CHAPTER 6· RELATIONSHIP MARKETING USING THE INTERNET
E-CRM or electronic customer relationship managementinvolves creating strategies and
plans for how digital technology and digital data can support CRM. Some specialists in
e-commerce teams have this as their job title or in their job description.
But what is e-CRM? This is what Smith and Chaffey (2005) say:What is e-CRM? Customer Relations Management with an ‘e’? Ultimately, E-CRM cannot
be separated from CRM, it needs to be integrated and seamlessly. However, many organi-
sations do have specific E-CRM initiatives or staff responsible for E-CRM. Both CRM and
E-CRM are not just about technology and databases, it’s not just a process or a way of
doing things, it requires, in fact, a complete customer culture.
More specifically, we can say that important e-CRM challenges and activities which
require management are:
Using the web site for customer developmentfrom generating leads through to conversion to
an online or offline sale using e-mail and web-based information to encourage purchase;An approach to reconciling customer satisfaction, loyalty, value and potential is to use a value-based seg-
mentation. This modeling approach is often used by car manufacturers and other companies who are
assessing strategies to enhance the future value of their customer segments. This approach involves creat-
ing a segmentation model combining real data for each customer about their current value and satisfaction
and modeled values for future loyalty and value. Each customer is scored according to these four variables:
Current satisfaction Current value
Repurchase loyalty Future potential.Mini Case Study 6.1
How car manufacturers use loyalty-based
segmentationTable 6.2 Loyalty-based segmentation for car manufacturerSLVP score Nature of customer Segment strategy
Moderate An owner of average loyalty who replaces their car Not a key segment to influence.
satisfaction and every three to four years and has a tendency to But should encourage to
loyalty. Moderate repurchase from brand. subscribe to e-newsletter club
current and future and deliver targeted messages
potential value. around time of renewal.
High satisfaction, A satisfied owner but tends to buy second-hand Engage in dialogue via e-mail
moderate loyalty. and keeps cars until they have a high mileage. newsletter and use this to
Low future and encourage advocacy and make
potential value. aware of benefits of buying new.
Low satisfaction A dissatisfied owner of luxury cars who is at risk of A key target segment who
and loyalty. High switching. needs to be contacted to
current and future understand issues and reassure
potential value. about quality and performance.Key concepts of electronic customer relationship management
(e-CRM)
Electronic customer
relationship
management
Using digital
communications
technologies to
maximise sales to
existing customers
and encourage
continued usage of
online services.