Relationship marketing
(RM)
Relation marketing
concept
The influence on Internet
on customer relationships
The difference between
marketing paradigm and
customer centric approach
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Learning objectives
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Assess the concepts of relationship
marketing, direct and database marketing
on Internet
Learn the influence of Internet on
customer relationships
Learn the stages and techniques to
support the dialogue with customers
Methods of acquiring and retaining
customers in the context of Internet
marketing
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Types of relationships
Relationships with suppliers
 Relationships with distributors
 Relationships with customers
 With non profit organizations
 With financing organizations
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Group task
Which relationships from the
mentioned above are the most
important?
 Which are the key relationships,
according to the articles?
 Give examples for the different
types of relationships
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Relationship marketing

A tool, used by the company to learn more
about its key customers
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Company activities, connected with an increase
of the customer database
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Technology, using the methods of data mining.
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Strategic planning and marketing techniques of
personalization.
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Relationship marketing
definitions

All activities, oriented towards establishing, developing
and maintaining successful exchange relationships. (Hunt
and Morgan, 1990)
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RM calls for intimacy, trust and commitment, manifested
between supplier, customer and processors. (Gronroos)

Marketing method in which businesses constantly maintain
two-way communication with their prospective, current
and inactive customers in order to gain deeper
understanding of their needs while delivering personal and
compelling marketing throughout their lifecycle (Vtrenz)
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Relationship marketing as a
process
Nurture
Prospects
Grow
Customer value
Retain
customers
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Group task
Discuss the difference between the
“push” and “pull” approach in
marketing.
 Give examples of two approaches
 Which of the two approaches is
more suitable for the Internet
marketing.
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Nurture stage
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Identify & Target prospects
Build awareness
Use offers
Collect information
Quality for purchase
Build trust
Demonstrate expertise
Nurture to purchase
Create a value proposition
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How to improve relationship
marketing effectiveness?
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Build your database
Segment your list
Design your communication
Build your micro site
Include a survey
Schedule & Send your campaign
Follow-up on leads
Nurture prospects
Analyze campaign results
Repeat the process
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Grow stage
Customer loyalty means a positive
attitude toward a company
 Loyalty is a tendency to choose one
product or service over another
 Customers are loyal when they
make repeat purchases or
recommend company to others.
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Grow stage philosophy
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Maximize the value of the existing
customer relationships through a set
of relationship marketing principals,
tactics and metrics.
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Loyalty ladder

Advocate- a customer that provides unpaid promotion for
your organization, product or services
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Customer- a business or individual that has on one or
more occasion purchased from your organization
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Prospect- A business or individual who has been qualified
with intention to purchase from or donate to your
organization

Suspect- A business or individual who has direct or indirect
contact with your organization, products or services
purchased from or donated to your organization
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How to move from
customers to advocates?
First time buyer
 Initial adoption
 Repeat buyer
 Repeat consumption
 Loyal buyer
 Supporter
 Evangelist
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Steps to grow customer
value
Welcome campaign
 Recent purchase study
 Newsletter
 Customer satisfaction surveys
 Cross sell/Up-sell promotions
 Relational campaigns
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Principles for growing
customer value
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Reduce buyer remorse
Reinforce value proposition
Encourage adoption
Increase satisfaction
Develop stickiness
Position as trusted advisor
Understand needs
Quality for Repurchase
Gain referrals
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Specifics in CRM in ecommerce

Factors, affecting acquiring of customers
of e-commerce.
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Factors, affecting the retention of
customers.
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Factors, affecting the process of buying of
customers.
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Stages of CRM in ecommerce
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The stages of CRM consist of the
following three phases:
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1) Acquisition of customers
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2) Retention of customers
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3) Extension of customers.
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Customer lifecycle
Customer acquisition
Customer retention
Customer extension
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Stages on customer
acquisition
Set objectives
 Segmentation and profiling
 Targeting
 Media planning
 Development and communication of
the offer
 Fulfillment
 Response analysis
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Aspects of customer acquisition

Attract new customers to the
company’s web-site
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Convert the web traffic into buyers
(Kotha, 1990)
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Reasons for retention of
customers
Acquiring new customer is more
costly than keeping a current one
 Customers have become more
profitable over time
 You are more likely to win back a
lost customer than attract a new one
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Principles for winning
customers back
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Identify at risk customers early
Evaluate customer value
Understand motivations for defection
Track the competition
Improve on the attributes most valued
Leave a good note
Stay in touch
Ask for another chance
Provide a peace offering
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Strategies for identifying and reengaging
Lost customers
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Inactive Customer survey
Periodic newsletter
Win-Back promotions
Welcome-back campaigns
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CRM in e-commerce
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Targeting is more effectively.
(Chaffey,2002)
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Customers have become more powerful
as they are more informed.
Customer is the leading part in the
relationship with the organization. He can
“pull” information he needs.
Increase depth, breadth and nature of
relationship.
Lower cost.
Personalization in the relationship with
customers.
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Factors, influencing CRM in
e-commerce
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Internet penetration.
Income of household.
Number of home PC.
Level of computer literacy of Internet
users.
Type of Internet connection.
Trust of customers in e-commerce
(Novak, 2002)
Website usability( Nielsen, 2000)
Customer confidence and trust in
Internet.
Onsite resources e-Commerce
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”5Is” concept by Peppers
Identification
 Individualization
 Interaction
 Integration
 Integrity
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Group task
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Summarize in groups and present
the differences between the
traditional marketing and Internet

How does the Internet changes the
relationship with customers?
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