Chapter Eight Case Study Four Deregulation and Services Marketing

Why this company? eBusiness in the Utilities industry 3 Drivers of change –Deregulation leads to increased competitions and lower prices –Technology leads to faster service and lower costs –Globalization is necessary to increase customer base

Company Background 100 yr old local utility company Wholly-owned subsidiary of a larger energy corporation –Parent was a wider geographical base Deregulation –what impact does it? E-business strategies Natural Gas company Technologically savvy Focused on customer service Andersen’s report –Directions selected

Competitive differentiation –Become more sophisticated online Stop brand erosion –Make online consistent with off line branding Lower transactional costs –Ecommerce` Companies goal

Adopting a marketing Model Creating a branded Customer experience –Customer service >> customer loyalty 4 Step Berry Model –Determine the most important service attributes for meeting and exceeding customers expectation –Determine the important service attributes that make the competitors the most vulnerable –Determine existing and potential service capabilities of the company. Asses service competencies and incompetencies, resource strengths and weakness, service reputation, belief systems and “reason for being” –Develop a service strategy that addresses important, enduring customer needs; exploits competitor vulnerabilities; and fits the companies capabilities and potential.

Companies implementation Services Marketing –Premier customer service –Valuable exchanges (marketing definition) Step One: Service Attributes –Conducted research and employed Anderson report Employees (Customer service) Customers –business intelligence Competitive benchmarking and best practices

Companies implementation Step Two: Competitors Vulnerability –Fours gaps between service promised and service received (for web sites) Information gap Design gap Communication gap Fulfillment gap Step Three: Internal part of SWOT –compared to competencies –investors –employees

SWOT Resource –Strength Long term customer contact employees Management commitment to customer service –Weakness Legacy computer systems “Old school” IT staff Competencies –Can move existing customer DB online –Fill support of staff Incompetence –Technological weakness with online

Companies implementation Step Four: Develop your strategy –outsource –customer involvement (usability)

Stakeholders –Phase 1 Customers –Phase 2 Suppliers –Phase 3 Investors –Phase 4 employees

E-Business Marketing Goals E-Commerce –bill payment CRM –varied and value-oriented services ERP –Lower cost of doing business BI –customers and competitors SCM--future but important

Value Bubble Analysis Used many (too much?) technologies –JavaServer –ColdFusion –CSS –JavaScript –Flash –Word and PDF files

Value Bubble Analysis Attract phase –existing and new customers –Invitation to join web site in all communications with the customers –Currently having problems Acquisition of potential customers Targeted mailings (snail mail and ) PR and advertising –Technologies Intro flash movie Graphics (family and fun)

Value Bubble Analysis Engage –online focus groups (visitor community) Gave discounts to participate –Ease of use –Quick downloads –Technologies “under construction” Dead links

Retain –on-going enhancements –Has a plan bit it is not implemented –No contact section Learning –Since retain technologies didn't work it was hard to do learning Relate –DOA

Summary Success is not likely –Factors Technologies failure Too much too fast Marketing Theme –Valuable Exchange Process A better example of value bubble in utilities –Florida Power and Light –