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InSite Marketing Technology

InSite Marketing Technology. Goran Nagradic. History. Three cofounders started InSite in February 1997 Glen Urban and John Little brought new ideas on virtual buying environments, trust and discrete-choice modeling

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InSite Marketing Technology

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  1. InSite Marketing Technology GoranNagradic

  2. History • Three cofounders started InSite in February 1997 • Glen Urban and John Little brought new ideas on virtual buying environments, trust and discrete-choice modeling • Jeffrey Stamen along with Urban and Little recruited StefaniaNappi to be the chief executive officer and president • The three cofounders invested a total of $450000 to fund the development of a prototype of a trust-based adviser

  3. About the company • Nappi had two priorities: hire a strong team and develop a prototype • Company started small and frugally • Its first prototype became Trusted Advisor for only $100000, released in May 1997 • In 1998 InSite raised $1.5 million from angel investors

  4. InSite’s product • InSite’s product attempts to reduce gap between shopping on the Web and shopping in a store • Initial target markets were any sales situation that involved a product with the multiple decision option and a desire for individualized service

  5. Online retail vs. traditional retail • Key difference is that sales people build a personal relationship with the customer • They ask questions, listen to responses and observe the customer’s behavior • Customers react to answers, observe salesperson’s behavior, form opinion about the product, salesperson and the process • Any of these can strongly influence their decision

  6. Online retail vs. traditional retail(cont’d) • On the Web consumers wonder whether the seller will deliver as promised • They can’t feel (sense) the product • Fear of giving the credit card information • If something goes wrong with the product who will fix that

  7. How Trusted Advisor satisfies e-customer needs

  8. How Trusted Advisor satisfies e-merchant needs

  9. InSite’s strategy and goal • The technology would combine research on trust cues, purchasing behavior, virtual buying environments and software capabilities • Goal was to blend the low cost of information service with the personal attention of a salesperson. • The system provides unbiased product information and uses a core engine to translate customer preferences into product recommendation

  10. InSite’s strategy and goal (cont’d) • Advisor engine takes known information about the visitor and uses rule-based prediction to create a customized experience • The engine uses marketing segment predictions to infer information about the visitor without asking a lot of information • Advisor brings products to shoppers rather then requiring shoppers to find and distinguish between the products they want

  11. InSite’s strategy and goal (cont’d) • Insite offers two performance levels for Trusted Advisor: • Implementing a fully-featured Trusted Advisor (requires about three months) • The buyer provides knowledge about the customers and InSite translates this knowledge into the Trusted Advisor

  12. Pricing of Advisor • Initial license was $100000 plus monthly maintenance fee of $5000 • Typical engagement would costs $200000 to $300000 for the first year and $100000 for the year after

  13. “Jill” • Insite’s first major customer, CompUSA, wanted an online advisor that would help customers buy notebook • Insite designed an advisor, named Jill, with all knowledge available 24/7 • “Everything is going perfect” – Nappi • In three months Jill was used 25000 times; CompUSA increase sales for 6 percent; 65 percent longer site visits; increase in customer satisfaction

  14. Problems with sales • Customers are satisfied with status quo of the web for their products • Customers adopt other concepts • Customers do not perceive the benefits • Customers perceive high costs

  15. Reaching end • Promising sales lead nowhere • 1999 InSite was reaching the end of its resources • Venture capitalist liked the idea but they were unwilling to invest without growing number of happy customers and potential buyer

  16. Implementation plan • Make only Advisors where buyers provide information and knowledge about the customers • Lower the price for at least 10 percent • Design special Advisors for specific fields • Make less complex model for customers andoffer 5 years free maintenance • Entered the market too early

  17. Implementation plan (cont’d) • Make Advisors to replace menus on the Web sitesfor example: Have couple of different Advisors on the same website; to first one you tell what do you want and Advisor brings you another one(specific for that section) just like in real store • Speech recognition – you would actually talk to them not write

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