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Chapter 5 Digital business strategy
Right‑ channelling strategy
example
Application and tactics to achieve
channel adoption
Typical sector and company
examples
1 Sell to and serve SMEs through
online channels.
Using the Internet for sales and service
through an extranet to lower‑ sales‑
volume SME customers who cannot
be serviced direct through account
managers.
Customer channel adoption encouraged
by convenience and lack of other options.
B2B. Hardware: Dell, software
services such as MessageLabs
Antivirus; anti‑ spam and email
management services. Commercial
banks such as HSBC.
2 Account‑ managed relationships
with larger companies offline,
either direct or through partner
companies.
The converse of strategy 1. Using
face‑to‑face and phone meetings with
large, high‑ sales‑ volume clients through
account managers. Customer channel
adoption encouraged by personal service
and capability to negotiate service levels
and buying options.
B2B. Account managers at Dell for
larger clients. Bank ‘relationship
managers’ who discuss financial
management with ‘ higher‑ wealth’
individuals.
3 Encourage consumers to buy
through online channels.
Customers buying online have lower
cost of sale. However, there is a risk
of customers evaluating competitor
offerings and lower conversion rates
during the sales process. Customer
channel adoption encouraged by reduced
‘Internet prices’ compared to offline
channels and explaining proposition of
more choice, more convenience.
Insurance companies such as
DirectLine.com and morethan.com.
Retailers such as Tesco and Comet.
4 Provide offline conversion to sale
options during sales process.
Offer a phone call‑ back or live chat
facility from within web sales process
since strategy 3 may involve lower
conversion rates than an in‑store or call‑
centre customer interaction. Customer
channel adoption encouraged by
providing clear contact numbers on‑site
(but not on home page, when part‑ way
through customer journey).
Insurance companies such as
DirectLine.com and morethan.com.
5 Migrate customers to web
self‑ service.
Customers are encouraged to use the web
to manage their accounts which results
in a lower cost‑to‑serve for the company.
Email notification and e‑billing.
Customer channel adoption encouraged
by marketing campaigns which
encourage e‑channel adoption, possibly
including savings on service.
B2C. Service providers such as
mobile phone companies, utility
companies, banks and government
(tax returns).
6 Selective service levels for
different customer types.
With integrated CRM systems
(Chapter 9), companies can determine,
in real time, the value of customers
and then assess where they are placed
in queue or which call centre they are
directed to.
Most companies would not publicly
admit to this, but the practice is
common amongst financial services
companies, mobile phone network
providers and some pureplays.
Table 5.9
Examples of ‘ right‑ channelling’ applications
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Part 2 Strategy and applications
return on investment for strategies that fail. The model of Ansoff (1957) is still useful as a
means for marketing managers to discuss market and product development using electronic
technologies. (This decision is considered from a digital marketing perspective in Chapter 8.)
The market and product development matrix (Figure 5.20) can help identify strategies to
grow sales volume through varying what is sold (the product dimension on the x-axis) and
who it is sold to (the market dimension on the y-axis). Specific objectives need to be set for
sales generated via these strategies, so this decision relates closely to that of objective setting.
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