Internet Marketing Customer Support and Online Quality
Jan 15, 2015
Internet Marketing
Customer Supportand
Online Quality
Marketing ProcessesThat Can Be Digitized
Understand Markets
& Customer
s
Involve Customer
s in Design Process
Market & Sell
Products &
Services
Deliver Value
Through Distributi
onProvide
Customer Care
Manage Customer Informati
on
Topics
• Solving problems online• Lower costs• Online quality• Justifying online enhancements• Co-production
Providing Customer
CareThrough Online
Content
Online Quality•VVAs•Customer Support
Lower Costs•Online Publishing•Electronic Distribution•Virtual Problem Solving•Customer SupportJustifying Online Content
• Enhanced Margin• Expanded Sales
– Acquire new customers– Develop existing customer
base• Customer satisfaction
– Customer retention
Solving Problems Online
• 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
Provides Strong Justification for Investing in the Web
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
• 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
Figure 6.3
Cost Savings
Q: Where do these cost savings come from?
• 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
• 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
• Sales calls and call centers – Require expensive, assisted, real-time
interactions– Are labor intensive
Customer ServiceMethod
Agent:CustomerRatio
Type ofInteraction
Type ofService
Sales Force 1:1 Real- time Assisted
Call Center 1:1 Real- time Assisted
Inexpensive Web-Based Communication
• Many of these methods do not require real-time intervention
• Customers are able to solve their own problems
Customer ServiceMethod
Agent:CustomerRatio
Type ofInteraction
Type ofService
E- mail 1:1 Messaging Assisted
E- mail with AI 1:many Messaging Self
Web: FAQ 1:many Messaging Self
Web: self 1:many Messaging Self
Web: chat 1:many Real- time Assisted
Web: phone 1:1 Real- time Assisted
Traditional and Web-Based Customer Support
Customer ServiceMethod
Agent:CustomerRatio
Type ofInteraction
Type ofService
Sales Force 1:1 Real- time Assisted
Call Center 1:1 Real- time Assisted
E- mail 1:1 Messaging Assisted
E- mail with AI 1:many Messaging Self
Web: FAQ 1:many Messaging Self
Web: self 1:many Messaging Self
Web: chat 1:many Real- time Assisted
Web: phone 1:1 Real- time Assisted
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
Headline
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.
Name of Publication - Date
Customer Care
Q: How do you create a Nordstrom-like experience on the Internet?
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
Virtual Value Activities and Customer Support Solutions
Figure 6.6
Virtual Value Activities and Customer Support Solutions
Figure 6.8
VVAs Investor Relations Technical Support
Gathering SEC filingsPress releases
Stock informationAnalyst Reports
Product manualsProduct design documents
Help desk infoField engineersWarranty info
Organizing Chronological listingKeyword search
NewsProduct group
Product line listingSearchIndex
Selecting NewsSEC reports
CEO speeches
FAQsHigh hit rate requests
Frequent call center requests
Synthesizing Reporter pagesAnalyst pages
Getting started pagesSolution pages
Distributing Homepage linkInvestor channel
Key customers extranetKey suppliers extranet
Navigation bar linksSolution CDs
Mass media ads
Tab
le
6.3
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
Drivers of Customer Satisfaction
Figure 6.9
Product Design Satisfaction Drivers
and Online MethodsTable 6.4
Sales Activity Satisfaction Drivers
and Online MethodsTable 6.5
After-Sales Activity Satisfaction Drivers and Online
MethodsTable 6.6
Culture Satisfaction Drivers and Online Methods
Table 6.7
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
• Traditional customer support technologies– customer-support
call centers– sales force help– dealers
• Steep curve due to increasing difficulty of providing higher quality levels
Cost Focus vs. Quality Focus
Figu
re 6
.10
The Cost-Quality Tradeoff for Traditional
Support
Breakeven Investment Analysis
• 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
Cost Focus vs. Quality Focus
Figure
6.1
1
Limited QualityPure Online Support
Breakeven Investment Analysis
• 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
Cost Focus vs. Quality Focus
Figu
re 6
.12
Creating a Hybrid High-Quality Support System
Breakeven Investment Analysis
• 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
A Dynamic Implementation Path
Figu
re 6
.13
Customer Lifetime Value Analysis
• 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
Closed Loop Web Enhancements
The ADR FrameworkAcquisitionSupported
DevelopmentSupported
RetentionSupported
Web Advertising E- mail accounts Free trials Amazon partners Edmund's QFN
Community andpersonalizationspending
I nformationcollection
Syndication expenses
Customer support Enhancement
spending Eff ectiveness
spending
• 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