Does online interaction with promotional video increase customer learning and lifetime value?
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Transcript of Does online interaction with promotional video increase customer learning and lifetime value?
1
“Does online interaction with promotional video increase customer learning and customer lifetime
value?”
Presented by:
Ross Moran
080052402
In partial fulfilment of the: Executive Master of Business Administration Degree
Submitted for:
Business Mastery Project
Presented to: Dr. Sionade Robinson
Faculty of Management; Cass Business School City University
London
Date: 5th
September 2011
Word Count: 15,062
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Table of Contents
Introduction ................................................................................................................................ 7
Literature review ...................................................................................................................... 11
The Internet .......................................................................................................................... 11
Attitudes toward the Web ................................................................................................ 12
Interaction ........................................................................................................................ 16
Interactive communications ............................................................................................. 19
Sustainable demand for interactive media ........................................................................... 22
Promotional video in Tourism ............................................................................................. 25
Customer loyalty & Net promoter score .............................................................................. 29
E-Learning ........................................................................................................................... 31
Persuasion technology ......................................................................................................... 32
Research Methodology ............................................................................................................ 35
Data collection ..................................................................................................................... 36
Survey design ....................................................................................................................... 36
Survey response rates ........................................................................................................... 39
Survey analysis ........................................................................................................................ 40
Introduction to the findings .................................................................................................. 40
Critical analysis ................................................................................................................ 40
Accuracy of the sample .................................................................................................... 40
Demographic profile of the respondents .......................................................................... 41
Time and Frequency ........................................................................................................ 48
Attitudes towards the web ................................................................................................ 50
Interactive learning .......................................................................................................... 54
Repeat viewers & Net Promoter Score ............................................................................ 60
Limitations and Further research ............................................................................................. 66
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Limitations ........................................................................................................................... 66
Survey limitations ............................................................................................................ 66
Methodology limitations .................................................................................................. 67
Further research ................................................................................................................... 67
Web 2.0 and attitudes towards the internet ...................................................................... 68
E -learning ........................................................................................................................ 68
Demand for interactive media .......................................................................................... 68
Conclusions and Recommendations ........................................................................................ 69
Conclusions .......................................................................................................................... 69
Recommendations ................................................................................................................ 72
A) Format of interactive media .......................................................................................... 72
B) Feature videos every 3 months ..................................................................................... 73
C) Interactive features ........................................................................................................ 74
Bibliography ............................................................................................................................ 75
Appendices ............................................................................................................................... 80
Appendix 1 ........................................................................................................................... 80
Link to survey on Kwik survey website. ............................................................................. 80
Appendix 2 ........................................................................................................................... 80
Respondents answers to the survey in chart format: ............................................................ 80
Appendix 3 ........................................................................................................................... 89
Definitions of interaction: .................................................................................................... 89
Definitions that Focus on Process ............................................................................................ 89
Appendix 4 ............................................................................................................................... 93
Internet subscription growth rates ........................................................................................ 93
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Table of Figures
Table 1 Benefits consumers want from websites .................................................................... 13
Table 2 Technology leading vs Market demand. Source: Suarez and Lanzolla (2005) ......... 23
Table 3 Survey sample ............................................................................................................ 39
Table 4 Age profile of respondents ......................................................................................... 43
Table 5 Gender profile between ages 30-44 ........................................................................... 43
Table 6 Profession by Industry Sector .................................................................................... 45
Table 7 Gender profile with the advisory professions ............................................................ 47
Table 8 Do respondents watch promotional video ................................................................ 51
Table 9 Age profile of respondents who watch video clips .................................................... 52
Table 10 Attitude to media clips ............................................................................................. 55
Table 11 Sector profile of respondents in table 9 ................................................................... 56
Table 12 Professional profile of respondents who ranked David communications skills as his
most important attribute ........................................................................................................... 58
Table 13 Attitude towards learning more about business ........................................................ 59
Table 14 Sector profile of respondents who want to learn more ............................................. 59
Table 16 Age profile of respondents who would watch more videos ...................................... 62
Table 17 Gender profiles of respondents who would watch more videos ............................... 62
Table 18 Net promoter score rankings .................................................................................... 63
Table 19 Net Promoter score ................................................................................................... 64
Table 20 Respondents who would recommend David ........................................................... 65
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Acknowledgements
Firstly, I would like to thank David Mellor. I was about to give up on my proposed
topic until I met David. He told me that he had just commissioned some promotional
videos and offered to help. It has been enjoyable and rewarding to work with him.
Secondly, my thanks go to Dr. Sionade Robinson for her guidance and patience
throughout the Business Mastery project.
Finally, I must thank my family in Ireland and my girlfriend, Caroline, for their support
and encouragement.
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Introduction
It is accepted that the introduction of a new media format mimics the incumbent media in the
very early stages. Over the course of time the new media establishes itself, develops
customers and replaces the incumbent media.
The internet has been evolving and maturing quickly. We are now at in a phase called Web
2.0. Web 2.0 is the term given to the increased functionality of the internet and the
interactive capability within that website. The internet now facilitates blogging, online
communities and video interaction.
One of the questions still to be answered about interactive media, is whether interactive
promotional media will be adopted by consumers as they adopted promotional
advertisements on TV? Can interactive promotional media generate customer loyalty and
profits?
Online interactive media is a relatively new form of media. Websites such as
www.youtube.com the largest video hosting website in the world, which was founded in
2005, broke ground by allowing anyone (business organisations, individuals, governments,
etc.) to post promotional videos online.
In the last few years significant investment has taken place with telecommunication firms
installing high speed broadband capabilities. Without that investment in infrastructure it
would be impossible to watch interactive promotional videos. Handset and device
manufactures have also invested in portable devices that can download and play video media.
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Interactive visual media is more engaging than traditional media such as print, radio, and TV
because it encourages the viewer to become more involved in the subject they are watching.
The viewer also has a greater level of control over the level of information they receive than
that of traditional TV advertising. Viewers can decide how many times and for how long
they want to watch media clips.
Interactive media is more creative than print media because moving images provide us with
a unique visual experience. When combined with audio effects the impact of interactive
media is greatly enhanced. For example, one’s desire to visit an exotic tourist destination
often increases after viewing it on screen rather than seeing images in a holiday brochure.
When people received a positive experience in the past they are more likely to be able to
remember that experience. Positive experiences leave a lasting impression.
.
Currently online businesses from entertainment to retailers are investing large sums of money
on interactive promotional video. They are investing because they believe it will help
educate their customers and provide those customers with a positive experience so that they
will remain loyal and also attract new customers.
There is little published research into interactive media. Previous research into the use of rich
visual imagery has found that consumers will engage with media which stimulates their
senses. Other research into consumers’ attitudes towards websites also provides evidence
that positive experiences can trigger behavioural changes. The study of computer technology
and how it influences behaviour and attitudes is called Captology. Online video is a
subcategory within Captology.
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Currently there is little evidence that investment in interactive media generates an adequate
return. It could be that firms are investing in it just because their competitors are. This is not
a strategic rationale for investment nor does it explain how interactive promotional media can
help differentiate firms from their competitors. Any previous research undertaken into
interactive media and interactive communication was primarily focused on identifying
general attitudes toward websites. The focus was on identifying what different forms of
advertising were generating positive attitudes towards that website. No research focused on
the impact of promotional video on websites.
The majority of the academic research is over five years old and was undertaken before the
interactive capabilities of Web 2.0 emerged.
My research is timely because of the lack of research into interactive promotional video and
the absence of investment returns on interactive media.
First stage in my project plan was to identify a website that had non-entertainment
interactive media. David Mellor kindly allowed me to use his website,
davidmellormentoring.com, as the basis for my research.
Second step was the design of a survey questionnaire which was easy to answer and
relevant to the audience.
Third stage was deciding on the relevant sample size and how participants were selected
for the survey.
Fourth stage was analysis of the data. The analysis of the data should identify that
sustainable demand exists for interactive media. It should show that the market for
interactive media has passed the early adopter stage and that there is significant future
growth for interactive media.
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To provide evidence that interactive media generates customer loyalty and is an indicator of
future growth I am using the Net Promoter score1. The Net Promoter score is a methodology
for determining the attractiveness of firms to its current and future customers. Word of mouth
is considered the most powerful form of recommendation. Most recommendations we
receive are 3rd
party endorsements in the form of advertising. The aim of advertising and
promotions is to convince us that we need certain products or services. Advertisers and
promoters achieve their goal by trying to convince us that something is missing from our
lives. Advertisers and promoters sell at us and this creates consumer scepticism..
The reason word of mouth is so strong is that when we receive a personal recommendation
from someone we know we are not sceptical and accept it. We accept it because we have
shared beliefs and opinions.
The effectiveness of the Net Promoter Score as indicator of future growth is disputed by
some but it is appropriate to use it for this project as it is an easy to use tool for research
purposes.
The internet and especially Web 2.0 has changed the way people use the internet. The
interactive capabilities of Web 2.0 have encouraged internet users to take more control over
how they use the internet. Web users are now more engaged with the internet and expect
more information than ever before.
Web 2.0 has changed the way firms compete on the internet; firms which encourage a high
level of interaction such as YouTube, Twitter and Facebook are changing the media industry.
This research will add to the existing research about web 2.0 and the impact of promotional
video on web users.
1 http://en.wikipedia.org/wiki/Net_promoter_score
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Literature review
The Internet
To watch promotional video on a website you have to be connected to the internet. Websites
grab your attention but it is the internet which enables those websites.
The internet is a global network of computers which are networked together and publicly
accessible.
Stewart and Pavlov (2002) suggest that “the internet is a set of technologies that came into
being within the context of an existing social and economic structure”.
If the internet really does bring benefits to society then it should be available to everyone and
make communications easier. There should be explicit benefits from interacting with it.
Keeney (1999) lists a number of ways in which the internet can improve our lives and create
value for us. This list includes savings we make on products and services we buy on the
internet. Every day the number of products and services available on the internet increases.
A growing number of people are accessing the vast amount of free and subscription
entertainment options available.
The internet has the capability to improve our lives, make existing markets more competitive,
and create new markets.
Stewart and Pavlov (2002) argue that” the real power of the internet and the characteristics
that differentiates it from traditional media is its potential for interactivity”
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Leckenby and Li (2000)2 defined interactive advertising as the presentation and promotion of
products, services and ideas by an identified sponsor through mediated means, involving
mutual interaction between consumers and marketers.
The internet and the technologies which support the internet have had a major influence on
society and have changed the way people behave. Interactive media enhances the browsing
experience and encourages people to spend more time online.
Attitudes toward the Web
Our attitudes are our mental view of something. They help shape our opinions and
behaviours. To get a better understanding of why interaction takes place on the internet it is
necessary to establish the factors that influence our attitudes towards the web.
The internet provides us with more information sources to review before we make our
purchasing decisions. (Hof 2001)3
One of the main advantages of the internet is that it has reduced the cost of accessing
information. (Bakos 1997) In general, consumers have taken advantage of the falling costs of
accessing information on the web. Consumers’ demand more information about products.
The more information customers receive, the greater the benefit to them.
2 Stewart, D. Pavlou, P. “From consumer response to active consumer measuring effectiveness of interactive
media” 3 Hof, Robert D. 2001. “Don’t Cut Back Now.”
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Another benefit is that the cost of accessing that information continues to fall. (Bakos 1997;
Brynjolfsson and Smith 1999), Reibstein (2002,p3) argues that “some people believe that
consumers armed with increased non price information on which to base a choice, can make
selections that lead to a higher level of post purchase satisfaction, thereby increasing levels of
loyalty”.
The behaviour of online customers is driven by the design, layout, and emotions they feel
while they are on a particular website.
To deliver an effective online experience it is necessary to identify and classify all the
individual elements which have a likely effect on the final outcome. This classification helps
marketers identify the resources that they require to deliver effective online campaigns. It
also adds to the debate about how consumers’ behaviour changes over time. Early in the
website design process, a list of the benefits that consumers want from a website should be
identified.
Table 1 below lists some of the design characteristics which should be considered when
developing a website. It is the combination of these design characteristics which provide
benefits to the users. The failure of one of the characteristics can destroy the customer
experience.
Functional Psychological Content
Usability Trust StyleConvenience Transaction security Atmosphere
Search facilities Data security Price
Speed Product
Table 1 Benefits consumers want from websites
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Nah and Davis (2002) define web usability as “the ability to find one’s way around the
desired information and very importantly to know what to do next”. The design of a website
which gives the user a visual experience requires state of the art technologies but, more
importantly, thorough knowledge of the needs and characteristics of the end users.
The psychological factors which power our emotions are influenced by the message that is
being communicated. If we believe the messages that are being communicated on a website
are authentic then we are more likely to spend more time on that website.
For a successful outcome for the user and the website, two objectives must be completed.
Firstly the customer must know what they are seeking to achieve and secondly they must be
able to navigate around the site easily. For example, new customers will be looking for a
different experience than returning users but it is presumed that returning customers
previously have had a positive experience. Customers who lapse and do not return need to be
targeted with a new customer experience so that their loyalty may be regained.
The quality of the online experience influences our perception about the quality of offline
experience we expect to encounter. A poorly designed and dysfunctional site threatens the
goodwill that has developed between the brand and its customer. This potentially not only
affects how successful and effective the web will be as a distribution channel but also the
firm’s physical activities as well. A study carried out using a Dieringer research group
established that half of all adult internet users who abandoned online orders have changed
their overall opinion of that brand because of the negative online experience they encountered.
(Costantinides 2004)
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A more recent study by Kwon and Lennon (2009) found that online performance does affect
offline beliefs. A study carried out by Demandware4 in May 2011, found that 52% of
respondents who had a bad online experience were less likely to shop for the same brand
offline.
The importance of the visual appeal of a website and how much interaction takes place on
that website has previously been researched. In a study of more than 2800 web users, the
“design” was the category that was most discussed by the participants in the study (Fogg,
Soohoo, Danielson, Marable, Stanford, & Tauber, 2003).
Burke (2002) also investigated the visual appeal of websites. In his study about internet
shopping it was discovered that consumers under the age of 25 were more willing to use new
technologies. He doesn’t give the exact reasons why this is so. The new technologies
highlighted were mobile phones and computers. He also segmented the consumers by age
group and found that consumers under the age of thirty-five preferred the TV for finding out
about new products than people over thirty-five. The people over thirty-five preferred
speaking with store attendants to gather their information. The inference from this is that TV
adverts will have a greater visual impact on consumers under the age of thirty-five.
If visual impact is a motivating factor on this age group then it could be assumed that the
same theory holds true for online consumers under the age of thirty-five when they are
watching promotional adverts on the internet. The Burke research was carried out in 2002.
The web was still in the early adopter phase and Web 2.0 was still some way off.
4 http://www.demandware.com/Demandware-Survey-Reveals-Web-Centric-Consumers-Have-Highly-Volatile-
Brand-Loyalty/pr_2011_05_03,default,pg.html
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According to the latest information from Verdict Research, in their UK E-Retailing report,
the internet is maturing and the year on year growth rate of internet subscribers is slowing5.
The web is no longer only for early adopters so visual impact should be an important
motivational factor across all age groups.
If a website is visually poor and cannot deliver a positive experience then there is little
chance that customers will have a positive attitude towards that website. If they do not have a
positive attitude will never become loyal customers.
Interaction
Rafaeli (1988, p. 11) defined interactivity as: “An expression of the extent that, in a given
series of communication exchanges, any third (or later) transmission (or message) is related
to the degree to which previous exchanges referred to even earlier transmissions.”
A lot of the research on interaction has been on process, such as the exchange of information
(Rafaeli 1988, 1990; Rafaeli and LaRose 1993; Zack 1993) or investigated how search
engines and chat room enhance interactivity. (Ha and James 1998; Massey and Levy 1999;
McMillan 1998; Schultz 1999, 2000).
Novak, Hoffman, and Yung argue that “interactivity takes place on three dimensions,
(a) speed of the interaction,
(b) mapping of the interaction based on how natural and intuitive the interaction is
(c) range of the interaction” (Number of possibilities for action at a given time).
5 UK E-Retailing 2010, Retailers need to think more strategically. April 2010
17
Lee (2000) believes that a more efficient way of measuring interactivity is to analyse user’s
attitudes and perceptions.
Analysis of process, function, or perception must be used in conjunction with dimensions
which include how much control individuals have and the time frame involved.
The internet encourages interaction and allows online vendors to personalise the service they
offer. When customers are satisfied with a service they have received they also facilitate
interaction with other online users because they are willing to share experiences and
suggestions. This encourages a networking of experiences effect, where positive consumer
experience help reduce uncertainty and cognitive dissonances. Networking and establishing
contact with other online communities has become very acceptable. Web 2.0 has facilitated
this. It is not seen as intrusive and has a powerful impact. Communities across the web use
online forums, chat rooms, bulletin boards to comment on their experiences. From a strategic
perspective firms must recognise that Web 2.0 has given customers more control, which has
meant that firms have had to become more efficient. The nature of competition for many
industries has changed with the introduction of Web 2.0. The media sector has experienced
this change more so than other industries - newspaper sales and classified adverts have been
decimated while community sites such as Facebook and Twitter have become the dominant
media channels.
This online networking effect is considered to have the same impact as word of mouth but in
an online context. The power of word of mouth is discussed later in the report.
One characteristic that differentiates media interactivity on the internet is the concept of
“sustained interactivity”. Sustained interactivity is interaction which is not restricted to a
single interaction. The premise behind structure theory is that structure supports and
encourages interaction.
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The structure theory assumes that human action is performed within the context of pre-
existing structures which adapt over time. Structural change is continuously evolving and
because current experiences are influenced by past experiences learning takes place. When
sustained interaction takes place it is purposeful, goal driven, dynamic, and continues over
time.
The design and layout of web pages support the theory of structure. Websites are
continuously evolving with new functionality being added constantly. Examples of new
functionality include personalisation, online payment systems and interactive media.
Structure also encourages positive online behaviour. An example of this is Wikipedia or
YouTube. Users of these sites police the sites for inappropriate content and then have it
removed. They set the acceptable norms and other users adhere to them. This could be
considered an informal code of conduct which also evolves. Web 2.0 has made the evolution
of the code of conduct easier because it has become accepted practice for web users to leave
comments and feedback in structured areas on websites.
There are always external threats and sustainable interaction must be aware of the threat of
substitutes or compliments. Technology is continuously striving to make processes more
efficient and when interaction is a core part of the consumption process it is always possible
to substitute some element of that interaction. Online, this happens very fast. This tends to
happen when a new technology makes the existing technology redundant. Online video has
now become a substitute for static images.
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What structure theory is proving is that interactivity is a combination of two functions. Firstly
it is a process, in that consumers and marketers are engaged in interactivity to achieve a
common purpose and secondly it has a more strategic function, which is to change behaviour.
The structure of theory states that over time media has no option but to change because
interaction forces it change. This supports the hypothesis that interaction caused a
behavioural change whether it is wanted or not. This point is so important it is worth re-
emphasising - the format of media is constantly changing because of interaction.
Interactive communications
The challenge with interactive media such as the internet and interactive services which use
the internet as a distribution channel is to find ways to measure the effectiveness of those
channels; traditional methods may not be good enough. (Pavlou and Stewart 2000, 2001).
Customer experience is one of the defining principles of how people interact with new media.
The personalisation of the media interface increases the customer experience. This
personalisation is done by allowing the users to choose what types of content they are
interested in receiving.
Leong, Huang, and Stanners (1998) scrutinized 10 key media attributes where the objective is
to
(1) Draw attention
(2) Convey detailed information
(3) Stimulate emotions
(4) Change or maintain attitude
(5) Involve the audience
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(6) Precipitate action
(7) Efficiently reach target markets
(8) Create brand, product, and corporate awareness
(9) Communicate product, brand image
(10) Communicate the corporate brand image.
All of the ten media attributes are used by traditional advertisers. Online media providers
have to address these attributes and find ways to make sure that new media is aligned with
each of these media attributes.
Interactive media has changed the way we communicate. It has become a two way process
where the principle objective is to encourage interaction by the end user.
Duncan and Moriarty (1998)6 argued that “communication (rather than persuasion) is the
base that forms the relationship between the customer and the marketer, even as the rate of
interaction between them increases”.
In order to understand interactive media it is important to analyse the structural
characteristics of interactive media and identify why interactive media is effective. The
effectiveness of interactive communications must include the viewers’ perspective.
Traditional methods have been very successful at capturing the dimensions of passive media.
Those same methods have been ineffective when they have been used to capture the
dimensions of interactive communications.
One of the dimensions of interactive communication they have failed to capture has been
“presence”. Presence is defined as the amount of effort the users inputs for the response they
get.
6 Duncan, Tom and S.E. Moriarty. 1998.”A Communication –Based Marketing Model for
Managing Relationships.” Journal of Marketing 62 (April):1-13
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Chen and Wells (1999) created their own scales to measure the effectiveness of web sites.
They constructed their scale after consultation with experienced web users. They argue that it
doesn’t matter what method of analysis is used to measure the web as long as that analysis
includes a format for measuring the attitudes of web users.
The current means of gathering information about interaction on the web is to use derivatives
of established exposure measurement techniques such as “click rates”, which is the number of
clicks on an advertisement divided by the number of times the ad is displayed.
Not only do we need new ways of measuring interactive media but we also need to analyse
those results in an interactive context. New measures in a traditional context may not work
as traditional frameworks were designed before internet media had begun to substitute
traditional media. The design of those measurement frameworks didn’t take into account
how interaction was influencing the media. Media is continuously evolving but many of the
frameworks have remained static. To some extent the data is manipulated to fit the
framework and because of this the results may be inaccurate.
Any framework designed for measuring interactivity must be diagnostic; it must measure
process as well as outcomes. It must be longitudinal and able to track changes in customer
requirements and levels of product knowledge. The framework should include
psychographic questions to capture the characteristics of consumers. Identifying consumers
who think in pictures or words is important because consumers who find pictures and visuals
more appealing are thought to use a more complex processing mechanism.
22
During the course of his investigations (Burke 2002)7 categorised shoppers.
He found that the visual appeal of products in consumer electronics, furniture, lighting and
apparel was critical to the purchase of those products. In the furniture category he found that
50% of customers surveyed expected websites to provide full page display pictures and 36%
of customers expected more advanced visual technology such as 3- dimensional.
Sustainable demand for interactive media
It is difficult to predict whether there will be sustainable demand for a product or service.
When a new technology disrupts the market place new markets are created. When new
markets are created and demand is proven to exist in those markets then the race is on to
secure the resources to meet that demand. One of the most effective ways of creating a
technical edge over competitors is an early start to investment in technology. Getting to grips
with technology early allows a firm to accumulate and master the technical knowledge
required to maintain a lead over their competitors. This can be a risky strategy because a firm
can accumulate significant costs before they generate a return on that investment. In the
worst case, the entire investment may have to be written off.
A different option is to identify the scarce resources and secure access to them.
The final and most difficult way is to build a customer base that would be reluctant to switch
to a competitor because of either the inconvenience or the expense.
There are two significant external factors over which the firm has no control. The first of
these is the pace of technology revolution and the second is the pace of market evolution.
7 Burke, R 2002 “Technology and what customers want in the physical and virtual store”
Journal of the Academy of Marketing Science Vol. 30 (4) pp.411-432
23
Suarez and Lanzolla (2005) discuss the long term success factors for first mover advantage.
When a new product or service is different from existing products on the market the chances
of success are slim because the market risks and technology risks increase. The market risks
are those risks associated with the demand for the new offering. These risks include the
demand for the product and the growth rate of that demand. The technology risks are the
risks associated with the evolution of the technology that is used in the delivery of the
product or service.
The chart below developed by Suarez and Lanzolla outlines the different outcomes between a
technology driven market and a demand driven market.
Table 2 Technology leading vs. Market demand. Source: Suarez and Lanzolla (2005)
24
Interactive media is no longer at the early stage in its lifecycle where only early adopters are
using it. It is not necessary to be the first mover in this market because the market is growing.
Similar to other technologies, the technical infrastructure which supports interactive media
has a lifecycle. Interactive media is growing and has been accepted by the early majority.
The frequency with which users are interacting with it is still unknown. Now that interactive
media has established itself, new ways of increasing the frequency of consumer interaction
with it will be developed.
This means that the demand is being driven by the market and that the rate of technology
change will slow down so that a return on investment can occur.
In order to maintain a competitive position within the market place firms must identify their
internal capabilities.
Listing capabilities is not a new exercise, but it is different from identifying assets or the
opportunities and threats of entering a new market segment.
Capabilities should be thought of more as a collection of skills and knowledge that has been
accumulating over the years. They are a combination of explicit and tacit knowledge.
Capabilities are difficult for another firm to copy; they are rare and there is difficulty in
securing access to them. They are also non transferable
Leonard and Barton (1992) suggest that there are four components in the successful
distribution of knowledge. Firstly knowledge and skills of employees, secondly the know
how to understand the information systems, thirdly the internal management structures that
create and manage the information and lastly the day to day routines and values which shape
the culture.
25
When internal capabilities are harnessed and combined with marketing, R&D resources, etc.,
is it possible to maintain the competitive advantage and address the needs of your customer
segments?
Interactive media is new and delivers an experience and, because it delivers this experience,
there is demand for the technology. New services will emerge that will increase the use of
the interactive video. As the frequency of interaction increases so will the revenue and
profits generated from the use of interactive media.
Promotional video in Tourism
I’m including a review of the use of promotional video in tourism. Promotional videos or TV
adverts have been used effectively to promote destinations. The purpose of the
advertisements is to stimulate us visually and introduce us to the positive experiences we will
have if we visit that location.
Buhalis (2000, p.112) stated that “promoting destinations essentially implies the development
of communication channels with clientele and other stakeholders to increase awareness and
persuade them to purchase products”.
Traditionally marketing organisations have used a combination of advertising, travel fairs,
brochures and direct marketing to reach consumers who require more information about
tourist destination.
26
There are many views on which of the different media are the most influential. Advertisers
prepare the text and imagery to give locations a sense of meaning and then they use
technology to communicate the message to their audience.
A study by Govers et al (2007)8 discovered that communications such as television,
magazines, internet, books and movies were very influential versus other form of destination
advertising.
Shani et al (2009) found that promotional video does have an impact on the desire to travel.
During their investigation into the attractiveness of China as a tourist destination they tested
promotional video.
A focus group of forty-seven international travellers was tested. The travellers were from
Asia, Europe and America. The focus group was tested with a list of general destination
images. The objective was to gauge their general reaction to the destination images of China.
A promotional video called “China Forever” was shown. The objective of the video was
similar to other media in that it was displaying the unique landscape, quality of the facilities,
rich heritage and people. The purpose of showing the video was to draw out new emotions
the focus groups had of China. After watching the video the participants were asked to add
any additional attributes they saw in the video.
The results of the study showed that promotional video has significant persuasive powers.
The video had a positive impact because the focus group’s perception of China as a travel
destination was changed and the desire and likelihood of the participants going to China
increased. The video succeeded in creating a behaviour change.
8 Govers R, Go FM, Kumar K. 2007. Promoting tourism destination image. Journal of Travel
Research 46(1): 15–23.
27
There is some evidence to suggest that movies and television series can influence the choice
of destination. New Zealand had an increase in tourism after the success of the Lord of the
Rings movies. The movies brought the scenery of New Zealand to new audiences.
Promotional Video in Music
Promotional videos have been used by the music industry very successfully. Music videos
help to establish a relationship between artists and their audience. This is why the success of
music videos as a promotional tool is being reviewed.
Enhancing the customer experience was identified as one of the key growth strategies from
the E-retail report compiled by Verdict research. According to surveys Verdict conducted,
customers want a better visual experience, especially in clothing and footwear. New
technologies which enhance the appearance of products now provide a better visual
experience and help enhance the overall customer shopping experience.
The music industry was one of the early pioneers of promotional video clips. Major record
labels have been using promotional clips since the 1970’s to promote their artists. The goal of
the music video is to help increase the sales of the artist, but video can be a long term
strategic initiative as it has been with Rap and R&B. In May 1981 MTV launched first 24
hour cable music television channel. This new distribution channel for promotional video
transformed the industry. The popularity of music video revitalised a music industry which
had been in recession. It revived consumers’ interest in music.
28
Madonna, Cyndi Lauper and Boy George were up and coming artists in the 1980’s and music
videos allowed them to cultivate and promote their unique image. Madonna has reinvented
her image many times and this has always been accompanied by a promotional video. Rap
and R&B music got virtually no air time twenty years ago in the USA. With funding from
the record companies and investment in promotional video, MTV increased the amount of air
time they gave to rap and R&B and now this genre is well established.
Moore (2004, p 179) argues that “Music video is a hybrid of content and advertising”. The
music video is delivering the content for the TV distribution channels such as MTV while the
audio part of the music video is promoting the sales of CDs, etc.
The success of promotional video grew throughout the 1980’s. In May 1981 only twenty
three of the top 100 singles on the Billboards “hot 100” had accompanying music videos.
This increased to eighty two by May 1986, and by 1989 ninety-seven of the top 100 singles
had accompanying videos.
By 1994, the industry was spending $150 million annually on video clip production with the
average promotional video costing $60,000-$80,000.9
Promotional videos were strategically important to record labels. Promotional video and
MTV allowed the record labels to bypass the radio stations that refused to play their artists.
Record labels would heavily promote their artist on MTV. The profile of the artists would
then increase and the radio stations would as a result be forced into playing those artists’
songs.
9 Banks, J. 1998 “Video in the machine: the incorporation of music video into the recording
industry”. Popular Music Vol. 16/3 pp.295
29
Customer loyalty & Net promoter score
Customer loyalty is not easy to define. Is customer loyalty driven by attitude or by
behaviour? If it is the case that customer loyalty is driven by attitude what should be
measured and how should it be measured?
Are behaviour metrics such as frequency of purchase and the value of the items enough to
determine customer loyalty?
(Assael, 1992) suggests that “The very term loyalty implies commitment rather than just
repetitive behaviour, which suggests that there is a need for a cognitive as well as a
behavioural view”
As part of their analysis Reichheld and Sasser (1990) tried to estimate what contribution
customer retention made to profitability. They argue that “as a customer’s relationship with
the company lengthens, profits rise. And not just a little. Companies can boost profits by
almost 100 per cent by retaining just five per cent more of their customers”
Customer relationship management has become a lot more important. There has been a shift
in management thinking and focus towards improving customer satisfaction with the aim of
increasing the customer retention ratio when customers are worth keeping i.e. profitable
customers.
It is essential that firms are able to identify the most suitable customer loyalty metrics.
Customer loyalty schemes have existed for a long time but now, with more data than ever
about customers, it has become increasing time consuming to manage all that data.
30
It is reaching a point that customer loyalty models are becoming so complex and difficult to
implement that managers are reluctant to implement them. Traditionally firms would engage
with market researchers and consultants to complete customer analysis. These firms are
specialist in customer analysis.
There were many sceptics who didn’t believe in the concept of customer loyalty. The reason
they found acceptance difficult was that there were multiple outcomes, and too much
management time was used up administering these outcomes.
An article in the December 2003 Harvard Business review entitled “The one number you
need to know” by Fred Reichheld, changed managements’ perception of customer loyalty.
Reichheld developed a simple loyalty based metric called the “Net Promoter Score”.
Reichheld claimed that the “Net Promoter Score” was the best indicator of a firm’s growth.
The net promoter score is calculated by asking people how likely they are to recommend a
firm on an 11 point scale. Respondents most likely to recommend are called promoters and
give scores of 9 or 10. The least likely are called the detractors and give scores of between 0
and 6.
The promoters are subtracted from the detractors to reach the net promoter score. This is
generally a percentage figure.
The net promoter score has its foundations in the power of word of mouth.
Word of mouth can be positive or negative. Thanks to improvements in mobile
communications word of mouth can become viral in a very short time. The advantage of
word of mouth is that is cheap. Word of mouth assumes credibility because consumers
believe they are receiving credible information rather than being sold to.
31
In a study by Godes and Mazlin 10
on the effects of word of mouth, they could not establish
the link between word of mouth and an increase in sales from a loyal customer base.
Rust et al discovered that the effects of word of mouth were hard to monitor.
Keiningham et al. (2004) tested Reichhelds hypothesis that the net promoter score was the
best indicator of a firm’s growth. There is some evidence that word of mouth can improve
the sales of a company.
The general consensus is that word of mouth is positive for a company.
E-Learning
It is accepted that new media mimics the existing media it is replacing. Early photography
imitated painting while early film making mimicked stage shows. The web as a
communications platform has broader capabilities than books or class room teaching. The
web has given consumers access to vast amounts of information. This has led to discovery
based learning. Discovery based learning is learning that occurs from spending time on the
web accessing different sources of information. Surfing the web is now an acceptable form
of entertainment.
John Seley Brown (2000) considers this fusion of learning and entertainment as
“infotainment”
We are in a new “learning ecology” Brown (2000).
10
“Using online conversations to study word-of-mouth communication”, Marketing Science ,
Vol. 23 (Fall) , pp. 545 – 560.
32
E-learning is still evolving and one of the main challenges is how to transform e-information
into human knowledge. We need to know what it will allow us to do compared to what we
can do currently. Educators recognise this as social challenge and not a technical one. Web
users are linked together via a network of communities who share similar characteristics.
Rich media such as video clips has been social accepted by web users. Rich media such as
video is a technology which allows for a greater transfer of knowledge than traditional print
media. Knowledge is a combination of explicit knowledge or “know what”, and tacit
knowledge or “know how”, where skills and practices are shared and demonstrated. The
advantages of E learning are that they build on communications and interaction.
The combination of persuasive technology and mass distribution across different devices
means that E-learning is a disruptive technology. We have yet to find out how influential e-
learning will be. Will it just support existing practices or will it alter how people learn by
changing their behaviour? If E-learning does have the capability to change behaviour then
the expectations and outcomes of the learners will also change.
Persuasion technology
Modern computing has gone well beyond the function of performing complex calculations
(Denning & Metcalfe, 1997).
Computers have three functions which they perform for end users,
a) tools, b) media, and c) social actions. .
The study of computer technology and how it influences behaviour and attitudes is called
Captology.
33
This subject matter is relatively new compared to other areas of human computer interaction
(Fogg, 1997, 1998).
Firstly Captology is focused on analysing the planned persuasive effects of technology and
secondly on attitude or behavioural changes.
The spread of computers and the network effect they create is very powerful. The influence
of computers on our lives continues to grow and because we are more dependent on
computers than ever, the way we interact with computers has the ability to change our
attitudes and behaviours. Computers and computing technology have the power of
persuasion.
Studies suggest that people form social relationships with computers (Reeves & Nass, 1996).
A positive customer experience is about providing memorable interaction. The user gains
information about a product or service they didn’t already know. Interacting with computers
and software on computers can deliver explicit and tacit knowledge.
The design and layout of computers and more importantly software applications which use
computers influence our motivation to interact with the technology. If we are motivated to
interact with computers, then our attitude towards computers will be more positive and we
will expect to enjoy our experience.
As previously discussed, a poor online experience can lead to negative offline perceptions
about a product or service. The unintended consequences of overlooking human computer
interaction can seriously damage reputations.
The purpose of having a website is to promote a product or service; to make it easier for your
customers to learn more about you and what you have to offer. For example, Amazon.com
has a website which encourages people to buy repeatedly.
34
They do this by making the website not only easy to navigate but also uses persuasion
applications which help motivate you to make further purchases. These persuasion
applications range from user registration and product reviews to one click purchasing. All
these applications work together to provide the customer experience.
Technology lifecycles on the web are becoming shorter. The internet has become a mature
market; it is just over ten years since the web became a distribution platform for information.
Only a few years ago rich media clips would not have been available because broadband
speeds were not quick enough to allow viewers to have a rich visual media experience. Now
with broadband more widely available rich media such as video is established.
Video technology within the framework of computing technology is one of those tools of
persuasion that is having a significant impact on changing consumers’ behaviour. Video has
the ability to increase the human computer interaction because we know that interactions
appeal to our visual senses and absorbing tacit information through observation is one of the
ways we learn.
Captology is made up of macro and micro elements. The macro objective is to change the
behaviour of users. The micro subset includes applications which enable the macro effect
such as spreadsheets, power point and word processing. Video technology crosses both
macro and micro elements. The macro elements are considered the interactive elements
which help transfer knowledge, the micro elements are applications which help network and
share the media.
From the evidence laid out in the literature there is reason to believe that interactive
promotional video has persuasion capabilities, encourages learning and can generate
customer loyalty.
35
For interactive media to be influential there needs to be market demand. Websites must
generate a positive experience for their users. If website users do not have a positive attitude
towards that website, they will not interact with it and so not learn.
If these conditions are not met, interactive promotional video will fail to fulfil its potential.
Therefore, the content reviewed in the literature review is relevant to the research question.
Research Methodology
The Business Mastery Project is based on a quantitative approach. The purpose of the
research is to investigate if promotional video increases customer life time value and to make
recommendations on implementing video as a communications strategy to David Mellor, who
is a business mentor and a member of the executive education team at Cass business school.
www.davidmellormentoring.com
To establish whether promotional videos does influence customers it was necessary to
identify videos where the objective is to increase sales or provide education.
David has recently started producing promotional videos where he discusses topics such as
“entrepreneurism and the big society” and “working with clients in group and one-to-one
settings”.
The promotional videos had to be accessible through an internet browser and available for
viewing across different devices such as PC, laptop or mobile phone.
36
Data collection
The research has been underpinned by a quantitative research methodology.
A comprehensive literature review of what causes internet users to interact with online
advertising, why promotional video has been successful in the music industry and why
customer lifetime value is important has been carried out.
Survey design
A number of key success factors were identified and the risks associated with achieving those
success factors were identified during the design of the survey.
A) Non-incentivised survey responses
It is widely accepted that people do not like completing surveys. Despite this, it seemed that
an online survey was the best way of gathering information, because the survey candidates
had to access the internet to view one of the promotional videos on David’s website.
Non incentivised surveys have a lower response rate than incentivised surveys. Incentivised
surveys can suffer from selection bias because incentives such as monetary rewards can
encourage people who need the money to participate in the survey.
When monetary rewards are offered (Hanson 1980) argues that "one expects that although
compliance is attained with the use of an incentive [i.e., the subject response] the degree of
compliance [i.e., the quality of the response] would be lower".
37
In order to mitigate the risk of a low response rate the survey had to remain simple and
because the survey was non-incentivised it was decided to limit the length to a maximum of
20 questions which would take no longer than 5 minutes to complete.
B) Interact with the website
To complete the survey respondents had to interact with at least one of the videos on the
website. In order to mitigate the risk of respondents not being able to find the website or the
video gallery tabs within the website, the links to those pages were embedded within the
survey.
There are five videos in total located in the video gallery section of the website ranging from
one minute ten seconds to five minutes in length.
The topics include one to one mentoring, entrepreneurship, and corporate development tools
such as PRISM.
C) Question design
It was necessary to keep the questions as simple as possible because of the time constraints
and the requirements for participants to interact with the website.
The questions were short, easy to read, and simple to answer. The questions and answers
were relevant to all the participants who were asked to fill out the survey.
There was a mixture of closed end questions where there answer to the question was “yes” or
“no”.
There were a number of ranked or ordinal questions. The choice of answers for these
questions is ranked according with importance, with 1 being the least important and 5 being
the most important.
38
There are questions set out using Likert’s scales.
The Likert scale is used to gauge the attitude of respondents. The range is from “strongly
disagree to strongly agree”. Respondents answer accordingly if they agree or not.
The survey was divided into three subcategories. In the first subcategory there were six
questions designed to identify the general attitude the respondents had towards the internet
and whether they thought interactive media had value as a communication tool. The
questions followed a logical order, were easy to answer and would not put off respondents
from completing the rest of the survey.
The second subcategory was more specific about David’s website and this is the point that
respondents needed to open his website and watch one of the videos.
The third section collected general demographic data about the respondents.
D) Survey distribution
The survey was distributed online via www.kwiksurvy.com. An email invitation was sent to
my contacts and David’s contacts.
The survey was published on my Facebook homepage and on my Linkedin home page.
Each respondent who participated was given a unique identification number. The questions
were numbered 1 to 20 and general instructions were given so that respondents were clear on
how to answer the questions.
The fonts remained consistent throughout.
39
Survey response rates
Non-incentivised survey response rates are low. General client satisfaction level surveys of
12 to 20 questions have response rates of less than 10%.11
Determining the correct sample of people to send the survey was based upon three criteria:
A) Business people
B) Entrepreneurs
The category “Business people” was defined as a group of people where the participants had
an interest in business. This included members of business associations etc.
The entrepreneurs’ category was defined as people who were owner/managers and who
needed mentoring.
Survey sample (No. of people) Entrepreneurs
Business
associates Other
David 900 300 0
Ross 30 70 100
Table 3 Survey sample
They survey began on the 13th
of July and concluded on the 2nd
of August. One reminder was
sent out during the second week of the survey. 110 completed surveys were received, which
is a 7.8% response rate.
67% (73 out of 110) of responses were recorded in the first week of the survey.
11
http://www.peoplepulse.com.au/Survey-Response-Rates.htm
40
Survey analysis
Introduction to the findings
The objective of the survey is to find out
(A) What are the key benefits of the internet?
(B) What are the benefits from interacting with promotional video on davidmellor.com?
(C) To make specific recommendations on how David Mellor can increase his online profile
with the use of promotional media.
Critical analysis
The responses to the survey will provide the answer to the research question “does online
interaction with promotional video increase learning and customer lifetime value?”
In addressing the question it was decided to focus on four general areas that would underpin
the findings from the survey.
Accuracy of the sample
Analysis of the number of respondents who answered the survey allows some inferences, on
how the overall population would interact with interactive media if everyone in the
population had been sampled, to be made. It was necessary to collect as many responses as
possible and prove that the survey was statistically significant versus the overall population.
The margin of error of the sample is that which occurs after surveying a sample of the
population versus surveying the full population
There are three acceptable margins of error categories 90%, 95%, and 99%.
41
The confidence interval is the statistic which explains how reliable the answers are.
The confidence interval for the survey is 95%. In this survey it is expected that if
respondents were sampled continuously, that the answers would be exactly the same 95% of
the time.
From the beginning it was necessary to collect as many responses as possible so that the
survey was statistically significant.
The minimum level of responses I was looking for was 96. At that level inferences can be
drawn about how the population would answer the questions if all of them were asked.
The survey is statistically significant and had 110 replies over the three week period during
which responses were collected.
The survey had margin of error of 90% and a confidence interval of 95%.
Survey response rates for general client satisfaction surveys which are non-incentivised are
less than 10%. A response rate of 7.8% is acceptable and satisfactory response ratio. Given
the difficulty in getting responses when using non-incentivised surveys, this is a good result.
Demographic profile of the respondents
Analysis of the demographic profile of the respondents gives us an insight into the age
profiles, genders, and professions of David’s clients. It was necessary to start with
demographic analysis even though demographic information can be quite limited in what it
tells us about the respondents, because it doesn’t capture any attitudinal information and
should always be used in conjunction with other information when making assumptions.
Before this survey was sent out, it was assumed that the vast majority of the respondents
would have been male.
42
Traditionally, it has been males who have been the entrepreneurs, but recently this has been
changing, and there has been an increase in the number of female entrepreneurs and business
owners. According to the University of New Hampshire Centre for Venture Research, the
percentage of women among “start-up capital” seekers in the US has increased from 12.6% in
2000 to 20% in 2011. The success rate of the number of women who applied for funding has
also increased from 9.5% in 2008 to 13% in 2010.12
64.5% of the respondents were male and 35.5% were female. This is roughly 2/3 male and
1/3 female. Further analysis will show how this statistic changes and what implication this
has for interactivity and customer loyalty.
It is generally accepted that most people who think about becoming entrepreneurs do so when
they are in their 30’s. By the time entrepreneurs are in their 40’s they have passed through
the start-up phase and are into the growth phase. As David’s clients are entrepreneurs and
business managers it can be presumed that the majority of the respondents in the survey are
between the ages of 30 and 45.
12
http://online.wsj.com/article_email/SB10001424052702303627104576413670597119208-
lMyQjAxMTAxMDAwNjEwNDYyWj.html
43
Q18:Age
5.45%
7.27%
12.27%
16.36%
18.18%
13.64%
11.82%
6.36%
3.64%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
20-24 yrs 25-29 yrs 30-34 yrs 35-39 yrs 40-44 yrs 45-49 yrs 50-54 yrs 55-59 yrs 60+ yrs
%
Table 4 Age profile of respondents
The chart above breaks down the age profile of the respondents. The age group with the most
respondents is the 40-44 year old age group with 18.18%. 46.8% of respondents fall within
the age group of 30-44. This is in line with the expectation of the age breakdown.
We already know that roughly 2/3rds
of the respondents are male and 1/3 are female, but
within the 30-44 age groups it was necessary to carry out further analysis and find out if the
gender demographic had changed within any the of the age groups.
Age Groups No. Male No. Female % Male % Female
30-34 15 4 78.9% 21.1%
35-39 11 4 73.3% 26.7%
40-44 12 8 60.0% 40.0%
Table 5 Gender profile between ages 30-44
Table 5 above shows that male gender is more prominent. It can be seen from the
percentages that the female gender increases as the age groups increase.
44
This is significant because during the literature review it was suggested that older people
were less likely to have positive attitudes towards the web.
This statistic also suggests that females are also entrepreneurs and business owners but they
tend to be older than their male equivalents. The significance of this is that for David there is
a doubling of the female audience between the ages of 30 and 44.
This supports the theory that promotional video is no longer being viewed by early adopters
only but has spread to a much greater audience.
Analysis of the different age groups suggests that entrepreneurs and business owners who are
established and have the resources to invest in their business are most likely to fall within the
30-44 age groups. They are also the ones who will benefit most from the advice that David
has to give. The reasons they will benefit the most is because he will have encountered many
of the problems they have experienced during his corporate life. His ability to communicate
his experiences and whether the respondents learnt from interacting with David’s video clips
is dealt with further in the section on interactive learning.
The UK economy is mainly a service based economy and the majority of entrepreneurs are
focusing on delivering services. It was necessary to offer a selection of options where most
of the categories were service orientated rather than manufacturing.
Analysis of the breakdown of the industry profiles is expected to show that David’s clients
provide specialist information services. During the survey design it was necessary to gauge
the attitudes of the respondents on what they thought were the most important benefits of the
internet. Access to the latest information was ranked the most important benefit. Analysis of
the industries where the respondents are employed should confirm that a large percentage of
the respondents are employed in a consulting or professional capacity.
45
It has been suggested in the literature review that interactive media is suitable for E-learning
and this will be investigated further in the report.
Table 6 below breaks the industries down by profession.
Q19:What sector is your business in?
3.3%
0.8%
8.2%
9.8%
1.6%
20.5%
7.4%
3.3%
7.4% 7.4%
9.9%
15.6%
4.9%
0%
5%
10%
15%
20%
25%
Retail
Com
mun
ications
Finan
ce IT
Telec
oms
Con
sulta
ncy
Bus
ines
s se
rvices
Med
ia
Edu
catio
n
Mar
ketin
g
Pro
fess
iona
l ser
vice
s
Other
N/A
Sector
%
Table 6 Profession by Industry Sector
Consultancy is the sector where the most respondents are employed and communications is
the sector where the least number of respondents are employed.
4.9% of respondents who took the survey were not involved in any industry and I expect that
those respondents are the MBA students from Cass Business School.
The second largest segment is “other” with 15.6%, the list of industry options was small
versus the number of industries and sub industries that exists, and it’s a little surprising that
the other category didn’t have a larger percentage.
46
To get a better insight into which industries maybe most inclined to interact with promotional
media industries which share similar characteristics are grouped together. The reasoning
behind this is that advisory services such as consultancy are driven by the need to
communicate explicit knowledge while in the IT industry there is a need for communicating
explicit and tacit information.
The first major grouping for analysis includes: Consultancy, Business services, Professional
services, and marketing. For the purpose of this report these are referred to as advisory
services.
45.2% of respondents are represented by these four categories. It can be presumed from this
statistic that a significant number of respondents are in careers where sharing their knowledge
is critical and where effective communication methods are required.
The second major grouping of industries which are related is: IT, Communications, Telecoms
and Media. Together they represent 15.5% of the respondents. For the purpose of this report
this group is referred to as technology services.
It is not surprising that these industries are so well represented. The new economies that have
sprung up around the internet and IT have attracted many new entrepreneurs who have left
traditional industries and started up new ventures with internet and IT services.
The technology and advisory services between them employ 60% of the respondents.
47
Final investigation of the demographics of the sample investigates the gender breakdown
within the advisory professions.
Profession Male Female % Male % Female
Consultancy 19 6 76.0% 24.0%
Marketing 9 3 75.0% 25.0%
Business Services 4 6 40.0% 60.0%
Professional services 9 3 75.0% 25.0%
Table 7 Gender profile with the advisory professions
The breakdown between male and female respondents in table 7 shows that in all but one
profession, Business Services, the male gender is roughly 75% of the sample versus the
overall survey where males are 64.5% of the total survey.
Analysis of the demographics shows that the gender balance remains relatively consistent
with some variation in the percentages in the 40-44 age groups. The professional profile of
the respondents is skewed towards information advisory services and technology services.
This evidence proves that there are no age biases in internet usage and that advisory based
services are the most likely to use the internet to search for the latest information.
48
Time and Frequency
Frequency is often considered an indicator of customer loyalty. When someone has a
positive experience on the internet they are more likely to have a positive attitude towards the
internet. The more times a person interacts with a website the greater the chance that an
emotional attachment will develop between the user and the website.
We know from the general attitude questions in the survey that access to the latest
information has been ranked at the most important benefit of the internet.
From that we can infer that websites which are up to date with current information have an
advantage over their competitors.
It was necessary to find out how much time our respondents spend on the web per week
developing their business and how frequently they search the web for consulting advice.
The vast majority, 75% of respondents, spend up to 10 hours a week online developing their
business.
General Internet trends
The general trend is consumers are spending more time online. The internet has developed
into a fully integrated entertainment, lifestyle and shopping utility. Internet subscription is
maturing fast, see appendix table 4 from verdict research.
With the user base of the internet expected to reach 42.5m people in the UK in 2014 time
spent online will increase as the internet reaches maturity.
According to a BBC news report,13
British web users in 2010 were spending 65% more time
online than they did three years previously.
13
http://www.bbc.co.uk/news/10122834
49
UK Online Measurement Company (UKOM) pointed out that the average surfer in 2010 was
spending 22 hours and 15 minutes surfing. Most of this time was spent on social networks.
The sample of respondents from this survey are more focused and are more likely to spend
more than 22 hours per week online as the time they spent on social and entertainment sites
was not surveyed. Demographic analysis shows that business advisory services which
includes consultancy and professional services employ the greatest percentage of respondents.
I9 respondents spend a total of 7-10 hours per week on line developing their business with 7
of those coming from a consulting background and 4 from professional services.
The frequency with which respondents search for consulting advice is an indicator of how
often they search for the most recent and relevant information.
As previously stated the greatest benefit of the internet is access to the latest information.
68% of respondents search the internet for business consulting/ advice and 70% search for
this advice at least once every three months.
These figures demonstrate that it is essential to use the internet to access the latest
information and that consumers expect greater amounts of information to be available to
them.
This supports the theory by (Bakos 1997; Brynjolfsson and Smith 1999), who believe that
customers demand more information about products.
From the analysis on time and frequency, we know that more time is being online with an
increasing amount of time being spent searching for the latest information. The amount of
information on the internet is increasing all the time. The corresponding effect of this
increase in information will be an increase in the amount of time spent online.
50
Attitudes towards the web
This section analyses how interactive media changes attitudes towards the web. How do
interactive media change attitudes on the web?
From the literature review we know that creating a positive experience is important for
generating positive attitudes towards the web.
Firstly, it was necessary to find out what the respondents thought were the most important
benefits of the web. Establishing those benefits would make it easier to identify their
motivations and attitudes. The first question in the survey asked the respondents to rank the
most important benefits of the internet using a scale of 1 to 5, with 1 being the least important
and 5 being the most important.
The 5 options were:
a) Faster communications
b) Access to the latest information
c) Finding new opportunities
d) 24 hour access to services
e) Save money, compare prices.
Access to the latest information was ranked the most important benefit. Access to
information implies that it easy to access the information and that the information is timely
and accurate.
As access to information is the most important benefit the survey investigated which
candidates watched promotional clips and whether they interacted with David’s website.
David has five video clips on the website which discuss topical business issues.
51
If interactive media is on a website and it is not being viewed, then website users are not
experiencing all the website has to offer. A poor experience is a sure way of prompting
customers to abandon a website.
In order to identify if the survey candidates watched promotional clips, question 3 asked
“Do you watch media clips or promotional videos if they are on a website?”
There were four response options:
f) Always
g) Weekly
h) Occasionally (once every 3 months)
i) Never
Q3: Do you watch media clips or promotional videos if they are on a website?
7%
26%
53%
14%
0%
10%
20%
30%
40%
50%
60%
Always Weekly Occasionally (once every 3 months) Never
Frequency
%
Table 8 Do respondents watch promotional video
Collectively 86.73% of respondents watched videos. From these percentage rates on can infer
that interactive media is no longer at the early adopter stage. 53% of the respondents watch
interactive at least once every three months.
52
This indicates that there is demand for interactive media and that the frequency with which
respondents engage with interactive media should increase as the supply and quality of the
interactive media improves.
The survey had a total of 110 respondents; 72 out of a total 110 survey respondents (65%)
are within the age groups of 20-44. The age profile of respondents also supports the general
appeal of interactive media.
Further investigation into the 58 respondents who watch video clips occasionally shows that
31 out of the 58 respondents, 53.4%, were between the ages of 30 and 44. The table below
breaks down the age ranges for viewers who occasionally watch interactive clips.
Age Groups No. %
20-24 2 3.4%
25-29 1 1.7%
30-34 12 20.7%
35-39 9 15.5%
40-44 10 17.2%
45-49 9 15.5%
50-54 10 17.2%
55-59 4 6.9%
60+ 1 1.7%
Table 9 Age profile of respondents who watch video clips
From a commercial standpoint the majority of entrepreneurs and owner managers of small to
medium organisations start their business when they are between 30 and 40 years of age.
David can continue pitching his mentoring services at entrepreneurs within the 30-40 age
groups and feel comfortable that his material will be watched.
53
Probing further into general attitudes about how viewers rate interactive media as a way of
giving advice, Question 5 from the survey asked respondents whether they agreed with the
statement that
“Interactive media (video) is a good way to give advice versus other media”.
54% of respondents, or 59 responses, agreed with the statement that interactive media was a
good way to give advice.
The last question on attitude towards the net and interactive media came from the analysis of
two questions simultaneously. The questions were “Do you watch promotional video clips if
they are on a website” and “interactive media is a good way to give advice”?
Aggregating the statistics from respondents who said they occasionally (once every three
months) watched interactive media on websites with statistics form the second part of the
question, respondents who agreed that interactive media is a good way to give advice gave us
a total of 35 respondents out of 110 replies which equates to 31.8% of the total respondents.
Of those 35 respondents the consultancy profession were the largest sector represented. This
sector had 10 responses out of the total of 35.
The consultancy industry is one of the first professions to use communication and media
techniques to improve the communication of information. These statistics support the
previous demographic analysis of the different professions and the amount of time those
professions spend online developing their business.
The age groups most represented from the 35 respondents were the groups from 30-34 and
35-39 which had 8 respondents each. 16 respondents represented 14.5% of the total
respondents. Again this age profiling supports that previous analysis on entrepreneurs and
business owner managers tend to be between the ages of 30 and 45.
54
This analysis gives an insight into the attitudes of the respondents towards the web and their
willingness to interact with interactive media if it is on a website.
It reinforces the evidence from the literature review which suggests, that when web users are
visually stimulated and given access to timely information, they will interact with that media.
Positive attitudes create the foundation for a relationship for customer loyalty. Reviewing the
demographic statistics and the attitudes statistics, it was a bit surprising that the advisory
industry which includes consultancy and professional services were the most inclined to
interact with promotional media. This could be because the respondents in these professions
realise the value of information more than respondents from other professions.
Interactive media changes attitudes on the web because of the experience it delivers.
Interactive learning
The next area of analysis is how interactive media encourages learning. What are the key
capabilities that interactive media has and how does it implement them?
The consulting and professional services professions are expected to benefit from
advancements in E-learning. One of those advancements is how interactive media will
increase communications. Technical barriers to E-learning such as internet penetration,
broadband speeds, and the attitude of consumers to accept new technologies, are falling. The
acceptance of electronic books such as the Amazon Kindle has been a milestone in the
acceptance of E-learning. In the few years since the launch of the Kindle the technology has
quickly passed through the early adopters phase and is now being accepted by the early
majority. Amazon14
the online retailer are now selling more Kindles than paperbacks.
14
http://technolog.msnbc.msn.com/_news/2011/01/28/5940731-kindle-books-now-outsell-paperbacks
55
This shows that the traditional norms about education are evolving. E-leaning is now
becoming market driven rather than technology driven. When there is market driven demand
there is less chance of technical obsolescence. Interactive media is at a key stage in its
development.
To analyse the potential influence interactive media will have within an E-learning
environment it was necessary to get a better understanding of what the respondents thought of
media clips. If the majority of respondents thought that interactive media was only for
entertainment, this would have been quite negative. The survey indicated this was not the
case. The respondents think interactive media is a good way to give advice but this needs to
be substantiated with more information.
To begin with, respondents were asked whether they agreed with the statement
“Media clips are mostly for entertainment”. This was question 4 in the survey.
Q4: Media clips are mostly for entertainment
6.3%
36.6%
26.8% 26.8%
3.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Strongly disagree Disagree Not sure/ NA Agree Strongly agree
Opinion
%
Table 10 Attitude to media clips
56
6.3% of respondents strongly disagreed and 36.6% disagreed with that statement. 26.6%
were not sure if they agreed.
These are good supporting statistics in that they show nearly half of respondents think that
media clips can be used for more other application than just entertainment. That is they
disagreed with the statement.
This also supports the framework that users get a positive experience from interacting with
media.
It can be assumed that users who agreed with that statement did so because they may be
waiting to have a positive interactive experience or they may have had a positive experience
but subconsciously that experience hadn’t registered with them.
The respondents who had a positive interactive media experience may have had that
experience while they were online purchasing goods or learning about new products and
services.
It is possible that the 27% who are not sure would react positively if they had engaged with
interactive media. That experience may not have happened for them yet or they could be
considered part of the late majority or laggards.
Further analysis of the 36.6% or 42 respondents who disagreed with the statement is in table
11 below.
Profession No. %
Consultancy 9 21.4%
Marketing 3 7.1%
Business Services 7 16.7%
Professional services 5 11.9%
Table 11 Sector profile of respondents in table 9
The table shows that of the 24 of the 42 respondents came from the professions where
information and communication of knowledge is essential. This also supports our previous
demographic analysis and attitudinal analysis.
57
A key part of learning is how well the tutors conduct themselves and their ability to
communicate their experience and knowledge. Interactive video is only as good as the
content it is supporting.
If tutors have poor communication skills they will not look confident in their presentation.
The viewers’ experience will also be poor because they will not be getting the experience
they were expecting and neither side will be encouraged to invest more time and effort.
David’s business is mentoring and because of this it is necessary for him to use interactive
media as effectively as possibly.
His ability to make an impact using interactive media will have a direct impact on the
audience and their willingness to make return visits.
It was necessary to find out how effectively David used the video clips.
In question 13 of the survey, the respondents were asked to rank four different statements on
a scale of 1 to 4; number 1 being lowest and number 4 being the highest.
The statements were designed to give an indication of what aspects were important in how
David communicated his knowledge.
The first statement was -
“Visually they are clear and organised”-
if the videos were of poor quality and the respondents were unable to follow them logically
this would result in a poor viewing experience.
The second statement was -
“Is the language simple”-to check that the language was not confusing or difficult and that
the message came across clearly.
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The third statement was –
“Video clips were too long” -
which intended to find out how long the viewers would be engaged before they lost interest
and decided to quit watching the clips?
The final statement –
“David communicates his knowledge clearly”-
focussed on how articulate David was at communicating his knowledge.
The final statement was ranked the most important with 44% or 48 respondents. The
inference from this ranking is that the respondents are learning from viewing the videos and
that they regard the information as valuable.
A breakdown of the respondents in question 13 shows us that the number of respondents per
category is very similar to those of question 4.
Profession No. %
Consultancy 12 25.0%
Marketing 7 14.6%
Business Services 7 14.6%
Professional services 3 6.3%
Table 12 Professional profile of respondents who ranked David communications skills as his most
important attribute
The main difference is in the consulting category, where there is an increase in the number of
consultants who agree that David communicates his knowledge clearly.
In the final review of educational merits of interactive media as an educational application it
was necessary to find out if the respondents wanted to learn more after interacting with
David’s videos.
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Question 15 of the survey asked respondents whether they agreed with the statement -
“after watching David’s videos I want to learn more about business”.
Q15: After watching David's videos I want to learn more about business
4.5%
11.7%
56.8%
34.3%
2.7%
0%
10%
20%
30%
40%
50%
60%
Strongly disagree Disagree Not sure/ Na Agree Strongly Agree
Opinion
%
Table 13 Attitude towards learning more about business
34.3% agreed with the statement and 2.7% strongly agreed with it. 56.8% of the respondents
are unsure or considered the question non applicable. That could be because the topics that
were discussed on the video clips were not relevant to their business.
Of the 34.3% or 28 respondents who agreed that they wanted to learn more, the gender
profile of those respondents was nearly exactly the same as those of the overall survey.
The table below break down the respondents by profession.
Profession No. % Male Female % Male % Female
Consultancy 10 35.7% 19 9 67.9% 32.1%Marketing 3 10.7%
Business Services 4 14.3%
Professional services 4 14.3%
Others 6 21.4%
Table 14 Sector profile of respondents who want to learn more
These statistics prove that both genders are receptive to learning via interactive media.
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Importantly, only 16.2% of the respondents did not want to learn more about business after
watching the clips. The assumption behind the 16.2% who didn’t want to learn is that they
were the respondents who were not involved in business. We know this because the survey
was sent to MBA students in Cass and other respondents who were not entrepreneurs/owner
managers. We also know that 30% of respondents do not search for consulting advice at all.
Repeat viewers & Net Promoter Score
The final section for analysis is how interaction can create lifetime value. Lifetime value is
linked with customer loyalty. Lifetime value is extremely important because the cost of
acquiring new customers is continuously increasing. A small increase in the number of
retained customers can lead to a significant increase in revenues and profits. Traditionally,
lifetime value has been calculated using a mathematical formula which discounts the future
profits of customers and attaches a new present value to each customer. In this study no
transaction was taking place so it was necessary to use a different framework for calculating
customer loyalty.
It was decided to use the Net Promoter score. The Net Promoter score is a reasonably new
framework for predicting firm growth. Its simplicity has won it many supporters but there
are some doubters as to how accurate it can predict growth. The basic principles behind the
net promoter score it is that positive recommendations from existing users translate into new
sales because customers who are unsure are convinced after receiving the recommendation.
Before investigating the net promoter score it is necessary to find out if the respondents had a
positive experience when they viewed David’s clips.
61
Question 14 asked
“if there were regular videos of David giving advice would you watch them?”
38.2% indicated that they would return to the site and watch clips of David giving advice.
While 27.2% said no, 34.6% of the respondents were not sure. Positive responses should be
indicators of future intention to return to the site. This also supports the theory that frequency
is an indicator of customer loyalty. We already know from the respondents that the main
benefit of the internet is access to information and that David communicates his knowledge
clearly. These two pieces of information are the two key reasons why 38.2% or 43
respondents are willing to return when David posts new interactive videos.
Q14: If there were regular videos of David giving advice would you watch them
38.2%
27.2%
34.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Yes No Not sure
Opinion
%
Table 15 %age of respondents who would watch regular videos of David
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Further analysis of the 38.2% who would watch regular videos of David is in the table below.
Age profile of
respondents
who would
watch regular
videos of David
giving advice
Age %
20-24 yrs 7.0%25-29 yrs 4.7%
30-34 yrs 9.3%
35-39 yrs 16.3%
40-44 yrs 20.9%
45-49 yrs 16.3%
50-54 yrs 11.6%
55-59 yrs 11.6%
60+ yrs 2.3%
Table 16 Age profile of respondents who would watch more videos
The table compares the age profile of the respondents who took the survey and the age profile
of the respondents who would watch regular videos of David.
The survey shows that 2% more females would watch David’s video clips compared to males.
Gender profile of
respondents who
would watch
regular videos of
David giving
advice
Gender %
Male 62.8%Female 37.2%
Table 17 Gender profiles of respondents who would watch more videos
The survey established that a significant number of respondents are willing to watch regular
videos. It also investigates whether the respondents who ranked David a 9 or a 10 in the net
promoter score were the same respondents who were willing to watch regular videos.
It is important that there is an overlap or a correlation between the numbers of respondents
and those willing to recommend David.
63
The net promoter score is worked out by subtracting the percentage score of the “detractors”
from the percentage score of the “promoters’”. The detractors are those people who are
unwilling to recommend and award a score of between 0 and 6 and the “promoters” award a
score of 9 or 10. Table 18 shows the rankings used in calculating the Net Promoter Score
(NPS).
Generally, this type of survey would be done on a large number of people using more than a
3 week time frame for gathering information.
Q16: How likely is it that you would recommend David to a friend or colleague who is looking for
business advice
17.0%
3.6%
6.3%
1.8%
4.5%
14.3%
5.4%
9.8%
17.0%
3.6%
17.0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Rank 0 Rank 1 Rank 2 Rank 3 Rank 4 Rank 5 Rank 6 Rank 7 Rank 8 Rank 9 Rank 10
Ranking
%
Table 18 Net promoter score rankings
Table 19 below calculates the Net Promoter Score. From the table we can see that the score
is negative. The first assumption to be drawn from that score is that very few people are
willing to recommend David and that the promotional videos he has commissioned are not
stimulating enough for the respondents.
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This suggests that promotional video does not fulfil customer expectations; that promotional
video is not a suitable tool for communicating with customers; that it does not encourage
frequent viewing and therefore is not helping to generate customer loyalty.
But that score is not accurate because it also includes those people who didn’t watch the
videos.
40% or 44 people didn’t watch any of the videos. Respondents who would be unwilling to
watch any videos in the future were included too.
Detractors Promoters
Rank 0-6 Rank 9-10
% %
52.68% 20.53%
NPS -32.15%
Table 19 Net Promoter score
A better way to prove that his investment in promotional video encourages learning and
customer loyalty is to compare the number of respondents who are willing to watch regular
videos and then recommend David to a friend or colleague who is looking for business advice.
From the previous research we know that 43 respondents are willing to watch regular videos
of David. 24 respondents ranked David either a 9 or 10.
Proof of customer loyalty will come from analysing the unique id numbers of the respondents
who watch regular video and then gave David a 9 or 10 ranking on the Net Promoter Score.
65
Table 20 Respondents who would recommend David
Of the 43 respondents who were willing to watch more videos and the 24 respondents who
ranked David a 9 or a 10 on the Net Promoter Score, 19 respondents were in both categories.
What this means is that 19 respondents are willing to watch regular videos and promote
David to their friends. These 19 respondents are proof that interaction with promotional
video increase learning generates customer lifetime value.
This represents 17.3% of the overall 110 respondents.
17.3% is a significant percentage of any survey. The literary review shows that a small
percentage increase in customer retention can lead to a significant increase in customer
profits.
This figure proves that interaction with promotional video increases learning and customer
lifetime value.
Unique ID number of people who
would watch more videos
Unique ID number of people who
awarded a 9 or 10 NPS
1 6752709 6752709
2 6821548 6821548
3 6848570 6848570
4 6752286 6752286
5 6775876 6775876
6 6821986 6821986
7 6828811 6828811
8 6828861 6828861
9 6838956 6838956
10 6851413 6851413
11 6864194 6864194
12 6864336 6864336
13 6864660 6864660
14 6866982 6866982
15 6867178 6867178
16 6867407 6867407
17 6911655 6911655
18 6940596 6940596
19 7056789 7056789
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Limitations and Further research
Limitations
There has been very little research carried out into interactive promotional media and it was
the intention of the author to supply evidence that interactive media can improve learning and
generate customer loyalty. From the very beginning of the research project it was necessary
to identify a website that was offering interactive promotional media.
The limitations are survey limitations and methodology limitations.
Survey limitations
There were a number of limitations to using surveys for gathering information. Early in the
project a distribution list was drawn up of who were the most likely people to participate in
the survey. Further screening could have been carried out to make sure that the survey
candidates were more suitable. Were they entrepreneurs or business owners and did they use
the internet to search for business consulting advice?
Non-incentivised surveys have low participation rates; to increase the participation rates a
financial incentive could have been included. Earlier in the report some of the problems
with incentivising surveys using financial rewards were highlighted. The length and design
of the survey had limitations. It was decided that the survey should take no longer than five
minutes to complete and that it should have no more than 20 questions.
The main limitation of the survey was that it required people to interact with the links to
David’s website. This required that the survey candidates spend some time on David’s site
before completing the survey. It was possible that some of the candidates might click onto
the website but never view any of the video clips.
67
Therefore guaranteeing the accuracy of responses to the survey was the biggest challenge.
To make sure they were as accurate as possible it was necessary to answer a question before
going on to the next question.
The survey was hosted on a 3rd
party website. If respondents were not familiar with filling
out online surveys then this may have negatively impacted their willingness to complete the
survey.
Methodology limitations
Face to face interviews would be considered the most appropriate form of survey considering
the complex nature of the question, which includes investigating people’s attitudes towards
the web, E-learning and interactivity.
The number of candidates involved rendered this inappropriate so an online survey was
undertaken.
Technical limitations also existed. The assumption was made that the survey candidates had
the required broadband speed to be able to download the videos and watch the video.
Further research
A lot of the literature review had to come from older studies which were carried out during
the Web 1.0 era when websites were not interactive. Banner advertising was considered
interactive during that era. It is only in recent years that high speed broadband has allowed
internet users to watch interactive media clips. Three main areas where further research is
needed have been identified and outlined overleaf.
68
Web 2.0 and attitudes towards the internet
A positive experience is one of the main indicators of positive attitudes towards the internet.
More research could be carried out into how interactive media generates positive attitudes
and how the design and layout of a web site influences our browsing experience. More
research could be carried out into how interactive media will influence the design of mobile
devices in the future.
E-learning
Further study into E-learning could analyse the relationship between the duration of media
clips and how successfully they absorb that information. Other studies could focus on the
technology used to support E-learning.
Demand for interactive media
The demand for interactive promotional media is no longer driven by the early adopters, but
compared to other media the demand is still low.
Further study could take place into predicting the future demand for the interactive media.
The review might include a review of the technical and non-technical market conditions that
drove the demand for TV adverts and then compare the growth in TV advertisements with the
growth in promotional media on the web. TV adverts were a substitute for radio adverts.
Will interactive promotional adverts become as substitute for TV adverts?
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Conclusions and Recommendations
Conclusions
The research question asked if online interaction with promotional video increases learning
and customer lifetime value?
Currently there is little research on promotional video but over the next few years the use of
promotional video is expected increase because of its interactive capabilities.
Promotional videos from David’s website www.davidmellormentoring.com were used to test
whether promotional video can increase learning and increase customer loyalty.
The survey consisted of twenty questions which took no more than five minutes to complete.
The majority of the people who were asked to complete the survey were entrepreneurs or had
an involvement in business.
The results suggest that online interaction with promotional video increases learning and
customer lifetime value. Analysis of the survey indicates that access to the latest information
was ranked as the most important benefit of the internet.
This is significant because attitudes determine our willingness to use the internet and our
interaction with websites. Attitudes influence our motivations and our future behaviour.
Respondents were asked if they used the internet to search for consulting/ business advice. A
significant proportion of respondents use the internet to search for advice and search for
advice on a regular basis.
Interaction with promotional video influences behaviour and creates positive experiences.
Interaction influences behavioural because it encourages users to become more involved.
Users become more involved when they are stimulated.
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The literature review point out that media which stimulates our senses is more effective in
delivering positive experiences. Positive experiences on the internet encourage a structural
shift in internet users towards the source of that experience.
When users enjoy an interactive experience they are likely to demand that experience in the
future. They are also more likely to promote that positive experience to other users.
An example of a website which has been able to capitalise on the shift towards interactive
media is www.youtube.com. YouTube has made it simple to watch the videos on its site and
also encourage the structural shift towards interactive media by making it easy to forward
videos to other users.
One of the issues with new media is that it tends to substitute other forms of media very
quickly. Interactive media will eventually be substituted by a new form of media which is
even more engaging.
Interactive media is no longer at the early adopter stage. It has become widely accepted. To
prove this the survey analysed the demographics of the respondents. Respondents from all the
age groups interacted with David’s videos. Respondents from every profession interacted
with the videos but the respondents from the advisory categories - consulting, business and
professional services were the most frequent users. It is possible that these professions
realise the value of information more than the other professions and therefore use the internet
more than other professions. There was no real difference between the genders in their
willingness to interact with the video clips.
The market is still a long way from maturity.
There are significant opportunities for new interactive services.
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One of the benefits of launching an interactive media service now is that there is demand for
interactive media, and internet users will engage with interactive media if it provides them
with a positive experience. This is important because it increases the chances of success and
generating a return on that investment.
Interactive video encourages learning because the respondents have to be more involved.
They control how much information they are exposed to. To prove that promotional is
suitable for E-learning, survey respondents were asked if they wanted to learn more about
business after watching David’s videos. 34.3% of the respondents wanted to learn more. The
reason that they wanted to learn more is because David communicated his knowledge very
well.
This supports the argument that interactive media supports E-learning. E-learning is still
developing, but there should be significant future opportunities within education for
interactive media.
Frequency is an indicator of customer loyalty. As previously started, if a website delivers a
positive experience it will encourage more frequent interaction. To prove that frequency is
an indicator of customer loyalty respondents were asked if they would watch regular videos
of David giving advice and if they would recommend David to friends or colleagues who
were looking for business advice.
38.2%, or 43 respondents, said they would watch regular videos of David giving advice. Of
the 43 respondents who would watch David on a regular basis, 19 of those said they would
recommend David to friends and colleagues who were looking for advice.
This represents are 17.3% of the total number of respondents who completed the survey.
This is a significant proportion and proves that online interaction with promotional learning
can increase learning and customer lifetime value.
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Recommendations
When potential clients of David’s are searching the internet for mentoring and business
advice and they navigate to www.devidmellormentoring.com, the relationship between
themselves and David begins. First impressions of a website are extremely important. A
clients’ first encounter with a website should convince them about the quality of service they
are going to receive. First impressions of www.devidmellormentoring.com should be
motivating and encourage a positive attitude towards that website. Clients should be looking
forward to having a positive experience.
The literature review indicates how a poor online experience influences offline decisions. If
a website cannot generate deliver a positive experience for its user it will fail to retain
customers.
The recommendations I’m suggesting are designed to deliver a positive experience to David’s
existing internet clients and future web clients. The following recommendations should
increase customer loyalty and encourage clients to use the website more frequently to get the
latest mentoring and management information.
A) Format of interactive media
Access to the latest information was identified as the most important benefit of the internet.
Web users want the latest information before they make their decisions.
The respondents identified David’s ability to communicate his knowledge and information
clearly as his best attribute.
David should focus on developing a portfolio of videos which contain the latest management
and mentoring advice for different professions. The videos should encourage as much
interaction as possible so that the viewer is engaged and learning.
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Every video should be focused on showing how David can create a positive behavioural
change for the viewer. Positive behaviour change should be achievable and all the resources
to achieve that behavioural change should be on the website.
David should start with the advisory professions which includes consultancy, professional
and business services. These professions represented a large proportion of the respondents to
the survey.
It is clear that David has the ability and communications skills to deliver complex
information on a high level.
Within these professions David could position himself as the consultants’ consultant.
B) Feature videos every 3 months
The second recommendation is to put feature videos on the site at least every three months
and more frequently if they are required. The majority of survey respondents viewed
promotional video at least once every three months and this would be expected to increase as
interactive video becomes more popular.
Feature videos are where David discusses major topics. Feature videos are where David sets
out the mentoring program for a specific industry or for a specific framework. Feature videos
should be supported by short reminder videos which are put on the site once a month. The
objective of the short reminder videos is to reflect on the feature videos and to reinforce any
of the suggestions that are made in the feature videos.
Reminder videos are also a good way of introducing new clients to the themes and concepts
that will be discussed in the feature videos and because they are short it is less likely that
viewers will quit before they have viewed the entire clip.
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C) Interactive features
The final suggestion is to encourage viewers to leave comments about the videos. Web 2.0
encourages more interactivity and currently the video gallery doesn’t encourage viewers to
forward videos to friends or colleagues who are looking business/mentoring advice. There
should be a way for users to make comments on what they have learnt from interacting with
the website and to make future recommendations.
These recommendations help to retain clients and attract new clients. A small increase in
client retention can lead to a significant improvement in profitability.
There is another purpose for having clients leave their comments and that is to help shape the
future design and content of the site. As previously outlined, websites evolve through
interaction. Having this level of interaction should guarantee that as the website evolves it
maintains its ability to deliver positive experiences.
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Appendices
Appendix 1
Link to survey on Kwik survey website. http://www.kwiksurveys.com?s=NNMLFM_dde30d7d
Appendix 2
Respondents answers to the survey in chart format:
Q1: Rank the most important benefits of the internet
18%
13%
16%
19%
34%
15%
18%
23%
25%
19%
13%
15%
42%
15% 15%
26%
22%
12%
23%
17%
27.0%
33.0%
7.0%
18.0%
15.0%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Faster communications Access to the latest
information
Finding new
opportunities
24 hour access to
services
Save money, compare
prices
Benefits
Rank 1(least important)
Rank 2
Rank 3
Rank 4
Rank 5(Most important)
81
Q2: Indicate the number of hours per week you spend online developing your business
14.2%
12.4%
16.8% 16.8%
15.0%
6.2%
8.0%
3.5%
2.7%
4.4%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
0 hours Less than 1 1 to 2 2 to 6 7 to 10 11 to 15 16 to 20 20 to 30 30 to 50 50+
Hours
%
Q3: Do you watch media clips or promotional videos if they are on a website?
7.3%
26.4%
52.7%
13.6%
0%
10%
20%
30%
40%
50%
60%
Always Weekly Occasionally (once every 3 months) Never
Frequency
%
82
Q4: Media clips are mostly for entertainment
6.3%
36.6%
26.8% 26.8%
3.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Strongly disagree Disagree Not sure/ NA Agree Strongly agree
Opinion
%
Q5: Interactive media (video) is a good way to give advice compared to other media
0.8%
8.0%
21.4%
54.5%
15.2%
0%
10%
20%
30%
40%
50%
60%
Strongly disagree Disagree Not sure/ NA Agree Strongly agree
Opinion
%
83
Q6: Do you ever use the internet to search for professional business consulting/ advice?
68.5%
31.5%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Yes No
%
Q7: If yes how often do you search for consulting advice?
8.2%
24.6%
37.3%
30.0%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Daily Weekly Occasionally (once every 3 months) Never
Frequency
%
84
Q8: Have you ever visited David Mellor's website
38.9%
61.1%
0%
10%
20%
30%
40%
50%
60%
70%
Yes No
%
Q9: How long is it since you visited his site?
26.4%
2.7% 2.7%
7.3%
60.9%
0%
10%
20%
30%
40%
50%
60%
70%
Within the last week Within the last 2 weeks Within the last month Within the last 3 weeks Don't remember
Frequency
%
85
Q13: Please rank the following statements
25.0%
12.0%
47.0%
15.0%
28.0%
43.0%
12.0%
17.0%
25.0%
31.0%
21.0%
24.0%
22.0%
15.0%
20.0%
44.0%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Visually they are clear and
organised
Language is simple Video clips were too long David communicates his
knowledge clearly
Opinions
%
Rank 1
Rank 2
Rank 3
Rank 4
Q14: If there were regular videos of David giving advice would you watch them
38.2%
27.2%
34.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Yes No Not sure
Opinion
%
86
Q16: How likely is it that you would recommend David to a friend or colleague who is looking for
business advice
17.0%
3.6%
6.3%
1.8%
4.5%
14.3%
5.4%
9.8%
17.0%
3.6%
17.0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Rank 0 Rank 1 Rank 2 Rank 3 Rank 4 Rank 5 Rank 6 Rank 7 Rank 8 Rank 9 Rank 10
Ranking
%
Q17:Gender
64.5%
34.6%
0%
10%
20%
30%
40%
50%
60%
70%
Male Female
%
87
Q18:Age
5.45%
7.27%
12.27%
16.36%
18.18%
13.64%
11.82%
6.36%
3.64%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
20-24 yrs 25-29 yrs 30-34 yrs 35-39 yrs 40-44 yrs 45-49 yrs 50-54 yrs 55-59 yrs 60+ yrs
%
Q19:What sector is your business in?
3.3%
0.8%
8.2%
9.8%
1.6%
20.5%
7.4%
3.3%
7.4% 7.4%
9.9%
15.6%
4.9%
0%
5%
10%
15%
20%
25%
Ret
ail
Com
mun
icat
ions
Fina
nce IT
Teleco
ms
Con
sulta
ncy
Bus
ines
s se
rvices
Med
ia
Edu
catio
n
Mar
ketin
g
Pro
fess
iona
l ser
vice
s
Oth
erN/A
Sector
%
88
Q20: What annual turnover does your business generate
15.5%
0.0%
10.9%
5.5%
7.3%
17.3%
14.6%
1.8%
2.7% 2.7%
5.5%
16.4%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0-9k 10-19k 20-29k 30-39k 40-49k 50-149k 150-500k 500-999k 1-4.9m 5-9.9m 10m-19.9m 20+
Turnover
%
89
Appendix 3
Definitions of interaction:
Definitions that Focus on Process
Study Definition/Description of Interactivity Key Elements
Bezjian-Avery,
Calder, and Iacobucci
1998
“In interactive systems, a customer controls the
content of the interaction requesting or giving
information…. The hallmark of these new media
is their interactivity – the consumer and the
manufacturer enter into dialogue in a way not
previously possible” (p.23).
User control and
dialogue between
consumer and
manufacturer
Cho and Leckenby
1999
“The degree to which a person actively engages
in advertising processing by interacting with
advertising messages and advertisers” (p.163).
Interchange
between individuals
and advertisers
Guedj et al. 1980 “A style of control” (p.69). User control
Ha and James 1998 “Interactivity should be defined in terms of the
extent to which the communicator and the
audience respond to, or are willing to facilitate,
each other’s communication needs” (p.461).
Responsiveness
Haeckel 1998 “The essence of interactivity is exchange” (p.63). Exchange
Heeter 2000 “An interaction is an episode or series of episodes
of physical actions and reactions of an embodied
human with the world, including the environment
and objects and beings in the world.”
Action and reaction
Miles 1992 “An interactive communication involves
responsiveness of the displayed message to the
message receiver” (p.150).
Responsiveness
Pavlik 1998 “Interactivity means two-way communication
between source and receiver, or, more broadly
multidirectional communication between any
number of sources and receivers” (p.137).
Two-way
communication
Rafaeli 1988 “Interactivity is an expression of the extent that in
a given series of communication exchanges, any
third (or later) transmission (or message) is
related to the degree to which previous exchanges
referred to even earlier transmissions” (p.111).
Responsiveness
Steuer 1992 “Interactivity is the extent to which users can
participate in modifying the form and content of a
mediated environment in real time” (p.84).
Real-time
participation
90
Definitions of Interaction continued.
Definitions that Focus on Features
Study Definition/Description of Interactivity Key Elements
Ahren, Stromer-
Galley, and Neuman
2000
Media interactivity was defined in terms of
features such as audio and video. Human
interaction was defined in terms of features such
as bulletin boards and chat rooms.
Multimedia,
features for two-
way
communication
Carey 1989 Interactive media are: “technologies that provide
person-to-person communications mediated by a
telecommunications channel (e.g. a telephone
call) and person-to-machine interactions that
simulate interpersonal exchange (e.g. an
electronic banking transaction)” (p.328).
Channels for
human-to-human or
human-to-computer
exchange
Ha and James 1998 Identified five characteristics of interactivity:
playfulness, choice, connectedness, information
collection, and reciprocal communication.
Five characteristics
that constitute
interactivity
Jensen 1998 “Interactivity may be defined as: a measure of a
media’s potential ability to let the user exert an
influence on the content and/or form of the
mediated communication” (p.201).
Features that enable
user control
Lombard and Snyder-
Dutch 2001
“We define interactivity as a characteristic of a
medium in which the user can influence the form
and/or content of the mediated presentation or
experience.”
Features that enable
user control
McMillan 2000a Identified thirteen features that, based on
literature about interactivity, might suggest that a
Web site is interactive. Included: E-mail links,
registration forms, survey/comment forms, chat
rooms, search engines, and games.
Web site features
that facilitate two-
way
communication and
control
Novak, Hoffman, and
Yung 2000
Interactive speed is a construct that contributes to
flow and is based on measures such as waiting
time, loading time, and degree to which
interacting with the Web is “slow and tedious”
(p.29).
Time required for
interaction
Straubhaar and
LaRose 1996
“We will use the term interactive to refer to
situations where real-time feedback is collected
from the receivers of a communications channel
and is used by the source to continually modify
the message as it is being delivered to the
receiver” (p.12).
Functions that
enable customized
and timely
feedback
91
Definitions of Interaction continued.
Definitions that Focus on Perception
Study Definition/Description of Interactivity Key Elements
Day 1998 “The essence of interactive marketing is the use
of information from the customer rather than
about the customer.” (p.47).
Consumer
involvement
Kiousis 1999 “With regard to human users, it [interactivity] …
refers to the ability of users to perceive the
experience to be a simulation of interpersonal
communication and increase their awareness of
telepresence” (p.18).
Simulation of
interpersonal
communication
McMillan 2000b Individuals rated interactivity of sites based on
their perceptions of two-way communication,
level of control, user activity, sense of place, and
time sensitivity.
Perception of two-
way
communication,
control, activity,
sense of place, and
time sensitivity
Newhagen, Cordes,
and Levy 1996
Conceptualize interactivity based on “the
psychological sense message senders have of
their own and the receivers’ interactivity”
(p.165).
Perception of
interaction by self
and others
Schumann, Artis, and
Rivera 2001
“Ultimately it is the consumer’s choice to
interact, thus interactivity is a characteristic of the
consumer, and not a characteristic of the medium.
The medium simply serves to facilitate the
interaction.”
Consumer’s choice
to interact
Wu 1999 “Perceived interactivity can be defined as a two-
component construct consisting of navigation and
responsiveness” (p.6).
Perceptions of
navigation and
responsiveness
92
Definitions of Interaction continued.
Definitions that Combine, Process, Features, and/or Perception
Study Definition/Description of Interactivity Key Elements
Coyle and Thorson
2001
“A web site that is described as interactive should
have good mapping, quick transitions between a
user's input and resulting actions, and a range of
ways to manipulate the content” (p.67).
Mapping, speed,
and user control.
Hanssen, Jankowski,
and Etienne 1996
“Aspects of interactivity were clustered around
three terms: equality (containing aspects such as
participants, mutual activity, role exchange,
control), responsiveness (e.g. mutual discourse,
nature of feedback, response time) and functional
communicative environment (e.g. bandwidth,
transparency, social presence, artificial
intelligence)” (p.71).
Equality,
responsiveness, and
functional
environment
Heeter 1989 Interactivity is a multi-dimensional concept that
includes: complexity of choice available, effort
users must exert, responsiveness to the user,
monitoring information use, ease of adding
information, and facilitation of interpersonal
communication.
Complexity, effort,
responsiveness,
monitoring,
participation,
interpersonal
communication
Lieb 1998 Interactivity is seen as having two primary
definitions. The first is a kind of personalization.
The second type is community building.
User control,
interpersonal
communication
McMillan 2002
Identifies four types of interactivity based on
intersection of user control and direction of
communication: monologue, feedback,
responsive dialogue, and mutual discourse.
Monologue,
feedback,
responsive
dialogue, and
mutual discourse.
Zack 1993 He suggests that the following key factors emerge
from the literature as elements of interactivity: the
simultaneous and continuous exchange of
information; the use of multiple non-verbal cues;
the potentially spontaneous, unpredictable, and
emergent progression of remarks; the ability to
interrupt or preempt; mutuality; patterns of turn-
taking, and the use of adjacency pairs.
Exchange, non-
verbal cues,
spontaneity,
unpredictability,
progression of
remarks, ability to
interrupt, mutuality
turn-taking,
adjacency.
93
Appendix 4
Internet subscription growth rates
94