The Scenario: Your brother just bought a bar. He knows you are taking a college class on this kind of thing and he wants your help building a digital presence. What should your brother consider before anything else and what factors would suggest going forward and what factors would make him decide not to build a presence?
Before we decide on the type of online presence we need to determine the ROI (Return on Investment) to ensure that we can maximize profits and minimize losses.
Some of the factors we must consider, along with the ROI, is the four P’s which are Product, Price, Place, and Promotion. These factors will help determine why, why not, or what type of online presence we should pursue.
Product: When need to understand the product we are selling which will enable us to determine the demographic segment we are trying to reach such as, who typically visits bars, and their average age and income bracket.
Price: We need to understand our average price point of our products so that we can better determine our ROI, by calculating the cost ratio of creating an online presence relative to the cost of our product, and the volume we sell on average.
Place: This should be an easy one because place speaks to the distribution of our product and since it is a bar our product is moved internally unless we are doing catering or selling miscellaneous items. This will help us determine what kind of online presence we need.
Promotion: This is probably the last factor we will arrive at based upon the analysis of the aforementioned factors. Promotion includes all forms of external communication to our customers and since we are trying to decide which type of online presence we should, or should not purse, promotion is very important.
The different types of online presences below will give examples of why our fictitious brother would want to use a particular type of presence.
Brochure: This would be great for our Brother’s bar due to the low cost to create and maintain this simple website. It would be concise in delivering the essential information our bar needs to generate foot traffic, i.e. hours of operation, happy hour, what type of bar we are (such as Irish pub, Biker Bar etc.), contact info, and the type of spirits we sale.
Informational: This would not necessarily be a good choice for our bar. There is really no need for a bar to have an online presence that would provide daily, hourly, or monthly news updates. Also, this type of presence would call for someone to manage the content frequently. In my opinion this would be a bad ROI.
Media: The ROI on this type of online presence is also sketchy at best, due to the nature of our business. We wouldn’t necessarily want video of our patrons drinking in our establishment, due to the level of privacy we would like to give our customers. Lastly, the cost to develop and maintain one of the sites could be cost prohibitive.
Data Gathering: This type of website could work for our bar, because it would help us in the future to better market to our customers which would generate steady foot traffic. We could essentially create some sort of web form that would be constructed to data mine the information we need to market effectively. We could eventually use this information to design and market apparel or tell us market trends in regards to the changing and unique taste our customers have. Lastly, we would need to consider the cost of maintaining a database for our data and also someone to analyze the data we mined.
Interaction: This is also a good choice and in my opinion a must. Having a social media presence will help our bar reach customers that other means of communication couldn't produce. The upside of a social media presence is that it's cost effective and also social media sites like Facebook, provide analytics of the demographic that is viewing, talking about, and sharing our post. However, the one caveat is that like and informational site, we would need to manage this presence daily and carefully.
E-commerce: This is not in our best interest right now because of the low ROI. We need foot traffic and this type of presence would not provide that for us in an effective way. If we develop any apparel or other types of products, it would be best to sell them in our bar initially. Alcohol sales is our focus because the profit potential is greater per transaction.
Promotional: The ROI for promotional presences like Four Square, Group-on is appealing and worth research because it will put eyes on our bar. However, it seems to be a very passive way of reaching or demographic as we would have to rely heavily on our customers to check in. I think we could get the same results use a social media presence such as Facebook or Twitter.
In conclusion I feel the best chance for a healthy ROI is to create a Brochure type website combined with an interaction presence on social media. In my opinion these presences will address our most important concerns whilst generating foot traffic.
Cited Works
Lascu, Dana-Nicoleta,
and Kenneth E. Clow. Marketing Principles. St. Paul, MN: Textbook
Media, 2012. Print.
Xeriland,
Tim. Do You Need a Digital Presence. Irving: Tim Xeriland, 15 July
2015. Doc.
