SIGNIFICANCE OF DIGITAL MARKETING STRATEGY TO SMALL SCALE ENTERPRISES
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SIGNIFICANCE OF DIGITAL MARKETING STRATEGY TO SMALL SCALE ENTERPRISES
Chapter Two: Literature Review
2.1 Theoretical Review
The study was based on numerous theories, which are captured below:
2.1.1 Network/Social Network Theory
The network approach’s concept is derived from several structural concepts proposed by sociological thinkers such as Emile Durkheim, Georg Simmel, and anthropologist Radcliffe-Brown,
whose research was primarily concerned with understanding the structure and impact of relational webs or “networks” of social associations between and among individuals.
Network theory examines all types of relationships, whether they are between humans, animals, or objects. Social network analysis is an overlapping tool for learning about patterns that emerge within social networks and their impact on behaviour.
Digital marketing channels are significant in this regard since they allow marketers to listen to and comprehend what customers say, as well as to leverage the power of powerful users to propagate messages to others in their networks. According to research, the most powerful users have the greatest effect across multiple specialised networks.
The network theory views social relationships in terms of nodes and ties. Nodes are the network’s actors, while ties are the relationships between them.
Various types of relationships exist between the nodes, and a social network, in its most basic form, explains all of the essential ties between the nodes under consideration.
The network can also be used to “determine the social capital of individual players”. These concepts are typically depicted in a social network diagram, in which nodes are points and ties are lines. This theory is relevant to the study since it examines how SMEs might maximise their ‘networks’, specifically their consumers.
2.1.2 Theory of Collective Intelligence
Collective intelligence is a method in which a huge number of people can converge on the same point(s) of knowledge while also achieving intellectual performance. According to collective intelligence theory, groups are generally smarter and more productive than individual members.
Crowdsourcing is an internet phenomena in which projects are divided into small, individual tasks and distributed to a large number of people for completion. It is recognised to have collective intelligence properties.
Tapscott and Williams (2008) define collaborative intelligence as having four principles. These values include openness, peering, sharing, and acting internationally.
Openness: For collective intelligence to work to its full potential, people and businesses must present and be frank about their ideas to the public on the internet so that their products can be enhanced. Peering is the process of taking outdated information or items and changing them to meet your and others’ particular needs before making them available to the public for use.
Sharing: It describes how intellectual property must be shared with others in the organisation. Allowing for the ongoing interchange of ideas and critiques is critical for increasing productivity.
The Acting Globally idea is based on advancements in communications technology, which enable organisations to reach out to their whole collaborator network and engage everyone.
This notion overcomes obstacles like as department and branch boundaries in order to capture and implement new ideas, talents, and markets. This theory is significant in the study because it demonstrates how digital marketing may bring SMEs and their customers together to connect and exchange ideas, resulting in products or services that improve the overall experience.
2.1.3 Generational Theory
According to generation theory, a person’s worldview is influenced by the era in which they were born. It also suggests that our value systems are influenced during our formative years by our families, friends, communities, key events, and the era in which we are born (Jurkiewicz & Brown, 1998).
Generational marketing theory, developed by Strauss and Howe in 1991, states that consumers born during the same era, often a 20-year period, have similar attitudes and behaviours as a result of common childhood experiences that shaped their worldviews.
The current period might be classified as one of digital information, as indicated by the use of digital media. Generational theory is crucial to digital marketing since it describes how each generation communicates
and where marketers can readily find them online. This theory is relevant to the study since it supports SMEs in identifying consumer generations and homogeneous groups and developing appropriate marketing content for them through digital media.
2.1.4 Forms of Digital Marketing
Digital technologies have the power to replicate practically every component of traditional media channels and marketing communications, thereby encompassing the marketing mix.
However, digital promotions are more specialised and form part of the marketing communication mix. Digital marketing refers to the use of digital media in the course of carrying out marketing procedures.
Emails, mobile marketing, search engine optimisation (SEO), social media, pay-per-click (PPC), online advertising, and viral marketing are examples of digital marketing tactics.
Email marketing is one of the early digital marketing tactics, and it entails sending personalised or targeted communications to certain people at the appropriate moment. Businesses will send emails that satisfy the user’s expectations.
Mobile marketing is the use of a wireless media to supply consumers with time and location-specific, personalised information about products, services, and ideas (Scharl, Dickinger, & Murphy, 2005).
It thus improves the interaction between consumers and their mobile phones, the consumer-brand relationship, and mobile advertising’s ability to control the viewing environment, allowing advertisers to create more meaningful brand relationships (Aaker, Benet-Martinez, & Garolera, 2001).
Search engine optimisation (SEO) is the process of developing website content to match what business prospects are looking for and presenting it in a way that is easily accessible to both humans and search engines.
To improve targeted traffic to a website, businesses should focus on organic or natural search results, which appear in the middle of search engine results pages (Ryan & Jones, 2009).
Pay-per-click marketing allows businesses to be highly ranked in search results for specified keywords and phrases by paying. This method is useful for generating search engine traffic based on the business type and desired keywords.
Although pay-per-click advertising grows in popularity and competitiveness, keywords are becoming more expensive for small firms (Ryan & Jones, 2009).
Online advertising refers to adverts put on search engine results pages, advertisements embedded in e-mails, and other methods in which advertisers use the internet. The primary goal is to entice a potential consumer to take immediate action by clicking on the advertisement (The Saylor Foundation, 2020).
These advertising are used to elicit various activities from potential customers and to achieve multiple marketing communications goals, including increasing action, influencing opinions, and increasing recall.
Affiliate marketing is a type of online advertising in which a digital user or website promotes an online shop in exchange for a reward based on the number of sales or leads generated (IAB Australia, 2016). In this situation, the third party makes money each time a potential customer clicks on the link provided by the advertiser’s website.
Viral marketing is a combination of several aspects of digital marketing that involves disseminating message material over different platforms.
It may contain YouTube videos, email marketing, blogs, and other traditional components, all with the goal of ensuring that the material catches market attention and spreads naturally to other online communities.
2.1.5 Digital Marketing and Sales
Several research and literature have suggested a link between digital marketing and sales. Digital marketing can reach new clients and deliver personalised communication, hence increasing awareness and sales (Jain, 2014; Jagongo & Kinyua, 2016).
Small businesses may be able to use digital media such as social media and e-mails, which are known to be very inexpensive, to reach out to potential customers and raise product awareness,
whereas medium-sized businesses may have some revenue to use digital tools such as pay-per-click (PPC), search engine optimisation (SEO), online advertising, and viral marketing.
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