Essay on "E-Customer Relationship Management"

Essay 17 pages (5217 words) Sources: 17 Style: Harvard

[EXCERPT] . . . .

Customer Relationship Management

e-Customer Relationship Management

How would you use social networks, permission marketing, and customer information acquisition in an E-commerce strategy?

The disruptive nature of social networks and their effects on marketing are revolutionizing every aspect customer relationships, including the re-ordering of marketing sales and services strategies. In aggregate social networks are bringing an entirely new level of insight and intelligence into how permission marketing, information acquisition and e-commerce strategies can be accomplished. The highest-performing marketing and sales organizations have successfully integrated the intelligence and insight gained from social networks via analytics and customer listening systems to better tailor selling, product and services strategies (Bampo, Ewing, Mather, Stewart, Wallace, 2008). Social networks have emerged as one of the most important and powerful platforms for aligning permission marketing to customer interest, segment and needs than any other development of the last decade. The insights gained from social networks in these areas are also completely revamping e-commerce strategies with much higher levels of personalization and more adept and agile multichannel marketing and selling strategies as well.

The intent of this analysis is to analyze and evaluate how social networks are completely re-ordering the nature of customer relationships. The nascent yet very rapid growth of Social Customer Relationship Management (SCRM), which is the combining of social networking-based prospect and customer information with the more structured and mature traditional CRM platforms is serving as the basis for many company's strategies in permission marketing, information acquisition and e-commerce strategies

(Cooke, Buckley, 2008). The mercurial nature of social networks however has made it difficult for companies to gain greater insights into their customer bases. The reliance on advanced analytics in SCRM and CRM systems has made the task of completing permission marketing achievable. Social networking has however changed the entire dynamic of relationships with prospects, customers and the general public, infusing a much greater level of transparency and authenticity into the process. Ironically the majority of marketers aren't using social networks to listen and respond to customers, creating more effective relationships in the process. Instead the majority of marketers are relying on social networks and their many channels they represent to communicate un-directionally, going so far as to spam prospects and customers alike. What's needed for marketers to drive greater value from social networks is the ability to listen, create trust and sustain strong communication with prospects, customers and stakeholders throughout their spheres of influence.

Marketers from both Business-to-Business (B2B) and Business-to-Consumer (B2C) companies have the potential to completely revolutionize their marketing, selling, service and long-term profitability by concentrating on these fundamentals (Doyle, 2007). The best practices of creating a very open, transparent and responsive level of communication throughout social media channels and across social networks permeate the companies getting the best results from these strategies. Consequently, their efforts at permission marketing, customer information acquisition and broader e-commerce strategies are significantly more successful (Harris, Rae, 2009). Companies excelling in this dimension of unifying social networks, permission marketing and customer information acquisition then driving effective e-commerce strategies include Amazon.com, Dell, Southwest Airlines and others who all have integrated social networks into their broader CRM platforms and strategies. Each of these companies have entire staffs dedicated to supporting their social CRM efforts and strategies, while also integrating unique customer data, managing ongoing marketing campaigns and responding to customer service requests that are initiated over social media channels. The net effect of this approach has been to galvanize the effectiveness of these social media channels for these companies (Jones, 2002). The best practices shown by Amazon.com, Dell, Southwest Airlines and others in this area of social networking is also showing that social networks can become a main part of any global, multichannel management selling and service strategy.

In a recent survey completed by market research and consultancy firm Gartner Group, the role of social media on e-commerce as a multichannel strategy was quantified. Gartner reports that brick-and-mortar stores in 2010 was 93.99% of all multichannel activity, with e-commerce being 4.7%, mail order catalog (.23%), call center (.93%) mobile commerce (.7%) and all other channels .7%. According to their research, this is expected to shift drastically by 2016 in the areas of e-commerce and mobile commerce. By 2016, Gartner predicts that brick-and-mortar stores will be 84.84% of sales in multichannel strategies, followed by e-commerce at 12.28%, mail order catalogs (.38%), call centers at .65%), mobile commerce at 1.74% and other channels at .11%. What these figures show is the pervasive adoption of social networks are having an acceleration effect on e-commerce and mobile commerce specifically and also shifting the sales channels to make them more diverse. This aligns with what industry researchers had said about the impact of social networks and permission marketing on the multichannel platform strategies of companies selling through e-commerce strategies as well. The net effect of these advances in multichannel selling via e-commerce is a more unified customer experience, and the maturation of multichannel selling and service strategies in industries that have long relied on them. From this perspective the combined effects of social networks, permission marketing and customer information acquisition, there continues to be a rapid maturation of e-commerce within specific pockets or segments of industries. The industries getting the greatest traction or value of e-commerce today include discrete manufacturing, entertainment and media, retail, travel and leisure and wholesale and distribution management. These industries also have among the most diverse and challenging multichannel selling networks and relationships, and also have the most diverse supply chains as well. The entire value chains of the companies shown in the red area of high customer-facing impact potential in Figure 1 also are differentiated in that they deal with complex fulfillment and loyalty dynamics with customers as well, and many are in B2B-oriented industries. Social networks and the relationships they are fostering with prospects and customers are also leading to greater agility and flexibility in multichannel-based selling and service strategies. Companies attaining best practices in these areas are using e-commerce as the unifying platform to ensure consistency of customer experience and further earn long-term loyalty in the process.

Figure 1: Assessing the Customer-Facing Impact Potential for E-Commerce

Successfully integrating social networks, permission marketing and the many processes and systems aimed at customer information acquisition into a unified e-commerce platform also requires these companies to appreciate and understand the role of Web 2.0 technologies as well. Having been defined originally by Tim O'Reilly in 1996, Web 2.0 today has grown into the foundation and framework of social network product and service design (Cooke, 1994). Web 2.0 design objectives permeate social networks, starting with the concept of the Web being the platform. The core competencies of Web 2.0 are commonly used in the development of Software-as-a-Service (SaaS) and highly collaborative networks including Facebook and Twitter today. The rapid adoption of social networks today can be entirely attributed to the Web 2.0 design objectives as shown in Figure 2, the Web 2.0 Meme Map Is a Platform of Social CRM and E-Commerce below (Cooke, 1994). Forward-thinking companies who see these dynamics and plan fro them in their SCRM, CRM and most of all, e-commerce strategies, are significantly ahead of their competitors who are stuck in a mindset of seeing social networks only as a means to blast out messages, not listen and learn from customers.

Figure 2: The Web 2.0 Meme Map Is a Platform of Social CRM & E-Commerce

The proliferation of social networks and permission marketing platforms that are the direct result of how pervasive the design tenants and concepts have been adopted throughout global public and private networks. Further, Web 2.0 technologies are also have a drastic impact on the approach taken by companies to attract, sell and serve their customers, with specific focus on how to create a more open dialog with them (Cooke, 1994). Permission marketing would not be possible to the extent it is in place today without social media and the continual attention being pad on the part of companies to creating a level of trust and transparency with prospects and customers alike. Social media actually made the attainment of permission marketing and its many variations incouding content marketing, possible. The role of social media, while much hyped in the context of customer information acquisition and e-commerce strategies, continues to act as a crucible that purifies marketing to its purest form -- which is understanding customer needs and responding to them. How all this impacts e-commerce is that it forces organizations to create a much more unified customer management strategy, one that is both information- and process-integrated for the greatest possible impact. Creating e-commerce strategies that fully capitalize social networks, permission marketing and customer information acquisition require very high levels of system integration as well (Qin, Kim, Hsu, Tan, 2011). In analyzing the best practices of companies who are attaining exceptional levels of performance on these dimensions, data from Gartner Inc. was used to define the five maturity phases of how companies are integrating social networking into their broader customer relationship and e-commerce strategies.… READ MORE

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