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Lecture 3: Serving the Customer

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CS5038 The Electronic Society Lecture 3: Serving the Customer Lecture Outline Consumer Behaviour Demographics of Internet Surfers Major Roles in Purchasing – PowerPoint PPT presentation

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Title: Lecture 3: Serving the Customer


1
CS5038 The Electronic Society
  • Lecture 3 Serving the Customer
  • Lecture Outline
  • Consumer Behaviour
  • Demographics of Internet Surfers
  • Major Roles in Purchasing
  • Purchasing decision-making model
  • Consumer Satisfaction
  • One-to-One Marketing
  • Personalisation
  • Customer Service
  • Market Research
  • Data Mining
  • Intelligent Agents

2
Consumer Behaviour
Prentice Hall, 2002
3
Consumer Behavior Online
  • Consumer types
  • Individual consumers
  • Commands most of the medias attention
  • Organizational buyers
  • Governments and public organizations
  • Private corporations
  • Resellers
  • Purchasing types and experiences
  • 2 dimensions of shopping experiences
  • Utilitarianto achieve a goal
  • Hedonicbecause its fun
  • 3 categories of consumers
  • Impulsive buyerspurchase quickly
  • Patient buyersmake some comparisons first
  • Analytical buyersdo substantial research before
    buying

4
Demographics of Internet Surfers
  • Environmental variables
  • Social variables influenced by peers
  • Cultural variables
  • Psychological variables
  • Other environmental variables - e.g. government
    restrictions
  • Personal characteristics / demographics
  • Consumer resources and lifestyle
  • Age gender marital status
  • Knowledge and educational level
  • Attitudes and values
  • Motivation
  • Personality
  • Ethnicity
  • More experience on Web ? more to buy online
  • Two major reasons people do not buy online
  • Security
  • Difficulty judging the quality of the product

5
Major Roles in Purchasing
  • 5 major roles
  • Initiator
  • Suggests/thinks of buying a particular product or
    service
  • Influencer
  • Advice/views carry weight in making a final
    buying decision
  • Decider
  • Makes a buying decision or any part of it
  • Buyer
  • Makes the actual purchase
  • User
  • Consumes or uses a product or service

6
Purchasing decision-making model
  • 5 major phases
  • Need identification
  • marketer must get customer to recognise need
  • Banner and URL advertising, community discussions
  • Information search
  • Web directories, search engines
  • Alternatives evaluation
  • Newsgroup discussions, cross-site comparisons
  • Purchase and delivery
  • Electronic cash, virtual banking
  • After-purchase evaluationcustomer service
  • Discussions in newsgroups

7
Consumer Satisfaction
Prentice Hall, 2002
8
One-to-One Marketing
  • Build a long term association
  • Meeting customers cognitive needs
  • Customer may have novice, intermediate or expert
    skill
  • E-loyaltycustomers loyalty to an e-tailer
  • costs Amazon 15 to acquire a new customer
  • costs Amazon 2 to 4 to keep an existing
    customer
  • Trust in EC
  • Deterrence-based threat of punishment
  • Knowledge-based reputation
  • Identification-based empathy and common values
  • Referrals Viral Marketing
  • Personalisation

9
Personalisation - Marketing ModelTreat
different customers differently
Prentice Hall, 2002
10
Personalisation
  • Process of matching content, services, or
    products to individuals preferences
  • Build profiles N.B. Privacy Issues
  • Solicit information from users
  • Use cookies to observe online behavior
  • Use data or Web mining
  • Personalisation applied through
  • Rule-based filtering (35ltagelt40 ? Jeep Cherokee)
  • Content-based filtering (based on stated
    favourites)
  • Constraint-based filtering (based on
    demographics)
  • Learning-agent technology (intelligent, e.g. from
    cookies)
  • Collaborative filtering examples
  • Predict preferences based on similarities with
    other customers

11
Customer Service
  • Provide search and comparison capabilities
  • Provide free products and services
  • Provide specialized information and services
    ge.com
  • Allow customers to order customized products and
    services dell.com
  • Enable customers to track accounts or order
    status e.g. FedEx, Amazon
  • Personalized Web pages - record purchases and
    preferences aa.com
  • FAQs - Customers find answers quickly
  • Troubleshooting toolsassist customers in solving
    their own problems
  • Chat rooms discuss with experts and other
    customers
  • E-mail (most popular inexpensive and fast) and
    automated response
  • Help desks and call centers
  • Well trained personnel with access to customer
    history, purchases
  • Metricsstandards to determine appropriate level
    of support
  • Response to problem (hours for human, real-time
    for agents)
  • Site availability and download times (lt30
    seconds)
  • Up-to-date site and availability of relevant
    content
  • Order fulfillment fast
  • Return policy

12
Market Research for EC
  • Market segmentation - divide consumer market into
    groups to conduct marketing research,
    advertising, sales
  • E.g. by geography, demographics or psychographics
  • (psychological characterization the study of the
    psychological profiles of potential buyers of a
    product, to improve its marketing)
  • Tailor mailing campaigns to each segment
  • Easier and cheaper than one-one personalisation
  • Online market research methods
  • Conducting Web-based surveys
  • Track customer activities possibly illegal
  • Limitations of online research
  • Skewed toward educated males with high income
  • gt40 answers to questionnaires inaccurate

How to analyse the gathered data? ? Data Mining
13
Data Mining
searching for valuable information in extremely
large databases
  • Automated prediction of trends and behaviors
  • Example from data on past promotional mailings,
    find out targets most likely to respond in future
  • Automated discovery of previously unknown
    patterns
  • Example find seemingly unrelated products often
    purchased together
  • Example Find anomalous data representing data
    entry errors
  • Mining tools
  • Neural computing
  • Intelligent agents
  • Association analysis - statistical rules
  • Web Mining - Mining meaningful patterns from Web
    resources
  • Web content mining searching Web documents
  • Web usage mining searching Web access logs

14
Intelligent Agents in Customer Applications
  • Need identification - determine what to buy to
    satisfy a need
  • looks for product information and evaluates -
    Querybot.com
  • Product brokering find best product to match
    need
  • Merchant brokering - find vendor offering best
    deal
  • Jango (embedded in excite program)
  • Negotiation - determine price and other terms of
    transaction
  • Kasbah - users create agents for selling or
    buying goods
  • Purchase and deliveryarrange payment and
    delivery of goods
  • After sale service and evaluation - automatic
    answering
  • Auction support agents
  • Fraud and detection protection agents eFalcon
  • Character-based interactive (animated) agents
    extempo.com
  • Future agents - Delegation

15
Summary
  • Consumer Behaviour characteristics, stimuli
    ?decisions
  • Consumer Behavior Online consumer types and
    purchasing experiences
  • Demographics of Internet Surfers environmental,
    personal
  • Major Roles in Purchasing 5 roles
  • Purchasing decision-making model 5 stages
  • Consumer Satisfaction ? loyalty
  • One-to-One Marketing
  • Personalisation build profiles, filter
    information
  • Customer Service personalised information, help
    desks
  • Market Research surveys, surreptitious tracking
  • Data Mining extracting useful information about
    customers
  • Intelligent Agents gather data, facilitate
    customer

16
  • QUIZ 4
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