Research on Digital Marketing in Big Data Era Bachelor’s thesis International Business Valkeakoski, autumn 2018 Zifan Kong Zifan Kong ABSTRACT VALKEAKOSKI International Business Author Zifan Kong Year 2018 Title of Bachelor’s thesis Research on Digital Marketing in Big Data Era ABSTRACT The main reason for this study was to look into the concept of big data in order to find out how it can be used and optimize digital marketing activi- ties. In order to apply the theories to the real business world, the thesis is commissioned by case company Netease Cloud Music. The study helps to understand firstly the definition of big data and also the current stage of technological development of it by going through relevant theories. The topic is enlarged by introducing the concepts of digital mar- keting as well as how big data can be applied to digital marketing. The ob- jectives of the study include: gathering theoretical information about big data and digital marketing, describing the current situation and perfor- mance of the case company Netease Cloud Music. Models such as PEST and new 4Cs are concluded to analyze the situation of the company. Com- bined with the result of the analysis, recommendations are made in the end. The analysis will look into external factors that have influence on the case company, also the current strength and weakness. To help the analyzing process, a personal interview of one employee from the company was conducted in order to better understand the general strat- egy and current situation of the company’s business. Despite that, all the data gathered for the analysis in this study are secondary data from inter- net data providers. Eventually, the recommendations are made based on the previous findings. Keywords Big data, digital marketing, content marketing, mobile music industry Pages 33p. + appendices 3 p. CONTENTS 1 INTRODUCTION ................................................................................................... 1 1.1 Backgroud Information .................................................................................... 1 1.2 Company Information ...................................................................................... 2 1.3 Purpose and Research Questions ...................................................................... 3 1.2 Research Objectives and Methods .................................................................... 3 2 THEORETICAL BACKGROUND .......................................................................... 5 2.1 Big Data........................................................................................................... 5 2.1.1 Definition & Characteristics ................................................................. 5 2.1.2 Difference Between Big Data and Traditional Data ............................... 6 2.1.3 Big Data Life Cycle .............................................................................. 8 2.1.4 What Does It Mean to Competitive Advantage ..................................... 9 2.1.5 Data Mining ....................................................................................... 10 2.2 Digital Marketing ........................................................................................... 11 2.2.1 Web Usage Mining ............................................................................. 11 2.2.2 Click Stream Analysis ........................................................................ 11 2.2.3 Social Media Listening ....................................................................... 12 2.2.4 Audience Analysis .............................................................................. 13 2.2.5 Search Analytics ................................................................................. 13 3 CURRENT SITUATION OF NETEASE CLOUD MUSIC.................................... 15 3.1 PEST Analysis ............................................................................................... 15 3.2 The New 4Cs Theory ..................................................................................... 19 3.3 Competitors Analysis ..................................................................................... 21 3.4 Product Positioning ........................................................................................ 23 3.5 Target Customers ........................................................................................... 25 3.6 Netease Cloud Music and Big Data Application ............................................. 27 3.7 Results of the Interview ................................................................................. 29 4 RECOMMENDATIONS ....................................................................................... 30 5 CONCLUSION ..................................................................................................... 32 SOURCES .................................................................................................................. 34 1 INTRODUCTION 1.1 Background information Big data, a term that is rarely known before but broadly discussed in the recent years. Generally saying, big data is just a hollow business term which is as empty as the so-called business intelligence. Of course, this doesn’t mean that big data is meaningless, but it means it can be different things when it is defined in different subjects. More and more enterprises have realized that big data can provide value as never before. Big data plays a role in almost every industry and is rapidly becoming a key driver of business growth and competitive advantage. One of the primary benefits of big data is its ability to turn data into potential revenue. (Villanova University, 2018) For marketing organizations, big data is the fundamental resource, born from the digital world we now live in. Till 2013, 98% plan to increase or significantly increase their use of mar- keting analytics, while 0% plan to decrease (2% say it will remain un- changed). (Adberdeen Group, 2013) At present, the application of new-generation information technologies such as mobile Internet, cloud computing, and the Internet of Things has made enterprise have the ability to capture rich information as never before. All kinds of devices have joined the network, generating various types of data which would provide great social and commercial value. Such as statistical data, transaction data, etc. are constantly emerging from all industries. According to CSDN's 2011 survey of cloud computing in China, more than 50% of enterprises generate more than 1T of data per day (CSDN, 2011). Big data has become an indispensable and important infor- mation foundation for government and corporate regarding decision-mak- ing, employee management, healthcare management, marketing activities, and product development. In particular, the application of big data in the field of marketing and innovation has greatly helped companies to accu- rately identify customer needs and greatly improve marketing effectiveness. It can be said that the use of big data runs through the entire marketing pro- cess and plays a vital role in the effectiveness of marketing. In nowadays business world, companies spend hundreds of thousands of dollars on research and data to ensure they are always ahead of the compet- itors. Data has been a foundation of online successes. In this research, we will talk about how big data has become a source of massive information, which can be valuable, especially how it can create value and help the pro- cess of digital marketing activities. 1.2 Company information Netease Group was founded in 1997. In 2017, in the list of China Internet Enterprise, Netease ranked fifth. According to Netease's third quarter finan- cial report, the net income in the third quarter of 2017 was 12.478 billion yuan. The same proportion increased by 35.5%. The net income of services in line games was 8.12 billion yuan, compared with 6.568 billion yuan in the same period last year. Netease was at the same time holding the cash cow of mobile gaming products. The net income from mobile games ac- counted for 68.3% of the net income from online games. The Netease Group has been developing for nearly 20 years, and the company has accumulated a billion-level feature database to develop Netease Shield, which enhances the security of UGC products. Netease Mengma and Netease Youshu serve customers as a big data developing management and data analysis platform. (Netease Group, 2017) Netease's products are broadly divided into games, software, services, e- commerce and general web portals. In terms of software and services, in January, CIWEEK published the 2017 APP classification rankings (CIWEEK, 2017). Netease was ranking top in the fields of news, postal boxes, finance, education, and e-commerce. Among them, Netease has a dictionary (desktop version + mobile version) with a user volume of 600 million. The market share has reached 80%. Compared to its major competitor Tencent’s product development strategy, NetEase seems to be very conservative. The revenue from mobile games release the capital pressure, and the portal is considered the main entrance of traffic which greatly helps product incubation. Each business of the com- pany competes on equal terms, and the final winners receive more support from the group. Netease always has a tolerance for KPIs, such as the aver- age development time of mobile games, is twice as longer as other compa- nies in the same industry. This makes the product manager become more self-driven, investing more