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E-Commerce Can Save Your Business -- or Sink It
Gartner CRM Summit '09, Day 2: Analyst Gene Alvarez emphasizes the strategic importance of expanding e-commerce with the power of Web 2.0 technologies.
Posted Sep 17, 2009
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SCOTTSDALE, ARIZ. — Consumers expect to be able to do business with you online. Most companies seem to have grasped that concept by now — 15 years after the dawn of the World Wide Web — but integrating online shopping carts isn't the end of the process. In fact, according to a presentation at the Gartner Research Group's CRM Summit here this week, it's just the beginning. In Gartner Research Vice President Gene Alvarez's assessment, we've reached a new era of e-commerce -- one that involves integrating many aspects of the customer life cycle. "Organizations that master this -- the art of communities -- and tie it with mobile and the Web as a CRM strategy, are the ones that will be successful," Alvarez told attendees. 

"The Web is more important to your business in a down economy than it ever has been before," Alvarez said during his keynote presentation. Referring to the overall effort as "e-CRM," Alvarez emphasized the topic is of critical importance for a company in the midst of any of the following:

  • closing branches or stores;
  • reducing sales personnel;
  • seeking to reduce costs of sales, service, or marketing;
  • developing a customer-centric Web experience to increase retention; and/or
  • attempting to increase online sales or influence indirect sales.

When people think of e-commerce, they often think of sites such as eBay or Amazon.com, Alavarez said -- but he argued that the category is in fact far more encompassing. Failing to recognize that Web sites have different personalities is dangerous, he said. Every site, he added, can be generally classified as representing one of the following:

Site PersonaDescriptionExamples
The SellerThe persona that site visitors recognize most
often, according to Alvarez; enables visitors to
make transactions using a shopping cart.
Amazon.com
Overstock.com
Newegg.com
The FacilitatorA site at which purchases might not occur, but at
which visitors can accomplish as much as they could
at the company's offline, bricks-and-mortar location.

bankofamerica.com (Bank of America)
aa.com (American Airlines)
fidelity.com (Fidelity Investments)

The InfluencerA site where people go to gather information to use
when making future purchases in other channels.
toyota.com (Toyota)
pg.com (Procter & Gamble)
The InformerA provider of content, but not a destination
consumers think of for transacting business.
nytimes.com (The New York Times)
gartner.com (Gartner)
engadget.com (Engadget)

Although e-commerce is now a mainstream Web activity, Alvarez provided the audience with a few caveats with regard to ongoing operations:

  • No Web 2.0 approach works for all organizations.
  • Mashups -- Web services provided by outside organizations -- can increase the risk of outages.
  • Web 2.0 efforts require alignment with the organization's goals and needs.
  • Good design and code management are critical for rich Internet applications.
  • Communities require management.

"Organizations need to master a new art -- user-generated content," Alvarez said. Not only are product reviews and other forms of user-generated content (UGC) a powerful mechanism for retaining customers, he pointed out, but companies such as Brookstone are finding ways to integrate that content into offline marketing materials. Enabling the creation of such content is as easy as adding a bit of code, he noted, but the benefits are nothing compared to the potential downside: Sites without UGC, he warned, will lose out to those that integrate aspects of the community.

Alvarez also noted that winning companies are now integrating UGC into mobile channels as well. He asked attendees how many had begun utilizing a mobile-phone screen, rather than a printout, to display an airline boarding pass. Few raised their hands, but the analyst suggested that the trend is accelerating: More businesses, he predicted, will integrate smartphones into their e-commerce efforts, enhancing the customer experience and making things easier for busy people.

That, of course, plays into the universal plea shared by all customers, Alvarez said -- which hasn't changed much since the old days: "Save me time and money, and treat me like my business matters."

But, he warned attendees, there's one key advancement wrought by Web 2.0 that organizations must force themselves to recognize: "Your customers have technology, too, and if you don't deliver a customer experience that's of value to them, they will let the community know."

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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