Electronic Customer Relationship Management E-CRM

1. Electronic Customer Relationship Management E-CRM

2. Introduction New type of Customers & firms Digital Firms and globalization IS and researches IT managers

3. Introduction Today’s Customers • Are sophisticated. • Are price sensitive. • Are demanding. • Live time-compressed lives. • Want their needs met. • Want their products fast with • greater convenience. • Have unprecedented control.

4. Introduction Today’s companies are: • Are digital companies. • Flatten (less hierarchy). • Location Independent. • Decentralization. • Flexibility. • Low transaction and coordinating cost. • Using strong IT infrastructure ( Enterprise software, hardware, Internet, LAN,WAN etc....).

5. Introduction Why the Need for Satisfied Customers • Cost up five to six times more to get new customers. • They buy more. • Take less time. • Bring in new customers. • Less price sensitive. • Great advertisers. • May be able to charge 10 percent more than competitors. • Dissatisfied customers tell others, as many as 20 others about there experience.

6. Introduction Why the Need for Satisfied Customers FedEx promises customers to “absolutely, positively” get your package to its destination on time, and it delivers on its promise.

7. Measuring Customer Satisfaction • Are you getting new customers? • Are good customers leaving? • What are you doing to keep customers loyal? • Response time, this should be targeted from 24 to 48 hours at most. • Security and privacy, (secure payments, information). • Return Policy, this will increase customer trust and loyalty. Ease return products of service will make customer more satisfaction. • Navigability, Easy to navigate the firm Web site • Quality assurance, every think must work properly

8. Learning about Consumer Behavior Online Reasons for not making purchases Source : Temking 2002

9. Learning about Consumer Behavior Online Model of consumer behavior online • Social variables—people are influenced by: • Family members, friends, co-workers, “what’s in fashion this year” • Cultural/community variables—where the consumer lives • Other environmental variables: • Available information, government • regulations, legal constraints, • situational factors

10. Consumer Behavior Online

11. Consumer Decision Making Process • Roles people play in the decision making process • Initiator • Influencer • Decider • Buyer • User The person who suggests buying a particular product of services The person whose advise carries some weight in making a final purchasing decision. The person who makes the buying decision The person who makes the actual purchase. The person who uses the product or service.

12. Consumer Decision Model In WEB Purchasing 5 phases of the generic purchase decision model:

13. Consumer Decision Making Process 1 Need Recognition 2 Information Search 3 Evaluation of Alternatives 5 Purchase Outcome 4 Purchase

14. One-to-One Marketing and Personalization in EC One-to-one marketing: Marketing that treats each customer in a unique way Personalization—the matching of services, products, and advertising content to individual consumer

15. One-to-One Marketing and Personalization in EC

16. Market segmentation • Market segmentation:The process of dividing a consumer market into logical groups for conducting marketing research, advertising, and sales • Market research tools • data mining • data warehousing

17. Tools for Gathering info. • Web bugs: Tiny graphics files embedded on e-mail messages and in Web sites that transmit information about the user and their movements to a Web server • Spyware: Software that gathers user information, through an Internet connection, without the user’s knowledge

18. Tools for Gathering info.

19. MyPoints Rewards Members for Time Spent Online Source: www.mypoints.com

20. Learning about Consumer Behavior Online Source: WebTrends product. (www.webtrends.com)

21. Consumer Behavior Online Example analysis from a WebTrends (www.webtrends.com

22. American Airlines Offers Personalized Web Sites • American Airlines (aa.com) unveiled a the most advanced personalized, one-to-one interactions and transactions on its Web site in 1998 • Intelligent agents enable the generation of personalized Web pages for each of its 1 million registered, travel-planning customers • Broadvision’s application dynamically matches customer profiles to a database • Output of the matching process triggers the creation of a real-time customized Web page

23. American Airlines Offers Personalized Web Sites • The use of intelligent-agent technology built a considerable edge over AA’s competitors • Personalizing Web pages is becoming more important in: • Increasing customer loyalty • Cementing relationships with customers • Fostering the community of AA frequent flyers

24. Market Research for EC • Process of gathering and analyzing information related to customers, and markets. • Tools: • Observations • Surveys • Experiments • Interviews

25. Market Research for EC(cont.) • Aim of marketing research is to: • discover marketing opportunities and issues • establish marketing plans • better understand the purchasing process • evaluate marketing performance • develop advertising strategy

26. Market Research for EC(cont.) • Limitations of online market research • 1.There may be too much data available. • 2.Responses may be inaccurate. • 3.Technical problems may cause a loss of respondents. • 4.There are ethical and legal considerations. • 5.It is difficult to build representative samples

27. CRM and Its Relationship with EC Customer relationship management (CRM):A customer service approach that focuses on building long-term and sustainable customer relationships that add value both for the customer and the company eCRM:Customer relationship management conducted electronically CRM

28. The goals of CRM Using existing relationships to grow revenue Using integrated information for excellent service Introducing consistent, replicable channel processes and procedures

29. Managing the customer life cycle: the three phases of CRM Acquiring new customers Enhancing the profitability of existing customers Retaining profitable customers for life Acquire Enhance Retain It costs six times more to sell to a new customer than to sell to an existing one, (Ravi k. et al, 2001)

30. CRM Applications and Tools:Delivering Customer Service in Cyberspace CRM applications improve upon traditional customer service by means of easier communications and speedier resolution of customer problems Customer service adds value to products and services It is an integral part of a successful business

31. CRM Applications and Tools (cont.) • Classifications of CRM applications • Customer-facing applications • Customer-touching applications • Customer-centric intelligence applications • Data warehouse • Data mining: involves sifting through an immense amount of data to discover previously unknown patterns Auto responders:Automated e-mail reply systems (text files returned via e-mail), which provide answers to commonly asked questions Sales force automation (SFA):Software that automates the tasks performed by sales people in the field, such as data collection and its transmission

32. CRM Applications

33. CRM Applications- Databases An ideal database should contains the following information • Transactions tasks: This should include a complete purchase history with associated information such as: price paid, quantities, discounts, addresses, sales person, delivery date etc. • Customer communications: Including sales calls, services requests or any customer links with the company. • Descriptive information: For the sake of segmentation and data analysis purposes. • Customers’ responses to marketing motivation. This information should contain the customer responded to a direct marketing program, a sales contact, or any other direct contact. • The data must be updated and corrected when needed.

34. CRM Applications and Tools (cont.)

35. CRM Applications and Tools (cont.)

36. CRM Applications and Tools (cont.)

37. CRM Applications and Tools (cont.)

38. CRM Model from managerial and marketing perspective, Own Model.

39. References: • Business Today, Ninth Edition, Mescon, Bovee Thill, Prentice Hall Publishers • Deitel, 2004, “E-business and e-commerce for managers”, Prentice hall. • Example analysis from a WebTrends (www.webtrends.com • MyPoints Rewards Members for Time Spent Online, : www.mypoints.com • Ravi k. et al, 2001, e-Business Roadmap for success, 2nd edition, Prentice hall. • Turban E. et al, 2004, “ electronic commerce a managerial perspective”, Prentice hall • Terri c. et al, 2003, “E-business marketing:”,prentice hall, 2003 • TRUSTe Builds User Trust :www.truste.org • WebTrends product. (www.webtrends.com) • http://www.emeraldinsight.com/rpsv/cgi-bin/linker?ext=i&ref=1080120308-23 • http://docserver.emeraldinsight.com/deliver/cw/mcb/14637154/v9n5/s2/p572.htm? • www.prenhall.com/turban • http://www.emeraldinsight.com/rpsv/cgi-bin/linker?ext=i&ref=1080120308-21