Page 228 - Electronic Commerce

Marketing on the Web

trends, general economic conditions, and market research about changes in general
preference levels that might affect demand for the company’s products or services.
In a CRM system, the multiple sources of information about customers, their
preferences, and their behavior is entered into a large database called a data warehouse.
On a regular basis, analysts query the data warehouse using sophisticated software tools
to perform data mining and statistical modeling. Data mining (also called analytical 203
processing) is a technique that examines stored information and looks for patterns in
the data that are not yet known or suspected. In CRM, analysts might apply data mining
techniques to the data warehouse and find that customers often buy two specific
products at the same time. By offering both products together at a reduced price
whenever a customer views either product page, the company could increase sales of
both products. Statistical modeling is a technique that tests theories that CRM analysts
have about relationships among elements of customer and sales data. For example, a
statistical model could be used to test whether free shipping increases sales enough to
cover the cost of offering the free shipping. Figure 4-10 shows the elements in a typical
CRM system.

Customer Touchpoints
Web site interactions
– Clickstream data
– Logs of chats with customers
– Customer-completed
information request forms
– Social media posts
Customer communications
– Phone calls Data Mining
– E-mails (Analytical
– Letters
Processing)
Salesperson interactions
– Call reports
– Memos
Company Operational Records
Invoices CRM Analysts
Statistical
Sales back orders
Modeling Formulate and
Sales returns revise strategies
Data Warehouse and tactics that
Warranty repairs
better meet the
needs of
External Data Purchased $ Billions 47.6 42.8
36.9 customers
33.1
27.7
21.6
17.1
12.4 9.8 2010 2011 2012
Industry trend reports 7.4 6.1 $ 2002 2003 2004 2005 2006 2007 2008 2009
Learning
Economic forecasts
Market research
Credit reports on customers Cengage
Data gathering Data storage Data analysis Recommend 2015
actions ©
FIGURE 4-10 Elements of a typical CRM system

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