MKTG 5721: Digital Marketing Strategies and Measurement College of Business Administration University of Missouri-St

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MKTG 5721: Digital Marketing Strategies and Measurement College of Business Administration University of Missouri-St. Louis Spring 2018

Instructor: Prof. Ho Kim, Ph.D. Office: Anheuser-Busch Hall 222 Office Hours: Open door policy and by appointment Phone: 314-516-6298 Email: [email protected] Instructor Homepage: http://www.umsl.edu/divisions/business/About%20the%20College/Faculty/Ma rketing/kim.html Class Schedule: Thursday 6:55 – 9:30PM

Course Description

The advent of internet has created opportunities as well as threats to companies. This course provides students the theoretical understanding of the Internet marketplace necessary to adapt to its many changes, while also introducing them to the real-world Internet marketing problems through real business cases. This course consists of three element: (1) lectures that cover basic concepts/theories of online marketing; (2) case analyses that apply the concepts to real-world online marketing problems; (3) online marketing simulation to provide hands- on experience. The following topics will be covered: (1) an overview of the digital landscape and status quo; (2) digital advertising and promotion including search advertising and display advertising; and (3) transitioning to digital: digital product, price, and place—the rest of the 4P’s of marketing.

Course Objectives

The course will help students achieve the following objectives. 1. To understand recent moves in the digital space by examining major online players (e.g., Google, Facebook, Amazon, and Apple) and studying relationships between offline and online marketing. 2. To understand how firms use the Internet to communicate value to consumers by studying various online advertising methods such as paid search advertising, display advertising, and social media advertising. 3. To understand consumer behavior and firm reactions in the digital age that transforms the traditional marketing of companies, including freemium pricing, showrooming, omni-channel marketing, mobile marketing, and online reputation management.

Course Structure

This course consists of three self-contained modules.

Module 1: Digital Landscape. Module 1 explores the new digital landscape. It is important to understand “how firms get here.” We will study Internet technologies related to digital

1 marketing (Week 1), overview the outbound/inbound digital marketing activities (Week 2) and social media marketing activities (Week 3), and study basic web metrics (Week 4).

Module 2: Digital Advertising and Promotion. The Internet has made available a plethora of tools for firms to use. Module 2 focuses on how companies use the Internet to communicate value to consumers and learn about consumers’ needs and wants. This module will cover search advertising (Week 5) and display advertising (Week 6) as outbound marketing tools; search engine optimization and landing page optimization (Week 7) as inbound marketing tools; and social media marketing (Weeks 9 and 10). In Week 8, we will introduce the digital marketing simulation game MIMIC Pro and do practice run in the classroom.

Module 3: Transitioning to Digital. Module 3 deals with the other three P’s of marketing. The module discusses the novel benefits of the ‘marketing mix’ afforded by digital strategies regarding what to offer (Product), where to distribute (Place), and how to charge for it (Price). Many of the traditional tenets of the three P’s still apply online but the Internet creates new opportunities and challenges, many of which are addressed in this module. Specifically, we will learn how firms manage online reputation (Week 12); how firms use mobile apps as a marketing tool (Week 13); and how firms price digital content and how the Internet has affected the distribution of products (Week 14).

In the last three weeks of the semester, we will review the course (Week 15), present the MIMIC Pro results (Week 16), and take the final exam (Week 17).

Course Materials

 Required readings The following readings are required for classroom activities and homework assignments. They are included in the course pack, available for purchase at http://cb.hbsp.harvard.edu/cbmp/access/72324995.

- Deighton, John and Leora Kornfeld. “United Breaks Guitars.” HBS No. 9-510- 057. Boston: Harvard Business School Publishing, 2011. - Deighton, John and Leora Kornfeld. “Harvard Business School Executive Education: Balancing Online and Offline Marketing.” HBS No. 9-510-091. Boston: Harvard Business School Publishing, 2012. - Deighton, John and Leora Kornfeld. “Amazon, Apple, Facebook, and Google.” HBS No. 9-513-060. Boston: Harvard Business School Publishing, 2013. - Gupta, Sunil and Joseph Davies-Gavin. “BBVA Compass: Marketing Resource Allocation.” HBS No. 9-511-096. Boston: Harvard Business School Publishing, 2012. - Gupta, Sunil and Joseph Davin. “Marketing Reading: Digital Marketing,” Boston: Harvard Business School Publishing, 2015. - Gupta, Sunil and Kerry Herman. “Bank of America: Mobile Banking.” Case No. 9-510-063. Boston: Harvard Business School Publishing. 2012.

- Jeffery, Mark. “Air France Internet Marketing: Optimizing Google, Yahoo!, MSN, and Kayak Sponsored Search.” Case No. KEL319. Evanston, IL: Kellogg School of Management. 2009. - Kumar, Vineet, Bharat Anand, Sunil Gupta, and Felix Oberholzer-Gee. “The New York Times Paywall.” Case No. 9-512-077. Boston: Harvard Business School Publishing. 2013. - Maddux, Robert, Timothy Harr, Martha Gray, Gautam Kanaparthi, Prateek Shrivastava, and Matthew Weiss. “Motorcowboy: Getting a Foot in the Door (A).” Case No. UV5778. Charlottesville VA: University of Virginia Darden School of Business. 2014. - Stephen, Andrew T. “Ford Fiesta Movement: Using Social Media and Viral Marketing to Launch Ford’s Global Car in the United States.” Case No. INS231. Paris: INSEAD. 2013. - Teixeira, Thales and Alison Caverly. “Mekanism: Engineering Viral Marketing.” Case No. 9-512-010. Boston: Harvard Business School Publishing. 2013. - Teixeira, Thales and Leora Kornfeld. “Managing Online Reviews on TripAdvisor.” Case No. 9-514-071. Boston: Harvard Business School Publishing. 2013. - Zerio, John, Arvind Deshmukh, and Akshay Seth. “Thunderbird—Improving the Online Experience Web Performance Analytics.” Case No. TB0371. Glendale, AZ: Thunderbird School of Global Management. 2014.

 Required lecture slides: Lecture slides will be posted on Canvas learning system before the each session starts.

 Required digital marketing simulation: We will play a digital marketing simulation game (MIMIC Pro by Stukent) throughout the semester. Every student should purchase the license here: https://home.stukent.com/join/933-AF6.

 Textbook (optional): The following book is optional but recommended as we will use it in the lecture part of a weekly session. - Stukent. Digital Marketing Essentials. This is an e-textbook that is updated regularly. To purchase, use this link: https://www.stukent.com/internet-marketing- textbook/.

Group Formation

You need to form groups as the MIMIC Pro digital simulation game will be done by team. An ideal group will consist of three to four students and no group can have more than five students. You must attend in the first week.

Session Format

A typical weekly session will consist of a lecture and a case discussion. As we move to the later parts of the semester, we may discuss your MIMIC Pro performance in the class.

Lecture. A weekly session will start with a lecture that deals with the textbook materials assigned to the week. Each week’s topic and textbook chapters can be found in the Course Schedule section of the syllabus.

Case Discussion. The weekly case studies have been carefully selected to enhance your learning by examining real-world problems. All students are expected to come to class ready to discuss the assigned case. At a minimum, each individual student should be able to (i) summarize the business environment the focal company is situated in; and (ii) identify main issues facing the focal company. Additionally, students are encouraged to prepare recommendations for the focal firm backed by your analysis. I may call upon any students at any time (cold called) to provide specific recommendations and analysis. Even if you do not contribute to a specific case discussion by speaking, make sure that you are comfortable with what you would have done in the management situation described in the case and why.

MIMIC Pro Simulation. Each student will be assigned to a team and each team will run the MIMIC Pro simulation game for seven rounds, starting in Week 8. More detailed information about MIMIC Pro will be given in the class.

Written Assignments

Case analysis executive memos. For every case discussion, you will prepare a one-page, single-spaced memo that is based upon situation analysis and organize your thoughts/ideas for the case. This is an individual assignment and should be completed independently by each student. Submit the memo on Canvas by the noon of the class day. Writing a memo for every case is designed to help you prepare for every case discussion. I will not give feedback on every memo, but randomly select 3 executive memos for your evaluation.

MIMIC Pro Campaign Report. During the semester, you will run the MIMIC Pro simulation game for seven weeks (starting from Week 8). After fishing the seven runs, student groups should write a post-campaign report that summarizes the campaign results and lessons you learned through the game. The post-campaign report should be submitted to the instructor. The report should not exceed eight pages (double-spaced). More detailed information about the report will be provided in the middle of the semester.

Grading Policy

The assessment and grading system is intended to reflect student learning and performance.

Attendance 5% (Individual) Case analysis executive memo 30% (Individual) Final exam 30% (Individual) MIMIC Score 10% (Group) MIMIC post campaign report 20% (Group) MIMIC peer evaluation 5% (Individual)

Grading Scale

100 – 92 = A 89.99– 88 = B+ 79.99 – 78 = C+ 69.99 – 68 = D+ 59.99 – 0 = F 91.99 – 90 = A- 87.99 – 82 = B 77.99 – 72 = C 67.99 – 62 = D 81.99 – 80 = B- 71.99 – 70 = C- 61.99 – 60 = D-

Computer Policy

Students may bring and use a notebook PC in the classroom for educational purpose only.

Weekly Readings (R: Required, O: Optional)

 Week 1 (1/18): Technological Aspects of Digital Marketing - (R) Deighton, John and Leora Kornfeld. “Amazon, Apple, Facebook, and Google,” Boston: Harvard Business School Publishing, 2013. - (O) Digital Marketing Essentials, Chapter 1.  Week 2 (1/25): Overview of Outbound/Inbound Marketing - (R) Deighton, John and Leora Kornfeld. “Harvard Business School Executive Education: Balancing Online and Offline Marketing.” HBS No. 9-510-091. Boston: Harvard Business School Publishing, 2012. - (R) Gupta, Sunil and Joseph Davin. “Marketing Reading: Digital Marketing,” Boston: Harvard Business School Publishing, 2015.  Week 3 (2/1): Overview of Social Media Marketing - (R) Gupta, Sunil and Joseph Davin. “Marketing Reading: Digital Marketing,” Boston: Harvard Business School Publishing, 2015. - (R) Deighton, John and Leora Kornfeld. “United Breaks Guitars.” HBS No. 9- 510-057. Boston: Harvard Business School Publishing, 2011.  Week 4 (2/8): Measuring the Impact of Digital Marketing Activities - (R) Online, Email, and Mobile Metrics [will be posted on Canvas]. - (R) Gupta, Sunil and Joseph Davies-Gavin. “BBVA Compass: Marketing Resource Allocation.” HBS No. 9-511-096. Boston: Harvard Business School Publishing, 2012.  Week 5 (2/15): Outbound Marketing 1: Search Advertising - (R) Maddux, Robert, Timothy Harr, Martha Gray, Gautam Kanaparthi, Prateek Shrivastava, and Matthew Weiss. “Motorcowboy: Getting a Foot in the Door (A).” Case No. UV5778. Charlottesville VA: University of Virginia Darden School of Business. 2014. - (O) Digital Marketing Essentials, Chapter 5  Week 6 (2/22): Outbound Marketing 2: Display Advertising 5

- (R) Zerio, John, Arvind Deshmukh, and Akshay Seth. “Thunderbird—Improving the Online Experience Web Performance Analytics.” Case No. TB0371. Glendale, AZ: Thunderbird School of Global Management. 2014. - (O) Digital Marketing Essentials, Chapter 6.  Week 7 (3/1): Inbound Marketing: Search Engine & Landing Page Optimization - (R) Jeffery, Mark. “Air France Internet Marketing: Optimizing Google, Yahoo!, MSN, and Kayak Sponsored Search.” Case No. KEL319. Evanston, IL: Kellogg School of Management. 2009. - (O) Digital Marketing Essentials, Chapters 2-4 & 7.  Week 8 (3/8): MIMIC Pro Introduction and Practice - (R) MIMIC Pro User Manual (on Stukent)  Week 9 (3/15): Social Media Marketing – Part 1 - (R) Teixeira, Thales and Alison Caverly. “Mekanism: Engineering Viral Marketing.” Case No. 9-512-010. Boston: Harvard Business School Publishing. 2013. - (O) Digital Marketing Essentials, Chapter 10.  Week 10 (3/22): Social Media Marketing – Part 2 - (R) Stephen, Andrew T. “Ford Fiesta Movement: Using Social Media and Viral Marketing to Launch Ford’s Global Car in the United States.” Case No. INS231. Paris: INSEAD. 2013. - (O) Digital Marketing Essentials, Chapter 11.  Week 11 (3/29): Spring Break (No Class)  Week 12 (4/5): Online Reputation Management - (R) Teixeira, Thales and Leora Kornfeld. “Managing Online Reviews on TripAdvisor.” Case No. 9-514-071. Boston: Harvard Business School Publishing. 2013. - (O) Digital Marketing Essentials, Chapter 12.  Week 13 (4/12): Mobile Marketing - (R) Gupta, Sunil and Joseph Davin. “Marketing Reading: Digital Marketing,” Boston: Harvard Business School Publishing, 2015. - (R) Gupta, Sunil and Kerry Herman. “Bank of America: Mobile Banking.” Case No. 9-510-063. Boston: Harvard Business School Publishing. 2012. - (O) Digital Marketing Essentials, Chapter 13.  Week 14 (4/19): Pricing of Digital Products, Place in Digital Age - (R) Kumar, Vineet, Bharat Anand, Sunil Gupta, and Felix Oberholzer-Gee. “The New York Times Paywall.” Case No. 9-512-077. Boston: Harvard Business School Publishing. 2013.

- (R) The Economist (2016), “Shops to Showrooms,” The Economist web article, accessible at http://www.economist.com/news/business/21694545-why-some- firms-are-opening-shops-no-stock-shops-showrooms.  Week 15 (4/26): Course Wrap-Up  Week 16 (5/3): MIMIC Presentation by Students  Week 17 (5/10): Final Exam (Online)

Course Schedule (Subject to change)

Week Topic Reading (R: Required, O: Optional) Assignment

1 Course Overview (R) Amazon, Apple, Facebook, and Google EM**: AAFG (1/18) Technological Aspects of (O) DME*, Chapter 1 Register for Digital Marketing MIMIC Pro at Stukent.

2 Overview of Outbound/Inbound (R) Digital Marketing (Gupta & Davin) – EM: HBS EE (1/25) Marketing Outbound/inbound marketing (R) HBS Executive Education

3 Overview of Social Media (R) Digital Marketing (Gupta & Davin) – EM: United (2/1) Marketing Social Media Marketing (R) United Breaks Guitar

4 Measuring the Impact of Digital (R) Online, Email, and Mobile Metrics EM: BBVA (2/8) Marketing Activities (R) BBVA Compass

5 Outbound Marketing 1: Search (R) Motorcowboy EM: (2/15) Advertising (O) DME, Chapter 5 Motorcowboy

6 Outbound Marketing 2: Display (R) Thunderbird EM: (2/22) Advertising (O) DME, Chapter 6 Thunderbird

7 Inbound Marketing: Search (R) Air France EM: Air France (3/1) Engine & Landing Page (O) DME, Chapters 2 – 4 Optimization

8 MIMIC Pro Introduction & (R) MIMIC Pro User Manual (on Stukent MIMIC Rounds (3/8) Practice site) 1 & 2

9 Social Media Marketing – Part (R) Mekanism EM: Mekanism (3/15) 1 (O) DME, Chapter 10 MIMIC Round 3

10 Social Media Marketing – Part (R) The Ford Fiesta EM: Fiesta (3/22) 2 (O) DME, Chapter 11 MIMIC Round 4

11 Spring Break (No Class) (3/29)

12 Online Reputation Management (R) TripAdvisor EM: TripAdvisor (4/5) (O) DME, Chapter 12 MIMIC Round 5

13 Mobile Marketing (R) Digital Marketing (Gupta & Davin) – EM: BoA (4/12) Mobile Marketing MIMIC Round 6 (R) Bank of America 7

(O) DME, Chapter 13

14 Pricing of Digital Products, (R) NYT Paywall EM: NYT (4/19) Place in Digital Age (R) Shops to Showrooms (Economist) MIMIC Round 7

15 Course wrap-up (4/26)

16 MIMIC Report and MIMIC Report (5/3) Presentation and Presentation

17 Final Exam Week (5/10) (Online Exam) * DME: Digital Marketing Textbook by Stukent ** EM: Executive Memo

Further Readings

The lecture slides are partly based on the following documents. Most of them are free, accessible on the web. I will post them in corresponding weeks as necessary.

- Adform (2015), “Digital Advertising Benchmark Report: Measuring the Impact of Branding and Performance Campaigns, 1HY 2015,” [will be posted on Canvas in the corresponding week]. - Adform (2015), “RTB Trend Report: Europe 2015 Q2,” [will be posted on Canvas in the corresponding week]. - Anderson, Chris (2012), “The Impact of Social Media on Lodging Performance,” research report, Cornell University Center for Hospitality Research Publications, [available at http://scholarship.sha.cornell.edu/cgi/viewcontent.cgi?article=1004&context=chrpubs ]. - AOL-BBDO (2012), “Seven Shades of Mobile: The Hidden Motivations of Mobile Users,” [available at https://advertising.aol.com/sites/advertising.aol.com/files/insights/research- reports/downloads/aol-bbdo-7-shades-mobile-abstract-final.pdf]. - Berger, Jonah and Katherine L. Milkman (2012), “What Makes Online Content Viral?” Journal of Marketing Research, 49 (April), 192-205, [available through UMSL library website, http://www.umsl.edu/library]. - Board of The Federal Reserve System (2015), “Consumer and Mobile Financial Services 2015,” [available at http://www.federalreserve.gov/publications/default.htm]. - Campbell, Dennis and Frances Frei (2010), “Cost Structure, Customer Profitability, and Retention Implications of Self-Service Distribution Channels: Evidence from Customer Behavior in an Online Banking Channel,” Management Science, 56 (1), 4- 24, [available through UMSL library website, http://www.umsl.edu/library].

- Chevalier, Judith A. and Dina Mayzlin (2006), “The Effect of Word of Mouth on Sales: Online Book Reviews,” Journal of Marketing Research, 43 (August), 345-354, [available through UMSL library website, http://www.umsl.edu/library]. - Godes, David and Dina Mayzlin (2004), “Using Online Conversations to Study Word-of-Mouth Communication,” Marketing Science, 23 (4), 545-560, [available through UMSL library website, http://www.umsl.edu/library]. - Google (2008), “A Guide to Building Successful AdWords Campaigns,” [available at https://www.adwordsrobot.com/en/free/ebook/a-guide-to-building-successful- adwords-campaigns---google]. - Gupta, Sunil (2013), “For Mobile Devices, Think Apps, Not Ads,” Harvard Business Review, 2013 (March), [available through UMSL library website, http://www.umsl.edu/library]. - Fang, Zheng, Xueming Luo, Michelle Andrews, and Chee Wei Phang (2014), “Mobile Discounts: A Matter of Distance and Time,” Harvard Business Review, 2014 (May), [available through UMSL library website, http://www.umsl.edu/library]. - Harvard Business Review (2013), “How People Really Use Mobile,” Harvard Business Review, 2013 (January-February), [available through UMSL library website, http://www.umsl.edu/library]. - Kim, Ho and Dominique M. Hanssens (2017), “Advertising and Word-of-Mouth Effects on Pre-Launch Consumer Interest and Initial Sales of Experience Products,” Journal of Interactive Marketing, 37, 57-74, [available through UMSL library website, http://www.umsl.edu/library]. - Kim, Ho, Reo Song, and Youngsoo Kim (2016), “Free-to-Paid Transition of Online Content Providers: An Empirical Analysis of U.S. Newspapers’ Paywall Rollout,” University of Missouri-St. Louis Working paper, [available at https://www.researchgate.net/profile/Ho_Kim15]. - MOZ (2015), “Search Engine Ranking Factors 2015: Expert Survey and Correlated Data,” [available at https://moz.com/search-ranking-factors]. - Netzer, Oded, Ronen Feldman, Jacob Goldenberg, and Moshe Fresko (2012), “Mine Your Own Business: Market-Structure Surveillance Through Text Mining,” Marketing Science, 31 (3), 521-543, [available through UMSL library website, http://www.umsl.edu/library]. - Shin, Hyun S., Dominique M. Hanssens, and Kyoo il Kim (2016), “The Role of Online Buzz for Leader versus Challenger Brands: The Case of the MP3 Player Market,” Electronic Commerce Research, 16, [available at https://www.researchgate.net/publication/299502336_The_role_of_online_buzz_for_l eader_versus_challenger_brands_the_case_of_the_MP3_player_market] . - Song, Reo, Ho Kim, Gene Moo Lee, and Sungha Jang (2016) “Evolution of Consumer Sentiment Surrounding a Pseudo-Product-Harm Crisis: The Impact of Advertising and News Sentiment,” California State University, Long Beach Working paper, [available at https://www.researchgate.net/profile/Ho_Kim15].

- Teixeira, Thales (2012), “The New Science of Viral Ads,” Harvard Business Review, 2012 (March), [available through UMSL library website, http://www.umsl.edu/library]. - Tirunillai, Seshadri and Gerard J. Tellis (2012), “Does Chatter Really Matter? Dynamics of User-Generated Content and Stock Performance,” Marketing Science, 31 (2), 198-215, [available through UMSL library website, http://www.umsl.edu/library]. - Tucker, Catherine (2012), Social Advertising, MIT Working paper, [available at https://marketing.wharton.upenn.edu/mktg/assets/File/Title-Paper-Tucker-C%2002- 09-2012.pdf]. - Tybout, Alice M, Bobby J. Calder, and Brian Sternthal (1981), “Using Information Processing Theory to Design Marketing Strategies,” Journal of Marketing Research, 18 (1), 73-79, [available through UMSL library website, http://www.umsl.edu/library]. - Williams, Martin and Francis Buttle (2014), “Managing Negative Word-of-Mouth: An Exploratory Study,” Journal of Marketing Management, 30 (13-14), 1423-1447, [available through UMSL library website, http://www.umsl.edu/library].