1. Pertemuan 9 CRM & e-Marketing (1)

2. TEXTBOOKS E-Business and E-Commerce Management, Ch. 9, p.393-446
Other Resources:
CRM Article

3. Customer Relationship Management and e-Marketing (1)
Agenda:
What is e-CRM?
The online buying process
Marketing communications for customer acquisition
Assessing marketing communication effectiveness
Marketing application for CRM
Customer retention management
Customer extension
Benefit of CRM
Online marketing communication
CRM Application

4. Learning Outcomes
Describe the application and implementation of e-Business concepts
Analyse the cases of e-Business in real business and or industry operations

5. What is e-CRM?
An approach to building and sustaining long-term business with customers
E-CRM is:
Applying – Internet and other digital technology… (web, , wireless, iTV, databases)
To – acquire and retain customers (through a multi-channel buying process and customer lifecycle)
By – Improving customer knowledge, targeting, service delivery and satisfaction.

6. Customer lifecycle
The stages each customer will pass through in a long-term relationship through acquiition, retention and extension.

7. An effective web site should have three characteristics:
Magnetic
Acquisitionof visitors by promotion and by making the site attractive.
Sticky
Retention – keeping customers on the site once they arrive and encourage them to engage in revenue-activities.
Elastic
Extension – persuading customers to return, particularly for revenue-generating activities.

8. The four marketing activities
Customer selection means defining the types of customers that a company will market to.
Customer acquisition refers to marketing activities intended to form relationships with new customers while minimizing acquisition costs and targeting high-value customer.
Cusotmer retention refers to marketing activities taken by an organisation to keep its existiing customers.
Customer extension refers to increasing the depth or range of products that a customer purchases from a company. This is often referred to as “customer development”.

9. There are range of customer extension tecniques for CRM
Re-sell. Selling similar products to existing customers.
Cross-sell. Sell additional products which may be closely related to the original purchase, but not necessarily so.
Up-sell. A subset of cross-selling, but in this case, selling more expensive products.
Reactivation. Customers who have not purchaseed for some time, or have lapsed, can be encouraged to purchase again.
Referrals. Generating sales from recommendations from existing customers, for example member-get-member deals.

10. The four classic marketing activities of customer relationship management (Dave Chaffey)

11. The Online Buying Process
Five different types of web users
Directed information-seekers. Will be looking for product, market, or leisure information such as details of their football club’s fixtures. This type of user tends to be experienced in using the web and is proficient in using search engines and directories.
Undirected information seekers.
Directed buyers
Bargain hunters
Entertainment seekers

12. Internet can offer several benefits over traditional methods of purchase
Easy for purchaser to asses whether item is in stock.
Order can be completed at any time of day or night.
Re-buys or repeat orders are easy to specify.
Delivery can be tracked online.
Purchasing history can be reviewed,

13. Marketing Communications for Customer Acquisitions
From push to pull
From monologue to dialogue
From one-to-many to one-to-some
From one-to-many to many-to-many
From ‘lean-back’ to ‘lean-forward’
The medium changes the nature of standard marketing communications tools such as advertising.
Increase in communication intermediaries
Integration remains important. We should combine and integrate new and traditional media according to their strength.

14. Push media. Communications are broadcast from an advertiser to consumers of the message who are passive recipients.
Pull media. The consumer is proactive in selection of the message through actively seeking out a web site.

15. Online and offline communications techniques for e-commerce (Dave Chaffey)

16. Assessing marketing communication effectiveness
0 Volume or number of visitors. Example: an onlline bank has one million unique visitors per month. 1 Quality or conversion rates to action. Bounce rate: percentage of visitors entering a site who leave immediately after viewing one page only. 2 Cost (cost per click) 3 Cost (cost per action or acquisition) 4 Return on investment. ROI is used to asses profitability of any marketing activity or indeed any investment. 5 Branding metrics. Brand awareness. 6 Lifetime-value-based ROI. Here the value of gainiing the customer is not just based on the initial purchase, but the lifetime value (and costs) associated with the customer.

17. An example of effectiveness measures for an online ad campaign (Dave Chaffey)

18. Marketing applications of CRM
A CRM system supports the following marketing applications:
Sales force automation (SFA). Sales representatives are supported in their account management through tools to arrange and record customer visits.
Customer service management. Representatives in contact centres respond to customer requests for information by using an intranet to access databases containing information on the customer, products and previous queries.
Managing the sales process. This can be achieved through e-commerce sites, or in a B2B context by supporting sales representatives by recording the sales process (SFA).
Campaign management. Managing ad, direct mail, and other campaigns.
Analysis. Through technologies such as data warehouses and approaches such as data mining, which are explained later in the chapter, customers’ characteristics, their purchase behavior and campaigns can be analysed in order to optimize the marketing mix.

19. Customer Retention Management
Has two distinct goals
To retain customers of the organization
To keep customers using the online channel

20. Customer extension
Deepening the relationship with the customer through increased interaction and product transactions

21. Benefits of e-CRM Targeting more cost-effectively
Achieve mass customization of the marketing messages
Increase depth, breadth and nature of relationship
A learning relationship can be achieved
Lower cost

22. Online marketing communications
Search-engine marketing (SEM)
Search-engine optimization
Frequency of occurrence in body copy
Number of inbound links
Title HTML tag
Meta-tag
Paid search marketing

23. Online PR. The management of reputation- the planned and sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its publics.
Communicating with media online
Link building
Blogs, podcasting and RSS
Managing brand on third-party sides

24. Online marketing communications (2)
Online partnerships
Affiliate marketing
Online sponsorship
Interactive advertising
marketing
Viral marketing

25. Figure 9.12 Schematic of the relationship between satisfaction and loyalty
Source: Adapted and reprinted by permission of Harvard Business Review from graph on p. 167 from ‘Putting the service-profit chain to work,’ by Heskett, J., Jones, T., Loveman, G., Sasser, W. and Schlesinger, E., in Harvard Business Review, March–April Copyright © 1994 by the Harvard Business School Publishing Corporation, all rights reserved

26. Lifetime value modeling
Lifetime value analysis enables marketers:
Plan and measure investment
Identify and compare critical target segments
Measure the effectiveness
Establish the true value
Make decisions about products and offers
Make decisions about the value of e-CRM

27. Different representations of lifetime value calculation (Dave Chaffey)

28. Advanced online segmentation
Identify customer lifecycle groups
Identify customer profile characteristics
Identify behavior in response and purchase
Identify multi-channel behavior
Tone and style preference

29. Customer lifecycle segmentation (Dave Chaffey)

30. Types of CRM applications
Ideal CRM system will support multi-channel communications or the customer preferred channel

31. An overview of the components of CRM technologies (Dave Chaffey)

32. Permission Marketing
Customers agree to be involved in an organization’s marketing activities, usually as a result of an incentive
Godin (1999) suggests that dating the customer involves:
Offering the prospect an incentive
Using the attention to teach
Reinforce the incentive
Offer additional incentive

33. A summary of an effective process of online relationship building (Dave Chaffey)

34. Conversion Marketing
Using marketing communications to maximize conversion of potential customers to actual customers and existing customers to repeat customers
Agrawal et al. (2001) scorecard:
Attraction
Conversion
Retention

35. Multi-channel conversion model (Dave Chaffey)

36. Questions & Discussion