The consumer adoption process is a generally accepted conceptualization of the stages a consumer goes through when confronted with a new product or service. The consumer must become aware of the product, develop interest, perform a pre-purchase evaluation, and then try the product, either as a consequence of a purchase or of a marketer-sponsored promotion or incentive.

The diffusion process is a communications model and consists of four elements: the innovation, communication channels, time and the social system within which the innovation is spreading, concept shows a process that is normally distributed around a population mean.

The degree to which an innovative product or service possesses these characteristics determines the ease with which it is adopted and diffused throughout the population. Older products such as the automobile and telephone were slower to diffuse through the population than newer ones like the Internet and cellular phones. In this fast-paced environment, marketers must develop and successfully commercialize new products. However the consumer adoption process explains consumer behavior and how consumers adapt to a product, while the diffusion of innovations describes the life of a product over time.

2) Define “pervasive computing” in your own words. What changes is it likely to bring about in the way marketers approach the Internet?

The concept means that a single person can have access to all their computing devices to assist in performing all sorts of daily tasks. It may accomplish an increasing number of personal and professional transactions using a new class of intelligent and portable devices. It gives people access to the information needed. Usually new technology are not usually simple to learn, that is why complexity can slow down the diffusion of an innovation. EXXONMOBIL’s speedpass example for gas station payments. Wireless meters in las vegas.

3) Be prepared to describe the strategic drivers of wireless adoption and to give an example of each.

Context- when and where the customer needs and wants.

Localization- a consumer driving down the highway can be beamed info about attraction in the area.

Personalization- specific stocks and price levels, notified on cellphone.

Time sensitive- coupons, can be saved or retained on the screen until the customer shows it at check out

High value- coupons with high value

Voice activation- make it safe

Once-click payment mechanisms- a system in which payment is easily and securely authorized and billed to a single account.

Security- user must be assured transmissions are secure.

Privacy- no abuse on tech capabilities like geo locational services, protecting consumer data.

Expanded permission marketing- must find out what kind of information consumers are willing to receive.

What the future holds in terms of knowledge management and the use of it for marketing application is still in working progress. I mean the technology does exist, however barriers exists and there could be other mistakes that most people overlook. Like for example I never really had an experience where I encountered with a human agent about exchanging of information worth telling, probably minor experiences but not good enough for an essay. However there is the example about the learning how to get your first home but through some kind of process.

There has to be some kind of information structured so it can execute in the most efficient manner. Information is the key that equips workers with knowledge to perform their tasks and on automated marketing programs of many kinds. As we all know, programs, no matter how much information is obtained, are followed in steps, after the first steps are taken then the following information can be revealed in the next process. Like for example when a new couple wanted to buy a house, they had to check to see if they can be approved or pre-qualified for mortgage, that’s step one of buying a house. They decide to start with their bank where they have their individual checking account, as they already have an established relationship with the bank, and will help smooth the whole mortgage process. This bank spends the last couple of years trying to build an integrated system in an attempt to make the process as quick and efficient as possible. The whole profile is set and customized according to their likings, and to their buying habits, a marketing plus. The contents of the screen show that the bank has considerable information about the customer and is using it in ways that have a good chance of being productive. Right after they send in their application, a personalized profile is constructed for them for information, and their value justifies a live customer service representative, they also have the button for live chat if needed. All this is done automatically, using many applications, all relying on event-driven software. In this case, the trigger is the mortgage application, which activates a series of decision rules. Then an automated system that electronically routes documents to the next person in the process, following up with emails and questions. The automated work flow also provides the customer with due dates for each task, and other things that need to be done before they can be approved. However this may not be realistic to one of our experience on the internet, but this is how knowledge should be managed, and this aforementioned process could be used in marketing.

NOTES ASIDE:

v You need detailed set of guidelines for using knowledge from several sources to provide the products, services, and support customers need

v Processes have become the key unit of analysis for improving quality and for implementing automated systems. It is not the individual step in the process that is most important; it is the smooth functioning of the entire process that is critical for success.

v Problems with missing data: be patient, data can be obtained over time in the normal course of business. Infer if needed. The alternative is to exclude a consumer from any age-related promotion, if you’re not certain with age.

v TACIT KNOWLEDGE: knowledge that has not been articulated; often subconscious and relatively difficult to communicate to other people. Askjeeves.com allows user to makes their queries in natural language.

v EMAIL systems require both sophisticated technology and a great deal of customer-relevant knowledge to perform well.

The Internet not only is a key reason why the expectations of both B2C and B2B customers are rising but also can be a way in which their expectations can be met in a cost-effective manner. Word of advice is to move away from total reliance on telephone call centers.

What is the concept of anticipatory customer service? What role can it play in successful customer service delivery?

The concept of anticipatory customer service revolves around the fact that even before the customer asks, perhaps even before the customer is aware of needing it, service will be provided. The aim is to prevent problems, not just resolve them once they occur, but onto a different level of service. One way to go about this is the rules-based personalization. This involves the actual business to notify the customer to see if they are aware of and allows them to agree to the modification of software. Like suppose if the customer bought “this” then you need send them “that” update, it’s almost like automatic email systems. The information comes on a schedule-basis, not on demand, automate the process to immediately send a thank you email. Another method of anticipatory customer service is to PUSH content to the user. The role this can play in successful customer service delivery is for example the Wall Street Journal Online offers desktop alerts on subjects selected by subscriber, based on their registration form. They took the initiative of providing information on them, without even them asking for it, this leads to successful customer satisfaction.

NOTES ASIDE:

v Assistance of a live person, includes email, instant messaging, and chat. The second way is to completely automate the process.

v The marketer can offer incentives, often price discount or free merchandise, to encourage customers to use the lower-cost channel. Marketers tend to turn to negative tactics in the customer service arena.

v Tech Savvy- The overall impression left by this piece of research is that self-service technologies have a great deal of potential to deliver satisfactory customer experience if they are carefully designed and if customers are trained in or guided through their use.

v Customer contact points include the Web, a telephone service center, field sales offices, and a telesales center. Dow’s Customer Interface Six Sigma quality improvement program. MyAccountsDow delivers services to registered customers invest much time and resources into organizing its people and process around our customer.

v Customer service at British Airways- Business mission was often described as being limited to getting the aircraft into the air and down onto the ground on time. No airlines experience, Sir Colin understood customer service and its important in the marketing of travel services. First step to train employees to stop arguing with customers. New tech becomes available to improve the overall customer experience, and the customer becomes ever more demanding as time goes on. Customer experience should be the key focal point.

Can you identify any ethical issues that are inherent in sophisticated customer service programs???????? umm human error, not all services are carried out the way we want them to be..

A relationship is defined as a bond or connection between the firm and its customers. This bond may be strong, weak, or nonexistent, and it can be based on either logic or emotion. An example of logical bond is a realization that the customer simply cannot get a better product elsewhere. However, strong relationships typically have an emotional dimension as well- think of your relationships with family and friends. Buyer-seller relationships can be strong, but generally they are not as powerful as the connection we have with people who are close to us. Buyer-seller relationships are based on exchange, where each party expects, or perhaps even demands, value for what is given.

2) Why is intregrated lever selection important in a marketing plan?

IMC ensures that levers complement one another and thus drive customers through the relationship stages more effectively.

3) How did eBay’s application of the Marketspace Maxtrix change over time?

eBay first focused on advancing users into the awareness and exploration/expansion stages. The next phase of its matrix involved building community and sustaining commitment. Once the community was established along with a large user base, eBay again returned to bringing new users into the community through the awareness and exploration/expansion phases.

4) What are the four categories of principles for lever selection?

v Which levers are customers most responsive to?

v Which levers are least likely to generate a competitive response?

v Which levers work best together?

v Which levers are consistent with strategy?

What are the key principles for lever selection within the Marketspace Matrix?

1- Base the levers on consumer behavior.

2- Choose levers to effect change.

3- Measure the impact of each lever.

4- Overcome barriers to advancement.

5- Anticipate your competitors’ likely responses.

6- Build on your firm’s skills and resources.

7- Look for interaction effects

8- Integrate across levers.

9- Levers create the position

10-Focus on superior customer value

• A distribution channel is the system of organizations involved in the process of making a product or service available for consumption or use.

• Marketing channels therefore facilitate the exchange of goods and services between buyers and sellers

2) What are the functions of channel intermediaries?

Objectives of Channel Intermediaries

Efficiency: Distribution costs are reduced only if the retailers can perform the required functions more efficiently than the manufacturers could in the direct channel.

Effectiveness: the ability of the channel to perform functions that create value for customers.

3) What is disintermediation and what are its implications for channel intermediaries and customers?

Disintermediation

•A strategy that involves the elimination of a channel intermediary.

•Internet has become a driving force for disintermediation

•Overall result is positive because channel works more closely to create value for customers.

Elimination of channel intermediary

• E.g. one hallmark of the new economy is a move from traditional manufacturer-retailer-consumer channels to direct online channels that eliminate the retailer.

Internet – driving force for disintermediation

• The Internet enables firms to interact at a much lower cost and higher speed than ever before.

• Frequency and complexity of communication between buyers and sellers, but tighter links between channel members which facilitates lower inventory and shipping costs.

4) What are the distribution levers and how do they affect relationships between intermediaries and buyers and sellers?

Awareness

Number of Intermediaries

• Intensive distribution strategy should lead to greater awareness because the firm is accessible via more outlets.

• Nearly all distribution in the online world is intensive because of the Internet’s massive reach.

• However, participation in affiliate programs is one tactic that increases distribution intensity.

Number of Channels/ Intermediary Type

• Given that different customers are likely to shop at different channel types, a greater variety of distribution channels increase market coverage and therefore awareness.

Exploration/ Expansion

Degree of Channel Integration

• As integration increases, the willingness to explore the potential for a relationship should increase.

• Very simply, integration increases the level of customer service, which increases the attractiveness of the firm as the relationship partner.

• Also important is the effect of channel integration on the reliability of customer service.

• Relationship quality comes not only from the level of the customer service, but also from whether the customer can count on the service from interaction to interaction.

Number of Channels/ Intermediary Type

• Likelihood of exploration increases as the number of channels increase.

• •Firms increase exploration and expansion of the relationship by ensuring they target their customers correctly.By understanding the needs of each target segment, the product or service can be delivered through the most appropriate distribution channel.

• As the perceived value of the product is enhanced, the willingness to explore increases.

Commitment

Degree of Channel Integration

• The channel environment must be integrated for customers to commit.

• Customers expect to be treated in a holistic sense, rather than on a per-transaction basis.

Intermediary Type

• •Making a commitment to the firm requires trust and so the selection of the channel should be affected by the degree of trust that is associated with the alternatives.Another issue is the ability to form buyer-seller relationship in an indirect channel. Manufacturers that go direct have greater control over the brand’s marketing strategy and are more likely to generate commitment.

Number of Channels

• •While a major advantage of employing multiple channels is the ability to appropriately serve multiple market segments, this strategy can also increase customer commitment within a segment.Customers often have different buying requirements based on the purchase situation, and their requirements can evolve over time as they grow older or their life situation changes.

Intermediary Functions and Responsibilities

• •The firm can enhance customer value and strengthen commitment by using market research to understand customer perceptions of service quality.Other channel functions and responsibilities that can lead to greater commitment include customer representative training, sales incentives that focus on customer satisfaction and increased margins.

Dissolution

Elimination of Channel Types

• Some customers, particularly those who find value in the functions carried out by the channel type that has been eliminated will complain or leave.

Reduction in the Number of Intermediaries

• Customers will find it more difficult to purchase the firm’s products and will complain or exit.

Reduction in Channel Integration

• By customers being treated based only on part of their transactions, they are less likely to feel connected to the firm or brand, and dissolution is likely to follow.

A set of interwoven relationships built upon shared interests, which satisfies members’ needs otherwise unattainable individually.

2) What are the criteria that define successful community?

•Membership is a conscious choice.

•Member base has achieved critical mass and sustainability.

•Members feel a great sense of trust.

•Members achieve benefits in scale.

•Roles are not hierarchical or imposed.

•Effective facilitation and site structure keeps community activities on track.

•A spirit of participation and feedback is clearly cultivated.

•A sense of affiliation is achieved through ownership of equity in the community.

•Efficiency in interaction is maximized.

•The community is easily navigable.

3) What are the different types of interest that form the foundation of community?

There are three broad types of Communities, differing by their foundation of shared interests: 1) Information-driven communities, 2) Activity-driven communities, 3) Commonality-driven communities

4) What are the different ways in which communities’ function?

How do Communities Function?

•Real-time systems

–Internet Relay Chat (IRC)

–Web-based chat

–Virtual worlds and MUDs (Multiuser Dimensions)/ MOOs (MUDs Object Oriented)

•Asynchronous systems

–Mailing lists

–Newsgroups (Usenet groups)

–Web-based message boards (bulletin board systems [BBS])

5) What are the three primary ways in which value is created within a community?

Three patterns emerge for creating and transferring value within communities: 1) User to user 2) Administrator to User 3) User to administrator.

6) What are the benefits that community can generate for a parent firm?

• Cost Benefits

– Reduced Customer Service Costs

– Reduced Customer Acquisition Costs

– Reduced Costs from Decreased Product Flaws and Marketing Mistakes

– Reduced Marketing Costs

• Revenue Benefits

– Increased Customer Segmentation and Customization

– Increased Branding

– Deepened Customer Relationships

7) What are the different levels of community?

Community Building on the Web in Amy Jo Kim’s book identifies 5 stages: Visitors, Novices, Regulars, and Leaders.

In a separate book, Randall Farmer similarly delineates the different participation levels: Passives, Actives, Motivators, and Caretakers.

How to Create Successful Community

Guiding Principles: The Four-Stage Micro-Approach

–Awareness

–Exploration/ Expansion

–Commitment

–Dissolution

Guiding Principles: The Three-Level Macro-Approach

-Nascent

-Formative

-Mature

• Can be defined as both tangible goods and intangible services generally created for the purpose of transaction.

• Two general types of products for which the levers of product development differ – physical and services.

• The Internet is changing some accepted limitations of service-based offerings such as intangibility, simultaneity, heterogeneity, and perish ability.

• Three components to overall value proposition: core benefit, basic product and augmented product.

2) How do interactivity and individualization affect product?

• The 2Is allow a company to learn more about its customer, personalize a product to meet customer preferences, and offer CRM tools to provide more value for customers and cut costs for product sellers.

• Websites which require customers to register to use the site have access to numerous tools to interact with the user as an individual.

3) What are the key marketing levers for products?

Basic Product includes the packaging, attributes & features, Customer- Specified Attributes & Features, and Mass-Customized Product.

These are the key marketing levers for products:

• Customer Service Programs

– Postsales support, customer care, & customer relationship management.

• Loyalty Programs and Privileges

• Availability of Complementary Products

• Upgrades

• Enabling Community

• Additional Functionality

• Fulfillment Capabilities

4) What does the overall product development process look like?

1. Idea generation
2. Screening ideas
3. Product design
4. Prototype development
5. Business analysis
6. Test marketing
7. Commercialization

5) How can companies manage their product portfolio?

A strong product development portfolio generally includes:

1. New product development
2. Enhancements and line extensions of current products and services
3. Development of existing products
4. Support of current products and services

6) How can products help enable a customer relationship?

• Two primary techniques:

1. Deploying the product development levers that are appropriate for the existing relationship and

2. Emphasizing the elements of the value proposition that are most relevant at a given stage of the relationship.

7) How can a customer-centric approach to product development create strategic advantages?

New product development is impacted by:

1. Customer needs
2. Production needs and capabilities
3. Research and Development
4. Competitors and Marketplace Forces

Its important because the internet has created competition and leaves expectations in the minds of the consumer, therefore we must reach these expectactions through interactivity and through individuals and their important relationships to the marketing department.

2)  What is the role of the Internet in a marketing communications campaign?

The goal of marketing and communications is to convey relevant messages to the right consumers at the right time.  Synergy between messages is intergrated communications.  Traditional and interactive  marketing methods may be used at hte same time.

3)  What are the main categories of communication types, and within each catergoy, what are the tools, or marketing levers, that marketers use to communicate with consumers?

Marketing communications, which includes all the points of contact that a firm has with its customers, can be grouped into four categories:

1. Mass offline- Broadcast Media: television, radio, outdoor & public relations. Print Media: newspapers, magazines, yellow pages, brochures, newsletters. Point-of-Purchase Displays
2. Personal offline- Telemarketing, Direct Mail, Statement Stuffers, Customer Service
3. Mass online- Basic Online Tools: banners, interstitials, search engines, point-of-purchase displays, Applications of Basic Online Tools: partnerships and affiliate programs, sponsorships, chat rooms, serial marketing
4. Personal online- Personalized Commercial Websites, E-mail Marketing: viral marketing, loyalty programs, customer service

4)  What are the six steps in the communication process?

1. Identifying the Target Audience
2. Determining the Communication Objective
3. Developing the Media Plan
4. Creating the Message
5. Executing the Campaign
6. Evaluating the Effectiveness of the Campaign

5)  How do the 2Is of the Internet affect marketing communications?

Interactivity- you can develop a closer relationship with consumers when you make them feel comfortable and can do anything online, like text messages alerts, and emails.  Individual- is the relationship with consumers.

6)  What levers are used for thedifferent customer stages?

Relationship Stage	Marketing Levers
AWARENESS	® Online levers: online billboards, search engines, e-mail, viral marketing ® Offline levers: television, magazines, radio, yellow pages, billboards/ outdoor
EXPLORATION/ EXPANSION	® Online levers: online billboards, search engines, e-mail, viral marketing, website, permission marketing, serial marketing ® Offline levers: television, radio, newspapers, packaging
COMMITMENT	® Online levers: targeted email/ permission marketing, personalized pages ® Online/ Offline levers: loyalty programs, customer service ® Offline levers: telemarketing, direct mail permission marketing with personalized offers
DISSOLUTION	® Personalized pages ® Termination

]]> http://blsciblogs.baruch.cuny.edu/wymbs/2008/12/17/class-14/feed/ 0 http://blsciblogs.baruch.cuny.edu/wymbs/2008/12/17/chapt-11/ http://blsciblogs.baruch.cuny.edu/wymbs/2008/12/17/chapt-11/#comments Thu, 18 Dec 2008 00:10:21 +0000 gibok22 http://blsciblogs.baruch.cuny.edu/cwglee/?p=67 •What is the relationship between price and demand? Why is it important for a firm to price at the point at which marginal revenue is equal to marginal cost?

•Why should a firm consider fairness when pricing its goods?

•How has the Internet enhanced opportunities for dynamic pricing strategies?

•Why would a firm want to implement a price-discrimination strategy?

•What is the difference between static and dynamic markets? Why must a firm consider its pricing strategies within the context of a dynamic market?

The Economics of 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

Dynamic Pricing Strategies

•Dynamic Pricing is one of the most significant contributions the Internet and the 2Is have made to pricing strategy.

•The Internet has enhanced dynamic pricing in two ways:

–Decreased Menu Costs

–Interactivity

Auction Types

•English Auctions

–Reverse-Price English Auction

•Dutch Auctions

•First Price Sealed-Bid Auctions

•Reverse First Price Sealed-Bid Auctions

•Group Buying

•Exchanges

Advanced Pricing Strategies

•Price Discrimination

–first-degree, second-degree and third-degree

•Volume Discount Pricing

•Two-Part Pricing

•Bundling

•Price Discrimination Over Time

•Frenzy Pricing

Strategic Responses to Competitor Price Cuts

®Enhance the Value Proposition

®Battle

®Cross-Parry Attack

®Targeted Response

®Fighter Brands

®Justify the Price Differential

Pricing Process

®Set pricing goal

®Differentiate value relative to substitute products

®Strategically select target customer segments

®Strategic pricing/ competitor reaction

®Select a pricing structure and price point

Pricing and Market Making on the Internet

(Dolan & Moon, HBS Case 9-500-065)

•The Internet will create downward pressure on prices:

•Potential buyers can speedily search the net

•Low consumer search costs will lead to greater price competition.

The Internet will create downward pressure on prices:

•The same technology that reduces customer search costs also:

•Facilitates buyer acquisition of quality information

•Enables suppliers to update price dynamically in response to observed demand

•Allows sellers to create meaningful markets for potential buyers with price being the outcome of the auction process

•Permits prospective buyers to specify in detail the product’s requirements and put fulfilment out to bid to an organized market of potential sellers.

In an Internet era the challenge is not only setting the price for knowledgeable consumers; but, also, how to select the most advantageous combination of market making mechanisms via which to transact exchange.

Type 1: The Set Price Mechanism

•Take it or leave it price involves horizontal interactions between buyers and sellers.

•Low transaction costs.

•Sense of fairness.

•In traditional retail markets, buyer ignorance is a source of profits, but in an Internet world search costs are low and search agents are increasing.

•Internet examples, Amazon, etoys.com, Compare.net, R U Sure, NECX.

•Internet has created set of companies that sell product below costs, e.g.,

Buy.com (but ?)

Type 1: The Set Price Mechanism

(Con’t)

•Others, like Amazon, do not offer the lowest price, but leverage other

dynamics such as:

•Branding and trust – most on-line transactions are not instantaneous and consumers have fear of being ripped-off

•The shopping experience – superior product information and search tools.

•Lock-in – activities that increase customer switching (customize customer interactions).

•Dynamic pricing – low menu costs and increased customer information.

Type II: The Buyer/Seller Negotiated Price Mechanism

•One-to-one vertical negotiations takes place around the world, from the fruit markets in Taipei, to car dealers in the NYC; however, they have some disadvantages:

•It takes longer than fixed price exchanges to complete.

•Price tends to dominate over features.

•For negotiations to be effective, the customer contact person must have some degree of pricing authority.

The Internet provides an efficient mechanism that mitigates each of these problems.

•Start with a specific price: NexTag.com gives listing of products and allows the customer to counteroffer. Advantages of the process are that negotiations can be done with multiple sellers at once and the customer is always in control.

•Another alternative is Hagglezone for real time negotiations and entertainment.

•Buying-power based negotiations

•Product aggregators, get volume discounts, sites like Accompany.

Type III: Auctions and Exchanges

•Three types of auctions based on competition across buyers and/or sellers producing prices that can be highly variable across transactions:

•(a) Classic auctions – competition across buyers lead to price

•(b) Reverse auctions – competition across sellers lead to price

•(c) Exchanges – multiple buyers and sellers interact to set price.

Classic Auctions IIIa

•Basic demand aggregation model that functions to deliver the best price for

sellers, given the market demand the seller has been able to assemble.

•Types of auctions include: C-2-C (eBay-like); B-2-C (Egghead); B-2-B (Tradeout). Related items of trust, community and relationships. Barriers of entry are relatively low, but success breeds success.

The Internet increases the economic efficiency associated with auction models. More specifically:

•The Internet lowers the search costs for sellers looking for buyers (transforms niche market segments into mainstream segments).

•The Internet lowers the cost associated with making inventory available to buyers immediately (bypass liquidation broker fees).

•For buyers, the Internet lowers the cost associated with accessing hard-to-find items (auctions aggregate supply for buyers).

•The interactive nature of the Internet facilitates the creation of a buyer community (eBay is actually the creation of something that could not have been done in the real world).

Classic Auction IIIb

•The buyer is more proactive and specifies what it is that will be purchased; then, supplier’s bid indicates the price of fulfilling that demand.

•Reverse auctions have been the main tool in B-2-B. RFP and RFQ are generated and transmitted to qualified buyers for bid. B-2-B examples include Freemarkets and CommerceOne,

•B-2-C auctions of Type IIb are less well developed, but some are forming like “imandi” where individuals put out a RFQ for a product or service.

Buyers remain anonymous to sellers and can choose to follow-up via e-mail.

•The Priceline-type variant: In many ways the service represents a sacrifice of consumer power in favor of solving a vendor’s problem of selling off excess capacity.

•By requiring customers to be flexible with regard to brand, sellers and/or product features, sellers are able to generate incremental revenues without disrupting their existing distribution channels or retail pricing structure.

Classic Auction IIIc

•IIIc exchanges are electronic marketplaces where a group of buyers and a group of sellers interact to trade and set prices for transactions.

•The general purpose of exchanges is for each product to dynamically update a list of offers to buy and offers to sell. These buys and sells are matched through the market making process.

•A major advantage of these exchanges, e.g., Fast Parts, ESteel, ChemConnect, is that they bring together buyers and sellers on a global scale.

Summary

•The Internet has changed the way many markets are organized and consequently the mechanisms via which price is set.

•Markets are now more efficient, i.e., they cut the ignorance premium, and different forms of market mechanisms will operate, but we can not unequivocally say that price will go down.

•The Internet can increase prices for time sensitive commodities in inefficient markets, e.g., airlines.

•The Internet can also be a price boom for differentiated commodities; it allows suppliers to provide more requested consumer information.

•However, the Internet can be a disaster for those with a commodity selling mentality.

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• Visit one B2C and one B2B Web site. Examine each carefully, identifying as many relationship building techniques as possible. Do you find extensive differences between the B2C and B2B sites? Be prepared to discuss your findings, and the similarities and differences between programs on the two sites, in class.
• Keep a log of the contacts from a particular site for a week. In general, what are they learning about you from these interactions? Specifically, what data might they have added to your record in their database.

CRM techniques range from segmentation approaches to highly personalized one-to-one programs. Different approaches may be appropriate for different businesses because of the nature of their products and target segments. Whichever specific approach is used, it is important to remember the value of building trust over time and of respecting the privacy of the customer. Opt-in permission marketing techniques are essential elements of relational marketing processes.

Lands End, a well-known catalog retailer of classic casual clothing – Site’s special features encourage visitors to browse, buy, and return. The “My Virtual Model” feature creates a virtual dressing room, in which the shopper can select a body type and try clothing on. If customer still having trouble finding the right product, there is a live chat feature accessible on the Customer Service that allows customers to exchange text messages with a customer representative in real time. Individualized service, customer can ask for a Specialty shopper by phone or chat. If shopper still isn’t able to find right products, then they offer a line of custom garments, and customer’s measurement are saved for future orders. 

Yellow Transportation- a freight company serving the B2B marketplace- Customers can tack shipments in process, get prices for planned shipments, and obtain a number of useful report. Customers can also create their own “My Yellow” page and specify parameters such as regular shipping time and pickup address. Yellow also offers chat capability on the Web site. Online tools page they can find self-service tools listed by category. Frequent addition of useful functionality on a site is an important ay to keep customers coming back and retaining loyal customers in the face of competition. Yellow transportation on Fortune Magazine list of most admired companies, ranking first in the transportation industry. Yellow received Carrier of the Year and Innovator of the Year awards from Wal-Mart for its contributions to supply chain excellence.

So basically what these two are aiming for is greater customer satisfaction, they may do it in a different way, but their main goal is the customers.

CRM:

Targeting: refers to directing marketing communications to individuals or businesses that have been identified as valid prospects for acquisition or retention. Targeting in CRM identify a customers by developing customer profiles and using them either to identify customers who are appropriate to receive. Customer profile: a description, primarily quantitative, of an individual or segment using specified demographics, lifestyle and behavioral characteristics. Fastest way for a firm to build its own house list is through registration on the Web site. Techniques that prevent errors, like pull-down lists, are desirable. Even so, the form may not be complete unless there is an incentive. (Lucille Roberts) If the information comes on a schedule basis, not on demand, automate the process to immediately send a thank you email. This is a classic direct marketing lead generation process. Data collection is just a “fishing expedition”, as relationship strengthens, more information that is more detailed and more personal can be collected. 

Personalization: involves the creation of specialized content for a prospect with a known profile by choosing from an array of existing content modules. In addition to the emails,

Both cases used PERSONALIZATION and CUSTOMIZATION techniques. Personalized email and site content-

THREE BASIC TYPES OF PERSONALIZED SITE CONTENT ARE IN USE:

Rules-based personalization chooses content on the basis of known  weather.com provides geographically appropriate content to registered users). “Purchase circle on amazon.com” registered address of the customers to say something.

User-Controlled personalization allows the user to choose the content elements to be displayed. Businesses are increasingly encouraging customers to create their own personalized entry page containing the information they access most frequently (My yellow option).

Information-driven personalization uses complex profiles.

CUSTOMER LOYALTY PROGRAMS- DUANE READE, SHOP RITE club card programs