E-commerce businesses tend to have very sophisticated Marketing Information Syst
ID: 466128 • Letter: E
Question
E-commerce businesses tend to have very sophisticated Marketing Information Systems. In the online environment, it is easier to collect and track information on visitors and purchasers than with brick and mortar enterprises. Keep in mind, nowadays companies give you "membership card" or ask for a phone number to track what you buy. Also many sales people will ask you how you heard of the business. These types of techniques may give you a hint as to companies with good MKT Information Systems. Research a traditional company that uses a good Marketing Information System to gather data. Describe how they gather information, the type of information gathered, and how that information helps the company market
Explanation / Answer
Collecting information about your customers can have a number of benefits for your e-commerce business, from getting a clearer view of your target market to improving customer communications. Here are the areas where collecting customer data can really move the needle.
Your target market
Every business should know who its target market is. Ideally you would know this before you even started making sales. However, businesses evolve and so do markets. The group you once thought was your target market may no longer be.
Keep an eye on the customer data you collect from your website, as it’ll make it easier for you to keep your brand and communications on target and relevant to the people who really buy from you.
Sales emails
Collecting email addresses and other contact information makes it easy to get in touch with past and potential customers if you have something new they might be interested in.
But click-to-open rates fell 11.4%, from 16.2% in 2011 to 14.4%, at the end of 2012 (source: Experian). It seems that customers are becoming less and less interested in marketing emails, so use insights about your customers to make sure yours are on target and contain something that’s of interest.
Other communications
Sending out relevant news and offers to your customers can strengthen their relationship with your brand, even if it doesn’t get them to buy from you again right away.
Problem solving
If you are armed with all the details of a customer, then you are going to be better empowered to resolve any issues they might have. This might be in terms of payment, a shipment that’s gone missing or a complaint on another matter. These sorts of issues need to be dealt with promptly and efficiently, and it’s easier to do that if you have all the customer details on hand.
91% of unhappy customers will not use your company again. However, if you can resolve the complaint, those customers will do business with you again 70% of the time (source: Lee Resources).
Improve your service
Having customer data such as buying patterns and demographic details can really help you improve customer service and marketing. You’ll be able to get an idea of customer buying habits and how they can work for you.
According to an American Express survey, 78% of customers have bailed on a transaction or not made an intended purchase because of a poor customer service experience. If you can pick up on these, you can deal with the underlying problems.
Customer loyalty
Tracking how customers shop lets you offer them reasons to keep coming back to your store. If you notice that someone is often buying a product to be shipped as a gift, give them money off for the next holiday or special occasion that comes around.
Loyalty cards and points are another great way to track your customers’ spending habits while also giving them a reason to come back to the site. A loyal customer is worth 10x more than their first purchase, according to the White House Office of Consumer Affairs.
Social media
If you are collecting social media information from your customers, then you can use it to engage with them. It’s a good way to let your customers know that you’re on their favourite social network, and will hopefully prompt them to include you in a tweet/post when they write about the brand.
According to a survey from Touch Agency, people are 75% more likely to buy from a brand they follow on Twitter, so get yourself on the network and start engaging with potential customers.
Pairing customer data with other sources of information
You can paint a very good picture of how people use your website by combining your customer data with statistics from other sources such as Google Analytics.
You can tell where your traffic is coming from, what page they land on, how many people get to the checkout process and how many people complete that process. This gives you the chance to identify things that are stopping people from placing orders, or perhaps will show you other routes you could be taking to get people to the check out.
Recommendations
You can drive more sales by looking at your customer’s buying habits and recommending products they might be interested in. You can also take a look at a customer’s recently viewed items. Is there a reason they didn’t buy these items? Or perhaps they just need a bit more of a push to make that order.
With this sort of data, you can give customers those extra incentives to buy or introduce them to something they didn’t even know they needed.
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