ELC 310 E-Marketing Day 5 Agenda Exam # 4 on Friday, December 16 10 Short essays Entire class period Albert Chapters 1-14 Case study Analysis 5 A’s, 3 B’s and 2 C’s Did not use student grading due to lack of participation Student prepared Case Studies Written due December 16, email in WebCT Presentation due December 20 at 3-5PM Student work to be shared and discussed with others Plus one extra credit essay Written Case study will be posted in WebCT by Friday evening. Should all be read prior to Tuesday, so that you may ask informed question of the presenters Will be assessed using published Case Study guidelines There will be NO Peer Grading Lecture/Discuss Evaluation Methodology and Research in ECommerce Case Study Recap Case Industry Marketing Challenge 1 Insulation Manufacturer Integrated marketing Communications 2 Steel Mill Pricing Decision Process 3 Hardware Distributor Business Strength matrix 4 Utility Company Branded Customer experience 5 Not for Profit Branding Strategies 6 Consumer packaged goods Service Marketing Model 7 Insurance Company Disintermediation Reintermediation 8 Financial Service New Product Development Chapter 13 Customerization--a future online opportunity What is “Customer”ization? Customerization defines the exchange process of marketing in the context of complete customercontrol. Natural fit with the electronic environment Entices customers to remain loyal Overview of the Model Customerization is a buyer or customer- centric marketing model. Develops a relationship between: One-to-one marketing Mass customization Internal operations must have the capability to customize “Build to order process” Characteristics Flexible Requires database integration, operations, and production for success Relies on a number marketing approaches: traditional mass marketing targeted direct marketing 8 Enhanced Marketing Outcomes Develop/Deepen Customer Relationship Transitioning Experienced-Based Decision Customizing the Interaction Co-develop Products and Services Premium Pricing Acceptance Interactive Information Exchange Distribution Channel Choice Personal Brands I. Developing/Deepening Customer Relationship Capitalizes on relationship building E-business component demonstrated : CRM Value Bubble Steps involved: Attract, Engage, Retain, Learn, Relate II. Transitioning ExperiencedBased Decisions “Design and Discover Process” E-business component demonstrated : allows user to see the outcome provides the experience that is necessary to make purchase decision CRM and SCM Value Bubble Steps involved: Engage, Retain III. Customizing the Interaction Relies on accurate databases that integrate all customer information a firm possesses. E-business component demonstrated : Segmentation and Microsegmentation CRM and BI Value Bubble Steps involved: Learn and Relate IV. Co-Develop Products and Services Collaborate with customers to develop a new product or service E-business component demonstrated : part of market research and NPD BI, CRM Value Bubble Steps involved: Engage V. Premium Pricing Acceptance Increases value beyond competition E-business component demonstrated : creates customer satisfaction and loyalty E-Commerce or the transaction Value Bubble Steps involved: Learn and Relate VI. Interactive Information Exchange Leverages information about the products and services it provides E-business component demonstrated : CRM Value Bubble Steps involved: Engage and Retain VIII. Personal Brands Transfers the brand from the company to the customer E-business component demonstrated : allows for total customer empowerment CRM Value Bubble Steps involved: Engage and Retain Original Article Evolution mass customization personalization 1:1 marketing Customerization buyer-centric mass customization with customized marketing 1:1 and Personalized “Know thy customer” Controlled by the firm Customerization more than customized products/services internal processes supply chain partnerships what if significant costs are involved? Customerization Why? Changing customer ability/competency to co-produce technological and operational capabilities Customer-centric active participant drive process building/solidifying relationships Potential Benefits Customer better meet needs worth premium price higher satisfaction Firm reductions in inventory enhance loyalty avoid commoditization better channel mgmt. Online environment: reconfigurable, and easier identification of preferences Company Examples Dell (build to order) inventory = $273 million/sales of $18.2 billion (1.5%) Compaq (build to stock) inventory = $2 billion/ sales of $38.5 billion (5.2%) 1999 figures Marketing Implications Relationship Marketing Focusing on Unarticulated Needs passive to active participants “What can you do with us?” adoption of MP3 by music industry guides customer through design & discovery product use experiences (search vs. experience) Andersen Windows Tailoring the offer only relevant options (db, software, ask) Marketing Implications New Products interactive process (no longer laboratory only) Acumin company no longer manufacturer but service provider TI specs for new calculator high school teachers’ web reviews pre-sold copycat product from competitor reaction Marketing Implications Price is Negotiable: Global Bazaar more fluid tailored to specific users based on elasticity customer acceptance issues dynamic pricing evolves prices don’t go down value-added services price becomes less important Interactive Edu-tainment mix what you know with what you offer DuPont customer selects information Marketing Implications Distribution off-the-shelf direct channel channel conflict customer has choice reverse portals aggregate and coordinate final distribution garden.com e-milkman Marketing Implications Competitive Advantage: Power of Finesse instead of brute strength high customer value wins levels playing field street likes finesse and flexibility “big will not eat the small…the fast will eat the slow” E-volve-or-Die.Com Marketing Strategies/Implications Customerization--additional strategy determine optimal portfolio E-businesses have advantage mass marketing direct marketing to target segments interactive customized marketing Amazon vs. General Motors Technology is easy strategic and organizational decisions more complex and expensive. Researching E-Business Chapter 14 E-business Market Research Business Intelligence Web Site Focus Results impact E-Commerce Customer relationship management Supply chain management Enterprise resource planning Traditional Marketing Research Process 5 steps Define the issue or challenge Develop the research plan Collect information Analyze the information Actions Defining the issue or challenge Indicators Declining market share Sales reduction Profits Order reduction Increased complaints Competitive actions Develop research objectives Developing the Research Plan 5 Steps (for step two) Deciding on the research design Determining the types of information needed and sources Evaluating different data Collections options Developing the data collection device Deciding who and how many will participate Research Design Exploratory research Look for connections Experimental group Control group Data sources Independent variables (cause) Dependant variables (effect) Multivariate analysis Experimental research Devine patterns Primary Secondary Skewed Populations Collecting the Information Face-to-Face Telephone On-line Representative samples? Analyzing the Data Begin with research objectives Address the issue, opportunity or challenge Analysis leads to Recommendations Actions Must be supported by quantifiable evidence 3 Strategies for an Initial Web Launch Setup Strategies Maintenance strategies Evaluation Strategies Setup Strategies Attract customers applicable to offerings 3 components Web Site Quality Frequency of updates Speed 56K—10 secs Value bubble Attract, Engage & Retain Maintenance Strategies Create Site Loyalty and Facilitate Sales GIST Gather Infer Segment Track Measure Sales Value bubble Learn & Relate Evaluation Strategies Site-Centric (automated) Daily, weekly and monthly reports (hits) Length of time spent (stickiness) Frequency of visits for each page and/or sections Customer-Centric (still new) Clickstreams Core Services aspects Recovery aspects