key term outline 4–14–1 chapter 4: e-marketing and customer relationship management...

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4–1

Chapter 4:E-Marketing and Customer Relationship Management

Pride/Ferrell

Foundations of MarketingThird Edition

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Copyright © Houghton Mifflin Company. All rights reserved. 4–2

Part 2Using Technology for Customer Relationships

in a Global Environment

Chapter 4 E-Marketing and Customer Relationship Management

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Objectives

1. Define electronic marketing and electronic commerce and recognize their increasing importance in strategic planning.

2. Understand the characteristics of electronic marketing—addressability, interactivity, memory, control, accessibility, and digitalization—and how they differentiate electronic marketing from traditional marketing activities.

3. Examine how the characteristics of electronic marketing affect marketing strategy.

4. Understand how electronic marketing and information technology can facilitate customer relationship management.

5. Identify the legal and ethical considerations in electronic marketing.

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1. Marketing on the Internet

Basic Characteristics of E-Marketing

E-Marketing Strategies

2. Customer Relationship Management

Database Marketing

3. Legal and Ethical Issues in E-Marketing

Outline

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accessibility cookie interactivity

addressability database memory

blogs digitalization portal

communityelectronic commerce

(e-commerce)spam

controlelectronic marketing

(e-marketing)wikis

Key Terms

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1. MARKETING ON THE INTERNET

Electronic Commerce (E-Commerce)Sharing business information, maintaining business

relationships, and conducting business transactions by means of telecommunications networks

Electronic Marketing (E-Marketing)The strategic process of creating, distributing,

promoting, and pricing products for targeted customers in the virtual environment of the Internet

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E-Marketing

Through e-marketing companies can market to target audiences

© Used By Permission.

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Benefits of E-Marketing

Open and Instantaneous Flows of Information

Enhanced Customer Service Efficiencies

Worldwide ScopeOpens markets to firms of

all sizes


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Consumer-Generated Electronic Marketing

Blogs

Wikis

Public Opinion websites

Social Networks

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Basic Characteristics of E-Marketing

Addressability

Interactivity

Memory

Control

Accessibility

Digitalization

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Addressability

A marketer’s ability to identify customers before they make a purchase

How E-Merchants Attain AddressabilityLimit access to areas of their web site to encourage

customer registration

Offer contests and prizes in exchange for consumer information

“Cookies”

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Interactivity

Allowing customers to express their needs and wants directly to the firm in response to the firm’s marketing communicationsReal-time interaction with customers

Broader market coverage at a lower cost

Community

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Memory

The ability to access databases or data warehouses containing individual customer profiles and past purchase histories and to use these data in real-time to customize a marketing offer.

Database

Data Mining


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Control

Customers’ ability to regulate the information they view and the rate and sequence of their exposure to that information.Portal

Security plays a large role in control.


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Accessibility

The ability to obtain information available on the Internet. Informs and educates the inquiring consumer

about competing products and prices

Creates competition for the consumer’s attention

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Digitalization

The ability to represent a product, or at least some of its benefits, as digital bits of information.

Digitalization has helped traditional businesses migrate

to online services© Used By Permission.

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E-Marketing Strategies

Product Customized orders

Services growing

Distribution Order processing

Synchronization

Promotion Consumer in control

Augments traditional forms

Pricing More consumer information


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2. CUSTOMER RELATIONSHIP MANAGEMENT

Focuses on using information about customers to create marketing strategies that develop and sustain desirable long-term relationships.

Database Marketing

Customer Lifetime Value

Technology Driven

Customer support

Call-center software

Customer Satisfaction

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Marketing for Customer Relationship Management

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Database Marketing

Database Management Identify/build database

Differentiate messages to consumers

Track relationships

Figure 4.1Why Customers Defect

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Customer Lifetime Value

80 percent of business profits come from 20 percent of customers.Advances in technology allow marketers to profile

customers in real-time and thereby assess their lifetime value (LTV) to the firm.

Some customers may be too expensive to retain given the low level of profits they generate.

Focus on developing and managing long-term relationships with more profitable customers.

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Technology Drives CRM

Customer Contact Points M-commerce

Data Analysis

Customer support/call-center software

Sales automation software


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Customer Satisfaction and CRM

CRM is about relationships, not technologyTechnology can help build

long-term relationships

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3. LEGAL AND ETHICAL ISSUES IN E-MARKETING

Privacy Issues

Spam

Misappropriation of Intellectual Property

SurfControl stops unwanted e-mails, block inappropriate content, and

secures confidential data. © Used By Permission.

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Legal and Ethical Issues


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Code of Ethics (1)

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Code of Ethics (2)

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After reviewing this chapter you should:

Be able to define electronic marketing and electronic commerce and recognize their increasing importance in strategic planning.Understand the characteristics of electronic marketing—addressability, interactivity, memory, control, accessibility, and digitalization—and how they differentiate electronic marketing from the traditional marketing environment.Have examined how the characteristics of electronic marketing affect marketing strategy.Understand how electronic marketing and information technology can facilitate customer relationship management.Be aware of legal and ethical considerations associated with electronic marketing.

key term outline 4–14–1 chapter 4: e-marketing and customer relationship management...

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