Beruflich Dokumente
Kultur Dokumente
Submitted To
Prof. T.S. Joshi
Submitted By
Aman Suveer(121104)
Submitted On
09th March, 2014
INTRODUCTION
Whether they are bricks-and-mortar boutiques, large chain stores, or online e-tailers,
retailers in are attracting shoppers through smart inventory choices and competitive pricing,
coupled with sophisticated customer relationship management (CRM) software technologies
often tied into social media strategies.
Perhaps never before have consumers faced so many choices. And so retailers, no matter
whether they use a storefront, a website or a mix of the two mediums, actively are courting
shoppers, looking to convert casual consumers into repeat buyers and loyal buyers.
Much of the overall retail sector's growth in both the U.S. and the EU over the next five
years will come from the Internet. To maximize that growth, e-business professionals will
have to help enable a multichannel strategy that responds to consumers' increased desire to
hop between the offline and online worlds and their increasing mobile and social CRM
behaviours. The retail innovators over the next five years will demonstrate customer
enablement across all touch points, not just via a PC-based Web browser. To truly
accomplish this cross-channel customer experience, however, retailers also must address
and conquerthe back-office, integrating multiple technologies such as point-of-sale,
accounting, inventory, human resources, and marketing, with mobile and social media,
among others. In addition, CRM systems are very popular in the retail industry: every
successful company in the sector uses this type of system to analyse customer behaviour and
predict sales. Consequently, with the collected data, retailers can offer personalized offers
and coupons to consumers who are members of their loyalty programs.
It may be more difficult to separate consumers from their money, but at no time has it been
more important for retailers to enter shoppers' living rooms. Using e-commerce with
integrated CRM systems, that knowledge of buyers' habits and preferences, plus up-to-date
information about inventory, pricing and availability, will help keep online and offline aisles
buzzing and registers ringing.
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With the volume of conversations happening online, retailers need to listen and learn to their
customers using sophisticated analytics technology to gain insight and adjust their marketing
messages to address what they are hearing on the wire.
Aspects of CRM
Operational CRM:
This is in place for most online retailers. Each interaction with a customer is generally added
to a customer's contact history, and the company can retrieve information on customers from
the database as necessary. Base on this operational data customers ranking, actual value and
potential value are calculated and different customers are treated differently.
Collaborative CRM:
There is scope for better collaborative CRM in online retail industry. The objectives of
Collaborative CRM are broad, including cost reduction and service improvements. Many
organizations are searching for new ways to use customer intimacy to gain and retain a
competitive advantage. Collaborative CRM provides a comprehensive view of the customer,
with various departments pooling customer data from different sales and communication
channels.
Collaborative CRM also includes Partner Relationship Management (PRM) which enables
online retailers to manage their relationships with partners (consultants, resellers and
distributors), and potentially the customers of those partners.
Analytical CRM:
Analytical CRM for online retailers analyzes customer data for a variety of purposes,
including design and execution of targeted marketing campaigns to optimize marketing
effectiveness,
design
and
execution
of
specific
customer
campaigns,
including
Some retailers have a fully implemented conventional CRM program and have adapted it to
new developments such as social networking. Others are comfortable with a traditional
program but haven't yet integrated new media and channels. Still others are at various levels
of using bits and pieces of conventional CRM programs.
While there may be degrees of implementation among retailers in using CRM, it appears that
few retailers need to be convinced of the value of using such programs.
Customer satisfaction and retention was a priority strategic goal in the retail sector for last
few years. The move toward a more customer-centred way of doing business has become
main stream. Still, there is a significant gap between appreciating CRM as a concept and
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actually implementing a system that fully utilizes the real potential of CRM and the related
tools of e-commerce and information technology. For many companies, the transformation is
under way toward a more customer-centred, knowledge-based, and integrated way of doing
business, but it is still far from completed. The implementation of new customer-relevant
metrics, appropriate for driving performance in a customer-centred company, still lags at
many retail companies.
There are several reasons retailers have failed to fully utilize CRM. One issue is short and
long-term tension. To build an effective CRM program is a long-term investment, and yet the
retailers want to remain competitive and profitable in the short term, so they have to balance
those goals. Thus, an outlay for a direct mail campaign that results in a quick boost in sales
may divert resources from installing a comprehensive long-term CRM program. Another
problem is coordinating CRM efforts. Many retailers, especially the traditional brick-andmortar companies, revert to a silo situation. They may expand to a catalogue sales operation
or an Internet program, but they set up separate operations for these channels and the channel
managers don't cooperate. They duplicate data collection and never fully exploit the CRM
capability of getting a complete customer profile because they don't integrate the customer
data and wind up with a hodge-podge approach.
A subtle but still significant factor is the orientation of the retail company regarding CRM. In
the past, the emphasis was on merchandising - getting attractive products to sell. Now there is
much more attention on getting to know the customer better and orienting the marketing
based on customer needs and doing things to retain the customer base. The emergence of the
online retailer was a real game-changer in pushing that concept, and the brick-and-mortar
retailers had to adapt to that. The online retail channel has changed the customer experience
situation. With digital marketing, the customer expectation level is higher. Customers can
shop a variety of sources easily. They can get product reviews and information from Web
sites and blogs. So, now they expect retailers to provide this kind of support. The whole
engagement environment with the customer has changed, and the retailers are beginning to
react to it. The change in orientation is now working its way back through traditional
marketing channels, including the brick-and-mortar physical store component, with increased
attention on a more personal or customer-centric approach, even with tried-and-true tools
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such as direct mail campaigns that are now based on more precise knowledge of individual
customers.
When CRM first emerged in retail marketing, its scope appeared to be more limited; it
formed one aspect of marketing tactics, along with merchandise management, discount
selling, heavy newspaper advertising and other selling tools. The e-commerce tools
associated with CRM such as data collection, pushed the concept into a realm focusing
almost exclusively on the associated technologies. That's why we are now seeing terms like
'customer-centric,' which address the whole customer experience aspect of marketing. The
use of technology is simply a means to address the shift in focus to the customer. With
retailers now committed to a more customer-oriented way of doing business, the role of
technology will be even more crucial to success. Even at less-than-optimal levels, retailers
now spend a considerable amount of their budgets on CRM tools, and that is likely to
increase with more attention on customers.
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Strategy and Culture: Few companies succeed in getting closer to the customer.
Because despite the rhetoric, most companies still love their brands, technologies, and
factories more than they love their customers. But Amazon has very successfully
crossed this chasm - its strategic choices are directed by a simple dictum, what's good
for the customer in the long run is good for us. It is strategically obsessed with
continually creating and innovating customer value; it doesn't waste its energy and/or
Rewards: Amazon has very successfully demonstrated the benefits of shunning short
term profits for long term sustenance and profits. By actively deciding against chasing
quick bucks Amazon has successfully invested in ongoing customer relationships and
built long-term customer equity. A fair amount of the hundreds of millions of dollars
Amazon has spent on R&D has gone toward developing, say, the Kindle, but a good
deal of it has also gone toward improving the customer experience. Amazon is willing
to lose money on some of its most popular items, like the latest Harry Potter novel.
And even with Amazon Prime, where for a $79 annual fee you get two-day free
shipping, it had to swallow millions of dollars in shipping costs. In a presentation to
analysts in late November, the companys chief financial officer, Thomas J. Szkutak,
showed one slide that read, Over $600 Million in Forgone Shipping Revenue.
Amazon has its eyes strongly set on long term profitability through customer equity.
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People: Without the right people, customer-centricity will remain a slogan; the
employees will hear the sirens, no one will move. Amazon is on the move, it is
excessively pernickety about who it hires.
a)
b)
c)
d)
B2B
B2C
C2C
M-Commerce
B2B business:
B2B stands for Business to Business. It consists of largest form of Ecommerce. This model
defines that Buyer and seller are two different entities. It is similar to manufacturer issuing
goods to the retailer or wholesaler. Dell deals computers and other associated accessories
online but it is does not make up all those products. So, in govern to deal those products, first
step is to purchases them from unlike businesses i.e. the producers of those products
B2C business:
B2C stands for Business to Consumer as the name suggests, it is the model taking businesses
and consumers interaction. Online business sells to individuals. The basic concept of this
model is to sell the product online to the consumers.
C2C business:
C2C stands for Consumer to Consumer. It helps the online dealing of goods or services
among people. Though there is no major parties needed but the parties will not fulfill the
transactions without the program which is supplied by the online market dealer.
M-commerce:
It deals with conducting the transactions with the help of mobile. The mobile device
consumers can interact each other and can lead the business. Mobile Commerce involves the
change of ownership or rights to utilize goods and related services.
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Amazon's business strategy. The company carefully records data on customer buyer
behaviour. This enables them to offer to an individual specific items, or bundles of items,
based upon preferences demonstrated through purchases or items visited.
Amazon is a huge global brand. It is recognisable for two main reasons. It was one of the
original dotcoms, and over the last decade it has developed a customer base of around 30
million people. It was an early exploiter of online technologies for e-commerce, which made
it one of the first online retailers. It has built on nits early successes with books, and now has
product categories that include electronics, toys and games, DIY and more.
It has also provided the option of a market place where a seller can sell an unwanted item
online and a buyer can buy it from that seller, there is usually a difference regarding the
competing retailers as it ensures customer loyalty and trust, which makes the bond with the
customer stronger and the loyalty is more durable.
User Reviews are used to share information and provide feedback regarding that
As Amazon adds new categories to its business, it risks damaging its brand. Amazon is
the number one retailer for books. Toy-R-Us is the number one retailers for toys and games.
Imagine if Toys-R-Us began to sell books. This would confuse its consumers and endanger its
brands. In the same way, many of the new categories, for example automotive, may prove to
be too confusing for customers.
The company may at some point need to reconsider its strategy of offering free shipping
to customers. It is a fair strategy since one could visit a more local retailer, and pay no costs.
However, it is rumoured that shipping costs could be up to $500m, and such a high figure
would undoubtedly erode profits.
Online-retailers require focus on their technology which is quite important. The system
requirement, especially the maintenance of the systems is held to be constant that should be
maintained in order to ensure customer satisfaction by providing the level of service the
customer is expecting without any delay.
Opportunities
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The company is now increasingly cashing in on its credentials as an online retail pioneer
by selling its expertise to major store groups. For example, British retailer Marks and Spencer
announced a joint venture with Amazon to sell its products and service online. Other recent
collaborations have been with Target, Toys-R-Us and the NBA. Amazon's new Luxembourgbased division aims to provide tailored services to retailers as a technology service provider
in Europe.
There are also opportunities for Amazon to build collaborations with the public sector.
For example the company announced a deal with the British Library, London, in 2004. The
benefit is that customers can search for rare or antique books. The library's catalogue of
published works is now on the Amazon website, meaning it has details of more than 2.5m
books on the site.
It can develop relationship with the publishers for exclusive offers and launch authors that
are exclusively for the firm which would generate growth because consumers have a
tendency of reading the author again.
Threats
All successful Internet businesses attract competition. Since Amazon sells the same or
similar products as high street retailers and other online businesses, it may become more and
more difficult to differentiate the brand from its competitors. Amazon does have it s brand. It
also has a huge range of products. Otherwise, price competition could damage the business.
International competitors may also intrude upon Amazon as it expands. Those domestic
(US-based) rivals unable to compete with Amazon in the US, may entrench overseas and
compete with them on foreign fronts. Joint ventures, strategic alliances and mergers could see
Amazon losing its top position in some markets.
The products that Amazon sells tend to be bought as gifts, especially at Christmas. This
means that there is an element of seasonality to the business. However, by trading in overseas
markets in different cultures such seasonality may not be enduring.
Good economy circumstances will initiate the price level to go down which in return will
hold the customer expectations regarding the promotional deals that will be the main focal
point for all product areas but with smaller economies-of-scale, the marketplace will not have
the sufficient offers on buying power.
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CEO
Business Platform
CFO
Real Estate
Retail Business
Control
Business
Development
China
Europe
India
America
the provision of the Amazon marketplace which act as an intermediary to facilitate consumer
to consumer transactions. Amazon employs multi leveled e-commerce strategy. The company
lets almost anyone sell almost anything using its platform. In addition to affiliate program
that lets anybody post Amazon links earn a commission on click through sales, there is now a
program which let those affiliates build entire websites based on Amazons platform. Amazon
also hosted and managed the website for Borders bookstores but this ceased in 2008. From its
inception until August 2011, Amazon hosted the retail website for Target. Benefit Cosmetics,
another merchant partner of Amazon, has also launched a major E-Commerce platform of
their own based onHybris_(company) and arvato systems NA, in the US, EU and China.
Amazon.com operates retail web sites for Sears Canada, bebe Stores, Timex, Marks &
Spencer, Mothercare, and Lacoste. For a growing number of enterprise clients, currently
including the UK merchants Marks & Spencer, Benefit Cosmetics' UK entity, edeals.com,
and Mothercare. On October 18, 2011, Amazon.com announced partnership with DC Comics
for the exclusive digital rights to many popular comics, including Superman, Batman, Green
Lantern, the Sandman, and Watchmen. The partnership has caused well-known bookstores
like Barnes & Noble to remove these titles from their shelves. These titles will be available
for purchase exclusively through Amazon's new Kindle Fire tablet.CRM systems for
marketing help the enterprise identify and target potential clients and generate leads for the
sales team. A key marketing capability is tracking and measuring multichannel campaigns,
including email, search, social media, telephone and direct mail. Metrics monitored include
clicks, responses, leads, deals, and revenue.
REFERENCES
Freeland, J. (2003). The Ultimate CRM Handbook. New York, New York: McGrawHill
Harney, J. (2003). Personalization and CRM: know thy customer. AIIM E-Doc
Magazine, 17(4), p. 32-37
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