BSAD 372 - CH 8

Copyright © 2019, 2015, 2011 Pearson Education, Inc. All Rights Reserved
Part 2
Strategy and applications
Chapter 8
Customer relationship
management
Digital Business and E-Commerce
Management
Seventh Edition

Learning outcomes
• Outline different methods of reaching and
acquiring new customers via digital media
• Evaluate different buyer behaviour amongst
online customers
• Describe techniques for retaining customers
and cross- and up-selling using digital media
communications

Management issues
• Which digital media should we invest in to reach
new audiences?
• What are the practical success factors for using
digital media to make customer acquisition more
effective?
• What technologies can be used to build and
maintain the online relationship?
• How do we deliver superior service quality to
build and maintain relationships?

What is CRM?
• You have a job interview for the AA
working in the CRM team (www.theaa.co.uk)
• How would you explain the terms:
– CRM
– e-CRM
• Why does Centrica have a CRM function?
– Why is CRM different?
– What are benefits of this approach?

e-CRM – a definition
e-CRM is:
• Applying…
Internet and other digital technology…
(web, email, wireless, iTV, databases)
• to…
acquire and retain customers
(through a multi-channel buying process
and customer lifecycle)
• by…
improving customer knowledge, targeting,
service delivery and satisfaction.

Marketing applications of CRM
• A CRM system supports the following marketing
applications:
– Sales force automation (SFA). Sales representatives are
supported in their account management through tools to
arrange and record customer visits.
– Customer service management. Representatives in contact
centres respond to customer requests for information by using
an intranet to access databases containing information on the
customer, products and previous queries.
– Managing the sales process. This can be achieved through
e-commerce sites, or in a B2B context by supporting sales
representatives by recording the sales process (SFA).

Marketing applications of CRM
(Continued)
• Campaign management. Managing ad, direct
mail, email and other campaigns.
• Analysis. Through technologies such as data
warehouses and approaches such as data
mining, which are explained further later in the
chapter, customers characteristics, their
purchase behaviour and campaigns can be
analysed in order to optimise the marketing mix.

Figure 8.1 The four classic marketing
activities of customer relationship
management

Figure 8.5 A summary of an effective
process of online relationship-building

Source: Smart Insights (2010) Introducing RACE: A practical framework to improve your digital marketing. Dave Chaffey, 15 July.
www.smartinsights.com/blog/digitalmarketing- strategy/race-a-practical-framework-to-improve-your-digital-marketing
Figure 8.6 Reach–Act–Convert–
Engage model

Figure 8.7 A summary of how the Internet
can impact on the buying process for a
new purchaser

Source: Bart et al. (2005).
Figure 8.8 A model of the relationship between different
aspects of trust and consumer response based on Bart
et al.’s eight website categories

Figure 8.9 Most-trusted sources of
information for consumers on products and
services in the UK in 2014
Source: www.statista.com/statistics/324550/most-trusted-source-of-information-on-products-services-in-theunited-kingdom-uk

Figure 8.10 Measures used for setting campaign
objectives or assessing campaign success, increasing
in sophistication from bottom to top

Figure 8.11 An example of effectiveness
measures for an online ad campaign

Which are the ranking factors affecting
position in Google SERPs?
200
+ −
• On-page optimisation
– Document meta data
– Document content
– Creation of new pages
• Off-page optimisation
– Link-building
 External links
• ‘Links in’
• ‘Backlinks’
• ‘Inbound links’
 AND internal links
• Behavioural
– Popularity of sites from toolbar
• Google’s search spam filters

Which SEO ranking factors
should I focus on?
• On page optimisation:
– <title> tag = 4.9/5
– Keyword frequency and density = 3.7/5
– Keyword in headings = <h1> = 3.1, <h2> = 2.8
– Keyword in document name = 2.8
– Meta name description = 2/5
– Meta name keywords = 1/5
• Off-page optimisation:
– More backlinks (higher PageRank) = 4/5
– Link anchor text contains keyword = 4.4/5
– Page assessed as a hub = 3.5/5
– Page assessed as an authority = 3.5/5
– Link velocity (rate at which changes) = 3.5/5
See http://www.seomoz.org/article/search-ranking-factors

Which factors affect returns
from paid search?
• Distribution of daily budget
• Amount bid (Max CPC)
• * Clickthrough rate
• * Creative quality including creative testing
• * Campaign structure
• * Match types especially negative matches
• Use of content network
• Time-of-day (day parting)
• Landing page quality
• Click fraud!
• * In Google AdWords, Live Search and Yahoo! Quality Score especially
important

Figure 8.12 Stages in producing
natural search engine listings

Source: Altimeter (2010).
Figure 8.18 Aspects of social CRM

Figure 8.19 Online PR categories
and activities

Figure 8.24 Activity segmentation
of a site requiring registration

Figure 8.25 Different representations
of lifetime-value calculation

Figure 8.26 An example of an
LTV-based segmentation plan

Figure 8.27 Customer lifecycle
segmentation

Figure 8.28 RFM analysis

Figure 8.29 An overview of the
components of CRM Technologies

Summary
• You should be able to outline different
methods of reaching and acquiring new
customers via digital media
• You should be able to evaluate different buyer
behaviour amongst online customers
• You should be able to describe techniques for
retaining customers and cross- and up-selling
using digital media communications

BSAD 372 - CH 8

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BSAD 372 - CH 8