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After purchase service and evaluation
Purchase and delivery
Alternative evaluation, negotiation and selection
Information search (What? From whom?)
Consumer Purchasing Decision-Making
(cont.)
- The Purchasing Decision-Making Model
Need identification (Recognition)
Customer Satisfaction
& Loyalty
Model of Internet Consumer Satisfaction
Customer Satisfaction
Logistics Support Customer Service Pricing Attractiveness Web-site Store Front
3rd Party Seal of Approval Trust in Web-shopping
Vendor Reputation
Repeat Web Purchase (Brand Loyalty)
Security
Authentication
Privacy Transaction Safety
Integrity
System Reliability
Speed of Operation
Ease of Use
Content, Quality Format Reliability Completeness
Timeliness
Organization want loyal
customers (Satisfied Customers)
but how?
Answer: Relationship Marketing
(One-to-One Marketing)
One-to-One Marketing
- Relationship marketing
- “Overt attempt of exchange partners to build a long term association, characterized by purposeful cooperation and mutual dependence on the development of social, as well as structural, bonds”
- “Treat different customers differently”
- Able to change the manner its products are configured or its service is delivered, based on the individual needs of individual customers
How One-to-One
Relationships Are Practiced
- Doing business over the Internet enables
companies to:
- Communicate better with customers
- Understand customers’ needs and buying habits better
- Improve and customize their future marketing efforts
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One-to-One Marketing (cont.)
Effects Purchase behavior One of the most significant contributors to profitability Increase profits; strengthen market position; become less sensitive to price competition; increase cross-selling success; save cost, etc. Real world examples 1-800-FLOWERS Amazon.com Federal Express (FedEx)
Customer Loyalty & E-Loyalty
- Customer loyalty—degree to which customer
stays with vendor or brand
- Important element in consumer purchasing behavior
- One of the most significant contributors to profitability
- E-loyalty—customer’s loyalty to an e-tailer
- Learn about customers’ needs
- Interact with customers
- Provide customer service
One-to-One Marketing (cont.)
- Building and maintaining customer loyalty Maintain continuous interactions between consumers and business Make a commitment to provide all aspects of the business online Build different sites for different levels of customers Willing to invest capital, both human and financial, in the information systems, to insure continuous improvement in the supporting technology as it becomes available
One-to-One Marketing (cont.)
- Customer Service : One of the essence of Customer Satisfaction Information can be directed to the customer efficiently Creation of a database which records purchases, problems and requests is facilitated Information can now be traced and analyzed for immediate response If customer service options and solutions do not maintain the same level of excitement and interaction as the advertising and sales presentations, the level of intensity declines and the vendor runs the risk of losing customers
Implementing Customer Service in
Cyberspace (cont.)
- Types of Customer Service Functions
Answering customer inquires
Providing technical and other information
Letting customers track accounts or
order status
Allowing customers to customize and
order online
© Prentice Hall, 2000 21
Tools of Customer Service
- Personalized Web Pages
- used to record purchases and preference
- direct customized information to customers efficiently
Chat Room
discuss issues with company experts; with other customers
E-mail
used to disseminate information, send product information and conduct correspondence regarding any topic, but mostly inquiries from customers
FAQs
not customized, no personalized feeling and contribution to relationship marketing
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Market Research for EC (cont.)
Procter & Gamble (cont.)
- Online research was facilitated by data mining conducted on P&G’s huge historical data and the new Internet data
- Internet created a product awareness of 35 percent before shipments were made to stores
- Revolutionized process of studying the product concept, segmenting the market, and expediting product development
Market Research for EC (cont.)
- Various tools are used to conduct consumer
market research:
- Questionnaires
- Surveyors
- Telephone surveys
- Focus groups
- Important first to understand how groups of
consumers are classified
Market Research for EC
If you don’t know how to do it then
companies such as E-valuations or
Northstar can conduct the research for
your company
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Limitations of Online
Market Research Methods
- Accuracy of responses
- Loss of respondents because of equipment
problems
- Ethics and legality of Web tracking
- Focus group responses can lose something in
the translation from an in-person group to an
online group
- Eye contact and body language are lost
- Anonymity is necessary to elicit an unguarded response
Intelligent Agents for Consumers
- Search Engines
- Computer programs that can automatically contact other network resources on the Internet, searching for specific information or key words, and reporting the results
- Intelligent Agents
- Computer programs that help the users to conduct routine tasks, to search and retrieve information, to support decision making and to act as domain experts
- Do more than just “search and match”
Intelligent Agents for Consumers
- Intelligent Agents for Information Search and
Filtering
Help to determine what to buy to satisfy a specific need by looking for specific products’ information and critically evaluate them For Organization these intelligent agents are a very useful source of consumer information and analytical calculation of this information could really provide closer insight to consumer buying behavior
Organizational Buyer’s
Behavior
Organizational Buyer’s Behavior
Demand Individual Organizational Purchase volume Smaller Larger Number of customers Many Fewer Location of buyers Dispersed Geographically concentrated Distribution structure More indirect More direct Nature of buying More personal More professional Nature of buying influence Single Multiple Type of negotiations Simpler More complex Use of reciprocity No Yes Use of leasing Lesser Greater Primary promotional method Advertising Personal selling
Characteristic Retail Buyers Organizational Buyers
Individual customers Vs. Organizational buyers
Organizational Buyer’s Behavior (cont.)
Model
Vendors’ Controlled Systems Logistic support Payments, delivery
Technical support Web design, Intelligent- agents
Customer service FAQ,E-mail, Call Centers, One-to-one
Decision Making Process (Group or Individual)
Stimuli Marketing Price Promotion Product Quality
Others Economical Technology Political Cultural
Interpersonal Influences Authority; status; persuasiveness
Individual Influences Age; gender; ethnicity; education, lift style; psychological; knowledge; values; personality
Organizational Influences Policies and procedures; organization structure; centralized/decentralized; systems used; contracts Buyers’ Decisions Buy or not; What to buy; Where (vendor); When; Delivery terms Payments
