Fairview Internet Consulting for Francisco Frères – Final project

Posted on December 3, 2011 by louisagb

E-Marketing Project – Fairview Internet Consulting

Event-Based Marketing – What is it?

Posted on November 28, 2011 by louisagb

Many argue that Event Based Marketing has huge potential. According to the Gartner Group (2006) ”event-triggered marketing yields a level of response rate typically five times greater than that obtained using traditional marketing approaches.” But what is it really?

Event-based marketing analyzes customer behavior through advanced database technology. Based on significant changes in customer behavior a signal is triggered that initiate relevant, personal dialogue with the customer. Hence the customer is contacted when the need is the greatest and when the customer is most receptive to interaction with the company. ”EBM is a strategic process designed to enhance the dialogue and relationship a company has with each of its customers” (Chris Twogood, “The Power of Event-Based Marketing, 2003)

As event-based marketing is relatively new, there are still many aspects of the concept, that are unexplored, and various pitfalls to be avoided for successful use of the concept. Furthermore, it requires a comprehensive customer database that contains specific knowledge about each customer. In other words, event based marketing is fairly resource intensive without an existing customer database. However, if properly implemented, the concept can allow for critical competitive advantage,. ”Enormous opportunities arise when customer events can be staged and managed using IT-based event triggers. As for the role of data warehousing, the best analytical tool only has business value when it can access and use data ”( Bartikowski, Boris; Braunmüller, Peter, “Critical events and next best activities in relationship marketing).

Event-Based Marketing – How does it work?

Posted on November 28, 2011 by louisagb

The most widely used marketing channel for event-based marketing is email, but to achieve the most effective marketing campaign it is advised to make use of several channels. Many companies today claim that they already use event-based marketing, which in its simplest form, probably is also the case. An example would be when a customer signs up for its newsletter, and a welcome email is triggered. Also, many companies use event-based marketing when a consumer buys a product and subsequently they are sent a confirmation email. But event-based marketing potential goes beyond these examples.

An example of more sophisticated event-based marketing is when a customer hasn’t visited a certain website for a longer period. This will trigger a contact to the customer where the customer is asked about the reasons for the lack of activity. If the customer on the other hand has just visited the website, an email can be trigged that is based on what the customer has been looking for. Changes in the customer’s life, such as moving, birthdays or children leaving home, are also examples of behavioral events, which the company can use to contact the customer. Event-based marketing is also effective in terms of cross-and upsell.

Event-Based Marketing – Future dilemmas and potential

Posted on November 28, 2011 by louisagb

Successful use of one-to-one marketing is strictly dependent on available customer information. This raises some practical as well as ethical dilemmas. While transactional/buying data often can be found in customer databases or the like, the acquisition of insightful, non-transaction related information such as interests, values, future purchase intentions, religion, political standpoint and other lifestyle characteristics are often based on consumers willingness to give out information. While this type of data collection is increasing, one needs to look at the reliability of data because incomplete and falsified information shortens the efficiency of direct marketing efforts. Ethical considerations concerns to what extend the company can use customer data. How far can we go in terms of use of customer data? Can we sell it to a third part?

Despite the various pitfalls, I believe that there are many opportunities within event-based marketing. Event-based marketing can contribute to profitable customer retention, increased customer service and relations as well as creating a closer relationship with the customer. However, it is difficult to predict the concept’s future success, as it is still a relatively unexplored topic in the scientific literature. There is no doubt that the rapid progress in the technological world, will support the development and allow for more intelligent forms of event-based marketing. I therefore believe that the future will have far greater emphasis on the quality of knowledge, including customer data validity.

Customer Reviews – Is it all good? Part I

Posted on November 13, 2011 by louisagb

The marketplace is full of advertisements promising you everything from weight loss to a new partner. At the same time people have become increasingly skeptical to these advertisement promises and that’s partly why consumer reviews have become so popular. The Internet has opened up for a whole new world of “unbiased” product or service opinions and I used to love it!! As long as it is kept honest I don’t care if it used as a part of the companies marketing strategy. But what I have come to realize lately is that, as with all things that gets very popular and grow in size, it has its disadvantages too.

TripAdvisor with over 41.6 million users a month is an obvious example of the increasing popularity of customer reviews. You can now get very specific information on almost any kind of accommodation down the very smallest detail. As a tourist new to a town this can be of great help especially when it comes to eliminating the very worst places to stay. Further it helps push the standards and increase the competition for the industries as a whole, which is very much in the interest of the consumers.

But what happens when we all read the same reviews??

In the end we all want to go to the place with the greatest service, nice beds, and outstanding breakfast within our prize category. Who would choose the noisy location and dirty room? For the lazy traveler, that doesn’t want to bother reading through all the reviews it is possible to search by highest review score and you’ll get the name of the best rated hotel/product right away. But is it all good?

Customer Reviews – Is it all good? Part II

Posted on November 13, 2011 by louisagb

Lately I have started to wonder; doesn’t the excessive amount of customer reviews take some of the joys out of travelling? Isn’t the purpose of (vacation) travelling to experience new things and come home with our own unique memories? How does that go hand in hand with the fact that we now know everything from the shape of the toilet soap to the receptionist uniform before leaving the safety of our own home?

Imagine that you later on want to go sightseeing. Because you have done your research from home (through blogs, travel sites etc.) you know exactly what to see, what bus/train to take, where to eat and even where to find the toilets. The result is that you end up not only staying at the same hotel as you neighbor but you end up coming home from the exact same vacation. In addition consumer reviews have the tendency to make you aware of negative details. This can end up having an unnecessary bad influence on your experience as you are annoyed my things you wouldn’t normally consider.

Nevertheless the fact is that positive customer reviews have become very important to any service or product. As the business world is starting to realize the potential and benefits of positive online customer feedback a new factor has to be taking into account; fraud. There are many examples of companies writing “fake” reviews of their product or services pretending to be an unbiased consumer. If not handled well this can potentially hurt online marketing based on reviews as its credibility is being questioned.

From a business perspective customer reviews also increases the demand for a very diversified portfolio of products and services. If the your products are to much alike and easily compared the rational consumer will buy very limited based on highest customer rankings.

CUSTOMER LOYALTY PROGRAMS From offline to online

Posted on November 7, 2011 by louisagb

Customer loyalty programs are increasingly popular and if companies haven’t already got at customer club most managers are seeking to get one. According to CBC news no less than 93.6 per cent of Canadian consumers belonged to at least one loyalty program in 2009. Loyalty programs can be very beneficial to any business if implemented correctly. In Q3 of 2009 the CMO council did research on “Ways that Customer Loyalty Investments Affect Marketing Effectiveness” and 59 % of respondents agreed that it “Improved customer retention and value” which is of huge value to almost any company.

But the fact is that loyalty programs have been around for many years just take a look at the airline industry. Airlines have successfully implemented and used customer clubs even before the digital age. So why the sudden boom in loyalty programs? The Internet certainly has had its influence. With e-mail, websites etc. it is now easier than ever to gain customer data and the internet has made it much easier for consumers to sign up for a given customer club.

In the article “Loyalty Programs: A Thing of the Past?” featured in Adweek the author questions the traditional loyalty programs. He criticizes that they are only targeted the 10-15 percent of customers that are in the top tier and the programs are only beneficial to this target group. He points out that the remaining 85-90 percent are typically neglected, as they don’t spend enough money to get sufficient points to benefit from the rewards the programs offers. For these people the loyalty programs does nothing he argues.

It is here business intelligence comes into the picture. By combining customer data, gained from the customer clubs, with analytics-based systems firms can much better target all company customers and target them more properly. The aim is to digitally create a bond or a one to one relationship between the company and the individual customer that the will ultimately result in higher customer loyalty.

When reading through the literature about what makes a loyalty club succeed one thing especially stands out: there needs to be a real perceived benefit from joining the loyalty program or club. According to US Internet users the two main benefits from a loyalty/reward program is “Discounts and savings” (66 % of respondents) and “Better deals and offers” (43 %) (CMO council survey). Factors such as “quicker and better service” or “special considerations” were only seen as a benefit for respectably 15 and 11 percent. This is confirmed when you look at data on main concerns about loyalty/reward programs. According to another CMO research marketers worldwide find that the two main customer concerns about loyalty/rewards programs are “Little or no added value to becoming a member” (28 % of respondents) and “Rewards have too little or no value” (24 %). This points in the direction that Internet marketer that considers doing a customer club online should be very aware that they are offering real value in exchange for customer participation in the club. In fact when you ask US Internet users about which “Factors that would encourage them to join or participate more in loyalty/reward programs” the main factor stated by no less than 70 % was “additional financial inducements or savings”.

The article “Best loyalty programs on the internet” in E-commerce Times points out other obstacles for making a successful loyalty program on the Internet. Any loyalty program or club is very dependent on getting information from their customers. If you are a trusted or well known brand such as American Airlines this might not be a problem, but when smaller unknown companies tries to get data out of their customers they might be more reluctant. This can be a huge drawback as individual customer data is one of the most important assets of the customer clubs. So making customers feel comfortable about giving personal data is key for smaller more unknown companies.

In addition the article stresses that the best online loyalty clubs are the ones that had a lot of success offline, which is typically airlines, casinos and hotels. These industries usually have years of experience in the area. According to John Bartold, account director at loyalty marketing firm Frequency Marketing, the rate of success is higher if you have an established offline program that you want to transfer to the internet. Online giants such as Amazon and Ebay have attempted to create online loyalty programs, but Bartold argues that in general the concept is more difficult to implement successfully for pure online players. Even though people shop online they don’t like to get points for more online shopping. According to Bartold solid online loyalty programs blend online shopping with offline rewards, such as hotel-room discounts or free flights.

There is still a lot to be learned and surely gained from loyalty and reward programs. The Internet has certainly made it easier for marketers to interact with the customers and create more interactive online membership clubs. Often you can go to the club website to check you point status, your purchase history, browse possible rewards and many more. In addition the companies can learn a lot from their customers through the collection of individualized data and it can be used in many beneficial ways. But there are many areas of loyalty programs that still need to be examined. Does the pure online business’ have a smaller chance or succeeding or do we just need to figure out how to create them better? There is also many ethically consideration that should be taken into account. Where are the boundaries for what we can use consumer data for? Is it okay to give customers grocery advise based on their past grocery shopping? Can we sell customer information to a third party?

All though we still need to gain more knowledge on the use and implications of customer loyalty/reward programs they undoubtedly has huge potential. According to Donovan Neale-May, executive director of the CMO Council, the loyalty/clubs provides a better understanding of customer behaviors, predispositions, intentions and preferences, which “enables more effective and relevant messaging.” But remember in return of all this and in order to make customer sign up in the first place; it is very important that the companies offers and keeps offering real value that exceeds the cost of joining a loyalty program.