Internet Consumer and Market Research
Chapter 3
Building Customer Relationship: Ritchey Design Inc.
Small business.Designer and manufacturer of mountain
bike components.The Problem
Early website was just a status symbol, The site did not:
Offer enough customer informationEnable the company to gain insight into their
customers’ needs and wants
Ritchey Design LearnsAbout Customers (cont.)
The SolutionCustomer surveys introduced on the site
Web Trader automatically saves and organizes answers in the database.
This information is used to make marketing decisions
Created an electronic product catalogVisitors can browse through the product catalog
with detailed descriptions and graphics of products.
Ritchey Design LearnsAbout Customers (cont.)The Results
Ritchey does not yet sell directly to individuals online, because the company wants to maintain its existing distribution system.
Dealers can:Place orders on the siteLearn about new products quicklySite is basically used for market research and
advertising,Now the company can hear from its customers directly,
learn from them and can educate them also.
The Consumer Behavior Model
Business Pressures (3Cs)CompetitionCustomers Change
Finding and retaining a customers is major critical success factor for all business.
Strengths of customers is increased due to information.
Magnitude of the change is very high.Every business need to control 3Cs to succeed,
or even to survive.
The Model of EC Consumer Behavior (Fig. 3.1)Decision making process is dependent to all these :-Personal characteristics
Gender, Age, Occupation, Education, IncomeEnvironmental characteristics
Social , family,Stimuli (motivation)
Marketing (Price , Promotion, Product, Quality) Others (economical, technology,)
Buyers Decisions What, When , where, which, how
Vendor controlled systems Logistics (payment, delivery) Technical support (website design, ) Customer service (FAQ, call center)
Consumer Behavior
Consumer types Individual consumers who commands most of the media’s attention Organizational buyers
Governments and public organizationsPrivate corporationsResellers
Purchasing Types Valuable or valueless Impulse buyer or patient Buyer
Direct sales, Intermediaries and Customer relations It is the end user who supports everyone
Environmental VariablesSocial variables—people are influenced by:
Family members, friends, co-workers, “what’s in fashion this year”
Cultural/community variables—where the consumer lives
Psychological variables –common beliefs Other environmental variables:
Available information, government regulations, legal constraints, situational factors
Personal characteristics and the demographics of internet surfer
Personal Characteristicsand Individual Differences Consumer demographic provide an indicator of buying:-Age and genderMarital statusEducational levelEthnicityOccupationHousehold income Internet Usage Profile
Internet access options Length and frequency of use Access cost
Consumer buying patterns Surfer are purchasers Spending categories Security and quality perception
Consumer Purchasing Decision Making
Initiator Influencer Decider Buyer User
Decision-Making model (Table 3.2)1. Need identification2. Information search3. Evaluation of alternatives 4. Purchase and deliver5. After-purchase evaluation
One to one and Relationship Marketing
Basic Idea No two customer are same: Treat different customer
differently Available to a customer and interact continuously Obvious attempt to build a long term association by
establishing a learning relationship with each customerEC trust* and customer loyaltyBy well defined rulesGood experience with ECRealistic expectationsReferrals (word of mouth) (Page 118)
Delivering customer service in cyber spaceCustomer service is set of activities designed to
enhance the level of customer satisfactionTypes of customer service
Answering customer inquiriesProviding search and comparison capabilitiesProviding technical and other informationOrder statusCustomizationTools Available
Personalize web pagesFAQs, chat rooms, emails, Help Desks and call centers
Market Research for EC
Market research is gathering information about economy, industry, firms, product, pricing, distribution, promotion and consumer behavior
Market research process Problem Definition Research Methodology Data Collection Data Analysis Results Implementations
Online market research: utilizing the internet in research for efficient, faster and cheaper
data analysis Larger the sample size, greater accuracy and predicative
capabilities
Market Research for EC
The goal of market research is to find information and knowledge that describes the relationships among consumers, products, marketing methods, and marketers.QuestionnairesTelephone Surveys Focus Groups
Market Research for EC
Market SegmentationThe process of dividing a consumer market
into logical groups for conducting marketing research, advertising, and sales.
Segmenting optionsGeographyDemographicsPsychographicsBenefits sought
Market Research for EC
Conducting Online Market ResearchWhat are we looking for in EC Market Research?
Analyze personal profiles to explain and predict online buying behavior.
Typical QuestionsWhat are the purchase patterns for individuals and
groups?What factors encourage online purchasing?How can we distinguish real buyers from browsers?How do individuals navigate?What is the optimal web page design?
Market Research for EC
Online Market Research MethodsWeb-based surveysOnline focus groups Hearing directly from customersTracking customer movements
Transaction logsClickstream behaviorCookiesWeb bugsSpyware
Market Research for EC
Limitations of Online Market ResearchHaving too much dataAccuracy of responsesEquipment failureEthics and legality of web trackingTruly representative samples
Data Mining
Data mining—the process of searching a large database to discover previously unknown patterns; automates the process of finding predictive information
New business opportunities generated by conducting:Automated prediction of trends and behaviorsAutomated discovery of previously unknown
patterns and relationships
Intelligent agents
Intelligent agents are computer programs that help the users to conduct routine tasks, search and retrieve information and support decision making. agents sense the environment and act automatically e.g. My Yahoo Intelligent agents for information search and filtering. Intelligent agent for products and vendor finding Intelligent agent for Negotiation Intelligent agent for customer services
Internet Marketing in B2B
Organizational Buyer BehaviorBuy in large quantitiesThe number of organizational buyers is smaller than
individual but the transaction volumes are largerBehavioral Model of Organizational Buyers
Organizational Influences Module
Organizational buyerCharacteristicsDemandPurchase volumeNumber of customerLocation of buyers
Distribution structureNature of buyingNature of buying influenceType of negotiationsUse of reciprocity Use of leasingPrimary promotion method
B-to-BOrganizationalLargerFewerGeographically concentratedMore directMore professionalMultipleMore complexYesGreaterPersonal selling
Retail IndividualSmallerManyDispersed
More indirectMore personalSingleSimplerNo Lesseradvertising