic fall of these ics. However, a core, unifying concept for e-marketing has
not emerged.
Journal of the Academy of Marketing Science.
Volume 30, No. 4, pages 487-499.
The lack of a common vocabulary, a categorization of
DOI: 10.1177/009207002236924 techniques, and an integrating framework creates funda-
Copyright 9 2002 by Academy of Marketing Science. mental problems for practitioners and academics, much as
488 JOURNAL OF THE ACADEMY OF MARKETING SCIENCE FALL 2002

was the case in the 1950s, before E. Jerome McCarthy describe will be apart of the overall marketing program for
(1960) introduced the 4Ps (product, price, place, and pro- a firm and that a complete description of such programs
motion) standardization of the marketing mix as a core requires a holistic blending of the online aspects with
unifying construct. First, there is the fundamental ques- offiine ones. Also, we do not delve into when different
tion, "What is e-marketing?" Second there is the follow-up subelements should be used or how to use them. In short,
question, "How is e-marketing different?" Third, the lack the treatment is not normative but descriptive.
of a framework means that managers do not have a natural
starting point for developing the e-marketing aspects of
the strategy. Fourth, since the scope of marketing activities
REVIEW OF E-MARKETING
is not well established, the specification and communica-
We reviewed the popular business press, research
tion of the marketing plan, a key marketing activity (Winer
reports from industry analysts such as Forrester and Jupi-
and Lehmann 1991), is more difficult. Fifth, it is hard for a
ter Communications, textbooks and the academic litera-
marketing manager to have an appropriate emphasis (and
ture for e-marketing tools, perspectives, and frameworks.
budget) across all the elements in the marketing mix with-
In addition to manual searches, we performed electronic
out a clear delineation of them. For example, customer
searches on ABI/Inform, Amazon.corn, Google, and the
acquisition might be overemphasized relative to customer
Harvard Business Press site for various keywords, includ-
retention. Sixth, the integration of the techniques might be
ing lnternet marketing, Web marketing, online marketing,
insufficient, leading to a marketing program that is dis-
e-marketing, Internet retailing, e-commerce, and e-busi-
jointed from the consumer's perspective. Also, without a
ness. We also searched for keywords on tactical marketing
complete understanding of the scope of the marketing ele-
tools such as e-mail, banners, and so on. When the litera-
ments, it is difficult to identify how different strategies are
ture review did not provide adequate detail, additional
being implemented through a differential blending of the
information and clarifications were gathered through in-
marketing elements. Finally, it is not clear if the functions
depth interviews of experts and practitioners. In the inter-
identified in the original marketing mix are appropriate or
ests of space, we highlight the key findings and limit our
whether e-marketing entails new functions.
citations to key articles.
This article, therefore, focuses on e-marketing tech-
niques that first emerged during the dot com boom and
E-Marketing Tools and Terms
e-tailing wars. The objective is to provide an approach to
organizing the Internet-based activities of a marketing Our review identified more than 30 e-marketing tools
manager. Analogous to the "marketing mix," attention is and terms. Table 1 provides a listing with a brief descrip-
focused on characterizing an e-marketing mix and tion and an example. As far as possible, we adopt standard
describing and motivating each element. As Niel Borden industry terminology in naming and describing these
(1964) said long ago, "To define the concept of a Mar- tools. When multiple terms are in use, we prefer the term
keting Mix is one way to define Marketing" (p. 3). Thus, that is used in the research reports of industry analysts. For
identifying the e-marketing mix actually answers the example the terms personalization and target marketing
question, "What is e-marketing?" Comparing the e-mar- are sometimes used interchangeably. However, most
keting elements to the traditional marketing mix can start industry analysts use the term personalization in their
to address the question, "How different is e-marketing?" reports, and we adopt this nomenclature.
In the next section, we review the e-marketing litera- We next review the literature to examine which frame-
ture, identify the techniques involved in e-marketing, and works and taxonomies have been proposed to classify
summarize the frameworks proposed and their limitations. e-marketing tools. We summarize our findings into the fol-
We then discuss some perspectives on how a marketing lowing four categories: sources that provide perspec-
taxonomy should be developed. These perspectives pro- tives on a specific aspect of e-marketing, trade books on
vide a theoretical framework based on which we develop e-marketing, textbooks on e-commerce, and textbooks on
the e-marketing taxonomy. The e-marketing taxonomy is e-marketing.
used to categorize the e-marketing tools. The article closes
with a discussion of how the e-marketing mix compares to Perspectives on a Specific
the traditional marketing mix and the implications of our Aspect of E-Marketing
findings.
Before proceeding, it is important also to describe what Some authors have focused on specific aspects of
is not within our scope. It is beyond our focus to prescribe e-marketing. Hagel and Armstrong (1997) provided one
marketing strategies and programs for either traditional of the earliest perspectives when they identified the power
businesses or Internet-based businesses. Thus, it is only of virtual communities. Alba et al. (1997) discussed the
implicitly assumed that the e-marketing mix elements we benefits of interactive home shopping and consumer,
Kalyanam, Mclntyre / E-MARKETING MIX 489

TABLE 1
A Compendium of E-Marketing Tools and Terms
E-Marketing Tool~Term Description Example
Personalization Denotes any aspect of e-marketing that is modified to an When Mary returns to the Amazon.com site, it responds,
individual customer "Hello Mary?'
Customization Modification of what is presented based on preferences My Yahoo!
that are set by the user
Individualization Modification of what is presented based on the user's We know that you buy e-marketing books. Would you
exhibited behavior like us to give you advance notice of new titles?
Rules-based system Modification of what is presented based on rules set by experts This white linen shirt is a good complement to these
khaki pants.
Collaborative filtering Modification of what is presented based on associating this The book recommendations on Amazon.com
or group individual's behavior with the behavior of a group
characterization
Privacy policy The policy addresses what information is being collected, See the extensive privacy notice page on Amazon.com.
how it will be used, and whether the information will be
sold or shared with third parties and, if so, in what context,
including an option for customers to opt out from receiving
offers or updates.
Security policy The policy addresses which aspects of a site and transactions See the privacy and security notice on Amazon.com.
are secure and which types of security measures are deployed.
Site The digital platform used to interact with customers A Web site, the software interface on a handheld
electronic organizer, or a cellular phone
Homepage The first page that is seen on the Web site eBay's first page listing ~ts categories and features
Navigation and The tools that customers use to navigate the contents of the The browse, search, and sitemap buttons on eBay
search tools site and search its contents
Web page A specific page on a site Any Web page
Configuration tools The tools used to specify the combination of features that are The tool used to select the amount of memory required
desired in a product on a computer at Dell.com
Ordering tools Tools that are used to purchase the product Shopping baskets and checkouts on any Internet
retailing site
Planning and Tools that are used to determine the fit of the product or the The garden planner tool on Garden.com
layout tools quantities required against a particular context
Recommendations Suggestions regarding complementary products The recommendation on Amazon.com that says readers
who bought this book also bought this other title
Usabihty and testing Procedures and tests that are used to evaluate how a site See Vividence.com for sample procedures.
performs in terms of certain criteria
Dynamic pricing A policy by which prices are changed continuously in response The revenue management that is implemented by the
to changing supp!y and demand conditions airline industry
Forward auctions or A selhng approach in which prices are determined by the The typical auction on eBay
English auctions highest bid from buyers, subject to any minimums stipulated
by the seller
Reverse auctions or A buying approach in which prices are determined by the The type of auctions hosted by Free markets
Dutch auctions highest bid from sellers
Name your price A buying approach in which buyers, who are wdling to be The Name Your Own Price system at Priceline.com
flexible, indicate the price they are willing to pay for a product
or service and are matched to sellers who can meet the price
Banner ads The rectangular box that appears at the top of a Web page and The typical ad that appears on the top of any Web page
contains an advertisement
Meta ads Banner ads that are tied to the content of the page or the An ad for a Toyota Land Cruiser that appears when you
keyword that is being used in a search search for SUVs
Pop over and pop Advertisements that open up in a separate browser window
under ads over or under the Web page that is being viewed
Sponsored links Results on a search page that are presented to highlight a The sponsored links that appear on a search on
particular sponsor Google.com
Outbound e-mail Electronic mails that are sent out to customers An electronic message from Amazon.com listing the
items that are on sale for the summer season
Viral marketing An approach in which current customers drive the adoption Hotmail pioneered this technique when it launched a free
by prospective customers of a company's product or service Web-based e-mad service with the tagline (at the bottom
of each e-mail), "Get your free e-mail at Hotmail."
E-coupons Coupons or codes that are obtained from Digital Media eCoupons provides a listing of various sources.
Remote hosting When one site mirrors another in a seamless manner Yahoo hosting merchants on its shopping page

(continued)
490 JOURNALOF THE ACADEMYOF MARKETINGSCIENCE FALL 2002

TABLE 1 (continued)
E-Marketing Tool~Term Description Example
Affiliates A relationship between an online merchant (the company) See the Associates section on Amazon.com.
and another Web site (the affiliate) in which the companypays
the affiliate a consideration for each action generated
FAQs A listing of frequently asked questions See the Help section on eBay.
Help desk The starting page for customer help-related queries See the Help section on eBay. This page is sometimes
called customer service or customer support.
Inbound e-mail Electronic e-mail that is received from the customer Inbound e-mails can originate from a support page on a
Web site (see the contact support page on eBay) or
from the customer's e-mail program.
Message boards A location where multiple individuals post regarding a The messages link under Yahoo!Finance
specific topic
Chat rooms A location where multiple individuals are participating in See the Communitysection on eBay.
a common "space" to discuss a prespecified topic
User ratings and Rating and reviews of products or services provided by users See the movie reviews under Yahoo!entertainment.
reviews
Wish list A list of products or services that an individual is interested in See the Wish List section on the Amazon.com
homepage.
Registries A list of products and services that a customer is interested in See the Wedding and Gift Registry section on Wilhams
receiving as a gift for an occasion Sonoma.com.
Reputation scoring A summary score for an individual that is derived from the On eBay under Help, under Top Questions, in the
feedback obtained from other individuals subsection titled after the Auction, go to What is
Feedback?

retailer, and manufacturer incentives to participate in elec- Trade Books on


tronic marketplaces. Godin (1999) introduced the notions E-Marketing Tools
of permission marketing and viral marketing (Godin
2001). Frost and Strauss (2002) focused on building Web Several books provide a survey of e-marketing tools.
sites that are robust and scale with traffic, and Breakenridge For example, Collin (1999) took the perspective that "in
(2001) examined cyberbranding. Consistent with their addition to the standard tool k i t . . , you now have direct
focus on a particular aspect of e-marketing, these authors e-mail, your web site." Collin's book covers the different
did not provide a survey of e-marketing tools or offer a ways of using these new e-marketing tools. Similarly Dan
framework for integrating them. Janal (2000), in Dan Janal's Guide to Marketing on the
Strategic perspectives regarding the Internet have also Internet, provided a survey of e-marketing tools. To facili-
been a popular topic of enquiry. Ghosh (1998) provided a tate the development of a business plan, Janal provided a
perspective on making business sense of the Internet. checklist of the reasons and benefits of being online. In
Bower and Christensen (1995) provided a disruptive tech- Guerrilla Marketing Online Weapons (1996), Jay Conrad
nologies perspective. Evans and Wurster (2000) and Porter Levinson, author of the well-known Guerrilla Marketing
(2001) analyzed how the new economics of information series, provided a survey of e-marketing. In addition to
transforms strategy. Fiore (2001) identified 10 rules for the reviewing several aspects of e-marketing such as advertis-
new economy and provided some discussion of specific ing, service, and publicity, Levinson provided a discussion
e-marketing tools. Wind, Mahajan, and Gunther (2002) of what he called "Guerrilla Attitudes." Consistent with
argued that the Internet has produced a hybrid consumer their focus on the practitioner, these books emphasize
who sits at the convergence of traditional and digital tasks such as creating a business plan and provide tem-
media, and they also introduced the notion of convergence plates to achieve these tasks. E-marketing tools are sur-
marketing. veyed in this context, and a "how to" is provided. Frame-
Internet technologies and software applications have works, theories, opposing perspectives, and empirical
been the focus of some authors. For example, Treese and evidence are not emphasized.
Stewart (1998) and Trepper (2000) provided a survey of
how systems should be designed for Internet commerce. Textbooks on E-Commerce
While the business objectives of e-commerce are briefly
reviewed, technology remains the key focus. In contrast to the trade books, several books have
appeared to serve the classroom audience. These books
Kalyanam, Mclntyre / E-MARKETINGMIX 491

attempt to provide a survey of e-commerce, including inte- elements. In addition, they argued that interactivity and
grative frameworks, theoretical perspectives, and empiri- individualization affect all aspects of the Internet market-
cal evidence. Given the relevance to the focus of this arti- ing mix.
cle, the frameworks proposed in these books merit some
discussion. Conclusions
In their book on e-commerce, Turban, King, Lee,
Warkentin, and Chung (2002:12) provided a framework The literature review indicates that more than 30 e-mar-
for e-commerce. They argued that successful e-commerce keting tools and terms are in use. At first blush, it seems
implementation is dependent on five major areas: people, that there are a lot of new e-marketing tools and terms. It is
public policy, marketing and advertisement, business part- natural to inquire whether these are really new or simply
ners, and support services. These five areas are the pillars Web-based versions of existing techniques. Furthermore,
of their framework. Underlying these pillars are infrastruc- one wonders how these tools and techniques are related to
ture and support components. Marketing is one element of the 4Ps of the marketing mix. Finally, a theoretically based
the framework and consists of market research, promo- construct that provides both a unified perspective of these
tions, and Web content. Rayport and Jaworski (2001:18) e-marketing tools and a taxonomy has not been developed.
provided a framework with six interrelated and sequential This is the focus of the next section.
decisions for determining and implementing an e-com-
merce strategy. The six decisions are market opportunity
A CHARACTERIZATION OF
analysis, business model, customer interface, market com- THE E-MARKETING MIX
munications and branding, implementation, and evalua-
tion. Given that marketing is one component of the focus In this section, we use a deductive process to build a
of these books, it is treated as part of an overall framework, classification apart from analyzing any specific set of data.
and a more detailed taxonomy for marketing is not This method is called logical partitioning, and it "presup-
proposed. poses a fairly sophisticated understanding of the phenom-
ena being investigated" (David Harvey, cited in Hunt
Textbooks on E-Marketing 1991:181).
Hunt's (1991) review of scientific theory outlines the
In contrast to the e-commerce books, several books following criteria for evaluating a classification schema
focus directly on e-marketing. Hanson (2000) argued that (e.g., developing a taxonomy):
"the Web is fundamentally about individuals using a net-
work to access digital products" (p. 22), and he offered (a) selecting the phenomenon (e.g., marketer-controlled
"DNI" as a mnemonic for this perspective. Hanson did not digital tools),
provide a taxonomy of e-marketing tools. Coupey (b) determining the characteristic on which classification
(2001:38) offered a framework for integrating marketing will be based (e.g., classifying by function, not by
and the Internet. The framework looks at the Internet as an form),
environment for marketing exchange. Furthermore, (c) developing mutually exclusive and collectively ex-
Coupey proposed that relationships serve as the vehicles haustive bins (e.g., identify a list of categories or ele-
for effecting exchange. Coupey did not offer a visual or ments based on e-marketing functions that are
mutually exclusive and collectively exhaustive),
mnemonic summary of the framework or provide a taxon-
(d) determining the usefulness of the results (e.g., check
omy of e-marketing tools.
the face validity of the apparent usefulness of the
Strauss and Frost (2001:17) proposed a framework that result).
relates the impact of Internet business models on the 4Ps of
the marketing mix. In addition to the 4Ps, they include van Waterschoot and Van den Bulte (1992) were the first to
relationship marketing as a fifth element and categorize apply these criteria to evaluate the traditional 4Ps charac-
CRM and community building under this element. These terization of the marketing mix. We follow their lead and
five elements form the basis of their taxonomy of Intemet develop the e-marketing mix with these criteria in mind.
business models but not of e-marketing tools. Mohammed,
Fisher, Jaworski, and Cahill (2002:13) described an Scope of the Phenomenon
Internet marketing mix that consists of the 4Ps of the tradi- Being Classified
tional marketing mix, plus two new elements--namely,
community and branding. They proposed that branding The first step is to define the scope of the underlying e-
moderates the other marketing elements and visually marketing tools. We confine the scope to be marketing
depicted branding as a cloud around the other marketing tools that enable interactions with individuals in digitally
492 JOURNAL OF THE ACADEMY OF MARKETING SCIENCE FALL 2002

networked environments (Hanson 2000). Negroponte promotion category of the traditional marketing mix, van
(1995) defined digital interactions as interactive commu- Waterschoot and Van den Bulte (1992) pointed out that the
nications using digital media. Web-based interactions are components of "communication" address "barriers to
a form of digital networked interactions. An Internet- wanting," whereas the sales promotion function addresses
based tool such as text e-mail is also digital and enables "barriers to acting." They observed that "triggers to cus-
interactions with a network. Such interaction can be about tomer action" seem necessary in certain situations to
any aspect of a potential marketing relationship or a spe- induce the exchange. Hence, they termed sales promotion
cific transaction. The interaction can extend to the actual a "situational" function. On the basis of these distinctions,
delivery of the product for a growing number of categories the marketing mix can be reclassified into the "basic mix"
(e.g., maps, art, news, software, photographs, tickets, writ- and the "situational mix." In addition, since the sales pro-
ten materials, information, music, movies, etc.) and com- motion mix can apply across the full spectrum of the basic
munication-related services for most products (e.g., prod- mix (e.g., the rest of the traditional marketing mix), it is
uct configuration, pricing, store locations, inventory considered by van Waterschoot and Van den Bulte to be
levels, product features, product ratings, etc.). Digital overlapping.
interaction also encompasses what Hoffman and Novak The developments in van Waterschoot and Van den
(1996) have called marketing in "computer-mediated Bulte (1992) can be summarized in the form of the follow-
environments." Digital interactions thus would include ing axioms:'
reading a marketing e-mail offline on a handheld device.
It is also important to clarify what is not included in the Axiom 1: Marketing functions are the appropriate prop-
scope of our definition. A consumer watching digital TV erties for the classification of marketing tools.
would not be included (since no two-way digital interac-
tion takes place). Even if the consumer uses a digital In view of the marketing management perspective in-
remote control for changing channels, this would not con- volved, only those functions whose fulfillment is at the
stitute a digital interaction. However, if the consumer is marketer's discretion must be considered. In marketing
able to use that remote to inspect a product on the screen or theory, these are known as marketing functions.
interact with the program in any "marketing-oriented
way," then it would constitute a digital interaction in our Axiom 2: Some functions are essential and others are sit-
framework. Also, a mobile consumer who is in the super- uational in nature.
market and receives, on a shopping cart-based screen, a
coupon message about Cheerios while walking past the Given that the taxonomy is to help structure marketing
box on the shelf would not constitute digital interaction decision making and management, it is suggested by van
(since the communication is one-way). But a two-way Waterschoot and Van den Bulte (1992) that one must iden-
device that is on the shopping cart that the consumer uses tify the "essential marketing functions" to be those "neces-
to enable in-store activities would be included. sary for an exchange to take place." For example, sales
In summary, the scope of the phenomena to be classi- promotion, which is typically meant to overcome procras-
fied is the set of digital tools that enable interactive com- tination, is not considered essential but only situational.
munications with a network.
Axiom 3: Some functions have a moderating effect across
Properties or Characteristics other marketing functions and are called overlap-
for Classification ping functions.

The ExchangePerspective As van Waterschoot and Van den Bulte (1992) noted,
The next step is to identify a conceptualization of mar- the sales promotion function can be applied across the ba-
keting to better identify the activities and criteria for clas- sic functions. For instance, a sales promotion can involve a
sification. Recently, van Waterschoot and Van den Bulte temporary price reduction or a product giveaway.
(1992), following Bagozzi (1975), took the view that mar-
keting is about facilitating exchange. Based on early trans- Axiom 4: Functions are accomplished by marketing
action theory and Kotler (1972), the core functions neces- tools.
sary for an exchange are identified to be the following:
configuration, valuation, facilitation, and symbolization. From a taxonomy point of view, it is important to estab-
Kotler (1972:50) mapped these functions directly to the lish the concept of marketing tools, which is a term used to
4Ps classification of product, price, place, and promotion. identify marketing tactics, techniques, or activities that are
The promotion function has traditionally been broken alternatives for achieving the basic and situational func-
out into advertising, personal selling, public relations, and tions. For instance, a banner ad on a Web page would be a
sales promotion. However, in analyzing the sales tool, as would a promotional e-mail.
Kalyanam,McIntyre/ E-MARKETINGMIX 493

Axiom 5: A tool can serve one or several functions. These deliveries can be direct (e.g., without intermediar-
ies) and provide both enormous cost savings and
It is a beneficial fact that a marketing tool can be used to substantial anytime, anywhere benefits to consumers.
address one or several marketing functions. For example,
the e-mail tool can be used to offer a sales promotion, pro- Price. The valuation function maps to the price element
vide customer support, or receive a customer query. Also, of the marketing mix. Price is broadly conceived of as
e-mail is often categorized as outbound to refer to promo- what the consumer gives up to receive the product or con-
tional or communicational e-mail and inbound to refer to tinue the relationship, which may be time, effort, money,
customer support-related e-mall. So tools that can per- or some other consideration (perhaps a referral permission
form multiple functions are further designated as in the or simply permission to be contacted again later). Aspects
case of inbound and outbound e-mail and categorized by of this broader conception of price, such as referral per-
function. mission, are more salient in the e-marketing environment.
Also, the e-marketing environment enables large-scale use
Generalizing the Exchange of certain pricing mechanism, such as forward auctions,
Perspectives to E-Marketing reverse auctions, dynamic pricing, and "name your own
Since exchange remains an important focus of market- price" that are otherwise not widely feasible.
ing (including e-marketing) and the logical culmination of Place. The facilitation function maps to place in the
marketing efforts, the functions identified under the ex- marketing mix, and in the e-marketing context, it connotes
change paradigm are also e-marketing functions. Hence, the facilitation and location of the transaction. In tradi-
the axioms described in the previous section, which are tional marketing, facilitation typically occurred at a loca-
also applicable to the development of the e-marketing tax- tion controlled by a third party such as a distributor or a
onomy, are summarized in the following propositions: retailer. However, in the context of e-marketing, facilita-
tion can occur at the Web site of the manufacturer. This
Proposition I: Configuration, valuation, facilitation and presents the opportunity for a "manufacturer direct-to-
symbolization are basic e-marketing functions that customer' approach, a strategy that has received consider-
map into product, price, place, and promotion as the
able attention from manufacturers (Kalyanam and
respective e-marketing elements.
McIntyre 1999) and that the popular business press has
Proposition 2: Direct inducement to overcome barriers
to action is a situational e-marketing function, with termed disintermediation.
sales promotion as the corresponding e-marketing Promotion. The symbolization function maps to pro-
element.
motion in its communication sense. While it is tempting to
use communication as the element name, we stick with the
However, in generalizing these marketing functions to
termpromotion to maintain continuity with the widely rec-
e-marketing, it is useful to highlight some unique aspects
ognized and standardized 4Ps framework. Online adver-
of e-marketing.
tising (e.g., a banner ad or a popup ad, etc.) has been a
Product. The configuration function maps to the prod- natural extension of offline promotion. Some of the newer
uct element of the marketing mix. However, in the e-mar- digital tools and techniques include sponsored links on
keting context, the concept of product configuration can search engines, outbound e-mail, and viral marketing
become quite literal through the mechanism of a configu- (Godin 2001).
ration engine. For instance, Detl Computer offers a config-
Sales promotion. Some marketing activities, such as
uration engine at its site that can be used by the customer to
e-coupons, are undertaken as special inducements to en-
designate changes to a basic computer model to include a
courage the relationship partner to undertake a specific act
different disk drive size, processor speed, screen size,
by a certain time. For instance, an e-coupon might be good
memory size, operating system, software footprint, and so
for a 20 percent discount if used by the end of the month.
on. AII of these settings represent hundreds of potential
These inducements help consumers to overcome the natu-
configurations that would be very costly to stock in a
ral human tendency to procrastinate and are considered,
bricks-and-mortar retail setting.
therefore, to serve a separate function for the marketing
In addition, many Web sites include digital offerings or manager. These inducements are termed situational be-
services, such as a consumer printing out a map obtained cause they are applied as an exception or temporary
through the Yahoo.com Web site or viewing financial suboffer to the basic ongoing marketing plan relative to
information about the stock market. Such digital delivery that specific act.
is a paradigm-shifting capability for many product catego-
ries, including music, video, jokes, maps, stock quotes, The Relationship Perspective
software, art, tickets, photos, and all fashions of written At least two broad trends suggest that the exchange par-
materials and thus a huge array of products and services. adigm is a limiting way of characterizing e-marketing.
494 JOURNALOF THE ACADEMYOF MARKETINGSCIENCE FALL2002

First, during the 1990s, marketing theory moved toward Site (anytime, anywhere digital access point). A digital
the relational exchange paradigm. In an influential article, media-based relationship requires an anytime, anywhere
Berry (1983) noted that marketing has historically over- digital access point. We use the term site, which is com-
emphasized customer acquisition when compared to cus- monly understood industry parlance, as the e-marketing
tomer retention. Reichheld (1996) presented evidence mix element that designates this function. We recognize
regarding the economic importance of the loyalty effect that a Web site is only one manifestation of site. The inter-
flowing from customer retention. Others have synthesized face on a handheld personal digital assistant (e.g., Palm Pi-
these perspectives into the notion of relationship market- lot) is another manifestation. The access point can be used
ing (Sheth and Parvatiyar 2000), including the need for to interact about any aspect of a relational exchange. A
one-to-one interactions (Peppers and Rogers 1993, 1997). customer can obtain product information and pricing, ac-
As Kotler's (2003) leading marketing management text cess the latest sales promotion, or request customer sup-
now states, "Transaction marketing is part of a larger idea port. Since the access point moderates all e-marketing
called relationship marketing" (p. 13). This larger perspec- functions, site is considered an overlapping function.
tive views marketing as a relationship made up of a contin-
uing series of collaborative interactions with each cus- Personalization. Once a relationship is the marketing
tomer individually. goal, an important step is to identify individual customers
(Peppers and Rogers 1993) and to gather information
The second trend is the reality of Web-based interac- about them, which is the foundational concept of personal-
tions, which are one of the most common forms of digital ization (Peppers and Rogers 1997). Personalization, then,
interactions. In the Web-based environment, customers is defined to be any form of customization that occurs be-
can initiate an interaction at any time and from anywhere, cause of specific recognition of a given customer. For ex-
as well as before, during, or after the exchange, making the ample, a cookie placed on the visitor's computer can allow
exchange paradigm very limiting when thinking about a site to deliver a homepage low in graphical content if the
e-marketing. Furthermore, most Web-based interactions user appears to be on a slow dial-up modem. Such person-
tend to be personalized, at least in some minimal way, such alization is a matter of degree. Kamran Parsaye 2has devel-
as recognizing a visitor using a cookie. As Peppers and oped a conceptual personalization quotient (PQ) based on
Rogers (1999) pointed out, "Relationship marketing has the degree that the Web site exercises:
only recently become practical and cost-efficient on a
large scale because of database technology and the
(a) customization--the system's ability to customize
internet" (p. 122). These technologies allow an enterprise items by allowing individual users to set their own
to track its customers individually across all touch points preferences,
and transaction types. Digital interaction on Web sites, at (b) individualization--the system's ability to customize
call centers, and through sales force automation tools now itself to the user based on the user's exhibited behav-
provides an automated connection to the firm. Mass cus- ior, and
tomization technology permits a firm to configure its (c) group characterization--the system's ability to cus-
offerings digitally--in effect, mass-producing in lot sizes tomize itself to the user based on the preferences of
of one. This interaction is then likely to become part of an other users with similar interests.
ongoing series of linked interactions, building a rich and
individualized context for the relationship over time. With In addition, personalization can be done based on rules
each interaction, the offering can more closely meet the provided by experts. For example, if the customer buys
customer's needs. The relationship tends to get smarter shirt A, then recommend pant B, or if the customer is from
and smarter, in what is called a "learning relationship" corporation X, then provide a discount of Y percent, and so
(Peppers and Rogers 1999). on. From this discussion, it is apparent that personalization
These trends can be summarized in the following can be applied across any aspect of the e-marketing mix
proposition, which combines the notion of exchange with and is, therefore, overlapping and moderating with re-
relationships: gard to the effect those other functions have on the cus-
tomer experience.
Proposition 3: The marketing functions should be de- Privacy. The collection of information for personaliza-
fined from a relational exchange perspective rather tion forces the marketer to decide how this information is
than a transactional perspective. to be used, particularly regarding access to it--thus the ba-
sic decision about privacy. Note that privacy-related deci-
Furthermore, these trends identify personalization, se- sions are inescapable (or, in the terms of this literature,
curity, privacy, site (e.g., anytime, anywhere access), and "basic") once the marketer collects information about in-
customer service as relational exchange functions. These dividuals and stores it. Furthermore, privacy consider-
functions are now discussed in detail. ations are well recognized by the policy-making forces in
Kalyanam,Mclntyre/ E-MARKETINGMIX 495

society and often carry the force of laws, which increases The Network Perspective
the complication of managing this aspect of the marketing In addition to perspectives on relationships and
mix internationally. exchanges, another perspective on e-marketing focuses on
Security. Another "essential" function of e-marketing, the fact that the Internet is a network (Hanson 2000).
once we move beyond the concept of simply a transaction, Access to the Internet also means access to other individu-
is the issue of security. There are at least two aspects to se- als who are a part of the network. Metcalf's law states that
curity, the first being security during the transaction. An a network is valuable in proportion to the number of indi-
example of the first type of security is to ensure that a third viduals involved in the network. This phenomenon
party is not hijacking aspects of the transaction. The need emphasizes a positive externality evolving from participa-
for credit card numbers and other critical information on tion in a networked group. The essence of this externality
the Internet exposes the customer to risks beyond just the leads to the value of what has been called community on
current transaction and therefore involves a trust in the the Internet.
marketer that goes well beyond just the probity and punc- Mohammed et al. (2002) defined a community as a set
tuality of the current transaction, heightening the relation- of interwoven relationships built on shared interests that
ship nature of these digital interactions. This trust now satisfies members' needs, which are otherwise unattain-
encompasses beliefs about the security-related diligence able individually. Customers are members within a com-
of the marketer. The second aspect of security is regarding munity (Mohammed et al. 2002) who interact with one
the data that are being recorded about the individual (e.g., another over time (either independently or under some in-
providing adequate security to the consumer that a third fluence from the marketer). A marketer-influenced interac-
party cannot break into the database). There is a constant tion can be to exchange support information about the prod-
battle between methods of security (e.g., encryption) and uct or to provide something as simple as frequently asked
the sophistication of hackers. It is the marketers' responsi- questions (FAQs). Hence, community building is now rec-
bility and competitive necessity to keep ahead in this tech- ognized as an important function to be addressed by mar-
nological race. A lapse in the security domain could easily keting management (Armstrong and Hagel 1996; Young
be the end of a company. and Levine 2000). However, it is viewed as a situational
function rather than a basic one. Since the interactions in the
Customer service. Many early marketing mix taxon-
community can be about any of the other functions, com-
omy specifications (e.g., Borden 1964) included customer
munity moderates other functions and is an overlapping
service as a support function often needed to make a trans-
function. This leads to the following proposition:
action happen (and therefore a situational function). The
introduction of "time" into the exchange paradigm (the
Proposition 5: Community is an e-marketing function
driving factor in moving to a relationship perspective) that is situational in nature.
means that the marketer is forced to consider providing
support to the customer over time. This necessitates con-
Following van Waterschoot and Van den Bulte (1992),
sideration of customer service (in its broadest sense) as an
it is important to realize that while all of the marketing mix
ongoing and essential function. Interestingly, customer
elements are to be coordinated in terms of their interacting
service is typically shown as a necessary function (a key
and potentially synergistic influence on the customer ex-
element) in the retail mix (Levy and Weitz 2001). This sug-
perience, some functions take place mostly through their
gests that an ongoing direct interaction with customers re-
interaction with other more basic functions and very much
quires support as an essential function. Furthermore, the
moderate the effect of those basic functions. These func-
support can be about any aspect of the e-marketing mix. It
tions are termed overlapping functions and lead to the
can be an issue about product availability, service plans,
sixth proposition:
pricing, or promotions. Hence, customer support is an
overlapping function. Proposition 6: Site, customer service, personalization,
The preceding discussion regarding e-marketing func- privacy, security, sales promotion, and community
tions can be summarized into the following proposition: moderate e-marketing mix functions and are desig-
nated overlapping.
Proposition 4: The basic relational e-marketing func-
The Resulting E-Marketing
tions are anytime, anywhere access; personaliza-
Mix Taxonomy
tion; security; privacy; and customer service.
The preceding propositions lead to the e-marketing tax-
These functions map into the following e-marketing el- onomy portrayed on a cube in Figure 1. Functions that do
ements, respectively: site, personalization, security, pri- not moderate other functions as much (nonoverlapping)
vacy, and customer service. are shown on the surface of the cube. The overlapping
496 JOURNAL OF THE ACADEMY OF MARKETING SCIENCE FALL 2002

functions are placed in the lower part of the cube to convey FIGURE 1
that they operate mainly by moderating any of the func- The E-Marketing Mix = 4Ps + P2C=S~
tions on the surface in addition to moderating each other.
The resulting e-marketing mix is expressed in the follow- Basic Situational
ing acronym: 4Ps + p2C283, where P stands for product,
price, place, promotion, personalization, and privacy;
C stands for customer service and community; and S
stands for site, security, and sales promotion. The product,
price, place, promotion, and sales promotion functions
~ Product P r i c e ~
tion P l a c e /

(following the distinctions drawn in van Waterschoot and o


Y
Person~dizatton1
Van den Bulte I992) are as described in the traditional e

marketing mix. We note that most of the new elements are


Custon~r Community
considered essential from an e-marketing perspective and c2 Servio~
p
overlap across the other elements. P Site
i Sales
Mutually Exclusive g s~ Security Promotion
The schema proposed can be tested against the criterion
that none fits within the domain of another (e.g., that they
are mutually exclusive) and that there are not other impor-
tant functions of marketing that are omitted (e.g., that they Mapping the E-Marketing Tools
are collectively exhaustive).
With regard to being mutually exclusive, certain Another test of a taxonomy is to accomplish the pur-
macro-level elements, particularly the site, draw questions pose of mapping the tools in the e-marketing compendium
as to whether they are mutually exclusive of the other ele- (see Table 1) into the taxonomy developed. If the mapping
ments. Some observers want to place site under product, is successful, no tool to be classified fails to find a "home"
while others want to place it under promotion. The reason for it, and no tool satisfies some "unidentified" function.
for this tendency for "misclassification," in our view, is However, it is important to note that these tools can accom-
almost always because of an inadequate recognition of the plish or impinge on several different e-marketing mix
underlying function of the site element. We take site to be functions, oftentimes even simultaneously. For instance,
an anytime, anywhere relationship touch point between e-mail can address the function of(a) customer service and
the customer (or prospect) and the company, whereas the (b) community all within the same e-mail message. This
individual wanting to classify site under promotion will would be the case, for instance, if Amazon.corn sent an e-
invariably be defining the role of the site design in a dif- mail containing a user review of a book posted by another
ferent, more communication-oriented way. Hence, we customer (community) in response to an enquiry (cus-
conclude that the functions of product and promotion do tomer service). Hence, classifying tools by function pro-
not fulfill this now essential role. This kind of vides a robust approach. Consequently, e-mail can be clas-
misclassification is understandable, but on further reflec- sified as outbound, a subelement of communication; as
tion, our functional view of site usually leads to an agree- inbound, a subelement of customer support; and under
ment of it being a distinct function. community.
Similarly, there are those who might argue that cus- This criterion also is a test that we have applied with
tomer service is a part of the product (the extended prod- positive results. We are able to classify all e-marketing
uct). But actually, customer service in e-marketing is pri- tools based on their function to one of the e-marketing mix
marily about supporting the customer at the access point. elements. Figure 2 presents this classification. The e-mar-
Customer service might have nothing to do with the prod- keting functions allow the categorization of tools that are
uct, per se, and should not really be treated as a part of the otherwise hard to categorize or have a tendency to be arbi-
product or configuration function, tn fact, many of the trarily categorized. For example, consider registries and
other marketing mix suggestions (e.g., Borden 1964) wish lists. Many retailers consider these "services" that are
included as an element of the marketing mix the top-level offered to the customer. However, as per our analysis, reg-
element of customer service. Also, it is clear that customer istries and wish lists allow customers to communicate their
service emerges as a clear function due to the relationship preferences to other customers; in other words, they are a
and time-oriented perspective on the marketing endeavor community function. Merchants and buyers often provide
that was not so prevalent during the 1960s. recommendations based on their expert judgment and
Kalyanam, Mclntyre / E-MARKETING MIX 497

FIGURE 2
Classifying the E-Marketing Tools

Basic Situational
~i Product
sonment Price
9 Dynamic Prtt.mrtt.mg //
9 ConfigurationEngine 9 ForwardAuction,
9 Planning& Layout 9 Re~er~eAuction,
Tool~ 9 Nameyour price
on Place
9 Online Ads
9 Spon~redLtnks 9 Alhhate,
9 OutboundEmad 9 Remote
9 Viral Marketing Ht~tlng

cIndtvlduahTatlon
............
Rule~ganed System
I ]Persomll=t~m
Collaborat,~e Filtering / P z ~

]~ Chat Rooms
FAQ'~ & Help [ U~r Ratings&
De~k Revlew~
Emad Re~pon,e C ~ ~r
(,,,~HIUffdt~ 9 Reglsmes&
Mgmt [
Cha, C~ Servtee Wish Llst~
9 Reputation
S~onn~
HomePage& Search I
Navtgauon ~tli!
Page De,lgn & Layom
E Coupons
Promotion
~, Se~dty

knowledge, and retailers tend to classify them under "How is e-marketing different?" The next section contains
assortment. However, our analysis suggests that these are a more detailed discussion of this issue9 Another problem
simply communications and hence should be classified that was identified in the introduction was the lack of a
under the promotion element. Furthermore, even if a rec- common vocabulary for e-marketing. The 11 e-marketing
ommendation were personalized, it would still be a com- functions provide a common vocabulary.
munication, except with personalization moderating it. The e-marketing mix designates which functions need
Again, thinking in terms of e-marketing functions pro- to be considered in the marketing plan. Thus, it provides a
vides a basis for the categorization9 Finally, we do not natural starting point for the specification of the e-market-
include e-marketing techniques such as site testing or ing plan. The e-marketing mix is a simplifying tool.
usability in our taxonomy. We recognize these as enabling Instead, of a mental model that encompasses more than 30
processes and hence do not include them in the taxonomy9 e-marketing tools, the manager can work with a simplifi-
cation that involves only 11 functions. Since the manager
has a simplified construct of 11 elements along with a
USEFULNESS
mnemonic device and a visual that provides a holistic
view, it is less likely that the marketing plan will be unbal-
In the introduction, several problems were identified,
anced, overemphasizing some functions at the expense of
including the lack of a common vocabulary regarding
others due to oversight9 Furthermore, the e-marketing mix
e-marketing, an inability to define and compare e-market-
maps the e-marketing tools into e-marketing functions.
ing with traditional marketing, and difficulty in specifying
The manager can formulate strategy by specifying differ-
an e-marketing plan because of unclear scope. The analy-
ential emphasis on the various functions and map the strat-
sis and the e-marketing mix construct presented in this
egy directly into tactical implications for the tools9 Con-
article help toward resolving these problems9
versely, limitations of the tools might indicate the
First, the propositions in this article collectively offer
limitations of a particular strategy9 The e-marketing mix
the following definition of e-marketing:
serves as a unifying construct and focal point for this top-
E-marketing enables relational exchanges in digital, net- down or bottom-up exercise.
worked, interactive environments. Apart from these practical considerations, the new tax-
onomy serves to move the marketing mix framework
Second, 11 e-marketing functions have been identified beyond the transaction paradigm to the more viable rela-
and are represented by the mnemonic 4Ps + p2C253. These tionship paradigm. In addition, the e-marketing mix can
functions provide another perspective to the question, better describe the modem marketing strategy, which now
"What is e-marketing?" By demarcating the most widely almost always entails a role for e-marketing tools, particu-
recognized version of the traditional marketing mix, the larly a Web site. The Web address is often found on the
4Ps + p2C2S3 mnemonic directly answers the question, packaging, on the product itself, in the user's manual, on
498 JOURNAL OF THE ACADEMY OF MARKETING SCIENCE FALL 2002

the company letterhead, on the sales person's business e-marketing is about enabling relational exchanges in digi-
card, and so on, making it an element of the marketing tal networked and interactive environments. The taxon-
strategy that may not be essential for a transaction but is omy has face validity when assessed against the criteria
competitively necessary in the customer relationship bat- identified by Hunt (1991). The e-marketing taxonomy
tle that is today's marketing environment. enables the development of the e-marketing strategy by
enabling the holistic consideration of various e-marketing
functions. Mapping the functions into e-marketing tools
IMPLICATIONS FOR
facilitates implementation. In this manner, the e-market-
THE MARKETING MIX
ing mix serves as a core, unifying construct. Comparison
to the traditional marketing mix indicates that the e-mar-
The premise of the marketing mix has been the
keting mix provides continuity to the 4Ps, contributes sev-
exchange paradigm in a physical world. The premise of e-
eral new elements, and directly represents personalization,
marketing is relational exchanges in a networked world
a form of segmentation as an endogenous function. Many
predominantly made up of bits and bytes. 3The 4Ps + mne-
of the new elements moderate the other elements, and this
monic shows that there is continuity with the 4Ps of mar-
suggests that integration across elements must become
keting. The e-marketing mix has the following additional
routine.
elements: site, personalization, security, privacy, commu-
While the taxonomy seems robust in its ability to clas-
nity, and customer support. But there is much more to
sify extant e-marketing tools, its robustness in the face of
e-marketing because these additional functions are con-
other yet to be identified tools remains an open issue. Will
sidered overlapping. Since overlapping functions moder-
e-marketing programs be more integrated across various
ate other functions, planning and implementing an over-
elements compared to traditional marketing? Will the
lapping function involves coordination and integration
4Ps + p2C2S3 mnemonic serve the marketing community
with other functions. Figure 1 shows that in the e-market-
as well as the 4Ps has? Does the e-marketing mix general-
ing mix, there are more overlapping functions than stand-
ize to relationship marketing? Is it really synonymous with
alone functions. Naturally, one expects more and deeper
the relationship marketing mix? These questions will ben-
integration and coordination across elements in e-market-
efit from further assessment and research.
ing compared to the traditional marketing mix.
The consideration of the individual leads us to the issue
of segmentation, which is typically treated as a process NOTES
outside the traditional marketing mix. The e-marketing
mix, with its focus on relational exchanges, makes consid- 1. We take as "axioms" those statements that appear self-evident
eration of the individual customer through personalization from prior literature, as opposed to "propositions," which are assertions
a necessary function. To put it differently, fine-grained introduced in this article.
segmentation in the form of personalization is now endog- 2. As cited by Mohammed et al. (2002:635).
3. The atoms versus bits and bytes perspective follows Negroponte
enous to the mix. This is more intuitive and conceptually
(1995).
appealing.
While the e-marketing mix has been motivated in the
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York: McGraw-Hill.
Mahajan, Vijay,Raji Srinivasan,and Jerry Wind. 2002. "The Dot.corn the Graduate School of Business at Stanford University, the
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Doubleday9
- - and - - . . 1999. The One to One Manager. New York: problems of retailing. He earned a B.S. in engineering (1965), an
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Porter, Michael E. 2001. "Strategy and the Internet" Harvard Business He has subsequently published more than 50 articles in leading
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McGraw-Hill/Irwin.
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Company. He has twice received the annual award from the Journal of Re-
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ship Marketing. ThousandOaks, CA: Sage. in Retail Marketing?' He teaches marketing information systems,
Strauss, Judy and Raymond Frost. 2001. E-Marketing. Upper Saddle marketing research, brand management, and marketing manage-
River, NJ: PrenticeHall
ment and was the chair of the Marketing Department at Santa
Treese, WinfieldG. and LawrenceC. Stewart. 1998. Designing Systems
for Internet Commerce. Reading,MA: Addison-Wesley. Clara University from 1983 to 1991. His research interests cur-
Trepper, Charles. 2000. E-Commerce Strategies. Redmond, WA: rently focus on decision support systems, retaiI-related decision
Microsoft Press. models, and e-commerce.

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