The 2Is: WHy the web is Unique at creating Customer Relationships
1.Interactivity
–Defined as the extent to which a two-way flow if communication occurs between the firm and the customer.
2.Individualization
–Reflects the degree to which firm-customer interactions are tailored or customized to the individual user.
Stages of a Relationship
1.Awareness
2.Exploration and Expansion
1.Attraction
2.Relationship Norms
3.Trust
4.Power Relations
5.Satisfaction
3.Commitment
4.Dissolution
Two basic reasons why customer relationships increase profitability:
1.Costs of serving existing customers are lower.
2.Existing customers are willing to pay higher prices.
Pricing – +++++++++++++++++++++++++++++++++++++++
Key variables of basic demand-curve pricing:
•Price
•Substitute Offerings/ Prices
•Complementary Offerings/ Prices
•Income
•Market Size
•Taste
•Marginal Revenue
•Marginal Cost
Basic Pricing Strategies
•Cost Plus
•Target Profit Growth
•Target-Return Pricing
•Prestige Pricing
•Price as a Sign of Quality
•Cyclical Promotional Pricing (Hi-Lo)
•Everyday Low Pricing
•Fairness in Pricing
•Promotional Low-Cost Pricing
Auction Types
•English Auctions
–Reverse-Price English Auction
•Dutch Auctions
•First Price Sealed-Bid Auctions
•Reverse First Price Sealed-Bid Auctions
•Group Buying
•Exchanges
Product – +++++++++++++++++++++++++++++++++++++++++