IGCSEBusinessCIERevision Notes3. Marketing3.3 The Marketing MixTechnology & the Marketing Mix

Technology & the Marketing Mix (CIE IGCSE Business)

Revision Note

Danielle Maguire

Expertise

Business Content Creator

Introduction to E-Commerce

  • E-Commerce is the trade of goods and services over the internet
    • Businesses can trade through their own websites
    • Alternatively, platforms such as Amazon, Ebay and Etsy offer the chance for small businesses to sell their products online

  • The rise of e-commerce means customers increasingly pay online using credit/debit cards with the result that contactless payment systems (such as Apple Pay and Paypal) are growing in popularity

Opportunities & Threats of E-Commerce

  • E-commerce can make life more convenient for customers and is a source of competitive advantage
    • It also provides the potential for small businesses to reach large audiences
  • However, setting up an e-store can be costly and some consumers may be concerned about security risks of purchasing online
  • The opportunities and threats of e-commerce can be considered for both the business and the consumer
     

Opportunities and Threats of E-commerce to Business


Opportunities of E-Commerce for Business


Threats of E-Commerce for Business

  • Websites offer a direct and cheap promotional method for businesses

  • Competition comes from many businesses around the world, allowing customers to easily switch brands

  • Businesses can easily make online purchases of supplies and materials from other businesses

  • Large warehouses and efficient stock control systems are essential to fulfilling online orders 

  • An easy-to-use and well thought out website can encourage customers to buy more
    • E.g. Automation suggests complimentary products often purchased at the same time

  • E-commerce is not suitable for businesses selling personal services such as beauty services or home improvements

  • Dynamic pricing techniques can easily be implemented so profit can be maximised during periods of high demand

  • The lack of face-to-face contact with consumers means businesses miss out on instant and useful market research feedback

Opportunities and Threats of E-commerce to Customers


Opportunities of E-Commerce for Customers


Threats of E-Commerce for Customers

  • Competition drives prices down and allows customers to easily 'shop around' and compare prices

  • Poor connections or technical difficulties can sometimes deter or stop customers from using the website to make purchases

  • Electronic payment using credit and debit cards is relatively easy
    • E.g. Using 'one-click' platforms such as Apple Pay 

  • Customers in low income countries may not be able to access the products due to poor infrastructure limiting potential market size

  • E-commerce is convenient as it allows customers to shop from anywhere in the world 
    • E.g. when travelling, 24 hours, on many different devices

  • Many consumers are concerned about identity theft or fraudulent use of credit cards if they buy goods online

  • Customers can buy from worldwide retailers so have increased choice
    • Chinese e-tailers Shein and Temu are increasingly popular in the UK

  • Products cannot be handled or tried out before purchase which means customers frequently return them because they are unsuitable

Using the Internet and Social Media for Promotion

  • Social media marketing targets promotional activity at users of online communities such as Facebook, Twitter Instagram and YouTube 
    • Businesses share interactive posts containing images, sound and video at very low cost
       
  • Viral marketing Is a strategy where businesses use online platforms to promote their products by creating content at specific times, which can easily be shared and commented on by social media users
    • E.g. During the COVID-19 pandemic, Coca-Cola and McDonald's ran campaigns that emphasised community which aligned with the public's need for social support

 

Diagram of Examples of Social Media Communities

Diagram of types of social media communities

Examples of social media platforms

  • Interacting with customers on social media builds relationships, drives repeat business from existing customers and attracts new customers as content is shared with other users
     

An Evaluation of Social Media Promotion


Advantages
Disadvantages

  • Billions of active users on platforms allows businesses to reach a vast audience 
  • Deliver promotional content to specific groups based on demographics, interests and behaviours which increases the chances of reaching the target audience
  • Regularly and easily create and share content which increases brand visibility and exposure 
  • Social media marketing does not generally require a large budget

  • Effort and time is needed to create quality content, manage multiple platforms and engage with the audience 
  • Public feedback and reviews, which can include negative comments or complaints, can be viewed by all social media users
  • Social media platforms frequently update their algorithms which may affect the visibility and reach of content
  • Capturing users' attention amidst the large volume of competing content is challenging

 

  • As social media platforms evolve, businesses must also adapt their social media strategies to keep up with the latest trends
    • E.g. Instagram has been a popular platform for businesses to promote their products through influencer partnerships.
    • More recently many businesses have shifted their focus to promoting their brands through short-form video content on platforms like TikTok

The Influence of Technology on Sales, Costs and the Marketing Mix

Type of Technology
Influence on Sales
Influence on Costs
Influence on The Marketing Mix

E-commerce

  • A powerful tool for expanding the customer base and increasing sales
  • Amazon has enabled many businesses to sell their products online and reach a global market

  • Has helped businesses reduce overhead costs by eliminating the need for physical storefronts 
  • Zappos saved $10 million in operating expenses by closing its call centre and focusing on online customer service

  • Offers businesses new channels for advertising and promotion
  • Shopify has customisable storefronts, email marketing tools, and search engine optimisation (SEO) capabilities

Social Media

  • Powerful tool to increase sales by building relationships with customers and generating leads
  • Glossier has leveraged social media to build a loyal customer base on Instagram with 1.5 million monthly visitors

  • Cost-effective alternative to traditional advertising channels

  • Fast-food chain Wendy's has increased advertising on their Twitter account, while reducing advertising expenditure in the national press

  • New channels for building brand awareness and engaging with customers has transformed promotion for many businesses
  • Instagram allows businesses to share  and live stream content 

Digital communications

  • New channels for reaching customers and closing deals  include the use of email marketing

  • A cost-effective alternative to traditional communication channels
  • Increasingly WhatsApp is used to support customer service allowing employees to work from anywhere reducing the need for call centres

  • The product element of the marketing mix has been enhanced as product information and customer service can be communicated online
  • Mailchimp provides businesses with customisable email templates and sales tools

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    Danielle Maguire

    Author: Danielle Maguire

    Danielle is an experienced Business and Economics teacher who has taught GCSE, A-Level, BTEC and IB for 15 years. Danielle's career has taken her from across various parts of the UK including Liverpool and Yorkshire, along with teaching at a renowned international school in Dubai for 3 years. Danielle loves to engage students with real life examples and creative resources which allow students to put topics in a context they understand.