Test Bank: 2.which Technologies Influence Strategic CRM, On Both The Consumer and The Company Sides?

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TEST BANK

Chapter 1
1.What is customer value, and why is this term essential for CRM?
- Customer Value: The economic value of the customer relationship to the firm –
expressed on the basis of contribution margin or net profit
- Customer value is essential to CRM because CRM refers to the practices, strategies,
and technologies that companies use to manage and analyze customer interactions and
data throughout the lifecycle. customer lifecycle, with the goal of improving business
relationships with customers, assisting in customer retention, promoting customer
relationships

2.Which technologies influence strategic CRM, on both the consumer and the
company sides?
Technology has changed the business landscape in terms of how product-based
marketing has made a shift into customer-based marketing determined by the
competitive nature of firms and increasing demand for customer needs.

• Better technology, cheaper and larger storage units


• Huge increase in demand for data storage
• Increased popularity of data warehouses
The ability to be more customer-centric is crucial for businesses to establish a
presence online as more users are participating in social media. Company has better
information about customer behavior and attitudes, can better prediction of customer
buying behavior

Consumers seek the internet as a convenience and the rise of self-service has played a
role in changing how a service firm provides a service. Due to more competition in
the marketplace product-quality differentiation is hard to identify as there are many
options and allows the customer to be able to choose amongst various competitors to
whatever product or service they are seeking.
3. List some key changes in the business environment. How are these changes
driving the shift from product-based marketing to customer-based marketing?
List some key changes in the business environment: (should describe some major
details)
Changes with respect to Consumers
Changes with respect to the Marketplace
- More intense competition between companies for customers. Market access is
less localized, the need for logistics management and distribution partners is
more significant.
- Market fragmentation, resulting in personalized marketing needs
- Reduce product quality differences, create a need to gain competitive
advantage through closer relationships, focus on service
- Changes related to Data Storage Technology include:
 Better technology, cheaper and larger storage units
 Increase popularity of data warehouse
 The result is better information about customer behavior and attitudes and
better predictions about customer buying behavior.
- The changes to the marketing function are:
 Dilute the media and multiply the channels
 popularity of customer-focused media, both direct-to-consumer channels like
email, phone, and interactive media like internet, interactive television, etc.
 Reduced need for price-only techniques due to the availability of new
communication and data collection tools and marketing processes such as
loyalty programs
(Miss the second part of Q)

Chapter 2
1. How are CRM activities similar/different from marketing activities?
Please discuss.
CRM and Marketing are similar as they both measure their effect on customer value
and maximizing customer lifetime value.
Marketing, on the other hand, identifies and analyzes segments of its customer
population to find valuable information that can be used to increase the impact of
marketing campaigns by shifting the their customers. However, CRM uses modern
communication technologies (social media, email, chat, text, etc.) to “think and act” at
the individual customer level. Instead of focusing on increasing customer loyalty
through repeat purchases of every customer,

CRM focuses on identifying different types of customers and then developing specific
strategies to interact with each other. work with each customer. For example, create
better relationships with profitable customers.

2. What is the distinction between traditional database marketing and a


customer value-based approach toward database marketing?
Database marketing traditionally allows a company to identify and analyze segments
of its customer population to find valuable information that can be used to increase the
impact of marketing campaigns tis.

In the customer value-driven approach to database marketing, the concept of customer


value becomes an important component of CRM. It is an important marketing metric
that aids decision-making and evaluates marketing effectiveness. A customer value-
based approach to CRM can reduce costs, maximize revenue, improve profits and
ROI, and aid in the acquisition and retention of profitable customers and reactivate
inactive customers.

3. Companies want relationships with customers, but do customers want


relationships with companies? Please discuss.
Customers do want relationships with companies as their needs and wants can be
better met and it allows them to feel important. However, some customers may not
appreciate that level of “closeness”. For example, reminders to the customer to place
what is normally their regular order may be helpful, it can quickly become a source of
irritation. It's a fine line that companies need to customize for their target market.
Contract relationship, Exclusive distribution force customer having relationship with
company.

Chapter 3
1. What are the four key components of CRM strategy? Briefly describe each
component.
• Defined as the set of organizational values, beliefs, and
strategic actions that enable the implementation of
customer management principles
• Characterized by a top management belief and
A customer management commitment that the customer is at the center of activity
orientation • Recognizes that customers are heterogeneous in needs
and value to the firm and reflects a readiness to treat
different customers differently
• Considers the fact that a longer-term view of revenues
from customers needs to be taken into account
The integration and • Comprises organization-wide creation and
alignment of organizational synchronization of processes, systems, and reward
processes systems enabling the implementation of customer
management principles
• Strategic CRM works best for organizations that are
organized around cross-functional processes rather than
functional silos
• Firmly incorporates needs of the customer and goals of
the firm into product and service delivery
• Characterized by an understanding that value provided
to target customers should be what drives all processes
• Individual processes work in sync with a common goal
of attracting and retaining target customers
• Customer management compatible incentives drive
employee and organizational goals simultaneously
• Processes are designed in such a manner that they
automate a feedback
• Comprises all the necessary technology and processes
to collect, store, and process relevant and timely
customer information
• Characterized by the capability of leveraging data to
actionable information
Information capture and the
• Makes customer management processes not only more
alignment of technology
efficient but also more effective
• Helps to create entirely new processes and channels
based on online and mobile applications
• Firms that are able to generate intelligence and act on it
will derive a competitive advantage
CRM strategy
implementation

• Each cell in the matrix corresponds to a specific


implementation activity or process (CRM
Implementation Matrix)
 Customer dimension: captures influence of changing
phase of a customer-firm relationship
 Management dimension: constitutes analytical and
operational aspects of CRM
• Characteristics of Marketing-Driven CRM
Implementation:
 Activities and processes that constitute analytical
CRM
 Activities and processes that constitute operational
CRM
 A firm’s ability to understand the value of the
customer to the firm and the variety of needs
different customers have
 An acquisition and retention process that
continuously aligns the offering with customer
needs and values
 An ability to continuously improve what the
company offers by learning about its customers

2. What are the key steps in implementing CRM?


Step1: Gain Enterprise-wide • Top-down management commitment
Commitment • Bottom-up buy-in from system users
• Dedicated full-time project team
• Budget allocation for the total solution
Step 2: Build a CRM Project Obtain active representation from:
Team • Management - Provide leadership, motivation,
and supervision
• Information services/ technical personnel -
Ensure CRM system compatible with existing
software applications
• Sales, marketing, and services groups -
Evaluate the usability of CRM system based on
effectiveness, efficiency, and satisfaction
• Financial staff - Provide critical analysis for
assessment of increased sales productivity,
evaluation of operating costs, the estimated cost
of system expansion, and ROI projections
• External CRM expert - Provide a valuable
source of objective information and feedback
Step 3: Analysis of Business Gathering information to:
Requirements • Identify the services and products that are
being supported
• Map current workflows, interfaces, and inter-
dependencies
• Review existing technologies, features and
capabilities
• Discuss the vision for the business and the
operational plan
• Define business requirements
• Develop enhanced business workflows and
processes
• Identify gaps in technology functionality
• Map functionality to business processes
• Develop new technology and functionality
framework
• Develop a conceptual design and prototype
plan
Step 4: Define the CRM • Value Proposition
Strategy • Business case
• Customer strategy
• Enterprise transtormation plan
• Other stakeholders

3. What is the value proposition?


- Multi-faceted package of product, service, process, price, communication, and
interaction that customers experience in their relationships with a company
- Areas to be addressed (The value proposition is not affected by an investment
in CRM):
 What the customers value - what the company should focus on
 What the company says it offers the customers
 What the company actually offers the customers
- The company should strive to offer what customers value; if all three elements
of value proposition are not aligned, the company likely cannot achieve
customer-centricity, because it is not delivering actual value to customers.

Chapter 4
1. What factors will you consider when measuring the ROI of CRM
investments?
- Calculate the ROI of CRM to see whether investment meaningfull with the
questions
 How much will consult for the project cost?
 To what degree is business process re-design necessary?
 What new software and hardware must be purchased to accommodate the
new system?
 Does the system need to be customized or will it work “out of the box”?
 How much customization is required and at what cost?
 Can the system be easily configured and maintained by internal IT staff
 or is continuous external assistance required?
 What is the cost of training the company’s staff to use the CRM system?
 What is the timeframe for implementation and what will happen to the
current system processes during that time?
 What are recurrent costs?
4 factors to be considered: (should add details)
CRM Costs
IT Costs
People & Process Costs
Stages of ROI estimation
2. What are the various components of the CRM architecture from an
operational perspective?

3. What analysis is involved in assessing the value of a customer?


Create a customer journey map:
- The customer demographic analysis, customer behavior modeling, and
customer value assessment.
- While shopping, different demographics have different needs, preferences, and
habits. People want a variety of products and brands. Whether male, female,
young, or old, people’s perspectives and rationales vary significantly from one
another. These differences usually have a significant impact on their buying
decisions.
 Establishing the methods to model customer behavior and analyze customer
demographic information, it is essential to assess customer value. It helps the
company focus its limited resources most efficiently on the best and most valuable
customer relationships.
 Measurement and analysis of customer value and customer profiling and scoring
processes that are based on these measures of customer value.

Chapter 5
1. 1. Calculate the acquisition rate of a bank if you know the target market of the
credit card issuer might have been two million office staffs. Acquisition was
measured in terms of new credit cards issued. The bank issued a total of 120,000
new credit cards.

Answer:
= 100 x(120.000/2.000.000) = 6%

2. Calculate the Average Inter-purchse Time (AIT) of a supermarket if customers


buys, on average, 4 times at this supermarket during a month

Answer
= 1/4 =0.25*30 = 7.5 days

3. Calculate the Remaining Customers after a period of 5 years, if the constant


retention rate is 50%, and in year 1 the company X can acquire 100 customers

    in peson
Customer starting at the beginning of year 1 100  
Customer remaining at the end of year 1 50 =100*0.5
Customer remaining at the end of year 2 25 =50*0.5
Customer remaining at the end of year 3 12.5 =25*0.5
=12.5*0.
Customer remaining at the end of year 4 2.5 5
Customer remaining at the end of year 5 1.25 =2.5*0.5

4. Number of customers starting at the beginning of year 1 is 1,000. Computing the


number of survivors.

Retention Survival Survivor


  Rate Rate s
Year 1 0.5 0.5 500
Year 2 0.6 0.3 300
Year 3 0.7 0.21 210
Year 4 0.8 0.168 168
Year 5 0.9 0.1512 151.2

5. Compute the P (Active) of each of the two customers in the twelfth month of
activity, where customer A bought five times within the first 8 out of the
observed 12 months and customer B bought only two times within the first 8 out
of the last 12 month.

P (A) = (8/12)5
= 0.131
P (B) = (8/12)2
= 0.444
Chapter 8
1. What are the various ways to categorize databases?
- Categorization:
 Databases managing business operations (e.g., account payable
database, cost accounting database, order processing database, payroll
database).
 Databases supporting decision-making activities (e.g., marketing
databases, product development databases, advertisement/ promotion
databases).
- Alternate categorization: (should add more & short details)
 Categorization Based on the Information Included in the Databases
 Categorization Based on the Nature of the Underlying Marketing
Activities
 Categorization Based on the database Technology

2. How are databases classified based on the information they contain? Are
these different classes of databases complements or substitutes?
 Categorization Based on Information in the Databases
Types of databases: (should add more & short details)
• Customer database (Complements)
• Prospect database (Substitutes)
• Cluster database (Complements)
• Enhancement database (Complements)

3. List some of the key uses of marketing databases. Provide an example for each
of those
 Uses that directly influence customer relationship
Example: Panera Bread tracked customer feedback to become the first restaurant
chain in the country to post ingredients and calorie counts. Then, in 2014, Panera
quickly won the hearts of the people by making a public pledge to remove all
preservatives, sweeteners and artificial flavors from its menu. In addition, Panera
personalizes the patrons' experience as much as possible. Customers who create an
account with Panera can expedite online orders and earn personalized rewards, as well
as receive recommendations for new menu items tailored to their individual tastes.
Today, Panera's loyalty program has more than 28 million members.

 Uses that directly influence other business operations


Example: Companies specializing in property management, housekeeping, and
industrial cleanup, for example, often sell these services exclusively to other
businesses, rather than individual consumers

Chapter 10
1. Explain the difference between behavioral and attitudinal loyalty, Provide
an example of each.
 Attitudinal loyalty—Customers that are loyal because they love a particular
brand.

Example : If you only have one grocery store in your town, you’re going to exhibit
behavioral loyalty. You’re a repeat customer because you don’t have any other choice.
On the flip side, if you drive past three grocery stores just to get to the nearest Publix,
you’re exhibiting attitudinal loyalty. You have many options, but you’re picking
Publix because of what they stand for, how you’re treated, etc.

 Behavioral loyalty—Customers that are only loyal because they’re trapped.

Example: Companies like Apple have the best of both worlds. As you buy more
iDevices and become more dependent on iCloud, switching to Android becomes
harder (behavioral). At the same time, they have millions of raving fans exhibiting
attitudinal loyalty.

 Attitudinal loyalty is built on amazing experiences. It has strong ties into


customer support. Every interaction is a chance to reinforce attitudinal
loyalty by exceeding expectations, removing roadblocks, and delivering
delight. Meanwhile behavioral loyalty is built on…..???

2. What are the key objectives of loyalty programs? Which of these


objectives provide the strongest competitive advantages?
 Maintain, gain, and win back customers The primary objective of a loyalty
program is to retain existing customers. The loyalty program allows the
customer and the business to understand each other better.
Which of these objectives provide the strongest competitive advantages?

 The objective that provides the strongest competitive advantage


is Effectiveness Profits as it is more likely to generate sustainable competitive
advantage and yield the highest profits in the long run.

(should add more & short details)

 Building true (attitudinal & behavioral) loyalty


 Efficiency profits
 Effectiveness profits
 Value alignment

3. You are a consultant to a credit card organization that wants to establish a


loyalty program. The CEO has just read about how most loyalty programs
result in money-losing propositions. How do you alleviate the CEO's concerns?

4. Do companies profit by introducing loyalty programs? Is the success of a


company's loyalty program dependent on its industry category?

5. How can you measure loyalty? How does loyalty relate to the profitability of a
company?
6. Would low-ticket items (coffee, candy, sodas) benefit from loyalty programs?
What kind of incentives might work best?

7. Design a loyalty program for your neighborhood gas station. Describe the
incentives. Determine the cost structure. Set benchmarks and evaluate the
profitability of the program across possible scenarios.

Chapter 11
1. Explain the three key steps in the management of campaigns.
- Campaign Planning & Development
At the campaign planning stage, marketers make strategic decisions that help
define the overall objectives of the campaign, the best communica-tion message,
and the best target audience. Once these strategic issues are defined, the develop-
ment phase starts.
- Campaign Execution
The campaign execution stage is the operational process by which a campaign is
implemented. There are two important aspects at this stage: implementation and
monitoring
- Analysis & Control
Analysis and control end the campaign manage ment cycle. In this phase,
marketers should be able to draw some conclusions about the cam paign success
and use these results not only to improve their customer knowledge but also to
improve future campaigns. This is an important stage because it evaluates
campaign results in light of the original objectives and determines the campaign
level of success or failure. Features that run well should be used as "best practices"
for other campaigns. For features that didn't per form well, marketers should
search the reasons why this has happened. This research should be recorded in the
CRM database to serve as a learning lesson to future campaigns.
Campaign analysis can be done in many ways. Marketers can use campaign key
performance indicators (KPI) and compare them with budgeted KPI's and
campaign objectives. They can also perform back end performance analysis to
deter mine the purchase behavior of campaign respon dents. Finally, more
elaborated analysis can be performed, such as profile and response analysis, to link
profiles and behavior with the campaign
2. Imagine you are the manager of a chain of 25 seafood restaurants in
Virginia. The restaurant has a mainstream positioning. You are
planning a campaign to attract new clients and your available
budget is $30.000. Describe how you would go about implementing
this campaign.
- Find existing customer segments
- Find the customer segment that doesn't exist yet
- Take care of customers and attract to the restaurant
- Share promotion, Social media,…
- Give away a loyalty card, accumulate points after each bill for a special
discount or
- 1 free drink for customers.

3. Explain the ideas around the concept of campaign testing? Do you


think that testing in general will become more important in the
future? Why or why not?

4. Give examples for key performance indicators for the evaluation of


campaign success.

BE CAREFULL!
KPIs Used:
Reach: the number of people who see the campaign’s messages and or hashtags.
Number of Mentions: number of social media messages referring to or tagging the
campaign.
Interaction Rate: level of engagement (likes, shares, comments) per social media post.
Traffic Websit
Google Analytics is a powerful PR measurement tool for websites. Use Google
Analytics to track and evaluate the amount of traffic to the website by each channel,
the user's behavior on the website and the target results received (the number of
people filling out the form, the number of people calling ...)
Brand mentions/Media mentions
Measure hashtags, brand names, messages… in PR campaigns.
Example: In the PR campaign "Go to return" of Biti's Hunter, in season 1, the phrase
"Go to return" was hashtagged 200,000 times by young people in posts and photos on
Facebook and Instagram. Along with that, the campaign created a lively debate
between the two sides #team going and #team returning and received up to 90,000
mentions on social networks.
Sentiment
Assess how customers feel about certain products, services or messages by tracking
long or short visit and leave behavior of customers. Then, a high bounce rate may
indicate that the content is not suitable for the customer file.

Example 1: You can track the Bounce rate of visitors to your website through Google
Analytics
Example 2: Track visitors' comments under blog posts on your website.
Example 3: In the PR campaign to launch Marvel's movie "Black Panther" on Social
Media in 2017, the Black Panther trailer got over 30% positive feedback from the
public on Facebook.
Reach
Deploying PR campaign on Social Media platform, especially Fanpage, it is necessary
to pay attention to measuring PR effectiveness through reach for posts.

Example 1: Track the Reach of the posts on the fanpage of Monte Milkshake.
Example 2: The Social Listening TalkWalker tool has calculated the total reach
indicators of the PR campaign to launch the movie "Black Panther" on typical social
networks. In it, TalkWalker also analyzes the rates by age and gender of the public.
Engagement 
Monitor the interaction of the participants through their response level such as
applause, participation attitude (indifferent, superficial or enthusiastic, supportive ...)

Example 1: On June 5, 2020, Japanese fashion brand - Uniqlo held the opening event
of the 3rd store at Vincom Landmark 81. Right before the opening time of Uniqlo
store, a large number of customers lined up. in advance to prepare to go inside the
mall. For more than an hour of shopping here, the checkout and try-on areas are
always crowded due to the increasing number of shoppers. Everyone who came to the
opening was very happy and comfortable shopping. Uniqlo's new store opening event
was very successful because of the positive support of a large number of customers.
Example 2: Biti's "Going back" campaign in season 1 has generated strong interaction
among the public with a total interaction of more than 1.2 million (number of posts,
likes, shares, comments)

Share of voice 
It's important to gauge the impact your campaign has on your competitors' campaigns.
Competitors here are brands competing for influence on social media.

Example: According to Buzzmetrics statistics, with the same mention of the keyword
"Get together" during Tet, Biti's Hunter brand had the highest Share of voice rate on
Social Media compared to other brands in 2017 and 2018.
Revenue
Whether your PR campaign is on the right track or not is also determined by
examining the revenue it generates. If you are getting a return on your investments, it
is a good sign that your PR campaign is succeeding.

Example 1: Biti's "Going back" campaign Season 1 used a combination of many


Marketing communication activities (Marketing Mix) such as advertising, promotions,
PR activities... The results of the campaign reached 300 % of sales target within 7
days only.

5. Explain the advantages and disadvantages of the various campaign budget


setting methods.
1.Present budgeting
Advantages: The campaign budget won't be drastically cut over the years, so it will
follow a more or less steady expenditure flow.
Disadvantages: Working with a preset budget that doesn't take into account last year's
sales is the least effective way of calculating a budget. Companies treat marketing as
an expenditure instead of as an investment to boost future sales. As a consequence,
working with this kind of budget planning may be hazardous for the firm, rendering
its business less competitive and slower to change. Although this is the least effective
way to establish a budget, it is, in fact, one of the most commonly adopted

2.Budgeting for an allowable marketing cost


Advantages: When using the AMC there is no preset limit to the campaign budget
unless a exis cash-flow constraint is imposed. By using this method the company
controls costs.
Disadvantages: Many activities are hard to accurately forecast, and some activities
may not pay back in a given year. These intricacies lead to a degree of conversatism
that inhibits the aggressive pursuit of an AMC marketing policy.
Example: One of the main sources of revenue IC is for "Old Books Limited" comes
from the sub of scription fees of its monthly magazine, Rare ired Books. In order to
preserve this source of reve nue, it has two choices: either put in place a cold is no
mailing to obtain new subscribers or a mailing-to ss a existing subscribers, inviting
them to renew their this subscription. It calculated the allowable marginal cost of each
activity and discovered that sending d to four invitations (i.e., four direct mailings) to
not existing customers had a lower marginal cost ad to than doing a cold mailing

3. Budgeting with the competitive parity method


Advantages: In this method, emphasis is on competitor intelligence. By checking out
what the competition is doing, the company is adapt ing itself to the market
conditions.
Disadvantages: It is difficult to be precise as to who your competitors are. It is also
difficult to estimate the relative size of competitors, because a company's nearest
competitor may be signifi cantly bigger or smaller than your company. Next,
marketing communication strategies are certainly different for market leaders and for
market followers and budgeting based on parity may thus not be very wise. This
method cannot satisfactorily take into account sudden changes in the competitive
activity or objectives. It does not take into account the company's own objectives.

4. Budgeting with the objective and task method


Advantages: This method focuses on market ing objectives. The resources are
expended according to the objectives.
Disadvantages: Implementing this method is a difficult task because it is not always
easy to define the objectives and to quantify their implementation costs. This method
also makes an important presumption: It assumes that the relationship between
objectives and tasks is well known and understood

5. Budgeting with the percentage of sales method


Advantages This method incorporates a sales series of alternatives, and it allocates
costs to each the objectives
Disadvantages It may be difficult to deter- from mine the percentage of sales that
must be allo cated. Competitors may have a small advertising effic budget and
concentrate their budgets on the sales prof force, and this would be a deceiving
benchmark.
6. Budgeting with key performance indicators

7. Budgeting using the lifetime value method


Advantages Using the CRM database infor mation allows the company to predict, in
a more accurate way, the cost of the campaign. At the same time, it efficiently
allocates resources between strategies because it allows a compari son between the
returns of alternative marketing campaigns.
Disadvantages: It is very difficult to keep track of customer values because most
compa nies lack transactional data from customers. Forecasting the customer LTV as
a budgeting measure is still in its infancy. Also, if the com pany doesn't keep track of
the performance results of past campaigns, it won't be able to compare these results
with similar campaigns and learn from past errors. Sometimes the strat egy that
produces the highest ROI does not pro vide the fastest return and therefore, it can be
replaced by faster strategies with lower ROI. Ideally, budgeting should use LTV
forecasts to determine the cost of a campaign. In prac tice, this may be hard to
implement. So in this case, the marketer should proceed with both front-end analysis
and with the allowable mar keting cost analysis. Keep in mind that no bud get should
be done without estimation of the return of marketing investment (ROI rates)
Unfortunately, the preset budgeting is still a very common practice among companies,
but it should ideally be replaced by the other methods discussed.

Chapter 12
1. Discuss, with regard to a firm's CRM strategy, whether the proliferation
of direct channels is just a current trend or if online channels will someday
replace traditional channels completely.
If online channels will someday replace traditional channels completely, the firm
can do somthing, such as:
 Convert all existing brick-and-mortar stores to online platforms to ensure the
best customer service focus
 Focus on developing and maintaining websites, gradually switching from
booths on e-commerce floors to buying directly at the company's website
 Actively build a delivery system instead of having to go through other transport
companies to avoid damaged goods, making customers unhappy
 Customer care 24/24, customer care process as thorough as possible, salary
increase for employees in this department, because all staff resources are
focused on online
2. Obi, a German DIY supplier, initially sold through franchise stores, but it
just opened an online shop in November 2010. The implementation of this
additional channel resulted in an unhealthy conflict between Obi and its
franchisees, leading to a battle in court. The focal issue was the
cannibalization by the website of sales in the franchise stores, especially
due to the low prices charged online. Discuss Obi's multichannel design
and management. What went wrong?
Obi can manage multiple channels by combining both online and franchised channels:
 Initially, the franchisor can buy products from this very website at a better price
than other retail customers. This is to help Obi retain its franchisees and reach
more customers online.
 Obi can design a website with an interface suitable for both wholesalers and
retail buyers: for bulk purchases, partial/full payment in advance, immediate
pickup...,
 Obi may consider discounting or using other forms of discount to retain
customers; For consumers, customers who buy a certain amount of money will
be able to upgrade the card and enjoy corresponding discounts
 The price on the website cannot be cheaper than the retail price to avoid
channel conflict.
3. Manufacturers such as Henkel or Procter & Gamble are very detached
from end customers. Given the increasing power of retailers, how might
they reestablish closer contact with these ultimate customers
 Create a website to sell directly to customers, a store to market products
(similar to Biti's)
 Perform customer setup operations from the company instead of delivering it
all to retailers (retailers)
 Send promotional information to end users directly instead of through retailers
 Cooperate with a 3rd party (Walmart) to know and answer customers' questions
or complaints for P&G's CS to answer

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