Andrew Green - University of Gloucestershire

Transcription

H o w ca n m u l t i m e d i a m a r k e t i n g
t e c h n i q u e s s u p p o r t Cu s t o m e r
R e l a t i o n s h i p M a n a g e m e n t ( CR M )
f o r Sm a l l a n d M e d i u m si z e d
En t e r p r i s e s ( S M E) ?
A n d r e w Gr e e n
Presented as part of the requirement for an award within the
Modular Scheme at the University of Gloucestershire
May 2007
Module Adviser: Fiona Collard
© Andrew Green 0305372
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DECLARATION
This dissertation is a product of my own work and is the result of nothing done in
collaboration.
I agree that this dissertation may be available for reference at the discretion of the
University.
(Student signature)
ANDREW GREEN
Date: ___/___/___
The word count for this research project is approximately 10,995 words excluding
Bibliography and Appendices
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ABSTRACT
The World Wide Web (WWW) not only contains an immense array of useful
information but it also provides a powerful infrastructure for communication
and information sharing (Ahn, Kim and Han, 2003). The initiation of the
Internet has created an opportunity for consumers to access a virtually
unlimited selection of products, brands and sellers. The consumer has the
ability to switch brands or try different products in a single click however they
have limited time and unlimited choice. A major problem that companies
encounter is the constant necessity to retain their customers. This is essential
because acquiring new customers can cost five times more than it costs to
retain their current customers (Massey, Montoya-Weiss and Holcom, 2001).
This research project investigates how multimedia marketing techniques
support Customer Relationship Management (CRM) for Small and Medium
Enterprises (SMEs). This involved creating semi-structured interviews with
SMEs to ascertain their perception of CRM and the use of multimedia
marketing within their organisation.
ACKNOWLEDGEMENT
The author would like to thank all of the participated of this study for their
time and insight into their companies. Special thanks go the authors family
and friends and also to the academic advisor, Fiona Collard for her valued
advice, time and guidance throughout this project.
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TABLE OF CONTENTS
1
INTRODUCTION....................................................................................................6
1.1
Overview .......................................................................................................6
1.2
Aims and objectives ......................................................................................8
1.3
Limitations .....................................................................................................9
2 LITERATURE REVIEW........................................................................................10
2.1
Introduction .................................................................................................10
2.2
What is Customer Relationship Management?...........................................11
2.2.1 The Four Dimensions of CRM.................................................................12
2.3
Multimedia Marketing ..................................................................................15
2.3.1 Websites .................................................................................................15
2.3.2 Promotion................................................................................................15
2.3.3 Communication .......................................................................................20
2.4
Summary.....................................................................................................26
3 METHODOLOGY .................................................................................................28
3.1
Approach.....................................................................................................28
3.2
Study Design...............................................................................................28
3.3
Ethical Issues ..............................................................................................30
4 RESULTS.............................................................................................................30
4.1
Summary.....................................................................................................30
4.2
Data Analysis ..............................................................................................31
4.2.1 Case Study 1 Dream Doors Kitchens ..................................................31
4.2.2 Case Study 2 Katie s PlayPen .............................................................36
4.2.3 Case Study 3 ORBIT Training..............................................................40
4.2.4 Case Study 4 Xtreme Vortex................................................................43
5 DISCUSSION OF FINDINGS...............................................................................47
5.1
Summary.....................................................................................................47
5.2
Case Study Discussion ...............................................................................48
6 CONCLUSION AND RECOMMENDATIONS ......................................................53
6.1
Summary.....................................................................................................53
6.2
Limitations ...................................................................................................53
6.3
Recommendations ......................................................................................54
6.4
Conclusion ..................................................................................................54
7 REFERENCES.....................................................................................................57
8 APPENDIX ...........................................................................................................61
8.1
Appendix A Interview Prompt Sheet ........................................................61
8.2
Appendix B Overview of Interviews..........................................................64
8.2.1 Dream Doors...........................................................................................64
8.2.2 Katie's PlayPen .......................................................................................66
8.2.3 ORBIT Training .......................................................................................67
8.2.4 Xtreme Vortex .........................................................................................69
8.3
Appendix C Participant Consent Forms ...................................................71
8.4
Appendix D ORBIT Training PR appearances.........................................72
8.5
Appendix E Traditional Marketing Materials.............................................76
8.5.1 Dream Doors Leaflet Advert....................................................................76
8.5.2 Dream Doors Front page newspaper advert........................................77
8.5.3 ORBIT Training Leaflet ...........................................................................78
8.5.4 Xtreme Vortex Leaflet .............................................................................79
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LIST OF FIGURES
Figure 1: Business orientations of the last 150 years (Bose, 2002) ...........................11
Figure 2: The four dimensions of CRM (Sin et al, 2005) ............................................11
Figure 3: Dream Doors Franchise successful advert..................................................35
Figure 4: Dream Doors Franchise younger appealing advert.....................................36
Figure 5: Katie's PlayPen advert NewsShopper, April 18th 2007.............................39
Figure 6: Katie's PlayPen advert and voucher NewsShopper, April 25th 2007 .........39
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INTRODUCTION
1 INTRODUCTION
1.1
Overview
The World Wide Web (WWW) contains an immense array of useful information
which provides a powerful infrastructure for communication and information
sharing (Ahn, Kim and Han, 2003). The initiation of the Internet has created an
opportunity for consumers to access a virtually unlimited selection of products,
brands and sellers. The consumer has the opportunity to switch brands or try
different products in a single click however they have limited time and
unlimited choice.
A major problem that companies encounter is the constant necessity to retain
their customers. This is essential since acquiring new customers can cost five
times more than it costs to retain current customers (Massey, Montoya-Weiss
and Holcom, 2001). Traditionally, the principles of marketing are referred to as
the four P s, consisting of Product, Price, Place and Promotion (Krakk &
Pelletier, 1998), however the impact of technology in the 21st century has
changed the way products are marketed to consumers. Moran (2006)
suggests using the same marketing tactics that were used five years ago will
not work with today s shifting demographics and preferences.
Customer Relationship Management (CRM) is a concept that many
companies have been investing in since the early 1990s with varying degrees
of success. Sin, Tse and Yim (2005) suggest there is much debate over
exactly what constitutes CRM. They suggest many scholars have claimed that
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INTRODUCTION
the precise meaning of CRM is not always clear in literature. Itkis (2005)
suggests CRM is the latest buzz-phrase which embodies the convergence of
sales, marketing and service into one cohesive system.
The concept of CRM has been established ever since the birth of commerce
(Viewpoint, 2002). At the heart of every transaction lies a process between a
customer and a vendor. This relationship stems back to the village
convenience store where customers were greeted personally and the staff
knew exactly what each customer would order, what items they preferred and
if a customer would pay on time (Bose, 2002).
Automated phone lines and call centres rule our relationship between the
consumer and a company. Consumers are reluctant to repurchase from a
company where they are constantly speaking to different members of staff,
and each time having to re-establish this circumstances (Fowler, 2000). The
key to successfully satisfying customers is to maintain consistency across all
interaction channels such as the internet, email, telephone, web and fax,
through sales, service and marketing fields (Pan and Lee, 2003).
Many organisations varying in size are using CRM within their organisation.
This research project investigates the use of CRM within Small and Medium
sized Enterprises (SMEs). A consistent definition of SMEs is hard to obtain. In
the United Kingdom (UK), the Department for Trade and Industry (2006)
define SMEs as consisting of less than 250 employees however Fernekees
(2006), defines it as fewer than 1,000. For the purpose of this research project,
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INTRODUCTION
SMEs will be defined as a company with fewer than 250 employees.
Regardless of its definition, Hill (2001) believes it is important that SMEs
should not be considered as large firms on a smaller scale, but to envisage
they have their own characteristics which has a great impact on the way they
operate and manage their business. According to Benady (2003), only one
quarter of SMEs currently have some form of CRM in place. He believes some
systems can be cumbersome and extremely expensive. An SME could expect
to pay between £5,000 and £25,000 on a CRM solution (Director, 2000)
although Cunningham, Song and Chen (2004) report that between 50 and 80
percent of CRM initiatives fail.
This paper will investigate the considerations an SME should take when
contemplating using CRM and investigate how multimedia marketing
techniques can support this.
1.2
Aims and objectives
The aim of this research project is to establish how multimedia marketing
techniques can support Customer Relationship Management for Small and
Medium Enterprises. This involved creating a semi-structured interview with
SMEs, to ascertain their perception of CRM and the use multimedia marketing
tools within their business.
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INTRODUCTION
The following objectives will be achieved through out this report in order to
answer the research question.
To define what is meant by CRM,
To establish and evaluate the relevance of CRM SMEs,
To establish and evaluate how multimedia techniques can support
CRM,
To discover which multimedia and CRM tools SMEs currently find most
effective and the methods they utilise within their business,
To discover which multimedia and CRM tools SMEs do not use and the
reasons behind them not utilising these method.
To analyse the research results and discuss links with existing
knowledge.
1.3
Limitations
To gain the most meaningful data this research has been limited to
interviewing four small companies operating in different business sectors. To
include more would be beyond the time constraints of this project. By
concentrating on a small number of businesses, this will provide qualitative
data that can be analysed through case studies.
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LITERATURE REVIEW
2 LITERATURE REVIEW
2.1
Introduction
According to Bose (2002), businesses traditionally focused on production as
they could sell any product they made during the 1850s (Figure 1). By the
1900s, there was more competition between businesses which gave more
power to the consumer therefore companies had to find reasons why
customers should buy their products changing their focus into sales. This all
changed again by the 1950s, as businesses started to realise they had to
produce what the customer wanted rather than trying to convince them to
make a purchase. This led to the introduction of a marketing orientation.
According to Palmer and Griffith (1998), marketing is continually evolving
through new and innovative technology and improving interaction with
customers. Technology has moved businesses beyond the physical
constraints of their traditional realms, into a virtual community in which
businesses compete (Palmer and Griffith, 1998).
Since the turn of the century, the focus is now customer centric. McKim and
Hughes (2001) suggest CRM evolved because all customers have different
preferences and purchasing habits. If this was not the case, there would be no
use for CRM, as mass marketing communication tools would work sufficiently.
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LITERATURE REVIEW
Production
1850
Sales
1900
Marketing
1950
Customer-Centric
2000
Figure 1: Business orientations of the last 150 years (Bose, 2002)
2.2
What is Customer Relationship Management?
Sin, Tse and Yim (2005) suggest CRM is a multi-dimensional concept
consisting of four broad behavioural components. These four components are
key customer focus, CRM organisation, knowledge management and
technology based CRM, which are all vital for the success of a CRM system.
(See Figure 2)
Key
Customer
Focus
CRM
Organisation
CRM
Knowledge
Management
Technology
based CRM
Figure 2: The four dimensions of CRM (Sin et al, 2005)
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LITERATURE REVIEW
2.2.1 The Four Dimensions of CRM
2.2.1.1
Key customer focus
Key customer focus involves an overwhelming customer-centric focus (Sin et
al, 2005). Sheath, Sisodia and Sharma (2000) suggest customer-centric
marketing is the attempt to understand and satisfy the needs, wants and
resources of selected individual customers. Ryals and Knox (2001) suggest
CRM stresses the deliberate selection of key customers who are of strategic
significance, as not all customers are equally desirable and profitable.
This strong relationship with selected customers links vitally with key customer
lifetime value identification. It has been defined by Lee, Lee and Feick (2006)
as an approach which examines customer value over time by comparing
acquisition and retention costs to revenue contribution. The lifetime value of
each customer should be individually assessed to decide whether to build a
relationship with them by providing a personalised service (Sin et al, 2005).
Personalisation is the practice of one-to-one marketing through the use of
mass customisation allowing customers to seek unique solutions to their
specific needs (Sin et al, 2005). Ahn, Kin and Han (2003) suggests
personalised services to be a way to provide value to a customer is to know
the customers and serve them as individuals.
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LITERATURE REVIEW
2.2.1.2
CRM Organisation
CRM essentially means adaptations to the way a company is organised. The
key to a successfully implemented CRM system is for the company to be
reorganised around the system. The success of customer acquisition,
development, retention and reactivation, all hinges on the company s
commitment of time and resources towards identifying and satisfying key
customer needs (Nykamp, 2001 cited in Sin et al, 2005). Although strategy,
people, technology and processes are all important to CRM, it is the individual
employees who are the building blocks to a successful CRM system (Brown
2000, cited in Sin et al, 2005).
2.2.1.3
Knowledge Management
Knowledge is vital to the success of any business and is also a major factor
contributing to the success of a CRM system. Knowledge regarding key
customers is vital to CRM as it can be used to develop a relationship with
customers (Sin et al, 2005). Information about customer s needs and
preferences can be captured both directly and indirectly through two way
communication. Knowledge that a company acquires must be readily available
throughout the organisation, to allow the information to be used efficiently.
2.2.1.4
Technology Based CRM
Technology plays a vital role in CRM. For many years businesses have
concentrated on a short term approach to achieve transactions rather than
building a life-time value of a customer (Chaffey, 2003, p30). This has not
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LITERATURE REVIEW
always been the case within SMEs as they are often naturally more successful
than larger companies at developing relationships with their customers.
Vermond (2004) suggests SMEs can accomplish the goals of CRM more
quickly, easily and cheaply, by virtue of their size and flexibility. When a small
company starts to grow, it will gradually find it harder to keep close
relationships with customers, which is why an automated approach may
benefit to coordinate their customer relationships.
Companies such as Siebel and IBM have created CRM solutions for large
corporations for many years, however, Benady (2003) suggest these solutions
are too complex for small businesses. SMEs were previously ignored as
potential users of CRM software, however, over recent years, a wider choice
of off the shelf packages are more widely available. While SMEs have some
of the same needs as large enterprises, they do not have the same resources
(Himmelsbach, 2006). This is why Itkis (2005), advices companies to get in
slowly .
There are several factors holding SMEs back from investing in CRM
technology (Vermond 2004). Employees are often over worked and rarely
have time to test drive numerous CRM products. They also face time
restrictions as the implementation of CRM can be time consuming and tie up
key employees along with a lack of capital investment. A good customer
relationship does not have to be fully managed by one central CRM system.
April and Hareld (2002) suggest most large companies tend to have five to ten
CRM applications running concurrently which suggests that there is no reason
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LITERATURE REVIEW
why a range of multimedia marketing techniques could not be used to support
relationships with their customers, without huge investment.
2.3
Multimedia Marketing
2.3.1 Websites
Multimedia traditionally comprise of graphic images, text strings, audio, video
and animation (Rabin & Burns, 1996). In today s high tech environment, a
company s website is often the primary medium through which a firm interacts
and performs a variety of transactions with their customers (Ganapthy,
Ranganathan & Shankaranarayanan, 2004). When websites were first
designed it was not important to give visual prominence of offers to acquire
new customers (Chaffey, 2003). A website can no longer consist of simply
posting brochures of products or services online, as this will not attract
customers. A successful website needs to deliver value, develop sustainable
one-to-one relationships and provide alternative channels of distributions
(Rao, Salam and Dos Santos, 1998). Through new advances in multimedia
technologies, websites can incorporate far more advanced techniques.
Websites can be adapted from pages merely made up of the five traditional
multimedia elements into web based solutions incorporating new techniques
such as podcasts, blogs, advergaming and social networks.
2.3.2 Promotion
2.3.2.1
Search Engines
The first impression of many businesses is through their website therefore it is
vital that the website provides a positive message. Promoting a company is a
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LITERATURE REVIEW
vital component of their marketing strategy to ensure customers are aware of
the service on offer. A website incorporating new multimedia techniques is
ineffective unless potential customers are aware of its presence. Search
engine registration is the primary method to promote a website to advertise
company s products or services (Chaffey, 2004).
Chaffey (2004) suggests over 80 percent of web users state they use search
engines to find information. Kennedy (2006) asks what more do you really
need other than Google? Search engine users find vast amounts of
information from sites such as Google, however none of it is the information
they were searching for (Kennedy, 2006). Through using search engine
marketing, a good customer relationship can be built as customers will be
receiving relevant information to the terms they searched.
Search term marketing, often referred to as pay per click (PPC) programmes,
are one of the most well known online marketing strategies (Duffey, 2004). It is
a concept where companies place bids on certain keywords or groups of
words, and a text advertisements is displayed when the selected keywords are
searched (Duffey, 2004). The appeal of this form of marketing is that
companies only pay for the number of clicks they receive. This method is
attractive to SMEs as it allows them to focus interested users to their website
which should create a higher percentage of converted sales.
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LITERATURE REVIEW
2.3.2.2
Viral Marketing
A current trend for promotion is viral marketing. It is a positive strategy,
meaning a way of spreading a message which can often get confused with the
negative connotation of infection (Breakenridge, 2001:138). Viral marketing
harnesses the network effect of the Internet and can be extremely successful
in reaching large volumes of people, quickly and inexpensively (Chaffey,
2003). The most common example of viral marketing is the tell-a-friend
option on many websites (Breakenridge, 2001). This is the equivalent to word
of mouth recommendations, where a form is placed on a website which
enables a customer to forward the page to a friend or colleague. This referral
is performed with confidence of the recipient who will trust the judgement of
the friend or colleague.
Chaffey (2003) suggests a successful viral campaign should be more than a
word of mouth recommendation and should encompass a WOW factor. It
should contain an entertainment impact on the recipient, which usually entails
using sex, humour or even violence. The user could still be presented with the
facility to enter names and email addresses of their friends and colleagues
who they imagine would also be interested.
Although Chaffey suggests a "WOW factor is needed for viral marketing, an
immensely successful campaign did not contain any sex, humour or violence.
The scale of the growth of Yahoo and Hotmail s free email service was due to
every email users sent contained an advertisement for the free service.
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LITERATURE REVIEW
Hotmail spent a mere $50,000 on traditional marketing and it grew from zero
to 12 million users in 18 months (Leskovec, Adamic & Huberman, 2006).
2.3.2.3
Advergaming
Another form of promotion which is associated with viral marketing is the use
of advergaming. Advergaming is the combination of advertising and gaming.
This method is desirable by marketers due to the cost effective promotion of
their brands (Bryon, 2005). The idea of using games as carriers for goaloriented strategically shaped rhetorical messages such as advertising and
propaganda has been much talked about (Svahn, 2005). The only advertising
that the younger generation consume is the kind that entertain them through
interactivity and community, which are also some of the core components of
gaming (Cesare, 2005). Due to this there has been a vast growth in
advergaming. PricewaterhouseCoopers predicts advergaming will be a
$3billion business by 2009, which is a five-fold increase from the level in 2005
(Bryon, 2005). Advergaming offers a good opportunity for building brands,
however, companies must ensure they are not implementing just another
generic game without achieving marketing results (Lee, 2003).
SMEs could use advergaming as a tool to gain loyalty within a younger target
audience. Cesare (2005) suggests advertisers have to aggressively seek ways
of advertising to 18-24 year olds. This is because there is a decline in people
of that age watching television because they are playing video games.
Advergaming is a solution to this problem which an SME should consider
using for their younger target audience. Bertrim (2005) suggests a typical
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LITERATURE REVIEW
player spends around half an hour playing a game, often returning to the game
15 times or more. A successful advergaming campaign should have a
component of loyalty where players are rewarded for recommending a friend.
An SME could use an advergaming mindset to create customer loyalty by
encouraging users to returning back to their website which will keep the
company brand fresh in people s minds.
2.3.2.4
Podcasting and YouTube
Loyalty can also be created through users subscribing to a podcast.
Podcasting is the preparation and distribution of predominately audio for
download to digital music players, however, the same technology is also used
to prepare and transmit images, text and video (Curran & McKinney, 2006).
Podcasts are useful to SMEs, to allow them to promote their company and
maintaining a personal relationship with customers.
Podcasting is often referred to as a push technology meaning the publisher
is pushing the content directly to the user (Maxymuk, 2007). A current
phenomenon is the use of YouTube which is a more grassroots application of
streaming video to users (Maxymukm, 2007). In 2006 Google purchased
YouTube for a massive $1.6 billion despite the fact its annual revenue is a
mere $15 million which suggests financially Google over paid for the company,
unless they can attract more revenue from advertising (Creamer, 2007). The
biggest drawback of using YouTube as a marketing tool is that there are
currently no ad models for the site. Creamer (2007) questions whether
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LITERATURE REVIEW
YouTube can be transformed into a media staple with professionally created
content which can happily coexist with amateur clips.
At this moment in time YouTube appears to be a medium for people
attempting to find 15 minutes of fame, which is why large corporations are
reluctant to invest into this medium until they see suitable success from other
companies. In contrast some SMEs are currently investigating using this
medium since it requires little or no capital investment. This could be a huge
advantage for SMEs, as it will enable the promotion of their products and
services to thousands, if not millions of users as part of YouTubes 100 million
streams per day (Creamer, 2007).
2.3.3 Communication
2.3.3.1
Email-Marketing
It is important that a company not only successfully promotes themselves but
they also need to effectively communicate with their customers. Email is a vital
method of communication used internally within an organisation and externally
with customers, suppliers and partners. Email offers many practical benefits
over traditional forms of communication such as telephone, post and fax.
These benefits include immediacy, targeting, accountability and cost (Chaffey,
2003). Emails are a more cost effective method, especially when large
distances are involved, and since it does not rely on real-time presence
(Hamill, 1997). It is more advantageous over websites as it is a push
communication tool allowing the push of their messages to the selected
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LITERATURE REVIEW
recipients, rather than waiting for people to recall a companies brand and visit
their website (Chaffey, Mayer, Johnston and Ellis-Chadwick, 2003).
For a company to be in a position to use email marketing, they must have a
vast database of information about their customers or potential customers. An
SME could store data on their own customers to be used instead of renting a
list. A company must ensure that they are being lawful and ethical by keeping
any data current and ensure that they have received permission from their
customers by using an opt-in approach (Sipior, Ward & Bonner, 2004). Until
this year it was only considered good practice to give the users the option to
opt-in as apposed to automatically suggesting they opt-in. Since 1st January
2007, the user has to actively request to be included on a list for example
selecting a tick box on a form (Miller, 2007). For a company to feasibly use
email marketing, they should constantly analyse the success of their
campaigns. McKelvey (2007) is concerned that email spending is soaring,
however an overwhelming 70 percent of companies apply basic or no analysis
to any of their email campaigns.
It has always been perceived that emails are the preferred method over direct
marketing (Chaffey, 2003). With the ever increasing levels of spam,
companies are finding it harder to successfully portray their messages in the
most effective way. It has been reported that last year spam volumes have
doubled, with over nine out of ten emails being spam (Smith, 2007). Although
email has many advantages over traditional marketing methods, many
companies are finding they are receiving higher levels of success through
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LITERATURE REVIEW
direct marketing. This is not to say that emails should not be used, however
there is room for both methods to be used in harmony. Smith (2007) suggests
the choice between direct mail and email marketing is more complex than
simply choosing between the two options. SMEs should analyse their return
on investment for both methods, since they both have their uses.
2.3.3.2
Blogging and RSS
Although email is still a vitally important communication tool, it suffers from an
increasing number of problems for delivering information to the correct
audience. The increasing volume of spam and viruses means that email users
have to seek remedies via spam blockers and email filtering to prevent the
influx of spam emails (Curran & McKinney, 2006). According to Patch and
McFinlay-Key (2004 cited in Curran & McKinney), 38 percent of genuine
emails are being erroneously blocked by email filtering software which means
that more than a third of emails, newsletters and special offers are not
reaching their intended audiences.
An alternative, effective and secure communication method is clearly needed
to allow companies to communicate messages to their customers (Curran &
McKinney, 2006). Wusterman (2004) believes RSS to be a solution, even
through it has been ignored since its introduction 10 years ago. There is no
agreement to the meaning of the acronym RSS. It has been defined as Really
Simple Syndication, RDF Site Summary and Rich Site Summary (Wusterman,
2004). Nevertheless, RSS is becoming an increasingly influential
communication technique (Wusterman, 2004). RSS is essentially XML syntax
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LITERATURE REVIEW
for describing a channel or feed of a recent addition to a website. These
additions may be updated sections of a website such as news items and
blogs. RSS is a popular technique else users would have numerous
bookmarks which they would have to manually search through each day just
to check if there are any changes in the information.
A blog can be defined as an online diary or journal which is a place to put
ideas where feedback can be received from others (Davision-Turley, 2005).
Blogs are used by many people from businesses to politicians to radical
groups (Young, 2006). When used within an organisation it should reflect a
company s brand. It is a chance for companies to communicate their ideas
with customers and for them to receive feedback, via a two way
communication tool.
Blogs could be highly successful within an SME as it is a free tool to create
relationships with customers. It is easy to use and a fun networking tool. A
company would have to be vigilant to ensure people do not post negative
comments or spam, and ensure the company is not spending too much time
maintaining this solution (Young, 2006).
2.3.3.3
Social Networking and Instant Messaging
Currently there has been a significant increate in the number of businesses
that are using social networking websites. Social networking is a collection of
individuals linked together by a set of relations (Downes, 2005). Social
networking sites such as MySpace and Facebook are popular sites boasting
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LITERATURE REVIEW
millions of users, all segmented by age, geography and interests which offers
an amazing opportunity for companies (Moran, 2006). Users can create a
profile on these sites and give it their personality which for a business can be
their branding. A company can set up a profile which can contain information
about their products and services, and provide a way that customers can
feedback their experiences with other users. These sites can also be used to
create blog entries which can be used to endorse their latest promotions and
to receive instant feedback within their network. Networking is not a new
concept within businesses however social networking websites are just
another tool to encourage this on a less formal basis and to network with
customers, as well as other businesses.
Instant Messaging (IM) is also highly popular, allowing users to talk in realtime with each other through short text messages sent over the internet. It is
an immensely popular method of communication within teenagers and young
adults. It is suggested that the average American teenager and young adult
will spend 868 hours (36 days) online each year of which 20 percent of this
time is spent instant messaging (Primeaux & Flint, 2004). IM has changed the
world to the same degree as voice-mail and email, which has proved a huge
potential for many businesses (Primeaux & Flint, 2004).
The appeal of IM to businesses is the immediacy of this technology. IM allows
informal and spontaneous conversations between co-workers or between
business and consumer. Goldenberg (2006) suggests the future of CRM will
require every process to occur in real time through an always on, always
connected approach. This method of communication can create a highly
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LITERATURE REVIEW
personal, informal relationship with its customers and offer instant responses
to enquiries when customers are looking at their website.
2.3.3.4
Multimedia Mobile Marketing
The use of mobile phones and new associated technologies has experienced
exceptional growth over the past 10 years and created many opportunities for
companies to enhance relationships with their customers. The use of text
based communications via Short Messaging Services (SMS) is not a new
concept to businesses. SMS can be used to send adverts, allow interaction,
receive voting, offer discounts, and provide promotional games. Although
some of these uses of SMS have recently received bad press in the UK
through TV game shows unfairly using this medium, it should not stop SMEs
from considering its advantages.
Through advances in technology and the drop in costs, Multimedia Messaging
Service (MMS) is proving to be a highly successful medium. According to the
Mobile Marketing association (Moran, 2006), by 2008, 89 percent of brands
will use text and multimedia messaging to reach their audiences with nearly
one-third planning to spend more than 10 percent of their marketing budget on
using this medium alone.
Not only can mobile phones be used as a push technology to drive messages
to customers, they can also be used to pull customers in through providing
downloadable items such as videos or pictures to encourage a viral effect
(Hargraves, 2005). Gary Corbett, managing director of Opera Telecoms
suggests multimedia mobile marketing is proving to be far more successful
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LITERATURE REVIEW
than both plain text and email campaigns (Hargraves, 2005). He believes the
mobile is a very personal way of getting in touch with customers therefore it is
great for driving responses. This method constantly receives significantly
higher response rates of about 20 to 25 percent which is far higher than you
would expect from email marketing.
SMEs should take advantage of this technology to create this personal touch
by targeting their customers through text and multimedia campaigns. They
should also consider creating their website in formats that are viewable on
mobile phones. WAP (Wireless Application Protocol) was first introduced in
1999 which caused much hype by providing the opportunity to access the
Internet while on the move (Chaffey, 2003). This hype was ignored due to
limitations of the devices in terms of screen size, colour and bandwidth. With
the introduction of 3G technologies, this has enabled users to transfer
simultaneously both voice data (a telephone call) and non voice data such as
downloading information. SMEs can exploit this technology to communicate
and build relationships with their customers through their mobile.
2.4
Summary
It has been established that there is a variety of solutions SMEs could use to
enhance their relationships with customers, through multimedia techniques. A
CRM system does not have to cost thousands of pounds and does not have to
work in isolation. It has been demonstrated that multimedia marketing
techniques could work just as well at creating and managing relationships with
customers from the very moment they discover a brand. With ever evolving
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LITERATURE REVIEW
technological advances, SMEs should not be complacent with the
technologies they use today but be aware and experiment with new
technological advances.
It is widely assumed that a company will have some level of CRM system in
place to give them a competitive advantage however several factors hold
SMEs back from investing in CRM technology such as time and recourses
(Vermond, 2004). This research project will investigate the use of CRM within
SMEs and investigate how successful SMEs find multimedia marketing
techniques.
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METHODOLOGY
3 METHODOLOGY
3.1
Approach
When deciding on which research method to use for this study, a careful
choice had to be considered to ensure appropriate research was obtained. A
case study approach was chosen because it involves an empirical
investigation of a particular contemporary phenomenon within its real life
context using multiple sources of evidence (Robson, 2002). A case study
approach enables a rich understanding of the context of the research and the
processes being enacted (Saunders, Lewis and Thornhill, 2007). To capture
the required data various methods were considered such as creating
questionnaires or a focus group. A questionnaire was not suitable as it would
require many small companies to participate and they may be reluctant to
provide adequate details about their business through this medium. A focus
group can provided valuable in depth information, however many proprietors
may not wish to discuss their business openly in a room with other proprietors.
There would also be the issue of arranging to get a group of businessmen in
the same location, on the same day, away from their business. The decision of
using a semi-structured interview was chosen as it provides the opportunity for
proprietors to speak openly about their business which can be kept
anonymous if they prefer.
3.2
Study Design
A semi-structured interview technique was chosen to collect qualitative
information for this investigation in order to create a case study based on four
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METHODOLOGY
small businesses. Of the businesses in the UK employing up to 250 people, 71
percent have no employees at all and 24 percent have 1-9 employees. Within
companies who do have employees, only 16 percent have ten or more (DTI,
2007). For this reason, the businesses chosen all have less than 10
employees and operate in the same area of Kent but in different business
sectors. They have been established various durations of time, from one year
to seventeen years. The companies chosen where Dream Doors who
specialise in fitting kitchens and bedrooms, Katie s PlayPen who are a retailer
selling products for babies, Orbit Training who offer a range of personal
development courses for young people, and Xtreme Vortex who operate a
mobile laser tag arena.
The semi-structured interviews lasted around 30 minutes each and were
conducted in a private room with only the researcher and the participant
present. This ensured that the participant could not be influenced by anyone
and that the information they provided was kept anonymous if the participant
requested. The structure of the interviews varied between each company to
reflect the information they provided. A prompt sheet (Appendix A) was
created prior to the interviews to enable key points to be raised if it was
relevant and to ensure the interviewed continued to flow. An audio recording of
the interviews was captured and a summary of each interview written down
(Appendix B). A summary of the interview was presented to the participant and
verified that the interpretation of the researcher was how the participant
intended.
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RESULTS
3.3
Ethical Issues
To comply with the Research Ethics outlined by the University of
Gloucestershire (2005), each participant signed a consent form (Appendix C)
to explain the process of the semi-structured interview. The participants were
asked if they would grant permission to allow their company name to be used
within this research. This was not mandatory, however, if the participant
wished to be kept anonymous, this was confirmed on the consent form and
informed they could withdraw at any time. The participants were debriefed
after the interview and the contact details of the researcher were provided to
allow the participants to make any further queries.
4 RESULTS
4.1
Summary
The aim of this research project was to establish how multimedia marketing
techniques can support Customer Relationship Management for Small and
Medium Enterprises. This involved creating semi-structured interviews with
SMEs to ascertain their perception of CRM and the use of multimedia
marketing within their organisation.
The companies chosen represent both the retail and service sector. It has
been determined that each company has their own unique way of operating
and have different priorities regarding CRM. Depending on the age, size and
sector of the company, can relate to the level of CRM required. This will now
be discussed in detail for each of the companies who participated.
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RESULTS
4.2
Data Analysis
4.2.1 Case Study 1
Dream Doors Kitchens
Dream Doors are an established bespoke kitchen and bedroom supplier. They
are dedicated to providing their customers with the highest quality of products
and service. They currently have around 40 franchises over the UK of which
18 currently have showrooms. For the purpose of this research, an interview
the franchise which covers the Dartford area of Kent was conducted. This
franchise has been established for just over two years. Due to their expansion
they have set up a showroom to promote their service, as recently as two
months ago. The franchise consists of a director and secretary who manage
the company and staff the showroom, while two fitters work under contract.
The franchise licence allows them to advertise under Dream Doors and
includes training and five year support along with national advertising including
a website.
Due to the service which the franchise provides, customer retention consists of
providing a personal relationship with their customers from the moment they
discover the brand until the transaction is complete. They currently do not
have a CRM system because once the work has been completed, the
customer is unlikely to require the service again. Although a CRM solution is
not implemented, a mixture of a paper and electronic database is used to store
customer s information. Although the franchise has yet to use this information
to contact their previous customers, they have considered sending out
calendars around Christmas to create brand awareness. The franchise
decided against spending money on this method since they would only be
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RESULTS
appealing to a very small section of their customers. Instead they constantly
advertise for new customers through a variety of sources and ensure each
advertising method creates a positive relationship with each customer from
first impressions, through to design and implementation of the kitchen or
bathroom.
During the last two years, the franchise has investigated a number of methods
to promote their business to enhance a positive relationship with new
customers. The franchise offers their customers quality products rather than
the cheapest solution. This factor affects the typical customers they attract, as
the younger market can generally only afford a cheaper kitchen which is why
the majority of the customers are over the age of 50. This is because they
have the opportunity to spend their money on quality as they have a more a
disposable income than the younger generation. To enhance their relationship
with people over 50, they offer a five percent discount to promote their
services and to encourage word of mouth referrals.
As part of the franchise licence, Dream Doors have a generic website which is
used for all Dream Doors franchises. The website is very informative of
different options available to customers. If they wish to find out more they can
complete an enquiry form which is then processed and allocated to the
nearest franchise. Although each individual franchise does not have physical
control over the website content, they can make suggestions to be
implemented. Over the next few months the website will be re-designed which
provides a perfect opportunity to make suggestions for the content. Some Key
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RESULTS
suggestions the franchise have already made to head office include using
more photography and show maps of where each individual franchise is
located. The topic of creating a news section was discussed, however, with a
service such as fitting kitchens, there is not really a necessity to create news
section since the only news they could report on would be new products and
showrooms.
The problem Dream Doors have with their website is that many people who
enquire on the website are interested in receiving brochures which cannot
contain prices as each kitchen is bespoke. Customers who tend to use the
internet for searching, will spend lots of time researching for the best price
which Dream Doors do not try and compete with as they provide quality
products. As their website is not their most successful advertising tool they
would not wish to spend money on advertising their website through tools such
as pay-per-click marketing.
The key to creating a strong customer relationship in this line of business is
through their first impression and personal communication with their
customers up until completion. When customers enquire the franchise use a
mixture of telephone and email to respond to customers. They would not
consider using methods such as SMS or instant messaging as they feel these
methods would not enhance their relationship with their customers and they
were unsure of the costs involved. During the interview the topic of using
social networking websites such as MySpace was discussed. They had
previously never considered using this method of marketing however after
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RESULTS
considering the advantages of using this method they suggested they will
consider this method in the future.
The main methods they use to build up relationships with their customers are
through advertising in local publications such as newspapers and magazines
and through leaflet dropping. Newspaper advertising has proved extremely
successful through using the advert in figure 3, however, when using the
advert in figure 4 which is more in line with their corporate colours, they have
received very little work from it. The advert in figure 4 appeals more to the
younger market which as previously recognised is not their target market. The
advert in figure 3 appear to look like a newspaper article, therefore, the reader
will unknowingly start reading the advert.
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RESULTS
Figure 3: Dream Doors Franchise successful advert
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RESULTS
Figure 4: Dream Doors Franchise younger appealing advert
Overall, the Dream Doors franchise does not use multimedia to enhance its
customers experience due to the target audience generally not using
technology to contact the company. The company mainly uses traditional
methods supported by their website, which is their only multimedia element.
4.2.2 Case Study 2
Katie s PlayPen
Katie s PlayPen (Katie s) is a retail superstore and website, selling products for
babies. They are well established in the local area since they have been
trading since 1990. The company consists of three directors and six staff
members. The target audience for the company is primarily mothers and
couples, who are expecting a baby. It is crucial for Katie s to create strong
relationships with their customers and ensure their experience with the
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RESULTS
company is hassle free since it can be a stressful time for the expecting
mother. There is an immense opportunity for Katie s to create strong
relationships, since the mother will require new products as the baby grows up
and the mother may also have a second child.
CRM is vital tool within Katie's, since their store customers often wish to order
products but collect them nearer the due date of the baby. Copious information
regarding the customer and their requirements is recorded through a
computerised database, however, the information stored in this database is
not compatible with their online website. This could hinder the relationship with
their customers since they could shop using both methods and they would
have to provide their personal details twice. Although this could create a
problem, Katie's believe their online store is used more by customers who are
not in the local area.
Over the last six months, Katie s have been setting up a new website for the
company. This website was created by a design company in such a way that
staff within the company could add material and maintain most of the website.
Their old website had the facility to buy products however this new system has
created a far more user friendly solution for both the company and their
customers. The old website was created using JavaScript which meant any
changes to the website had to be managed by the hosting company.
The new website incorporates a number of tools to enhance their customer
relationships. There are new features such as setting up a user account where
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RESULTS
users store their personal details. The old system did not have this feature
which could hinder the relationship with their customers since they would not
wish to constantly complete their details for each order. The website also has
the facility for customers to create a wish list which they can give to friends
and family to make suggestions of products to purchase for the baby. The new
system is more user friendly for their customers as they can send confirmation
emails at the click of a button, to inform customers of each stage of their
purchase.
Although Katie's spend lots of time retaining previous customers, it is vital that
they constantly advertised for new business. To reach new customers, Katie's
hold promotional days and advertise through local newspapers. Around three
times a year they have a promotion day where products are discounted and
family activities are available. They recently held one of these events and
advertised it through traditional newspaper adverts over a two week period.
The first advert (Figure 5) promoted the event and suggested readers look for
next weeks advert for their 10 percent off voucher (Figure 6). Although these
promotional days are currently aimed at obtaining new customers, Katie's are
currently considering making their current customers aware of these
promotional days. They plan to create a database of email addresses from
their two database systems to allow them to send out email marketing to their
current customers.
- 38 -
RESULTS
Figure 5: Katie's PlayPen advert
NewsShopper, April 18th 2007
Figure 6: Katie's PlayPen advert and voucher NewsShopper, April 25th 2007
- 39 -
RESULTS
Overall, Katie's PlayPen has an extensive CRM system in place however this
is mainly due to the nature of the business. They have been established many
years and although they know which marketing methods are successful, they
constantly need to assess their requirements and make necessary changes
like that have recently done with their website.
4.2.3 Case Study 3
ORBIT Training
ORBIT Training offer a range of personal development courses for young
people between the ages of 13 and 24. Their courses provide people with an
opportunity to develop their self-esteem, confidence and personal potential
through learning basic mechanical engineering. ORBIT comprises of three
partners and has been trading since October 2005. Personal development
schemes similar to ORBIT have been available for many years at static sites
all over the country. However, there are many problems between rival gangs
in different boroughs of London, where if gang members walk through the
wrong estate to get to such a scheme they receive confrontation from rival
gangs. ORBIT offers a unique mobile service which targets young offenders,
young people at risk of offending, and also school children. They can go to any
site, run a course and leave without rival gangs knowing about the event.
Due to the company still trying to expand, all of the partners have other jobs
therefore ORBIT is currently run on a part time basis until all three wages can
be covered by their profit. They currently do not wish to spend lots of money
on advertising and CRM systems as most of their contacts come from word of
mouth and through networking. The relationships with their customers are
- 40 -
RESULTS
currently manually recorded through a paper based system however they have
created a database which they have never used. To enhance relationships
and grow their network they personally meet with prospective customers
where they offer discounted rates for the first booking to allow them to
demonstrate their service.
ORBIT greatly relies on building personal relationships through networking
however they currently do not personally use social networking websites such
as MySpace. The company was not aware that they actually appear on one of
their client s blog where events that ORBIT had attended were reported.
Through looking at this example, ORBIT has decided they might investigate
the advantages of using this method to target the participants on the schemes.
Although ORBIT are not advertising for new business, they use Public
Relations (PR) to get reported in newspapers for the work they do which is
often with the Metropolitan Police or local councils (Appendix D). Their website
plays a key role at describing the service they provide to clients since without
pictures it is difficult to explain their service. ORBIT wish to update their
website to include many new features however the due to a problem with the
company who created the website they no longer have contact with this
company. Since none of the partners of ORBIT have much knowledge of
computers they are unsure of the situation regarding ownership and
management of their website. They have attempted to personally update their
website however by doing this they have lost the user friendliness of the
website. They plan to employ someone over the next few months to rectify the
- 41 -
RESULTS
problems regarding their website. They are also keen to add new features on
the website which will include video and also viral marketing such as a tell-afriend feature.
ORBIT believes a tell-a-friend feature would be highly successful as it should
work in a similar way to the personal networking. They are currently trying to
implement a news section themselves however they are struggling due to lack
of skills. They were not aware of RSS technology however once explained,
ORBIT believes this would be a huge benefit to their relationship with people,
to inform them of changes that have been made. Although they wish to use
videos as a marketing tool, they are reluctant to use websites such as
YouTube. They believe it would tarnish their brand since it contains pointless
videos such as youths happy slapping . Once the company s website has
been redesigned, ORBIT might consider investigating where they appear on
website listings and consider using pay-per-click tools to enhance their
position. This would require vast research to ensure these options are
suitable to ORBIT as they have little experience in using such marketing
techniques.
Overall, ORBIT training are still a young company however until they have
more cash flow they are not wishing to consider investing heavily into CRM
and multimedia marketing tool to promote themselves. This is not to say that
ORBIT are would not consider using such techniques but a matter time before
they do.
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RESULTS
4.2.4 Case Study 4
Xtreme Vortex
Xtreme Vortex supply and operate a fully insured state of the art mobile laser
tag system for many different types of events. The company consists of two
partners and has been trading for just over a year. There are two types of
customers that they attract. Some customers are a one of transaction such as
parents organising a Childs birthday party. They are unlikely to want the same
birthday party again. The other type of customer is one who organises a
regular event each year, which requires a relationship to be created. Xtreme
Vortex contacts their customers through both email and telephone. The
information about customers is currently stored both on computer through
email enquiry forms and also through a paper based system. A database to
store such information has been created however the system was never used
efficiently. Instead consideration is being given to implementing a system
where online enquiries are automatically inputted into a database. They do not
wish to invest vast amounts of money in this but to merely create a simple
solution to the problem.
Xtreme Vortex would never consider using a rented list to send out marketing
material to promote the business such as emails. This approach was
described as being an intrusion of the inbox since everyone is bombarded
with too many emails of which most is never of interest. Currently the company
have not asked permission to use customer s information for this purpose
however they wish to adapt this as part of the revamp of their website. Other
methods of building relationships with customers through SMS would not be
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RESULTS
explored as they would prefer to use email, as SMS is seen as possibly being
a more expensive method.
Search engine submissions and pay-per-click marketing was vital in the start
up of the business to ensure they received hits to their website by appearing in
an optimum position on the listings. Xtreme Vortex suggested they see tools
such as Google Adwords to be the modern day marketing tool rather than
using phone directories. As the company expands they hope they will not
have to spend as much money on pay-per-click advertising. As the company is
only a year old, this method has been their primary source of advertising and
is their preferred method as they have full control over the amount of money
they spend on the tool.
Xtreme Vortex created their website a year ago and they believe their website
is adequate at the moment however over the next few months they will
consider adding new features. They wish to create a more interactive website
through using gaming to encourage users to revisit. These games will be
quirky games associated with the service that Xtreme Vortex provides and
should reflect on their brand image. They would wish to use these games as a
viral marketing campaign to get people to send the link to their friends to see
if they can beat each others top score . They hope the game will be sent
across the younger market but also through them to reach their parents who
will forward the links around their place of work . The reason behind them
wishing to use this technique is due to relatively no cost being involved and
will hopefully grow the business and enhance their customer relationship.
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RESULTS
Other improvements they wish to make to their website include creating a
news section. They are concerned that their news section might lack up to
date news since they are not as busy during the winter months. They were not
aware of RSS technology but believe this could enhance the news feature
however it would not solve the issues regarding out of date news.
To enhance their website and customer relationship, Xtreme Vortex is
currently considering the idea of using social network websites in particular
MySpace. They see it as a popular tool which has put many music bands into
the spotlight. They believe it can be a positive tool if implemented correctly to
create a personality for the brand, to allow customers to build a relationship
with the company. They believe this tool will help create a community feel and
allow customers to feel more connected to the company. Xtreme Vortex
wishes to unitise the features of MySpace such as the facility to blog which
they will use to record a list of events they will be attending and also to record
where they have been. They would also use the facility to stream videos on
their profile to advertise the equipment they provide. The advertising videos
that they produced would be replicated on their website however they would
not want to submit them onto websites such as YouTube. They see it as a
source to pass the time where you can view people s crazy moments or silly
videos of a sneezing panda.
Overall, Xtreme Vortex uses a vast array of multimedia marketing to enhance
their customer relationships. Due to the nature of the business they are
- 45 -
RESULTS
constantly interested in new ideas to promote their business and to improve
their website.
- 46 -
DISCUSSION OF FINDINGS
5 DISCUSSION OF FINDINGS
5.1
Summary
The project discussion draws on findings and themes from the case studies, in
an attempt to evaluate and assess the relevant uses of multimedia marketing
to support CRM, within Small and Medium sized Enterprises.
Common themes occurred throughout the four case studies. It appears that all
the companies still rely on traditional marketing techniques, however,
technology is used simultaneously to support their traditional techniques. The
use of promotional material such as leaflets and advertising in newspaper is
still commonly used within SMEs (Appendix E). The four SMEs suggested that
sign written vehicles are by far the most successful method of advertising for
their businesses as it creates brand awareness in the local area. The use of
CRM within each of the companies varied, mainly due to the different
durations they have been established and their industry sector. One common
theme is that all of the SMEs use a mixture of both telephone and emails to
communicate with their customers. The use of the data gathered about their
customers all varied between the four companies however none of the
participating companies have ever rented or considered renting data to
promote their business. The findings from the companies who participated will
now be discussed in detail.
- 47 -
5.2
Case Study Discussion
The companies chosen all varied in size and duration of trading. Katie's
PlayPen has been established the longest and has by far the most
comprehensive CRM system out of the four companies. The reason why
Katie's have such an extensive CRM system is due to their line of business.
Retail shops such as Katie's need to record in-depth information for many of
their transactions since most products need to be ordered and often
customers wish to collect the products at a later date. As they also sell through
their online store, it is vital that a CRM system is incorporated into this. Katie s
have previously managed without an extensive CRM system as part of their
website, however they have realised their limitation and recently invested into
creating a solution to allow customers to create their own account. Although
Katie's has implemented such a system they are not utilising the data they
have collected. The new system collects a vast amount of personal data and
history of orders, although Katie's do not plan to export this data, to target their
customers, even though they have gained permission to use this information.
Director (2000) suggests an SME could expect to pay between £5,000 and
£25,000 on a CRM solution however simple multimedia solutions such as
redesigning a website to include a personal account facility can be highly
successful with a much lower level of investment required which in this case
was a mere £600.
As already established, Katie's use CRM to ensure they provide a quality
service however they also use CRM to reward loyalty to their customers.
- 48 -
Katie's have created a Very Important Baby (VIB) reward card. This card is
issued to customers when they have spent over a certain amount and consists
of bronze, silver and gold levels. The more loyal a customer becomes the
higher discount they receive. Katie s are also planning to encourage loyalty
through sending email marketing campaigns to customers to inform them
about forthcoming promotional days. This involves creating a database from
their two CRM systems to allow them to send emails. This method would
benefit Katie s due to the immediacy and ability to target their emails to
specific customers at a reasonably low cost (Chaffey, 2003). Katie's would
have to consider their success rate for their email marketing campaigns since
it has been reported that last year spam volumes have doubled, with over nine
out of ten emails being spam (Smith, 2007)
Although Katie's have been trading for 17 years and had the opportunity to
experiment with their business, CRM has always been imperative. In the retail
industry, it is vital to use CRM as a customers experience can lead to repeat
business. Companies such as Dream Doors, do not have the same
opportunities to build up relationships with their customers as they are a
service. The relationships Dream Doors create with their customers finishes
once the transaction is complete as the customer will rarely require their
service again. This is not to say Dream Doors do not need to maintain
relationships, but instead they need to ensure their customer do not forget
their experience and would refer the service to a friend. This approach is
created through more traditional methods such as regular newspaper adverts,
sign written vehicles and leaflets to keep the brand fresh in consumer s minds.
- 49 -
Although companies such as Dream Doors could explore multimedia
techniques to enhance their customer experience, since as the company is a
franchise, this limits the solutions they could use.
Although Ganapthy, Ranganathan & Shankaranarayanan (2004) suggests a
company s website is often the primary medium through which a firm interacts
and performs a variety of transactions with their customers. This is not
relevant to Dream Doors since their website is generic for all franchises. The
franchise would not wish to spend money advertising through pay-per-click
marketing. The franchise also does not see their website as a successful
medium because most of their customers are over fifty and do not tend to
enquire through their website. The reason why their customers are typically
over the age of fifty is due to the products and service they provide not being
cheapest, therefore the younger generation often seek a more affordable
solution. Dream Doors try to encourage their target audience by providing
people over the age of 50, with a 5 percent discount. Since their target
audience do not tend to use the internet to search for their service, other
multimedia solutions such as SMS, RSS and blogging are not beneficial.
Although a service such Dream Doors does not benefit from multimedia
marketing, Xtreme Vortex uses various techniques to its advantage. The
service Xtreme Vortex provides is futuristic, therefore they attempt to create an
image and brand to reflect this. Xtreme Vortex appeals to the younger market
therefore using tools such as pay-per-click marketing, along with a state of the
art website is immensely beneficial. It has been suggested that search engine
- 50 -
users find lots of information from sites such as Google, however none of it is
the information they were searching for (Kennedy, 2006). By Xtreme Vortex
investing in Pay-Per-Click programmes, they are enhancing their customer
relationships from the moment a customer discovers their brand. Xtreme
Vortex is currently designing a new website which will incorporate a vast
amount of multimedia marketing tools. As part of their website upgrade they
wish to design the site to be more aesthetically pleasing and to add new
features such as a news section, improved photo section, video gallery and a
game section. By creating a game where users are attempting to achieve the
highest score, this creates an immense viral effect. It is important to ensure
the game has marketing results and is not just another generic game (Lee,
2003). Although Xtreme Vortex are implementing a large scale viral campaign,
ORBIT training wish to create a similar effect but without a WOW factor
(Chaffey, 2003).
ORBIT Training is a young company who are still looking to grow. ORBIT
currently do not consider CRM to be of importance however they are looking
at way to improve their website. One feature they believe will highly improve
their site is by creating a refer-a-friend feature. This is a viral method which
harnesses the network effect of the Internet and can be extremely successful
in reaching large volumes of people, quickly and inexpensively (Chaffey,
2003). The company does not spend vast amounts of money on advertising
but relies on PR and networking. Social networking was discussed with all
three of the companies however Xtreme Vortex were the only company
already considering this method. ORBIT and Dream Doors previously had not
- 51 -
considering using social networking websites however after the discussion
they suggested they may consider using it in the future. Although ORBIT
currently does not have their own MySpace profile, they currently appear on
MySpace on other people s blog entries.
A current internet phenomenon is the use of YouTube to publish videos. The
presence of YouTube and the possibilities of using it as a marketing tool were
discussed with the participants. Although YouTube is a highly popular website,
all of the companies who participated explained they would not be interested
in using this medium as they all felt the image of YouTube could damage their
brand. Participants described it as a place to watch youths happy slapping ,
and a source to pass the time where you can view people s crazy moments or
silly videos of a sneezing panda. This coincides with Creamer (2007) who
questions whether YouTube can be transformed into a media staple, with
professionally created content, which can happily coexist with amateur clips.
Overall SMEs tend to use a mixture of various techniques to support their
relationships with their customers. Although it is apparent that there are trends
between the companies, each one uses different solutions and is successful in
its own way. Companies need to be aware of the different options to maintain
relationships with their customers but they also need to realise they need to
ensure it is suitable to their organisation.
- 52 -
CONCLUSION AND RECOMMENDATIONS
6 CONCLUSION AND RECOMMENDATIONS
6.1
Summary
The aim of this research project was to establish how multimedia marketing
techniques can support CRM for Small and Medium Enterprises. This
research has provided the author with an insight into the different ways Small
and Medium sized enterprises can manage and promote different types of
relationships with customers.
6.2
Limitations
This research project was limited to finding an adequate number of SMEs to
participate. The researcher attempted to find four companies from different
industry sectors, with a differing number of employees and level of
establishment. To enable this to occur, two of the companies interviewed had
a personal relationship with the researcher. Although it is common practice,
the researcher ensured he maintained a professional, unbiased opinion of the
participants in making no assumptions and ensuring the participants agreed
with the answers they provided. Copious notes from each interview were taken
and after each section the researcher reiterated their summary to ensure the
participant agreed with their interpretation. By the researcher interviewing
personal contacts, this provided a greater insight into the businesses as the
participants were familiar with the researcher and able to talk openly about
their business in confidence.
- 53 -
6.3
Recommendations
Although the chosen data collection method was most appropriate for the
circumstances surrounding this research project, this research topic can
further investigate the uses of multimedia within SMES. The inspiration for this
study came from the authors own experience of establishing an SME. This
research project could be developed to investigate the four case studies
further in order to explore the return on investment for each of the multimedia
marketing techniques to get a clearer picture of the uses of multimedia. It
could also be interesting to investigate CRM within a wider number of
companies and to explore the topic in more depth. A further quantitative study
could also investigate the topic to obtain statistical analysis regarding the
popularity of using multimedia marketing to support CRM within Small and
Medium sized Enterprises.
6.4
Conclusion
It has been determined from relevant text and interview results, that
multimedia marketing can support CRM within Small and Medium sized
Enterprises. From the companies interviewed, traditional marketing is still vital
to enhance their customer relationships. Although the companies still use
many traditional marketing techniques, the level of multimedia content relates
to the business type. From the interviews, it appears that companies in the
retail industry require a far greater level of CRM than the service sector.
Although the companies in the service sector are much younger than those in
the retail industry, depending on the type of service they provide relates to the
- 54 -
level of CRM they need to implement. It has also become apparent that
depending on a companies target audience, relates to the level of multimedia
content that the company should implement. An example of this is Dream
Doors kitchen who appeals to people over the age of 50 and from their
experience it is apparent that this age group contact them through their
traditional marketing methods rather than their multimedia methods. On the
other end of the scale is a company such as Xtreme Vortex, whose services
appeal to the younger generation therefore the use of multimedia marketing
can create stronger relationships.
Although from the research it was apparent that some multimedia marketing
techniques such as publishing video through websites such as YouTube is not
currently desirable to SMEs, this method should not be ruled out. YouTube
has been owned by Google for less than a year therefore companies should
be patient and obverse any improvements Google make. Google will most
likely change this image problem however in the mean time, video can be
streamed through websites such as MySpace. This can be part a larger
marketing tool which can incorporate company news and promotions through
writing blog entries to allow customers to provide feedback. Social networking
is constantly increasing however companies need to ensure that they are
using this tool effectively as a positive promotional tool.
It has been suggested that there will be an immense increase in new uses of
multimedia over the forthcoming years through advergaming and SMS.
Although currently only one of the participating companies are considering
- 55 -
implementing advergaming, many SMEs may deicide to use this method once
they see similar companies using this medium. There appears to be vast
potential for using these techniques, as it can harness the network effect of the
internet for a relatively low investment. From the companies in this research,
none use SMS or would consider this in the future. Therefore from this
research it appears that SMEs may not be interested in using SMS and mobile
related technologies, however, it could be recommend that further research
could be carried out to investigate this which might suggest there is a potential
growth area.
Overall this research project has provided evidence to suggest that multimedia
marketing can support CRM within Small and Medium sized Enterprises.
Although CRM is considered as an immense system which requires vast
levels of investment which often ends in failure, SMEs can successfully use
multimedia techniques to enhance their relationships with their customers. By
using numerous multimedia marketing techniques, this involves less risk and
investment than a fully automated CRM system which can be equally effective
at enhancing customer relationships. Each company offers a different
relationship with their customers due to the type of products and service they
provide. There is no one CRM solution which can be implemented into every
company however each company must assess their needs and apply the
marketing tools that are relevant to their requirements.
- 56 -
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- 60 -
APPENDIX
8 APPENDIX
8.1
Appendix A
Interview Prompt Sheet
Company Overview
Company Name:
Years of trading/Established:
Number of employees:
Location:
Website:
Type of business: Private/Franchise?
Target Audience
- 61 -
APPENDIX
Interview Questions
What is the relative importance of retaining old customers and obtaining new
customers?
It is suggested that it costs five times more to acquire new customers than to
retain your current customers. Would you agree with this statement and does it
change your answer to the first question?
How important is Customer Relationship Management within your organisation?
Do you currently have a Customer Relationship Management system in place
within your organisation?
How to you recorded enquiries from websites/customers preferences? Database?
Which of the following components does it consist of and please explain each
component.
If you don t use one of these methods, what is your reason behind not using this
method?
How much do you spend on this medium?
o
Do you have a Website?
What features does the website have?
Is your website accessible to all users? W3C certification?
o
Do you have a database of customers/prospective customers?
Is the data rented or in-house?
How was it created? Automatically/Manual? From website?
How often do you ensure this data is kept up to data?
o
Do you keep in contact with current customers via telephone?
o
Do you use Email to send newsletters to keep in contact with your
customers? How often?
o
Do you use search engines to advertise your website?
o
Do you use any methods to ensure that your listing is of its highest
position (eg. Search engine optimisation)
- 62 -
APPENDIX
o
Do you use Pay per click search engine advertising such as Google
Adwords?
o
Do you use SMS marketing?
Adverts
Interaction
Voting
Offers/Discounts
Promotional games
o
Have you ever used a Viral Marketing campaign?
Tell a friend feature?
Sex, humour or violence
Advergaming
YouTube
o
Do you have a news section on your website?
Do you use RSS to enable users to be informed of the latest news?
o
Have you ever considered using Blogging to record ideas and events that
occur within the organisation?
Do you use RSS to enable users to be informed of the latest blog
entry?
o
Do you use Instant Messaging (IM) to stay in contact with your customers
or to entice new customers to choose your organisation?
o
Do you use social networking websites such as MySpace and Facebook to
stay in contact with customers and to network with people to promote your
brand?
- 63 -
APPENDIX
8.2
Appendix B
Overview of Interviews
8.2.1 Dream Doors
Overview
o Established 2 years
o Opened a show two months ago which has been a huge success and
used as a big promotional tool
o Dream Doors as a franchise has around 18 showrooms and 35 -40
franchises however the exact figures are on the website
o Dream Doors supply full kitchen replacements or upgrades and bedrooms
o The franchise covers the DA (Dartford Area) through Dream Doors
enquiries on their website
o Closest other franchise Southend, Tonbridge, Sutton
o Typical customers -50+ - expendable income = quality
o 5% discount this market
Franchise Rights
o 5 Year support from Dream Doors
o National Advertising and website
o TV adverts and national press
Branch Advertising
o Local Newspapers
News Shopper
Kent Messenger
o Yellow Pages and Yell.com
o Thompson
o Saga Magazine Monthly
o Home Design Magazine Monthly
o Supermarket magazines
o Local Hospital magazine money goes to charity
o They attended an exhibition however this method was not cost effective
o Used to leaflet drop themselves however they now use the Post office to
post leaflets. This method is just as effective and costs the same at around
3p per leaflet. They recently sent out 10,000 leaflets through this medium
o Designs of leaflets
black and red brand colours attracted more younger people but
they are after a B&Q style cheap kitchen so didn t really work
Red and white with older lady photographed and more journalistic
writing worked better for their market
o Sign Written van might get car done soon very amazing technique
Website
o Managed my Head office
o Franchisees have input
o New website update happening soon
o Head office asking for suggestions
o More information required more samples and photographs
o Maps of franchise locations
- 64 -
APPENDIX
o
o
o
Use Thompson which guarantees Google placement however not sure
what this entails
Website works but conversion rate low many customers searching
around too much and only lightly enquiring
Not the cheapest company around because they sell quality
Considered
o Radio Advertising
Was not used due to recommendation by other franchisees
o Bus advertising
Was not used due to recommendation by other franchisees
o 118247
Was not used due to other kitchen fitter using it unsuccessfully
Have you considered using SMS
o Not considered it and would not consider using it. Not sure of price anyway
but imagine it most defiantly would not be effective.
CRM
o
o
o
o
o
Electronic database of customers with printed files for each person
Considered using branded calendars to send out over Christmas time
Considered using 118118 which incorporated a viral campaign through
SMS
Not considered due to people not needing a kitchen fitter right
here right now unlike plumber/locksmith
Internet Enquiries
Mostly just brochures via post followed up with letter - 30%
conversion rate lack or prices is the major problem
For general information they will just ring
If email enquiry is specific they will email them twice and if no
response they will try to phone them.
One example was when a person hasn t responeded they rang
and they explained they just didn t get round to reading it properly
which may be due to too much other junk emails
Receiving Word of mouth enquiries already in the 2 years
News/RSS
o Not necessary for this type of company
o Only news is new doors/new showrooms but people would not need to be
informed of this thru a push method
MySpace Very excited
consider it now
never considered the technique but would defiantly
- 65 -
APPENDIX
8.2.2 Katie's PlayPen
Overview
o Established 1990
o 3 Directors
o 6 Staff
o Target Audience Young, expecting women/couples
Repeat Business as child grows
Second Baby
o Mixture of old and new customers
CRM
o
o
o
o
o
Mothers not wish to get products until baby is born
Data collection
3 Systems
Shop orders
Internet Orders
Email Database
Permission marketing
Email/phone
VIB reward cards 3 levels
Advertising
o Newsshopper
o Window Advertising
Old Website
o Javascript
o No My Account feature
o Customers are all single transactions
New Website
o Bigger more products
o 98% Control
upload my own images,
change all product descriptions,
change the home page,
basically all text and images you see on our website I have put
on my self including the links
o Processing orders is a little easier
Email Confirmation at each stage
Tick box to send email
Receive email to inform of new order
o My Account
For customers benefit more than staff
Stores their data but not used by staff
Search demographics
No plans for marketing
o Wish List viral marketing
o Order processing
o Website maintenance
- 66 -
APPENDIX
8.2.3 ORBIT Training
Overview
o Established October 2006 Trading 1 and half years
o 3 partners
o Target Audience
Young offenders/young people at risk of offending/schools
o What are we? A company who have a big truck workshop and a few
quads and mopeds and we want to come and talk to young people
website plays a key roll of explaining this
o Unique service only mobile service patent then franchise
o Static projects but gang members cannot enter different boroughs of
London as they will end up being beaten up or even worse due to the
cultural issues that occur in certain areas of London.
o Get youths to get a CBT then if they get in with the wrong people
wrong side of the way they have something to loose
Advertising
o Word of mouth
o PR through events they do and links with Met who have links with
BBC get the events in the press free of charge to advertise
o Networking social online networking MySpace in the future link
themselves to younger mark
o Sign writing traditional methods
Truck, Van magnetic, cones, bikes, quads
Sell advertising
Helmets, storage company, Honda, bike companies
£450+VAT per month
o Never use Yellow Pages or similar medium
o Reciprocal links
Changes to website
o Background music
o More user friendly
o Videos sharing of videos but not like YouTube
o Build a news section
Would use RSS
o Tell a friend feature viral methods
Problems with website set up
o Not know much about computers
o Fell out with IT company
o Use of Google was promised submission but not know much about
this
o Google Adwords is on the plans
Not want to grow too quick. This sort of business can spiral out
of control become huge and they need to establish slowly as
they all have full time jobs and until they get established
enough to start two units
o
Not used
- 67 -
APPENDIX
o
o
CRM
o
o
o
o
o
YouTube
Bad name linked with happy slapping and the culture that
their target audience is involved in. Not interested in this
medium until
Tarnish their brand
Text Messaging rather use voice calls
Database/paper based database as they are still establishing they
can keep their relationships in their head
Lots of mobile numbers
Contacts with local police
Discount rates to get started to build relationships
Aim of the project
Occupy the youth- Keep youth off the street
Teach vehicle mechanics and bodywork
Teamwork
Working with police not again throwing rocks, bricks at them
Breakdown barriers
- 68 -
APPENDIX
8.2.4 Xtreme Vortex
Overview
o Established April 2006 1 year trading
o Two partners, 0 employees
o Target Audience
Parents, young teenage children, 6-18, corporate companies,
event organisers
o Different types of bookings
One off birthday parties not likely to return
Annual events have an ongoing relationship
o Actively seek new customers contact via phone and email
o Leave business cards and info packs with clients
o Christmas cards not a business opportunity therefore would feel a
negative reaction better things on their mind waste of time
o Calendars good idea to retain
Positive and negative cost issues
Needs to be something different - impact
CRM
o
o
Database
Folder and database that was never implemented.
Time issue
Automatically create a database from online enquiries
Different types of customers
Regular contact and transactions
Website
o Happy
o Fit for purpose however wish to make changes
o Develop and more interaction
o Use gaming to encourage people to revisit the website
Game must be based around the product
Use games to associate fun with the brand
Quirky games that remind them of XV
Email to a friend their highest score to try and get them to beat
it
Sent through a network of people to create a viral campaign
No cost but powerful
Mates sending between them children sending to adult who
circulate it through their work
Not sure how to implement rewards could reward with rapid
fire, extra life, protection
MySpace
o Definitely considering MySpace
o Creates a personality for the business
o Gives the brand a personality
o Gives emotional attachment
o Feel more connected
makes the business human
- 69 -
APPENDIX
o
o
o
o
o
o
o
o
Belong in a community
Use blogs to record where they ve been and where there going
Negative points management and time worried if not kept up to
date people will loose interest
Not use video blogs
Use video to advertise arena and equipment
Not on YouTube- its just a source to pass the time where you can see
videos of sneezing pandas which are hilarious
Not correct medium for a business
Used to record fun and crazy moments in your life
Email
o Not keen on using this method by renting a list
Consider it expensive?
o Intrusion of their inbox
o Spam is too much of an issue with people being bombarded with too
many emails
o If someone expresses an interest they would send emails opt in
o Permission based marketing
Search engine submission
o Crucial at start up level
o Modern day marketing tool
o Personally use Google AdWords
o Not use yell anymore
o Would not consider cutting it out at moment in time or in the near future
however it s a case of playing with the figures to spend what you
require
o Used to optimise listing position
Other methods
o Leaflet dropping although spam issues spamming letter box not
mail box
o Not keen on SMS rather email than SMS expensive?
o Word of mouth
o Viral tell a friend links back to the game
o News section Not aware of RSS would consider it however not
sure of cost involved and worried about ensuring news is current when
there is an off season
- 70 -
APPENDIX
8.3
Appendix C
Participant Consent Forms
- 71 -
APPENDIX
8.4
Appendix D
ORBIT Training PR appearances
Below is a selection of appearances in newspapers and trade magazines.
- 72 -
APPENDIX
- 73 -
APPENDIX
- 74 -
APPENDIX
- 75 -
APPENDIX
8.5
Appendix E
Traditional Marketing Materials
Below is a selection of traditional marketing which is used within the four case
studies.
8.5.1 Dream Doors Leaflet Advert
- 76 -
APPENDIX
8.5.2 Dream Doors
Front page newspaper advert
- 77 -
APPENDIX
8.5.3 ORBIT Training Leaflet
- 78 -
APPENDIX
8.5.4 Xtreme Vortex Leaflet
- 79 -
APPENDIX
- 80 -
APPENDIX
- 81 -
APPENDIX
- 82 -
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Andrew Green - University of Gloucestershire

Transcription

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