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THE EDUCATION NEEDS OF MICRO ENTERPRISES IN ON-LINE MARKETING

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The aim of this paper is to identify the educational needs of micro enterprises in online marketing. Primary data was gathered using an electronic questionnaire (n = 176). It was designed for micro enterprises and semi-structured interviews with experts in online marketing. It was found that micro enterprises primarily care about activity on social networks, and do not deal with or outsource website management, PPC advertising, e-mail marketing and analytics. Those made responsible for online marketing assess their knowledge of online marketing as low, which is reflected in the limited ability to evaluate the results of external entities. Due to the increasing complexity of online marketing, the inability to formulate the basic issues of contracts and related unrealistic demands, it is recommended to focus training on the management and control of outsourced activities. Especially, in the areas of options, prices, and desired outcomes, thus increasing the bargaining position in negotiations with external partners.
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472 ERIE 2016
Abstract
The aim of this paper is to identify the educational needs of micro enterprises in online
marketing. Primary data was gathered using an electronic questionnaire (n = 176). It was
designed for micro enterprises and semi-structured interviews with experts in online
marketing. It was found that micro enterprises primarily care about activity on social
networks, and do not deal with or outsource website management, PPC advertising,
e-mail marketing and analytics. Those made responsible for online marketing assess their
knowledge of online marketing as low, which is reected in the limited ability to evaluate
the results of external entities. Due to the increasing complexity of online marketing, the
inability to formulate the basic issues of contracts and related unrealistic demands, it is
recommended to focus training on the management and control of outsourced activities.
Especially, in the areas of options, prices, and desired outcomes, thus increasing the
bargaining position in negotiations with external partners.
Keywords
Education, micro entreprises, online marketing, outsourcing
Introduction
Online marketing takes place in the specic environment of the Internet and uses the
services there for the implementation and support of marketing activities. In the
changing marketing environment, the role of the Internet, and the role of social media
in particular, becomes crucial. For marketing strategists, the message is simple: cope
with the increasing demands of customers, do not rely on traditional marketing tactics
and segment the customer base, understand the importance of technologies used for
marketing purposes and, in particular, engage social media as part of marketing campaigns
(Constantinides, 2014). According to Gostian (2015), it can be observed that at present,
many marketing companies or marketing specialists have skills primarily in activities
such as market research, advertising, and sales support. Often companies do not have
sucient knowledge reecting the modern technological environment. This knowledge
is necessary in order to take advantage and so function successfully in the market. The
Internet cannot be ignored and must be used in the search for new channels to reach
customers, especially those who prefer the electronic environment and are multimedia-
oriented. Customers are given the opportunity to be active in communicating, more
engaged, creative and expressive. Applying online marketing enables the creation and
maintaining of long-term relationships with clients through the management of online
activities, allowing the exchange of observations, and evaluation of products and services
(Orzan and Orzan, 2007).
THE EDUCATION NEEDS OF MICRO ENTERPRISES IN ON-LINE
MARKETING
1Jitka Pokorna, 2*Ladislav Pilar
1Department of Management, Faculty of Economics and Management Prague, Czech University of
Life Sciences Prague, Czech Republic
2Department of Management, Faculty of Economics and Management Prague, Czech
University of Life Sciences Prague, Kamýcká 129, Prague, 165 21, Czech Republic,
pilarl@pef.czu.cz
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The most widely used forms of online marketing realization, targeted at user information
searches on the Internet are PPC (pay-per-click) or PPA (pay-per-action), space advertising,
records to catalogues, priority listings, search engine optimization, viral marketing,
advergaming and the use of various social networks (Madleňák and Švadlenka, 2009). One
of the most feasible ways to improve the performance of search advertising, is to achieve
a sucient knowledge of the issue of keywords, and its impact on achieving the desired ad
position through various PPC strategies (Ayanso and Karimi, 2015). Social media serves
to spread the message through social interaction. It uses techniques to easily publish and
distribute content. Social media supports the human need for social interaction, using
the Internet and web-based technologies, such as broadcast, in the form of one-to-many.
Social media also supports peer-to-peer communication and social networking. Dialogue
and social networking promote knowledge and information sharing, shaping individuals
from content consumers to content producers (Constantinides, 2014). E-mailing represents
the Internet equivalent of direct mail, and includes sending commercial e-mails to Internet
users.
Outsourcing can be considered as a tool by which companies seek and entrust external
suppliers with the performance of a set of activities that promote their business.
Outsourcing, can cover a wide spectrum of activities, including organizational core business
activities, such as new product development and/or supporting activities, as well as key
organizational activities like IT infrastructure development, maintenance and support or
fringe activities such as training, accounting, payroll, data entry etc. Researchers have
investigated the importance of outsourcing to businesses over the long term (Ahearne and
Kothandaraman, 2007). Carson (2007) points out that outsourcing in the academic eld
is studied mainly in the area of management, using a range of management theories, or
marketing focusing on specic activities like new product development. McGovern and
Quelch (2005) also add sales or marketing as such to commonly outsourced marketing
activities. Liang et al. (2016) examined the results of previous studies focusing on the
factors determining the success of outsourcing in information technology. The outcome
was that in the initial phase of IT outsourcing, the companies focused mainly on economic
and technological benets arising from outsourcing, after which success is measured
by the expected cost savings. Often, the expected cost savings are negatively aected
by hidden transaction costs and other factors, (based on customer needs can also be
operating), which will enable evaluation of the appropriateness of outsourcing activities
(Rottman and Lacity, 2006). As part of the success of IT outsourcing, four dimensions are
monitored: economic, technological, strategic and quality of services (Liang et al., 2016).
The segment of small and medium-sized enterprises in the Czech economy is dominated
by micro enterprises employing a maximum of nine people, which represents, in the long
term, one fth of all jobs (Czech Statistical Oce, 2013). The results of the survey focused
on training eciency in small and medium-sized enterprises in the Czech Republic,
(Fejfarová and Fejfar, 2015), showed that medium-sized enterprises invest more eort
in employee training and the evaluation of its eciency than small enterprises. Nkonoki
(2010) identied inadequate education and training as one of the internal factors limiting
small rm growth.
The goal of the research is to identify the education needs of micro enterprises in the
area of online marketing. The needs are based on determining what types of activities
micro enterprises are covering in this eld, how the person responsible for online
marketing/marketing assesses their knowledge, how they develop their knowledge and
what barriers in education they face. Based on the comparison of specialists‘ opinions,
474 ERIE 2016
in online marketing and the respondents responsible for its management at the specic
micro enterprise, the extent to which the specialists education in online marketing
is appropriate is assessed. The primary data was gathered using questionnaires and
individual interviews. This research determines what activities in the area of online
marketing at micro enterprises are managed internally and what areas are outsourced.
In the second part there are dened methods of education and the barriers in managing
online marketing at micro enterpises. This study will be followed by further research in
the eld of medium and large companies. The goal of the research is to dene particular
areas of online marketing in relation to internal or external solutions. The research will
be used to answer the research questions: What areas of online marketing is possible to
eectively managed internal and what areas of online marketing is eective to outsource
in relationship to the company size?
Materials and methods
The primary data was gathered using questionnaires and individual interviews. The
questionnaire is distributed electronically. The company selection is based on the following
criterias: (1) micro enterprises, (2) have own websites, (3) public e-mail address, (4) area
of the Services and Trades section, with the exception of Computer and Internet services.
This segment of micro enterprises was excluded from the investigation, because of its
kinship with the subject of the investigation - a level of knowledge and education in the
eld of online marketing. These criteria can be veried on the basis of the company’s
prole on the server rmy.cz where companies are selected and contacted. The focus
on micro enterprises is based on general assumptions about the lower use of specialists
whilst simultaneously, the higher level of complexity in the nature of work in these types
of enterprises. The questionnaire was intended for the individuals responsible for the
management of marketing/online marketing at the company. Two initial lter questions
were used and concerned the number of employees and the importance of marketing for
the company. The survey included only micro enterprises with less than 10 employees
(annual turnover criterion was not applied). The importance of marketing was evaluated
on a scale of 1 to 10 by the entrusted person. The survey included respondents who rated
the importance of marketing on a level of 3 and higher. The questionnaire was divided
into three parts: (1) knowledge level of online marketing, (2) methods of education
in online marketing (3) barriers in education of online marketing. The questionnaire
contained 2 lter and 7 core questions. Core questions used multiple choice or scale (1-
10; 1 represents minimum, 10 maximum). The questionnaire was completed by a total
of 176 respondents (n = 176). Primary data was collected over a period of two months,
from January to February 2016. Individual, semi-structured interviews were aimed at
specialists in online marketing, who have been operating professionally in the eld for at
least 5 years. The interviews determined the nature of co-operation with micro enterprises
in outsourcing online marketing. This primarily relates to the barriers in the course of co-
operation in form of open question. The interviews were conducted with 12 experts. The
core question is following: Which problems have you noticed during co-operation with
micro enterprises? Results are based on a data analysis expressed in relative frequency
and indicators of mean and standard deviation.
Results
Based on the questionnaire survey, it is possible to measure online marketing activities
which micro enterprises do internally, do not deal with externally or outsource.
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Tools Internally Outsourcing Not being used
Websites 10.2 89.8 0.0
Search Engine Optimization 3.4 46.0 50.6
PPC advertising 4.5 50.0 45.5
Social networks 30.1 2.9 67.0
E-mail marketing 13.1 21.6 65.3
Analytics 5.7 35.8 58.5
Table 1: Usage of On-line Marketing Tools in %, 2016 (source: own survey)
A condition for inclusion in the research was the use of websites in a company
presentation. In this area only 10.2% (18 respondents) manage the website internally and
89.8% (154 respondents) of micro enterprises outsource these websites. Conversely, most
micro enterprises, (in terms of relative frequencies), managed social networks internally
30.1% (52 respondents). At the same time it is an area that is managed by outsourcing, but
lowest usage showed - 2.9% (5 respondents) or was generally not managed - 65.3% (115
respondents). The area that was managed internally, but the most rarely, was Search Engine
optimization - 3.4% (6 respondents). This topic was not taken into account by over 50%
(87 respondents). In other words, area that is managed internally and the most frequently,
is Social networks and the least, Search Engine optimization. Outsourcing is most
commonly used for websites and yet rarely for Social networking. In terms of not being
used the most neglected are Social networks and at least PPC advertising - see Table 1.
Based on the questionnaire survey, it is possible to self-evaluate the subsequent knowledge
level of people in online marketing, those who are responsible for online marketing in
micro enterprises - see Table 2.
Questions Mean* Standard Deviation
How would you evaluate your online marketing knowledge? 3.2 1.36
Can you keep up with the latest trends in online marketing? 2.3 1.42
How well you can assess external subjects contributions of online
marketing activities? 4.2 2.36
How well you can assess costs of external subjects in online
marketing? 3.4 3.42
Note: *scale 1 - 10; 1 represents minimum, 10 maximum
Table 2: Online Marketing Knowledge, 2016 (source: own survey)
The highest value is found for the ability to assess the results of external entities in terms
of contributions to the company (4.2). This reects the fact that the company can, to some
degree, evaluate the increase/decrease in sales as a result of online marketing activites.
Despite the highest value in this area of questions, the value is in the bottom half of the
rating scale. Standard deviations, taking into consideration the evaluation scale of 1 to 10,
are at a relatively low level. The highest value (3.42) has the ability to assess the incurred
costs of external entities providing online marketing for the company, so the ability diers
in certain companies. On the other hand, the most united are respondents with low levels
of online marketing knowledge.
Consequently, it is possible from a questionnaire survey to identify methods of educating
people who are responsible for online marketing in micro enterprises. The most widely
used method of education in online marketing was through self-study via the Internet
(articles, videos and discussions). This option was used in 70.4% (124 respondents).
Another method of education is specialized courses, which were used at least once in
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35.2% (62 respondents). If the respondent was on a specialized course in the eld of
online marketing, 77.4% (48 respondents) of these attended only one course. The barriers
to education in online marketing at micro enterprises were also identied. Respondents
could mark more barriers from the list or ll in their own statement. In the rst place,
limited funds for training employees in online marketing is mentioned in 97.7% (172
respondents), followed by the lack of free time for education 93.8% (165 respondents)
and a high demand for IT abilities in 82.1% (141 respondents). In the “other” category,
the most frequently mentioned barriers were inadequate language abilities, 33.0% (58
respondents) or the feeling that online marketing is not perceived as important for the
company 15.9% (28 respondents).
Based on the interviews with the experts in online marketing, the following barriers in
co-operation were identied:
High cost pressures caused by ignorance of the issue - in connection with the
increasing complexity of individual online marketing tools, it is necessary to create
specialists for specic areas and it is no longer possible to cover the whole issue
on the basis of consulting with one person at a competitive level, which results in
greater cost. Experts often face the problem that business owners in order to save
money, delegate online marketing to one person who can not handle this job.
Unrealistic demands arising from ignorance of the issue - many companies
realize that when searching for companies on the Internet, customers are lazy and
most often open the links on the rst page of results. Most small companies demand
to be on the rst page of search results for all highly competitive keywords, which
is unrealistic and often go with an unreliable company that promises them this.
Ignorance of this problem often causes the loss of the client who goes to another
company that oers unrealistic but nice results.
Lack of ability to articulate fundamental business issues - another problem
of micro enterprises is the fact that many companies do not set their mission and
segments. We then spend much time (which represents costs for the company), by
formulating the mission and strategy of the company and dening their customer
segments. As a conseqence of a lack of knowledge clients often use services that
make any prot. For example, they use Facebook just because it is popular, but do
not detect whether their target group goes there.
Discussion
The results of the online marketing tools usage showed that they are not commonly used
in the micro enterprise segment, with the exception of social networks. If a company
does online marketing activities, they are mostly outsourced - especially websites, Search
Engine optimization or PPC advertising. For example, web or overall online marketing
analytics are not used at all by 60 % of the segment. To the opposite, Vaňa and Černá
(2012) stated, that the growing complexity of the current market environment, needs
a more systematic evaluation process of the organizational marketing performance
to deal with the dynamic market. Those made responsible for online marketing, self-
evaluated their knowledge as low. They are not able to assess whether external parties
do their job well. Similar facts are described by Solčanský, Sychrová and Milichovský
(2011), that marketing metrics must follow some principles, so that they can be used in
the measurement process: we cannot measure something if we do not understand it; we
cannot understand something if we do not control it and we cannot control something if
we cannot improve it (Solčanský, Sychrová and Milichovský, 2011). The most common
way that those responsible educated themselves in online marketing, is through self-study
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on the Internet. It is in accordance with the results of Urbancová (2014), that the use of
video-conferences, internet and e-learning has been increasing in recent years.
The research results identied a fundamental discrepancy on the side of costs and stang
at micro enterprises and the increasing complexity of all marketing communication tools.
The results of interviews with the online marketing experts complement the results of the
share of outsourced communication tools on the web. It can also be concluded that in the
years to come, it will not be possible for a single person to eectively handle all online
marketing tools. The need to care about marketing, or online marketing activities even in
the segment of micro enterprises, is supported by the Bressler (2012) who stated that micro
enterprises have to face increasing competition and it is necessary for them to improve
themselves in the elds of management, marketing and technological up gradiation.
Conclusion
Even despite the fact that educational companies oer a large number of specialized
courses ranging from e-mail marketing, to social network administration and PPC
campaign management, these courses cannot be applied in the eld of micro enterprise,
due to the increasing complexity of online marketing, which cannot be eectively covered
by a single employee. This then, is the greatest limitation and restriction to employees
gaining knowledge. Micro enterprises already partially recognize this fact, and if they
want to actively make use of online marketing, then they outsource it. Still, a high degree
of ignorance of the issues and great uncertainty regarding the assessment of reasonable
price and quality, is prevalent.
These facts indicate we can expect the extension of specic training courses and
programmes for micro enterprises in online marketing in the future. These will focus on
management and the control of outsourcing activities in the eld of marketing. Rather
than create specialists for individual areas of online marketing, it is better for micro
enterprises, (within the context of their stang and nancial limitations), to focus on
training in key areas of knowledge. These include pricing, options and desired outcomes
that will increase their bargaining position when negotiating with outsourcing partners.
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... In the other words, the main recommendation based on the research results is that micro and small companies should be using the services of professional marketing agencies and provide their employees which are responsible for managing the online marketing necessary training in the field of general orientation in online marketing tools, campaign goals and their measurements. Conclusion of the research supports the results of the local CZ study of Pokorná and Pilař (2012), which suggested a need of focusing on the micro enterprises employees´ education in their ability to communicate with the online marketing agencies and leave the management of these tools on the marketing agencies. This research confirms and extends these results to small entrepreneurs (<50 employees) and evaluates these results through the international study. ...
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