How to make a combination between your CRM and your digital marketing platforms

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

2. TEXTBOOKS
- E-Business and E-Commerce Management,
Ch. 9, p.393-446
Other Resources:
- CRM Article http://www.ebusiness-
watch.org/studies/case_studies/documents/C
ase%20Studies%202008/CS08_Retail_Casino.
pdf
2

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
3

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
4

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, e-mail, 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.
5

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

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.
7

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”.
8

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.
9

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

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
11

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,
12

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.
13

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.
14

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

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)
17

18. 18
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, e-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.
Marketing applications of CRM

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

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

21. 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

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Online marketing communications
1. 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. 1. 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
23

24. 24
Online marketing communications (2)
3. Online partnerships
• Affiliate marketing
• Online sponsorship
4. Interactive advertising
5. E-mail marketing
6. Viral marketing

25. 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 1994. Copyright © 1994 by the Harvard Business School Publishing Corporation, all rights reserved

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• 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
Lifetime value modeling

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

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

29. 29
Customer lifecycle segmentation
(Dave Chaffey)

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

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

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

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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. 35
Multi-channel conversion model
(Dave Chaffey)

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Questions & Discussion