Do Business Well

This subsection was kindly contributed by Glen Freeman, Brunel University. Background

The traditional high street retailer W. H. Smith plc has already established new channels to market through the Internet, digital television and WAP mobile phones. The company has a huge high street presence in the UK, with 1,500 stores nationwide. It also now has stores across the globe on major transport routes at airports and railway stations, and already has over 5 million members registered with its ‘club card‘ scheme. These are already loyal W. H. Smith customers who have experienced the company through its stores. Moving this confidence online will be far easier than trying to generate new business online.

Marketing audit

One way to analyse W. H. Smith’s current Internet strategy is to examine performance in terms of the digital marketing cycle:

1 Visitors are attracted to the ISP through in-store promotions.

2 They are engaged by the W. H. Smith Portal’s useful content.

3 W. H. Smith sends fortnightly emails to retain customers.

4 Data are gathered when the customers sign up, allowing the company to learn from its customers.

5 Either the product or the marketing effort is customized and tailored to one consumer at a time

Objective

W. H. Smith’s objective is to provide a seamless service across all channels through ‘my W. H. Smith‘ in order to improve customer relationships and generate additional revenue per customer. Specific objectives can be summarized as shown in the following list:

• sign up one-third of Club Card Members to ‘My W. H. Smith‘ within two years;

• increase spend per Club Card customer by 15 per cent within one year.

In order to build the trust necessary for CRM to be effective, Sawhney and Zabin (2001) recommend ‘presenting a seamless face to customers, regardless of what they buy, where they buy, and how they choose to interact with the firm’.

Strategy

Byproviding an integrated multi-channel service, W. H. Smith can pursue both market penetration (selling more to existing customers) and market development (attracting new customers) in terms of the Ansoff model.

Amazon’s example of a successful CRM campaign has set a precedent, with average spend per customer rising 25 per cent between 1998 and 2000. According to Gardner, 56 per cent of Amazon customers have remained active over this period.

Implementation of strategy through the marketing mix

The initial stage is to introduce Club Card members to the product ‘My
W. H. Smith‘ (an online customer relationship marketing scheme) by sending a welcome pack containing the ‘My W. H. Smith‘ CD and a new, updated Club Card.

• The ‘My W. H. Smith‘ product is free to all customers.
• Potential members will be offered a Welcome Pack in the firm’s retail stores.
• In a seamless multi-channel environment people must be able to sign up via all possible channels (high street stores, travel stores, WAP phones, digital television, the Internet). They should have to register only once to use them all. Once a customer has signed up, they will be able to use their email address or W. H. Smith Net ID plus a password to access any channel.
• On Internet channels, customers will be offered the option to store a cookie on their machine to identify them. The company should use cookies only with the customer’s authorization. The company’s policy on cookies should also be detailed in the privacy statement.
• The customer can order goods from any channel. They can have goods delivered to their desired destination or arrange to collect them at their nearest store. Customer services and return facilities should be available through both online and offline channels.
• The customer should be able to maintain control of the relationship at all times. In order to achieve this, they should be able to change the terms of the relationship as required.

• Personalized permission-based emails can be used to promote special offers and inform the customer how many club card points they have acquired.

Evaluation and control

The success of this project will be monitored by the following values:

• ‘My W. H. Smith‘ /Club Card ratios (reviewed monthly);
• annual revenue contribution (reviewed bimonthly by moving average);
• spend per Club Card customer (weekly targets, reviewed fortnightly).

• The targets will be set at each review and adjustments made to promotions and site structure if required in order to achieve objectives.

• Store managers will be set targets for signing up new customers.
• It is also important to keep a monitor on the amount and type of customer queries received. This will allow the feedback pages to contain answers to popular questions.

Possibly related posts: (automatically generated)
Proposed outline Marketing Plan for Multi-channel retailer W. H. Smith plc

• Challenges of building online customer relationships
• Relationship Marketing
• E-MARKETING Planning Process
• Consolidation and Integration of Web Service Offerings, direct email marketing continue...
• What Are You Selling?
• What All Plans Must Cover
• Making a Plan: how to construct a simple and workable business plan part 1
• Campaign Checklist: What goes in a campaign brief?
• Love your customers as they have never been loved before! Part 2
• How to select the right business — Follow your instinct but proceed with caution

3 Comments »