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Internet Marketing Customer Support and Online Quality Involve Customers in Design Process Market & Sell Products & Services Understand Markets & Customers Deliver Value Through Distribution Manage Customer Information Provide Customer Care Marketing Processes That Can Be Digitized

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internet marketing
Internet Marketing

Customer Support


Online Quality

marketing processes that can be digitized

Involve Customers in Design Process

Market & Sell Products & Services

Understand Markets & Customers

Deliver Value Through Distribution

Manage Customer Information

Provide Customer Care

Marketing ProcessesThat Can Be Digitized
  • Solving problems online
  • Lower costs
  • Online quality
  • Justifying online enhancements
  • Co-production

Providing Customer Care

Through Online Content

Lower Costs

Online Quality

  • Online Publishing
  • Electronic Distribution
  • Virtual Problem Solving
  • Customer Support
  • VVAs
  • Customer Support
  • Justifying Online Content
  • Enhanced Margin
  • Expanded Sales
    • Acquire new customers
    • Develop existing customer base
  • Customer satisfaction
    • Customer retention
solving problems online
Solving Problems Online

Provides Strong Justification for Investing in the Web

  • Lower customer support costs
  • Improved online value for customers
  • Companies and consumers benefit
    • Lower costs improve profit margins
    • Savings can be passed through to consumers

Figure 6.3

solving problems online6
Solving Problems Online
  • Benefits are strongest for companies that are first to innovate
    • Increased market share
    • Improved customer satisfaction
    • Improved customer acquisition and retention
lower costs
Lower Costs

Figure 6.3

  • Cost savings from using the Internet to support customers are more measurable and controllable that many other customer support investments
  • These savings can be quite large
cost savings

Q: Where do these cost savings come from?

Cost Savings
  • Online publishing saves the cost of printing and shipping manuals
  • Software updates can be downloaded, saving the cost of burning and shipping CDs
  • Virtual problem solving
  • Inexpensive communication
virtual problem solving
Virtual Problem Solving
  • Online solutions
    • Many companies practice call avoidance, making people log on instead
    • Difficult / impossible to find a phone # on the site
  • Stored answers
    • FAQ
    • E-mail auto-responders
  • Customers help each other
    • Bulletin boards
traditional customer service methods are expensive
Traditional Customer Service Methods Are Expensive
  • Sales calls and call centers
    • Require expensive, assisted, real-time interactions
    • Are labor intensive
inexpensive web based communication
Inexpensive Web-Based Communication
  • Many of these methods do not require real-time intervention
  • Customers are able to solve their own problems
web based customer support
Web-Based Customer Support
  • Merging e-mail, artificial intelligence, and smart routing shows promise
    • First: the system tries to find a stored answer
    • Second: the system tries to find the best customer service rep to handle the request
    • Third: the response becomes a part of the database
  • Over time, the database becomes richer and more inquiries can be handled automatically by the system

So What?

Success on the Web is Becoming More & More About Customer Care

Provide Customer Care

Through Online Content



Name of Publication - Date

Insert excerpts from a current article out of the business press (e.g. Wall Street Journal, Wired News, Business 2.0, or Fast Company) that talks about the importance of online customer support. I usually take excerpts out of the lead paragraph, and highlight keywords. There have been a number of articles talking about increased investments in online customer support.

customer care
Customer Care

Q: How do you create a Nordstrom-like experience on the Internet?

online quality enhancements
Online Quality Enhancements
  • Virtual value activities can improve quality
  • Companies have multiple constituencies
  • It’s possible to use the VVAs to design Web content that supports multiple customers and needs
    • Table 6.3
    • Figure 6.6
    • Figure 6.8
online quality enhancements21
Online Quality Enhancements
  • Effective use of the Web can increase customer satisfaction
  • Product design: online discussions provide early feedback that provide valuable insight and suggestions
  • Sales: consumers have access to online product information and dealer locations
  • After-sales support: self-help problem solving, technical support & user groups
  • Company culture: Web content communicates and reinforces corporate culture
justifying online enhancements
Justifying Online Enhancements
  • Two possible methods for justifying a firm’s investment in an online presence
    • Breakeven investment analysis
    • Customer-centered method, looking at customer acquisition, development and retention rates
  • Let’s take a closer look
breakeven investment analysis
Breakeven Investment Analysis

Cost Focus vs. Quality Focus

  • Traditional customer support technologies
    • customer-support call centers
    • sales force help
    • dealers
  • Steep curve due to increasing difficulty of providing higher quality levels

Figure 6.10

The Cost-Quality Tradeoff for Traditional Support

breakeven investment analysis29
Breakeven Investment Analysis

Cost Focus vs. Quality Focus

  • Exceptional service not yet attainable using online only
  • Online content is low cost for basic levels of support
  • Costs rise rapidly at higher levels
  • Pure online support attractive for cost-oriented firms

Figure 6.11

Limited Quality

Pure Online Support

breakeven investment analysis30
Breakeven Investment Analysis

Cost Focus vs. Quality Focus

  • Hybrid systems combine online content and technical help from staff
    • Online material handles routine inquiries
    • Customer-support staff focuses on difficult issues
  • Staff also provide support to customers without access to online materials
  • Quality-oriented firms use

Figure 6.12

Creating a Hybrid High-Quality Support System

breakeven investment analysis31
Breakeven Investment Analysis

A Dynamic Implementation Path

  • Cost savings from migrating to an online support model free up funds to enhance customer support over the long run
  • Managers often opt to achieve hard savings first
  • Then use those savings to improve quality

Figure 6.13

customer lifetime value analysis
Customer Lifetime Value Analysis

Closed Loop Web Enhancements

  • Web marketing as direct marketing
  • The Internet’s digital nature make it possible to capture, store & manipulate huge amounts of data on individuals
  • Three activities related to marketing at the individual level
    • Customer acquisition
    • Customer development
    • Customer retention
the adr framework
The ADR Framework
  • Acquisition: the cost of bringing in new customers
  • Development: costs incurred expanding the share-of-customer that firms receive from existing customers
  • Retention: costs to keep the business and loyalty of current customers
co production
  • A new view of the company and its customers as co-producers emerges when the Web is used in sophisticated ways to provide customer support
  • The customer is no longer a passive recipient of a product and some support material
  • Rather the customer is a partner
  • Closer links between companies and their customers provide opportunities for personalization and new product development