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eCRM report for Tjäreborg

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  • 1. Hult International Business SchoolMDM 2010 - 2011Module BCustomer Service and RetentionProfessor Mike Teasdale eCRM Strategy report Olli Lainto ID Number: L113020Hult International Business School 46-47 Russell Square London, WC1B 4JP T 020 7636 5667 OLainto2011@hult.edu
  • 2. Hult International Business SchoolTable of Content Executive Summary 3 1.0 Overview of Tjäreborg 5 2.0 Customer profiling and segmenting 6 2.1 Tjäreborg’s best customers group 6 2.1.1 Refining the Best Customer Profile 7 2.2 Permission marketing 7 2.3 Clickstream tracking 8 2.4 Measuring campaign effectiveness 8 2.5 Segmentation 9 3.0 eCRM scenario analysis 10 3.1 New customer acquisition 10 3.2 Customer retention and winning back lapsed customers 11 3.3 Responding to a customer complaint 11 3.4 Product cross-sell and up-sell for Tjäreborg 12 4.0 Email testing 13 5.0 Email evaluation 15 6.0 Tjäreborg’s Privacy Policy 16 7.0 Conclusion and Recommendations 17 References 18eCRM Strategy Report! 2
  • 3. Hult International Business SchoolExecutive SummaryObjectiveThe following report gives out an outline and explanation of a strategic change in theeCRM strategy that will be conducted by Tjäreborg. This change is required in order forthe company to improve their ROI, provide customers with meaningful and relevant emailsand create long-lasting customer relationships.Tjäreborg’s current one-way communication strategy in the different mediums needs tochange and the company needs to begin using customer profiling to understand their cus-tomers. Tjäreborg needs to understand who their best customers are and what they havein common. This will enable the company to identify common demographic and psycho-graphic criteria that combined with buying and response behavior, will provide the com-pany with higher ROI and long lasting customer relationships.The methodology used for Tjäreborg’s new eCRM approach will be constructed in an agileiteration delivery model, so the results and goals can be analyzed frequently. This ap-proach will enable Tjäreborg to quickly change the direction of their current eCRM ap-proach and find a style that suits Tjäreborg and provides value to their customers.SolutionEstablishing “Tjäreborg Family-members” (TF-members) group will enable the creation ofdifferent best customer groups in various segments and give Tjäreborg a betterunderstanding or their entire customer base. People signing up for this service will beasked to provide substantial amount of personal information and indicate their travelpreferences. By signing up they will receive a certain percentage discount out of the nexttrip they book through Tjäreborg. They will also be eligible to win a yearly gift certificateraffled amongst the TF-members. At the beginning of each year TF-members will alsoreceive a roundup email, where their past year’s holidays and special offers aresummarized. This email will also include a thank you from Tjäreborg and a discount codepercentage based on the amount of money they spent the past year. This program willenable Tjäreborg to send its customers highly relevant emails with higher response andpurchase rates and create long lasting customer relationships.StrategyIn order to maximize ROI and create long-term customer relationships Tjäreborg will befollowing the privacy and contact rules to the letter. This will also allow Tjäreborg to createan email list and a database that will be more responsive. It will also keep unsubscribtionrate and spam complaints low and prepare the company for the future, in case opt-out andsingle opt-in email marketing ever should become a legislative issue.Clickstream-based email campaigns are found to be most effective in generating desiredresults, so customization based on the users clickstream data will be used for individuallycustomized messages and offers. In practice this will mean customizing a message com-prising of specific locations and services, and of date specific offers, based on the datesthe user has searched for different holidays. The data for clickstream analysis will be gath-ered from clicks on links, page visits and from cookie data.Email list effectiveness will be analyzed and revised based on the email open-rate, clickthrough-rate and unsubscribtion-rates. Email subject line effectiveness will be monitoredeCRM Strategy Report! 3
  • 4. Hult International Business Schoolwith open-rate. The subject lines will me customized based on the clickstream data alongwith the email content. Content and offer effectiveness will be analyzed with click throughrates of the different email campaigns. The goal is to have users visit the website becauseit is there, where Tjäreborg can then convert these users into members, contributors andinto purchasing holidays. Landing page effectiveness will be measured according to thenumber of people exiting the landing page immediately after clicking a link in their emails.SegmentationTjäreborg’s customer segmentation will be based on different demographic, geographicand psychographic data. From this data Tjäreborg will establish best customer segmentsbased on the recency, frequency and monetary value (RFM score) they generate within acertain time-period. The data will be gathered form the initial registration form on theTjäreborg website, from Tjäreborg site surveys and by analyzing what users are discuss-ing about on the Tjäreborg forum.Scenario plansEmail address acquisition will be done mainly through list rental and by advertising on thirdparty newsletters.Tjäreborg will also be collecting email addresses from people visitingtheir offices and incentivize people to give out their contact details at travel related trade-shows through competitions.After spending significant amount time, effort and resources into building an active andvaluable customer base, Tjäreborg will be putting as much effort into retaining those cus-tomers. The TF-members and standard customers will receive regular contact from Tjäre-borg with newsletters, special offers and with the yearly roundup letters.Tjäreborg’s eCRM team will be tasked with actively monitoring the different social medias(Facebook, Twitter, LinkedIn) and various blogs and forums in order to receive informationof what people are actually saying about the company and to give Tjäreborg the possibilityto respond to complaints. This report provides guidelines and a flowchart on how thesesituations can be handled.Email address evaluationValue of an email address for Tjäreborg will be based on the new strategy suggested inthis report. The new approach to eCRM of segmenting customers based on demograph-ics, and their RFM and LTV scores will be used as a baseline, on which more refinedanalysis will be built on. Because of the different types of customers and segments, thevalue of the email address cannot be the same for all of the different segments. The moreTjäreborg will know about the holder of the email address, the more relevant messages itcan send them. By doing this Tjäreborg can increase conversion and eventually the valueof the email address. What needs to be taken into consideration as well, is the cost of ac-quiring the email address. Also the money spent in acquiring and retaining an email ad-dress needs to be evaluated against the lost opportunity cost.eCRM Strategy Report! 4
  • 5. Hult International Business School1.0 Overview of TjäreborgTjäreborg, founded in the 1950’s by a vicar looking for a cheap way to travel to Jerusalem,is Finland’s third largest travel agency with over 190,000 travelers per year. The com-pany’s market share in Finland is estimated at 21%. Tjäreborg is part of the Thomas CookGroup-concern which is a leading, international travel agency listed in the London stockexchange. Over 19 million people travel every year with one of the Thomas Cook Groupstravel agencies and the concern employs over 33,0000 people. The entire concern’s yearlysales are estimated at 12 billion euro (Tjäreborg, 2011).During the past 10 years Tjäreborg has decreased the number of physical agencies, limit-ing their presence to only the larger cities around Scandinavia. At the moment 70% of eve-rything sold by Tjäreborg is sold online, with an estimated revenue of 130 million euro. Thecompany’s market share declined between 2002-2008, as the company was slow to em-brace opportunities brought by the online revolution (Tjäreborg, 2011).In 2010 Tjäreborg launched a completely re-vamped website, imitating the same standardmodel found on other travel agencies’ websites. Besides the change in the look of thewebsite, pretty much nothing else did change about the company. The homepage allowslogging in via Facebook Connect, which is a nice feature for the user but doesn’t allowTjäreborg to gather detailed information about the person browsing the site. As mostFacebook profiles are disabled from being viewed by outsiders, the only thing Tjäreborgcan really get is the user’s name and date of birth. What is more noteworthy, is that Face-book Connect only allows the user to browse the member’s sections of the website, butpurchasing a holiday or a flight still requires the user to fill out a traditional signup form,which only ask for the basic contact details (Tjäreborg, 2011).The Facebook wall page is one long advertisement as is their Twitter page. The other sec-tions of the Facebook profile do not provide much content either, merely random picturesof different locations and contact information of the company. The communication is 99%one-way, with an average contributing comment by the company every month or so. Thecompany is embracing social medias little bit in their competitions, where they ask thewinners to blog and post pictures of their trips. Still, this falls short of actually getting peo-ple engaged with the company, as many questions posted under these wall posting are leftunanswered.The emailing strategy observed during past 2 months leaves much for desiring as well.The emails and their subject lines are relatively professional i.e they subject line clearlyindicates what the content of the email will be, but the relatedness to the user is non-existent. For 2 months “Amy Adams” a 55 year old woman, “John Johnson” a 35 year oldman and “Jack Jackson” a 18 year old youngster, have all received the exact same emails.These fictional people logged in twice a week and browsed the same holiday locations,with same travel dates every time (Amy browsed South America for September 2011, Johnbrowsed US for December 2011 and Jack browsed Asia for August 2011 ). The only differ-ence found in the emails has been that the email content has been addressed based onthe first name of these fictional people.eCRM Strategy Report! 5
  • 6. Hult International Business School2.0 Customer profiling and segmentingThe CMO Council deems the importance of customer profiling crucial for companies ac-cording to their 2008 survey. Valuable, long-term customers are fundamental to a success-ful business and are hard to replace. “Loyal customers are 15 times as likely to increasespend as high-risk, intermittent customers are — and acquiring new customers can costfive times as much as satisfying and retaining current ones” (CMO Council, 2008).Tjäreborg’s current eCRM strategy consists mainly of one-way communication by thecompany to their customers. The emails, Facebook postings and Twitter updates are allaimed at selling trips, flights and other travel related items and services. The emails they’resending are very general and not customized based on the customer information or pref-erences. The value that Tjäreborg’s customers are getting is very low. The company is ba-sically conducting analog business in a digital world.In order to chance this one-way approach, the company needs begin using customer pro-filing to understand their customers. Tjäreborg needs to understand who their best cus-tomers are and what they have in common. This will enable the company to identify com-mon demographic and psychographic criteria, such as user interests and travel destinationpreferences. This information can be combined with buying and response behavior foreven more precise segmentation.The methodology used for Tjäreborg’s new eCRM approach will be constructed in an agileiteration delivery model, so the results and goals can be analyzed every two or threeweeks. This approach will enable Tjäreborg to quickly change the direction of their currenteCRM approach and find a style that suits Tjäreborg and provides value to their clients(Berteig, 2006).2.1 Tjäreborg’s best customers groupIn conjunction to establishing a 2-way communication method in the social medias, Tjäre-borg will also begin analyzing and segmenting customers in their email database. The goalis to establish a best customers group (Tjäreborg evangelists) that will receive more per-sonalized emails based on their needs and preferences. The emails will consist of variousoffers, newsletters and informative emails. People signing up for this service (working titleis Tjäreborg Family group abbreviated TF-members from now on) will be asked to providesubstantial amount of personal information and indicate their travel preferences (Webster,2005).By signing up the members can modify their user profiles to exclude emails they feel arenot relevant for them. They will also be able to indicate specific travel locations of whichthey wish to receive more information and special offers. By signing up they will receive acertain percentage discount out of the next trip they book through Tjäreborg. They will alsobe eligible to win a yearly gift certificate, raffled amongst the TF-members. At the begin-ning of each year TF-members will also receive a roundup email, where their past year’sholidays and special offers are summarized. This email will also include a thank you fromTjäreborg and a discount code percentage based on the amount of money they spent thepast year. This program will enable Tjäreborg to send customers highly relevant emailswith higher response and purchase rates and create long lasting customer relationships.eCRM Strategy Report! 6
  • 7. Hult International Business SchoolTF-members are also asked to provide reviews of the locations they travel to, of the trans-portation & service they receive there and of the service they receive from Tjäreborg. Allthis information will be included on to Tjäreborg website, where they will be available foreveryone to see and comment. TF-members will also receive email alerts on discussionsand reviews of the locations they have indicated interest in.Customers choosing to provide only the bare minimum information and don’t sign up forthe TF-membership will still receive newsletters and more customized emails based ontheir previous travel preferences, browsing history and clickstream data (see 2.2 for moredetails). The segmentation in this group will be more broad and general. This groups’ cus-tomer life cycle will be still monitored and they will be encouraged every now and then (forexample when Winter or Summer holidays are being booked) to join the program by givingthem a glimpse of the special offers the TF-members are receiving.2.1.1 Refining the Best Customer Profile1. Direct data will be gathered from users and customers from the site registration forms(longer and shorter one), pop-up polls and questionnaires on the Tjäreborg website, fromsocial medias (Twitter and Facebook), form the Tjäreborg forum and from travel relatedtrade-show competitions (Webster, 2005), (Dun & Bradstreet, 2008).2. Tjäreborg will begin to regularly cleanse and categorize customer information to ensurethat it is up to date and accurate. This will be done based on the results received fromvarious email campaigns, mainly by monitoring the delivery- and open rates of the emails(Dun & Bradstreet, 2008).3.Tjäreborg will begin applying marketing analytics that predict future behavior based onthe information collected from customers. The customers are ranked from most to leastlikely to; respond, purchase or defect, in order to determine what kind of emails theyshould be sent. This will allow Tjäreborg to segment the TF-members and standard cus-tomers (Dun & Bradstreet, 2008).2.2 Permission marketingIn order to maximize ROI and create long-term customer relationships, Tjäreborg will befollowing the privacy and contact rules to the letter. This will create trust among users andpromote appropriate brand image. At the heart of achieving all this will be gaining the per-mission to send the Tjäreborg messages in the first place. The current opt-in option will bechanged to a double opt-in, which will ensure that users fully understand what they’reabout to sign up for and it will stand out from Tjäreborgs main competitors, such asEbookers and Finnmatkat, that use single opt-in (Bruce Clay, - -).This will also allow Tjäreborg to create an email list and a database that will be more re-sponsive. It will also keep unsubscribtion rate and spam complaints low. The final benefitcomes to play as the ever-increasing restrictions by the EU force advertisers to changetheir advertising methods. It’s not at all unimaginable, that the emailing of opt-out and opt-in emails would become a legal problem at some point. This type of permission marketingwill result in higher deliverability rates, positive brand image and higher ROI (estimatedCTR of permission-based emails is 5 to15 percent compared to non-permission based thatcreate on average 1 to 2 percent) (Bruce Clay, - -).eCRM Strategy Report! 7
  • 8. Hult International Business School2.3 Clickstream trackingClickstream tracking in email campaigns is found to be the most effective method in gen-erating different desired results (Net Atlantic, 2010) and the customization based on theusers clickstream data on the Tjäreborg website, will be used for individually customizedmessages and offers. In practice this will mean customizing messages comprising of spe-cific locations and services, and of date specific offers, based on the dates the user hassearched for holidays. The data for clickstream analysis will be gathered from clicks onlinks, page visits and from cookie data (Net Atlantic, 2010).Clickstream details will also provide important profiling data of subscribers, as Tjäreborgwill be able to analyze which landing pages are most interesting to different user seg-ments. The three most important benefits for Tjäreborg will be to: - Analyze which creative content and images in the email prove most successful in engaging subscribers - See how many clicked through to which landing page, and where they actually went from there - Measure and analyze performance of each message Tjäreborg sends (Net Atlantic, 2010)Because of the high relevancy and immediacy to users, some of them might not be com-fortable in receiving this type emails. This is why Tjäreborg will be providing an easy “tick /tick off box -section” in each user’s user preference section, where they can opt out thistype of emails along with other types emails (Net Atlantic, 2010).2.4 Measuring campaign effectiveness(Brief explanation of the main ones to be used, more detailed analysis in Appendix 1.)For Tjäreborg the ultimate goal will be to increase the engagement with emails that willdrive traffic to the website and keep customers actively contributing by reviews and poststo the Tjäreborg forum.Because of the agile iteration model that is used for this project, monitoring of differentKPIs at different stages of the project is important, but the results should be analyzed care-fully. Success of certain types of campaigns should be repeated several times in order toanalyze what specific aspects of the campaign made it stand out or were they just a onetime flukes.Email list effectiveness will be analyzed and revised based on the email open-rate, clickthrough-rate and unsubscribtion-rates. Whether the reason for unsubscriptions is irrelevantcontent or too frequent mailing by Tjäreborg, the results will be analyzed on a monthly ba-sis to optimize the relevancy of the emails to the users. The goal is to have the relativerate of unsubscriptions to decrease during the 12-month time period (Lavigne, 2007).eCRM Strategy Report! 8
  • 9. Hult International Business SchoolEmail subject line effectiveness will be monitored with open-rate. The subject lines willme customized based on the clickstream data along with the email content. The subjectlines of the promotional emails will be styled in a way that gives people an idea of thevalue they would receive from opening the emails. The tone of the emails will be friendlyand professional. Tjäreborg will conduct A/B testing to optimize subject lines based on theresults received from iterations. The open-rates will be compared against the conversionrate or ROI received from the campaigns and will be not used as a standalone measure ofsuccess (Lavigne, 2007).Content and offer effectiveness will be analyzed with click through rates of the differentemail campaigns. The goal is to have users visit the website because it is there, whereTjäreborg can then convert these users into members, contributors and into purchasingholidays. The click through rates will also be used to analyze the relevancy of the contentand how enticing they are to the user (Lavigne, 2007).Landing page effectiveness will be measured according to the number of people exitingthe landing page immediately after clicking on a link in their emails. The significance of thislast part of the conversion funnel is that the conversion (signing up to become a member,reading or writing a review or a forum post or purchasing a holiday) will not occur at thelanding page. Instead the purpose of the landing pages are to forward traffic to the pageswhere the conversion should happen. User related conent plays a significant role here andTjäreborg will take this into consideration by making sure that the email link clicked andlanding page are interrelated (Lavigne, 2007).2.5 SegmentationTjäreborg’s customer segmentation will be based on different demographic, geographicand psychographic data. From this data Tjäreborg will establish best customer segmentsbased on the recency, frequency and monetary value (RFM score) they generate within acertain time-period (for example 6 months). The data will be gathered form the initial regis-tration form, site surveys and by analyzing what users are discussing on the Tjäreborg fo-rum (Email Marketing Reports, 2010).Demographic data to be analyzed will comprise of users age, gender, household size,income, occupation, education and country of birth. For example families with parents 35-55 years old, couples from 20-30 years old, young people from 18-30 years old, peopleinterested in golf, extreme sports, relaxing beach holidays etc.Geographic data to be analyzed will be narrowed down from country, to city, to street ofliving. This information will be used to provide offers more related to the user.Psychographic data to be analyzed will include user interests (hobbies and favorite travelmethods and locations), general characteristics (what type of people they are i.e what typeof activities they like, are they big spenders or go for the special discounts, what motivatesthem to come to the website, what motivates them to purchase holidays, etc. ).Tjäreborgwill begin analyzing the psychographics of their customers so that the company can tailorpromotional activities and communication messages, that appeal to the customers’ specificinterests and lifestyles (Oakes, 2009)eCRM Strategy Report! 9
  • 10. Hult International Business School3.0 eCRM scenario analysis3.1 New customer acquisitionThe following strategy will be used to acquire new customers who havent opted-in to re-ceive emails from Tjäreborg.Email address acquisition will be done mainly through list rental and by advertising on thirdparty newsletters. The conversion rate (in this case percentage of people who open theemail, visit the website and register to the website & Tjäreborg newsletter) using thesemethods is found to be more efficient than when buying email lists, which Tjäreborg willnot be doing. Tjäreborg will also collect email addresses from people visiting their officesand incentivize people to give out their contact details at travel related trade-showsthrough competitions. Social medias like Facebook and Twitter will also be used (Nye,2011).The people Tjäreborg will be targeting with the above mentioned methods will have similardemographics and lifestyle interests as Tjäreborg’s TF-member segments (see 2.5 forsegments) The goal is to send emails that are highly relevant to the users in order to opti-mize the results. Tjäreborg will also test out different audiences (holiday packages for theelders, Tjäreborg Travel Around the World-challenge etc) in order to break into new typesof customer markets (Nye, 2011).Email rental list acquisition will be done with a reputable list rental agency. In the UKTjäreborg should consider using Thinkmedia for this. The third party newsletter advertisingshould be used to target the following segments in mind; - Families (parents 30-45 years old with children 1-15 years old, with 1-2 week fam- ily friendly holiday locations) - Couples (20 – 35 years old with romantic weekend trips) - Young people (18 – 30 males and females with spring break trips and extreme sports activities)Prospective customers will be prompted to visit the Tjäreborg website and sign up asmembers by giving them a brief description of the benefits TF-members receive and byraffling gift certificates to be used on Tjäreborg services. The emails sent, will be carefullyconstructed to be simple, pleasing to the viewer and with an appropriate subject line thatwill encourage opening the email.The evaluation of the success of these campaigns will initially be measured based on theopen rates of the emails, registrations to become members and the revenue generatedfrom these new members, compared to the cost of acquiring them. More important criteriaused to measure the success will be how well Tjäreborg will be able to establish long-termrelationships with these new customers. After the acquisition campaigns Tjäreborg willcontinue to nurture these new leads with follow-up marketing in order to maximize the life-time value (LTV) of these customers.eCRM Strategy Report! 10
  • 11. Hult International Business School3.2 Customer retention and winning back lapsed customersAfter spending significant amount time, effort and resources into building an active andvaluable customer base, Tjäreborg will be putting even more effort into retaining thosecustomers. The TF-members and standard customers will receive regular contact fromTjäreborg with newsletters, special offers and with the yearly roundup email (see 4.0 formore details)If a customer should for any reason stop responding (opening the emails, logging to thewebsite or purchasing services from Tjäreborg), they would be send a reminder email. Thetone of the emails will depend on the type of customer and can be anything from cute (pic-ture of a kitten with a text “We’re missing you”) to something more exciting like the onesent by Beach Park, a Brazilian water-park (http://bit.ly/ikjAN4). The emails will remindpeople of the benefits received from being and active member of the Tjäreborg communityand encourage them to visit the site to see all the new things it has to offer. There will alsobe a gift certificate raffling taking place every 3 months to win back lapsed members.If these emails are unsuccessful in convincing the lapsed customer, Tjäreborg will performa customer analysis, which will look at how recently the person used to visit the site, howfrequently, and how much monetary value they created with their purchases i.e RFM cus-tomer analysis. A customer scoring high in this analysis is likely to visit Tjäreborg site oftenand make frequent purchases. If this type of customer stops responding to emails and isno longer making purchases, then it is likely they have found an alternative site that suitstheir needs better. Tjäreborg will continue to target these high-value customers and if un-successful in convincing them to return to active TF-members, Tjäreborg will send anemail with a questionnaire enquiring about what they would change about Tjäreborg (Shu-lock, 2011).The way this will be measured is by analyzing the open – and click through rates of thesend emails over a 30 day time period. Changes in the response rates of TF-members willbe prioritized over standard customers with lower RFM scores. The bulk of Tjäreborg’s re-sources and efforts will be put to maximize the lifetime value of customers with high RFMscores. Depending on the remaining resources Tjäreborg will also target customers withlower RFM scores but the efforts put in trying to convince these customers wont be as“aggressive” or tailored (Novo, 2010).3.3 Responding to a customer complaintTjäreborg’s eCRM team will be tasked with actively monitoring the different social medias(Facebook, Twitter, LinkedIn) and various blogs and forums in order to receive informationof what people are actually saying about the company, and to give Tjäreborg the possibilityto respond to complaints. The following is an example of how a complaint made in Twitterwould be responded by a member of the eCRM team. (See Appendix 2 for a flowchart)Step 1. Customer makes a complaint to the Tjäreborg’s Twitter account or a member ofthe eCRM team notices a tweeted complaint about Tjäreborg.Step 2. eCRM member will contact the person who made the complaint directly via Twitter(optimally within a hour of the complaint) and requests whether they could chat with theperson about the complaint. The tone should be apologetic and the issue should be re-solved if possible during this discussion. Whether the problem can be solved on the spoteCRM Strategy Report! 11
  • 12. Hult International Business Schoolor not, the eCRM member should request the contact details of the person (Name, possi-ble reference number and email) for further follow-up.Step 3. Depending on the significance and urgency of the problem, the eCRM member willcheck the RFM score and lifetime value score of the customer. In cases of high value cus-tomers the process to identify liability and possible compensations will be prioritized.Step 4a. The eCRM member will be able to provide the customer a solution to their prob-lem on the spot. Tjäreborg is clearly liable / not liable for the problem and the customer isgiven information on what they need to do. Customer will also be asked permission tosend them email with a more detailed explanation of the issue and instructions how theycan be reimbursed if Tjäreborg is deemed liable. Step 4b. After 2 weeks the same eCRM member will send the person an email where they will again apologize and enquire whether the problem has been solved.Step 5a. If the eCRM member is not be able to provide the person with a solution to theirproblem on the spot, they will also be asked permission to reply via email, with a more de-tailed explanation of the issue and instructions how they can be reimbursed if Tjäreborg isfound to be liable. If Tjäreborg is not liable for the problem, the customer will be send anexplanation why this is so, and what they can do about the situation. Step 5b. After 2 weeks the same eCRM member will send the person and email where they will again apologize and enquire whether the problem has been solved.3.4 Product cross-sell and up-sell for TjäreborgWhile booking a trip form Tjäreborg, customer will be provided with relevant cross-and upsell advertisements, which they can add to their trip before purchasing. People will alsoreceive reminders of these offers and of new ones in the “Reminder emails” (see 4.0 formore details). The offers will be tailored as much as possible based on the user informa-tion available. The tailoring will be based on the users purchase history,clickstream data,profile preferences and interests. The strategy famously used by Amazon “Other peoplewho bought this also bought!”, will also be implemented in the sections where Tjäreborgwill be offering travel related products and apparels. The users won’t be charged extra (i.eadditional credit card charges), if they choose to purchase products and services related tothe specific holiday bookings.The pricing of the cross-and up sell products and services will be kept below the price ofthe product or service the user is / was primarily considering of buying. The value of anyadditional sale shouldn’t increase the overall order by more than 25 percent. The selectionof cross-and up sell services and products will vary in prices, so that each time the user ispresented a cheaper and a more expensive option. Bundling will be used to sell differenttravel packages like holiday destination bundles, transportation bundles and travel acces-sories bundles (Webcredible, 2008).The advertisements will be kept simple and clean. The tone of the sales slogans will alsoconvey a friendly explanation of the benefits the user would get by adding or upgradingtheir product. The emails will be more along the lines of friendly recommendations that of-eCRM Strategy Report! 12
  • 13. Hult International Business Schoolfer value to the customer even if they choose not to purchase anything. (“Buy a rain coatfor your upcoming trip!”, with weather update on the holiday location.)The different cross-and up sell options will include; - Upgrades to travel method (upgrade train, plain or boat tickets) - Additional services required for the flight (special foods, disabled access etc.) - Travel insurances - Car rental - Hotel offers - Holiday location specific tourist tours and activities (activities for the whole family, scuba lessons couples, pre-booked golf tee times!) - Luggage and other travel accessories (such as personal security related items, travel guides and gift certificates),4.0 Email testingThe following testing will be conducted during a 12-month time period. The types of emailslisted here are aimed for the TF-members and standard users. The level of customizationand types of emails sent will depend on the membership status of the customer. Timelineof the email sent can be found in Appendix 4.NewslettersAll users signed up on the Tjäreborg website will automatically receive a monthly updateemail (unless they chose not to receive it when signing up) of the latest offers, updates onthe site and the most popular discussion on the Tjäreborg Holiday forum.Thank You – emailsWhen a person signs up for the Tjäreborg website they will receive a Thank You – emailincluding the user information and password they have chosen, a link to their personal pro-file, tutorial of the different features of the site, information on how to take most of becom-ing a Tjäreborg member (special offers available for only Tjäreborg members). New userswill receive 3 welcome emails in total, spread out over 4 weeks. Each letter will encouragethe user to explore the Tjäreborg site in more detail, and explain how they can engage withthe site and how they will benefit from it.When a person books a trip they will receive a Thank You- email which includes the travelconfirmation, possible flight dates, hotel reservation number and links to the Tjäreborgwebsite relevant to the travel location (user reviews & different activities available at thelocation) and finally cross-selling ads relevant to the user (car hire, insurance, transporta-tion to-and from the airport). Once a person has returned from their holiday, they will re-ceive an email thanking them again for booking their trip through Tjäreborg and askingthem to rate and review their experience and share it on the Tjäreborg forum.Reminder emailsReminder emails will be sent to users who have booked an upcoming trip through Tjäre-borg. The emails will include a summary of the travel dates and reservation numbers. Theywill also remind the users to check their passports and vaccinations they might need (de-pending on the travel location) and news of possible events that might affect their trip(scheduled tube strike, train line repairs etc.) Depending on the time left until the trip (foreCRM Strategy Report! 13
  • 14. Hult International Business Schoolexample 6 months), the user will receive from 4-6 emails with updated travel informationincluding up-and cross sell advertisements.Summer - and Winter Holiday emailsThe Summer – and Winter Holidays email will be sent to all users. The email includes asneak peak of the most popular- and new holiday locations. The email will be tailored togive a slight sense of urgency with relevant imagery. Customers will receive different “earlybird specials” and they are encouraged to visit the website through visible, and dependingon the customer, in some cases customized call to action buttons. For example “Seewhat’s new in Barcelona!” if customer visited the city last summer and rated it high.Special Occasion emailsDifferent bank holiday and other internationally significant holiday themed letters will besend to users depending on the occasion one month or 2 weeks before. These include forthe year 2011; Valentine’s Day, St. Patrick’s Day, Royal British Wedding, Easter, Mother’sDay, Wimbledon, Midsummer’s Eve, Father’s Day, Christmas and New Year. The RoyalWedding email will provide customers with information on how to experience the most ofthe wedding or in the contrary, where to escape from London during this time. The Wim-bledon email is and example of significant sports or cultural events emails. Other possibleones could be Super Bowl, the Olympics, Football World Cup or the Canterbury music fes-tival.Last Minute Holiday emailsThese emails will be sent to users prone to respond to last minute special deals and to in-centivize standard users to sign up for the best customer program in order to receive morerelevant offers. The last minute offers can be sent depending on the offers 2-3 weeks be-fore a week long holiday or 2-3 days before a weekend long trip.Latest reviews and recommendations emailsThese emails will be sent every other month to remind users to engage with the websiteand with each other on the Tjäreborg forum. Gift certificates will be raffled amongst userswho participate in the relevant discussion for Tjäreborg (travel locations and what to dothere) actively and provide quality reviews and content. Members will also be asked tovote on different locations where they would like to travel or what kind of trips they wouldlike to take.Yearly Roundup emailThis letter will be sent at the beginning of every year wishing the TF-member a happy NewYear. The letter will include a personal discount code percentage based on the amount ofmoney they have spent on different Tjäreborg services the past year.Special emailsBased on the information members of the TF-members have provided and wrote on to theTjäreborg forum, the eCRM team can identify highly specific offers that can be sent to us-ers. These types of emails could be congratulatory emails for getting engaged, married orthe birth of a child. Emails could include a special offer for a bachelor party in Las Vegas,honeymoon in Barbados or first family trip to a child friendly location. The offers can alsobe tailored based on the member’s previous travel preferences and can be a fun way ofinforming them of things they might be interested, for example an avid skier who books atrip to the Alps every year might get an email of a Ski&Winter expo in Birmingham withtravel and accommodation information. These emails can also be sent in case of suddeneCRM Strategy Report! 14
  • 15. Hult International Business Schoolevent, like earthquake, ash cloud or snowstorm, which might or might not affect the mem-bers travel plans.Customer retention emailsEmails send to keep people coming back to the site and winning back lapsed customers.(See 3.2 for more details)5.0 Email evaluationValue of an email address for Tjäreborg will be based on the new strategy suggested inthis report. The new approach to eCRM of segmenting customers based on demograph-ics, and their RFM and LTV scores will be used as a baseline, on which more refinedanalysis will be built on. Because of the different types of customers and segments, thevalue of the email address cannot be the same for all of the different segments. The moreTjäreborg will know about the holder of the email address the more relevant messages itcan send them. By doing this Tjäreborg can increase conversion and eventually the valueof the email address (Novo, 2010).What needs to be taken into consideration as well, is the cost of acquiring the email ad-dress. Naturally Tjäreborg can spend more to acquire an email address if it its future RFMand LTV scores will be high in the long run. Since knowing whether Tjäreborg will be ableto turn the holder of the email address into an “Tjäreborg evangelist”, the funds and re-sources spent to acquire a new customer should be optimized, ones reliable median RFMand LTV scores are available. This optimization will begin after the new eCRM project hasbeen initiated and it will be re-evaluated at the end of the year (Novo, 2010).RFM evaluation will be calculated by analyzing how recently the users have bought aholiday from Tjäreborg, how often they buy holidays from Tjäreborg and how much moneythey’ve spent on these purchases. The three separate lists will be added together to createa complete RFM list. Ones reliable data will available for Tjäreborg, the weighing of the dif-ferent factors can be changed, if deemed necessary (Novo, 2010).Customer lifetime value for Tjäreborg will be calculated by multiplying customers me-dian purchase value by the number of transaction during the year. This number will be fac-tored by the estimated number of years the customer will remain active and with a factorbased on the estimation of the future level of activity (i.e activity will be decreasing or in-creasing). From this calculation Tjäreborg will deduct the cost of acquiring and retainingthe customer during the relevant years. This figure can be then divided to indicate thevalue of the email address per year or any needed time period (Novo, 2010).Evaluation based on the RFM and LTV scores, in addition to evaluating the value of theemail address, will give Tjäreborg - how much the company looses with unsubscriptions and with unsuccessful cam- paigns - how much acquisition of new customers cost for the different segmentAlso the money spent in acquiring and retaining an email address needs to be evaluatedagainst the lost opportunity cost. If the money could be spent in other marketing tacticsthat would yield higher revenues than what are gained from the email marketing, then thiseCRM Strategy Report! 15
  • 16. Hult International Business Schoolneeds to be addresses and optimized as well. The strategies used and their expectedcosts-and revenues need to be evaluated at Tjäreborg’s yearly strategy meetings.6.0 Tjäreborg’s Privacy PolicyTjäreborg’s privacy policy will explain in detail the rights of the consumers, the methodsused to gather information and how this information will be used. At the bottom of the pri-vacy policy will be an explanation of the legislation of the country the user is visiting thesite from and contact details of the local Tjäreborg representatives (Business Link, 2009).The outline of the privacy policy will consist of the following sections: - Introduction, explains the Privacy Policy with a link to Terms of Service - Consent, explains what the user is consenting to by browsing the site - Information Collection and Use, explains how the users IP Details and Cookies are used and stored - Personal Information, explains what kind of personal information will be collected and processed by Tjäreborg - Use of Information, explains how the IP details, Cookie data and Personal Infor- mation will be used to improve their user experience - Disclosure of your information, explains how the information collected might be disclosed according to the legislation corresponding to users location - Data Storage, explains how the information Tjäreborg is gathering will be stored - Links to third party websites, explains the concept and that the Privacy policy does not apply to these sites. - Sharing Information, explains the concept of exporting information from social networking sites and third party applications - Your Rights, explains the rights of the users in relation to the personal data they have provided - Access to Information, explains the corresponding country’s Data Protection leg- islation - How to contact us, explains the contact information relevant to the user and the location and contact information of Tjäreborg’s head office. (Business Link, 2009)Please be advised that the following guideline is subject to change.eCRM Strategy Report! 16
  • 17. Hult International Business School7.0 Conclusion and RecommendationsTjäreborg’s current one-way communication strategy in the different mediums needs tochange and the company needs to begin using customer profiling to understand their cus-tomers.Tjäreborg’s best customerPeople signing up for this service will be asked to provide substantial amount of personalinformation and indicate their travel preferences. By signing up they will receive a certainpercentage discount out of the next trip they book through Tjäreborg. They will also be eli-gible to win a yearly gift certificate raffled amongst the TF-members.This program will en-able Tjäreborg to send customers highly relevant emails with higher response and pur-chase rates and create long lasting customer relationships.Emailing strategy and effectivenessIn order to maximize ROI and create long-term customer relationships Tjäreborg will befollowing the privacy and contact rules to the letter. This will also allow Tjäreborg to createan email list and a database that will be more responsive.Clickstream-based email campaigns are found to be most effective in generating de-sired results and the customization based on the users clickstream data on the Tjäreborgwebsite will be used for individually customized messages and offers.Email list effectiveness will be analyzed and revised based on the email open-rate, clickthrough-rate and unsubscribtion-rates. Email subject line effectiveness will be monitoredwith open-rate.Content and offer effectiveness will be analyzed with click through rates of the differentemail campaigns.Landing page effectiveness will be measured according to the number of people exitingthe landing page immediately after clicking a link in their emails.Customer analysis and valueTjäreborg’s customer segmentation will be based on different demographic, geographicand psychographic data. From this data Tjäreborg will establish the best customer seg-ments based on the RFM and LTV scores they generate within a certain time-period.These scores will be used as a baseline, on which more refined analysis will be built on.The length of the project is estimated at 12 months, at which point the increased ROI,greater customer satisfaction and increased brand image will prove the excellence of thestrategic change and it can become the corner stone of Tjäreborg’s eCRM strategy.eCRM Strategy Report! 17
  • 18. Hult International Business SchoolReferencesBerteig, M. (2006). Seventeen tips for iteration planning. Available:http://www.agileadvice.com/archives/2006/08/seventeen_tips.html. Last accessed 9th Apr2011.Bruce Clay. ( - -). Email Marketing Done Right. Available:http://www.bruceclay.com/branding/email/mktgdoneright.htm. Last accessed 1st Apr 2011.Business Link. (2009). Sample internet policies and notices. Available:http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1076142085&type=RESOURCES. Last accessed 9th Apr 2011.CMO Council. (2008). Survey 2008. Available:http://www.cmocouncil.org/resources/form_mo_execsummary.asp. Last accessed 1st Apr2011Dun & Bradstreet. (2008). Customer Profiling: Using Your Customer Data To Improve YourMarketing ROI. Available:http://www.techrepublic.com/whitepapers/customer-profiling-using-your-customer-data-to-improve-your-marketing-roi/935591. Last accessed 9th Apr 2011.Email Marketing Reports. (2010). Segmentation and targeting .Available:http://www.email-marketing-reports.com/tactics/segmentation/. Last accessed 9th Apr2011.Lavigne, D. (2007). A year in the life of a BSD Guru. Available:http://it.toolbox.com/blogs/bsd-guru/mailing-list-effectiveness-17685. Last accessed 9thApr 2011.Net Atlantic. (2010). Clickstream and Clickthrough Tracking . Available:https://www.netatlantic.com/emailmarketing/clickstream.html. Last accessed 9th Apr 2011.Novo, J. (2010). Customer Response, Retention and Valuation Concepts (RFM Model).Available: http://www.jimnovo.com/RFM-tour.htm. Last accessed 9th Apr 2011.Nye, C. (2011). Using Email for Customer Acquisition . Available:http://www.practicalecommerce.com/articles/2611-Using-Email-for-Customer-Acquisition.Last accessed 9th Apr 2011.Oakes, S. (2009). Tips to Create a Customer Profile . Available:http://www.m4bmarketing.com/tips-create-customer-profile/. Last accessed 9th Apr 2011.Shulock, E. (2011). 12 Internet Customer Retention Tactics. Available:http://www.wdfm.com/marketing-tips/customer-retention-tactics.php. Last accessed 9th Apr2011.Tjareborg Admin. (2010). Yritystietoa . Available: http://www.tjareborg.fi/yritysinfo. Last ac-cessed 9th Apr 2011.eCRM Strategy Report! 18
  • 19. Hult International Business SchoolWebcredible. (2008). 5 ways to improve online cross- & up-selling .Available:http://www.webcredible.co.uk/user-friendly-resources/web-credibility/cross-up-sell.shtml.Last accessed 9th Apr 2011.Webster, M. (2005). Market orientation toward various customer groups in businessschools. Available: http://findarticles.com/p/articles/mi_hb6167/is_1-2_9/ai_n29241308/.Last accessed 9th Apr 2011.eCRM Strategy Report! 19
  • 20. Hult International Business SchoolAppendixesAppendix 2: KPI analysis for TjäreborgIn order for Tjäreborg to stay on top of the change their new online approach will have, thecompany will be formulating, following up on and revising relative KPIs according to theREAN framework (Reach, Engagement, Action and Nurture). Benchmarking will be usedto compare the company’s own improvement and to compare the company’s resultsagainst other competitors in the industry. Tjäreborg will nee to set up clear targets for im-proving each selected metric over a period of time (Chaffey, 2010).REAN Framework:REACH# Of Branded Searches# Of Blog Subscribers# Of Twitter Followers# Of Facebook Fans# %Site visits / %SEM visits / % Display ads# Of Branded Searches As the purpose of Tjäreborg’s online presence is to create brand awareness that can be turned into sales, the company needs to measure their online presence. Branded searches can be used to measure the development in this area.# Of Subscribers to different medias Having a constant and steady increase in followers means Tjäreborg is establishing a better and larger connection to their customers and that the whole company’s ap- proach is becoming more open and inviting. The increase in followers also means that Tjäreborg will be able to receive more information on what their customers want and how they can improve.ENGAGEMENT# Alerts (register and response rates / by channel / CTR / post click activity)# Comments (Social Media, Website, Blog)# Forward to a friend (Campaing news, Competition, Foursquare)# Uploads (add an item, e.g. articles, links, images, videos to Facebook,Company blog, Twitter)Time spent on site (by source / by entry page)Time spent on key pages (Competition pages)Social media sharing / participation (activity on key social media sites, e.g.Facebook, Twitter, Digg, etc)# Registered users (new / total / active / dormant / churn)eCRM Strategy Report! 20
  • 21. Hult International Business SchoolKPIs selected for the engagement part are mainly intended for the content on the mainwebsite but can also be used for the other online medium that Tjäreborg is using.ACTIVATIONConversion rates of:# Tjäreborg Family-member# Participation in the competitions# Contributions to the Tjäreborg site# Fans (Facebook, Twitter, Blog, Competitions)CPA for all of the aboveKPIs selected for the activation part are specific conversion points that Tjäreborg is lookingto achieve. Cost per action will be used to measure the success getting people to sign upfor the TF-membership, and contributing and participating on the site.NURTURING# Repeat visits / logins and their frequencyCommunity engagement (how actively people are responding to news andcomments from Tjäreborg, how well Tjäreborg can get people engaged andactive when new content is released)% Of Email permission coverage% Of Email engagement (“hurdle rate”)Feedback (site surveys and content rating)EMAIL SPECIFIC KPIS% Delivery rate% Bounce rate% Open rate% Click through rate% Unsubscribe rate# Link requests% Conversion rateeCRM Strategy Report! 21
  • 22. Appendix 3: Flow Chart of an Twitter complaint !"#$%&()* (*+,-./* !"()&01(2*)3.*045)"#./* ,)3*)3.*6&4%)7*$/"840)** ;/":%.#*0&(=)*:.* 5"%<.8*84/(2*)3.* 0"(<./5&1"(* 98.(167*,3&)*)3.* $/":%.#*5*,)3*)3.* $/"840)* 98.(167*?@A*&(8* B+C*50"/.5*"6*)3.* 045)"#./* ;/":%.#*0&(*:.*5"%<.8*84/(2*)3.* 0"(<./5&1"(* !%.()*5*0"()&0).8* %&)./*"(*&(*&(5,./*!3.0>4$*"(*)3.* !3.0>4$*"(*)3.* 045)"#./* 045)"#./*
  • 23. Appendix 4: 12-month email testing Emails shown in this timeline represent an example of what could be sent to a user. The overall strategy is subject to revisals as more data is gathered and analyzed.- Thank You-email (for - March newsletter - May newsletter - July newsletter - September newsletter - November newslettersigning up to the site &newsletter) - St. Patrick’s Day - Wimbledon - Last minute holidays - Winter Holidays - Congratulatory letter (for getting engaged, married or- January newsletter - Holiday location - Reminder email - Latest reviews and - Reminder email (Reminder being single) information & activities (Activities in your holiday recommendations (user email of the benefits of becoming- Summer Holidays destination, how to get there generated content) a TF-member for the standard - Customer retention - Customer retention and where to stay) customers) email- Thank You-email (for emailbooking a summer holiday) - Latest reviews and recommendations (user generated content) January February March April May June July August September October November December - February newsletter - April newsletter - June newsletter - August newsletter - October newsletter - December newsletter - Valentine’s Day - Royal Wedding - Midsummer’s Eve - Thank You-email - Christmas & New (Hoping that the holiday went Year - Last minute - Latest reviews and - Easter - Father’s Day well and asking the person to holidays recommendations (user write a review of the trip) - Latest reviews and generated content) - Mother’s Day - - Reminder email (Reminder email of the benefits of recommendations - Yearly - Latest reviews and (user generated content) Roundup letter - Reminder email becoming a TF-memberr for the (Passport, Vaccinations, public standard customers) recommendations (user transportation update! ) generated content) - Customer retention - Latest reviews and email recommendations (user generated content)
  • 24. Appendix 5: Tjäreborg’s Privacy Policy (based on the privacy policy of SkyScanner Limited)This Privacy Policy covers your use of this website. Tjäreborg is committed to protectingand respecting your privacy and we make it our highest priority to safeguard theconfidentiality of any and all personal details you provide to us. As a visitor to our websiteyou have the right to know and understand our information privacy practices prior toproviding Tjäreborg with any of your personal details.ConsentBy using our website, you consent to the collection and use of your IP Details andPersonal Information in accordance with this policy. If we change our privacy policy at anytime, these changes will be reflected in this Privacy Policy.Information Collection and UseTjäreborg may collect information from its users at several different points on our website.We may collect and process the following information about you:IP DetailsWe may collect information about your computer, including where available your IPaddress, operating system, browser type, referring URLs, page views and access times("IP Details"). We use such information for system administration, to analyze trends, trackusers movements and to report aggregate information to our advertisers and partners.CookiesFor the same reason, we may obtain information about your general internet usage byusing a "cookie" file which is stored on the hard drive of your computer. We may use both“session” cookies and “persistent” cookies on the website. We will use the session cookiesto keep track of you whilst you navigate the website. We will use the persistent cookies toenable our website to recognize you when you visit.We use cookies to make your use of our website easier. Usage of a cookie is in no waylinked to any personally identifiable information while on our website.Personal InformationWe may collect and process the following data about you: • We will collect certain personal information provided by you which may include your user ID, password, name and , email address. Additional information may be requested in future to improve the level of service we can provide you, and to allow access to additional Tjäreborg services. • Any information that you provide by filling in forms on our website. If you contact us, we may keep a record of that correspondence. • Information you provide to us when you complete surveys that we use for research purposes.Use of InformationWe will use your IP Details, Cookies and Personal Information (together, your"Information") held about you in the following ways: • To ensure that content from our site is presented in the most effective manner for you and for your computer. • To provide you with information, products or services that you request from us or which we feel may interest you. • To carry out our obligations arising from any contracts entered into between you and us.
  • 25. • To allow you to participate in interactive features of our service, when you choose to do so. • To notify you about changes to our service.Data StorageAll Information you provide to us is stored on our secure servers. Where we have givenyou a password which enables you to access certain parts of our site, you are responsiblefor keeping this password confidential. We ask you not to share this password withanyone.Unfortunately, the transmission of information via the internet is not completely secure.Although we will do our best to protect your Information, we cannot guarantee the securityof your data transmitted to our site; any transmission is at your own risk. Once we havereceived your Information, we will use strict procedures and security features to try toprevent unauthorized access.Links to third party websitesThis website contains links to other sites. In particular this website may direct you to thewebsites of third party flight or travel provider companies for you to make bookings. Inorder to book flights, you will provide personal data to the operators of such sites. Pleasebe aware that we are not responsible for the privacy practices of such other sites. ThisPrivacy Policy applies only to information collected by us via this website.Sharing InformationIn order to provide you with a useful social experience when using Tjäreborg, we may giveyou the option to export information from Tjäreborg to third party applications andwebsites, including social networking sites such as Facebook or Twitter. We do not own oroperate the applications or websites that you connect with and you should review theprivacy policies of such websites to make sure you are comfortable with the ways in whichthey use the information you share with them.Your RightsYou have the right to access personal data which you have submitted through the site.Where you are a user of our sign-in service, you can manage or remove your informationfrom our database by accessing your profile through the My Account area of the site. Bysigning in to My Account you will have the option to manage your personal profile andpreferences..How to contact usIf you have any concerns about this Privacy Policy or about data we may hold about youplease contact us by clicking here.