Online marketing

Market Opportunity

The Chinese renminibi, or yuan, is increasingly growing in strength against the weakening US dollar, creating increased demand for US goods. With the world’s largest population of 1.3 billion and the third largest economy (behind the United States and the European Union), China is one of the most lucrative and promising markets in the world with the third-largest purchasing power of $6.991 trillion. According to the National Bureau of Statistics, in 2005, the per capita disposable income in China is about $1525 in urban households and $473 in rural households. Although the Chinese amount of disposable income is lower than the US’s $28,000 real disposable income per capita, this amount is steadily increasing; in 2005, the People’s Daily Online reported that the amount of per capita disposable income increased by 12.9%, or 11%, if price factors are deducted. Also, with growing population in the middle-class group, the Chinese consumption rate is expected to increase from 58 percent in 2002 to 65 percent by 2010 and to 71 percent by 2020, very close to the rate in developed countries, said Chen Xingdong, chief China economist with BNP Paribas Peregrine in Beijing, adding that China has a potential enormous consumer market.

China’s middle class is constantly growing. According to the People’s Daily Online, a French investment bank’s definition on the Chinese mid-class group covers the well-educated professionals and white-collar employees (brain workers) with per capital annual income of 25,000-30,000 yuan (about $3,600-$4,300), household annual income of 75,000-100,000 yuan (or around $11,000-$14,500) and participants in the decision-making and management of companies. In June 2004, this group includes around 13.5 percent of the total Chinese population (about 175,500,000 people). In 2002, 50 million Chinese families were qualified for the standard, with per household having annual income of 75,000 yuan (around $11,000) and owning 310,000 yuan (around $45,000) of assets on average. By 2010, the figures will double, with up to 100 million families qualified for the standard, per household having annual income of 150,000 yuan (around $22,000) and owning assets of 620,000 yuan (around $90,000), according to the BNP Paribas Peregrine.

Figure 1: Graph of the US Dollar to Chinese Renmibi (or Yuan) Exchange Rate

Best Industry Segments

Based on the details released by the USA government and Sinomania! Research, the best export opportunities for USA businesses in non-agricultural products are in (1) information technology, (2) telecommunications equipment, (3) computer software, (4) oil and gas, (5) medical equipment, (6) pharmaceuticals, (7) pollution control equipment, (8) airport and ground support equipment, (9) building and decoration materials, (10) auto parts, and (11) agricultural chemicals. With the fall of the dollar and the steady and unfaltering rise of the Chinese economy, the Chinese consumers and businesses are inevitably gaining more buying power in the world.

Regulatory and Tariff Landscape

In March 2008, the average overall tariff rate is at 9.4% and 7.4% for USA priority products. In 2002, China began cutting tariffs to meet its obligations to the World Trade Organization. Then, in 2005, most products saw their final tariff cuts in 2005. Since then, few products have had their rates cut. Furthermore, in its 2007 annual report to Congress, the US Trade Representative said that China’s reduced tariffs contributed to another significant increase in overall US exports, which rose about 17% from January to September 2007 when compared to the same period in 2006.

Online Marketing Opportunities

Even though, says China Internet Network Information Center, China’s level of online penetration is low (15.9%) when compared to the United States’, Japan’s, and Korea’s percent of penetration (all of which are above 65%), China holds an abundant amount of promise. In fact, in 2007, the number of Internet users in China surpassed the number of Internet users in the United States, which formerly had the largest population of Internet users. This number of Internet users will continue to grow. According to news site of the year Timeonline.com, experts say that the number will swell rapidly in the next few years as hundreds of millions of Chinese still toiling as low-paid farmers or labourers experience a rise in their incomes that will enable them to go online. BDA China, a Beijing technology company, estimates that China’s web population will grow by about 18 per cent a year, putting the total at 490 million by 2012 – more than the population of the United States.

Online Language Preferences

Even though more than 300 million Chinese people, or nearly a quarter of the country’s population, have studied English according to Xinhua, most (mainland) Chinese people prefer to read content in their simplified Chinese characters. This is the case for the most part, but in the southernmost provinces in China and especially in Hong Kong, the usage of English has a moderate to strong presence. Since nearly a quarter of the country’s population has studied in English, it is recommended that a business has some of its content in Chinese so that the Chinese consumers could click through that Chinese webpage to reach and use the English version of the website.

Search Engine Profile

Unlike most countries in the world, the Google search engine has not dominated this market. The search engine here of predominance is Baidu (baidu.com), which is the local search engine that has the biggest market share in China (about 60%). In second, Google claims 20%, and in third, Yahoo claims 10%.

Summary

With the largest number of online users in the world, an increasing rate of online penetration, an expanding middle class, a continually fast-growing economy, and much room for growth, China provides excellent opportunities for global online marketing. For the above reasons, Global e-Marketer would rank China as a tier 1 country for developing an online market presence.

By: Wyliena Guan

The numbers are supposed to be big in online marketing, but are they significant in the online marketing of music? Clearly, we need someone with ‘Net experience to set a few things straight. Scott Meldrum is a businessperson and musician with a dry wit and a background in bulk mail. Oops, excuse me, direct response advertising. He’s also the man called on by major labels when they want to brand an artist and reach millions of fans via the Internet.

Beginning with Papa Roach in 1998 and continuing with such platinum-selling artists as Avril Lavigne, Dido and Jennifer Lopez, Meldrum’s Long Beach-based firm, Hype Council, is one of the prime marketing weapons utilized by the world’s largest entertainment companies.

Taking center stage for a Monday evening presentation by NARIP (National Association of Record Industry Professionals) at the Beverly Garland Hotel in Los Angeles, Meldrum began with some facts about the Internet. Does that sound a bit dull? It wasn’t. His presentation quickly revealed things about the ‘Net that should be known by every marketer (that’s you, if you or your artists are selling music online).

THE GLOBAL AUDIENCE FOR MUSIC.

Most Internet users (nearly a majority of them) are between the ages of 30 and 49, far older than many in the audience thought. And for those of us who believed that the USA had the highest percentage of Internet users, it was a surprise to learn that we’re only sixth. (Of course, in raw numbers of users, the USA has by far the most people.)

Fully 40% of the USA’s 177 million ‘Net users go online for music (more in some other nations). Look at it another way: if you put your music on the Internet, you have a potential audience of some 70 million. And with total Internet users currently at 404 million, that translates into a worldwide potential audience of 161 million people.

The problem is: how to reach them. They are wildly segmented in terms of music genre; they only want to be contacted under certain sets of circumstances; and they need to have a safe, secure, and easy way to make purchases.

Fortunately, “The Internet is still a new medium,” Meldrum asserts, “and there are tremendous opportunities for people in the business of selling music.”

Some of those opportunities are being wasted, however, through poor Web site design. Meldrum revealed the biggest errors made in creating or maintaining a Web site. . .

TOP 5 MISTAKES OF WEBSITES:

1. Mistaking creativity for functionality. “Don’t try to put everything on your front page. Organization is the key. Lead your fans to the most important things.” That’s what menus are for, so don’t hide them. “How many times have you gone to a site that looks interesting, but you have no clue how to navigate it? People don’t have time to waste figuring it out. Make it easy for them.”

2. Burying the offer. “Links to buy the CD should be available at almost every page on your Website. Many Websites challenge, almost dare visitors to find the product, let alone buy it.”

3. Ignoring fans. “Many artist Websites have a registration feature, but it is not prominently displayed. When you are not selling albums at your Website, you need to be collecting email registrations.” This builds a fan base where you can sell an album now and more in the future.

4. Not giving fans what they want. “Make your music accessible. Offer a few full streams of your songs. Make a download available in exchange for an email registration. You will win more fans and sell more CDs giving your music away than you will by not letting your potential fans really listen before they buy.”

5. Failing to design with bandwidth in mind. “Ever been to a Website and forgot why you were there before the page fully loaded? Getting people to your site is hard enough. Losing them because they got tired of waiting for your page to load is a waste of everyone’s time and energy.”

CONSIDER OTHER OPTIONS:

Websites are a necessity, but don’t overlook other ways of reaching out to potential fans on the Internet. Banners can be bought or traded. Emails can be sent (be mindful of the CAN-SPAM law; see below for link). Marketing can be done on search engines. You can join or participate in message boards and blogs (web logs). And the latest advancement in music marketing involves social networks such as MySpace.

RECOMMENDATIONS:

Meldrum had many specific suggestions for attendees, including:

* use Google for research

* check out MySpace.com

* target your audience

* simplify your Website

* give away some songs

* interact with your audience often

“You can send emails in text or HTML format. With HTML (hyper text markup language), you can include pictures and graphics. They look nice, but we get twice the ‘open rate’ with text emails.”

THE BOTTOM LINE ON WEBSITES:

“To your online fans, you are your Website. If they love it, they will love you, and will be eager to follow your careers. Take all the great things about you, your talent and your message, and translate to HTML. Keep it simple, easy-to-navigate and informative, and you will have a highly-effective marketing channel for your music.”

Sources for more info:

http://www.narip.com

[http://www.hypecouncil.com]

http://www.scottmeldrum.com

[http://www.spamlaws.com/federal/108s877.html]

http://www.wilsonweb.com/wmt5/viral-principles.htm

http://marketingterms.com/dictionary/blog/

http://www.google.com

http://www.myspace.com/thegman

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By: Scott G

If you are online then you are marketing YOU. That is a crucial thing in all aspects of niche marketing – but maybe something people only think that this only truly applies if they are in the “make money online” internet marketing niche. Nothing could be further from the truth! Whatever niche you choose, you need to be seen.

Carving your own spot within a niche is an involved process. You cannot just start a website, write an article or two and deem yourself the new expert of your niche. You will still be invisible online and if you want to be successful in any niche, your target market needs to get to know you!

One excellent way to bring your online business to life is to tap into a niche with a video or several! Videos are still one of the newest and possibly best way to market your business online. They grab the attention and respect of customers, prospects and your peers! And it is only going to get more important with time. Consider even now just how few successful products are brought out these days without any video at all!

One of the reasons why they have such a great impact is because it is visual. Your prospective customers can see and hear you, they feel as if they can look into your eyes and read your body language. All this helps engender trust and allows your prospects to like you. And because selling online is all about building relationships and delivering as much value as you can, if your customers like you, they will buy more from you. And of course your videos will help you create your brand as an expert on multiple levels and helps you gain standing in your niche!

When you use video to tap into a niche market, you have a great chance to show what you know to countless people! If you post it on major video sites and promote it, you could literally be seen by millions. And if your video is packed with useful information and is also entertaining, you have a recipe for a smash hit which will be widely viewed and highly ranked.

The best reason for using video to establish your market presence is to build a relationship with your customers. Most “make money” internet marketers still do not use video, and “niche” marketers even less so. Which all means that if you do, you will be light years ahead of your niche competitors!

So what are you waiting for?

By: S E Owen-Thursfield