Slide 9.1 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Chapter 9 Customer relationship management

Slide 9.2 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Learning outcomes Outline different methods of reaching and acquiring new customers via digital media Evaluate different buyer behaviour amongst online customers Describe techniques for retaining customers and cross- and up-selling using digital media communications

Slide 9.3 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Management issues Which digital media should we invest in to reach new audiences? What are the practical success factors for using digital media need to make customer acquisition more effective? What technologies can be used to build and maintain the online relationship? How do we deliver superior service quality to build and maintain relationships?

Slide 9.4 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 What is CRM? An approach to build and sustain long-term business with customers. Customer life cycle: The stage each customer will pass through in a long-term relationship through acquisition, retention, and extension.

Slide 9.5 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.1 The four classic marketing activities of customer relationship management CRM – Customer Life Cycle

Slide 9.6 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 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).

Slide 9.7 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Marketing applications of CRM (Continued) 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 further later in the chapter, customers characteristics, their purchase behaviour and campaigns can be analysed in order to optimise the marketing mix.

Slide 9.8 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 e-CRM – a definition 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.

Slide 9.9 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Benefits of e-CRM Some benefits include: Targeting more cost effectively Achieve mass customisation of the marketing messages Increase depth, breadth, and nature of relationship Enables learning relationship Lower cost

Slide 9.10 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.2 A summary of an effective process of online relationship-building Permission Marketing

Slide 9.11 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.3 Reach–Act–Convert–Engage model Source: Smart Insights (2010) Introducing RACE = A practical framework to improve your digital marketing. Dave Chaffey, 15 July ​ marketing- ​ strategy/race ‑ a ‑ practical- ​ framework ‑ to ‑ improve- ​ your- ​ digital- ​ marketing. Conversion Marketing

Slide 9.12 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.4 A summary of how the Internet can impact on the buying process for a new purchaser Online Buying Process

Slide 9.13 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.5 A model of the relationship between different aspects of trust and consumer response based on the categories Source: Bart et al. (2005). Influences on Purchase

Slide 9.14 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.6 Percentage who consider the different information sources as important when researching/considering a product or service Source: BrandNewWorld: AOL UK/Anne Molen (Cranfield School of Management)/Henley Centre, Influences on Purchase – con’t

Slide 9.15 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Characteristics of interactive marketing communications From push to pull From monologue to dialogue From one-to-many to one-to-some and one-to-one From one-to-many to many-to-many From lean-back to lean-forward Mediums Increase in communications intermediaries Integration

Slide 9.16 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.7 Measures used for setting campaign objectives or assessing campaign success increasing in sophistication from bottom to top Assessing marketing communications effectiveness

Slide 9.17 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.8 An example of effectiveness measures for an online ad campaign Assessing marketing communications effectiveness – con’t

Slide 9.18 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Online marketing communications: 1 - Search Engine Marketing (SEM) How does Google work? Crawling Indexing Ranking or scoring Query request and results serving Importance of keyphrase analysis…

Slide 9.19 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.9 Stages in producing natural search engine listings 1 - Search Engine Marketing (SEM): Search process

Slide 9.20 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.10 Search engine results page showing the two main methods for achieving visibility Source: Google and the Google logo are registered trademarks of Google Inc., used with permission. 1 - Search Engine Marketing (SEM): Search Engine Results Pages (SERPs)

Slide 9.21 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Online marketing communications: 1 - Search Engine Marketing (SEM) Search Engine Optimisation (SEO): A structured approach used to increase the position of a company or its products. Factors affecting search engine rankings: Frequency of occurrence in body copy Number of inbound links (page rank) Title HTML tag Meta-tags Alternative graphic text

Slide 9.22 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Online marketing communications: 2 - Online PR Online PR Leverages the network effect of the Internet. Activities considered to be online PR include: Communicating with media online Link-building Blogs, podcasting, and RSS Online communities and social networks Brand presentation on third-party sites Online viral marketing

Slide 9.23 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.12 Aspects of social CRM Source: Altimeter (2010). Social Media and CRM strategy

Slide 9.24 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.13 Online PR categories and activities Online marketing communications: 2 - Online PR

Slide 9.25 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.14 The affiliate marketing model (note that the tracking software and fee payment may be managed through an independent affiliate network manager) Online marketing communications: 3 - Online Partnerships B - ) Affiliate marketing C - ) Online Sponsorship A - ) Link building

Slide 9.26 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Online marketing communications: 4 – Interactive advertising Fundamental Ad serving Objectives Delivering content Enabling transaction Shaping attitudes Soliciting response Encouraging retention Targeting options On a particular type of site To target a registered user's profile At a particular time of day or week Online behavior

Slide 9.27 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Online marketing communications: 5 – marketing Outbound marketing s are sent to customers and prospects from an organisation Inbound marketing Managament of s from customers by an organisation Measures for evaluating marketing Delivery rate Open rate Clickthrough rate Opt-in options for customer acquisition Cold campaign Co-branded Third-party e-newsletter

Slide 9.28 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Customer Retention Management Two goals of customer retention Repeat customers Repeat visits Personalisation and Mass Customisation Personalisation Collaborative filtering Techniques for managing customer activity and value Increase # of new users Increase # of active users Decreasing # of dormant users Decreasing # of inactive users

Slide 9.29 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.17 Activity segmentation of a site requiring registration

Slide 9.30 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.18 Different representations of lifetime-value calculation Customer Retention Management – con’t Lifetime-value modelling

Slide 9.31 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.19 An example of an LTV-based segmentation plan Lifetime-value modelling Customer Retention Management – con’t

Slide 9.32 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Customer Retention Management Improving online service quality Tangibles Reliability Responsiveness Assurance Emphathy

Slide 9.33 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Advanced online segmentation and targeting techniques depend on resources available, technology capabilities and opportunities afforded by the list: Identify customer life cycle groups Identify customer profile characteristics Identify behaviour in response and purchase Identify multichannel behaviour Tone and style preference

Slide 9.34 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.21 Customer life cycle segmentation Advanced online segmentation and targeting techniques Identifying customer life cycle groups

Slide 9.35 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.22 RFM analysis Recency, Frequency, Monetary value (RFM) analysis Related concepts: Recency Frequency Monetary value Latency Hurdle rate

Slide 9.36 Chaffey, Digital Business and E-commerce Management Powerpoints on the Web, 6 th edition © Marketing Insights Limited 2015 Figure 9.23 An overview of the components of CRM technologies Components of CRM technologies