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Application of e-CRM by PARKnSHOP PARKnSHOP applies the e-CRM mainly through two medias: The Online Purchasing System and MoneyBack Rewards Card.

Extracts from this document...

Introduction

Executive Summary PARKnSHOP is a large chain supermarket. It implements MoneyBack scheme in recent year, which is one of the application of Electronic Customer Relationship Management (e-CRM). In this report, we will try to find out the benefits and drawbacks of e-CRM in different aspects, and conclude the contributions of e-CRM to PARKnSHOP in order to decide whether it should be abandoned. Background of PARKnSHOP In 1973, PARKnSHOP became a company under Hutchinson Whampoa and a member of the A.S. Watson Group (ASW). In that same year, PARKnSHOP opened its first shop. Today, PARKnSHOP has become one of the largest supermarkets chains and currently has over 200 branches in Hong Kong. The current three leading supermarkets in the Hong Kong area are: PARKnSHOP, Wellcome, and CRC. Among these three, PARKnSHOP is involved in many different research and development projects. For example, some of the different programs or new ventures that PARKnSHOP has implemented may include: opening its first "Megastore" in Metro City, Tseung Kwan O which sells products and merchandise that is not usually found in the other local markets. Other research ventures have resulted in establishing a food-safety laboratory and the construction of Asia's first multi-temperature distribution and processing center. With new technology on the horizon, introducing these new programs into their business will help facilitate the smooth flow of PARKnSHOP's operations. Electronic Customer Relationship Management ( e-CRM ) Customer Relationship Management (CRM) is the methodology and tools that manage the relationships with a company's customers. Generally speaking, it is a method of using a database to record all the data of the customers in order to realize their needs and provide services which are custom tailored to them. The objective of CRM is to increase sales by improving customer service, enhancing customer satisfaction and securing customer loyalty. To maximize customer satisfaction, an effective way is to provide tailor-made services to them. ...read more.

Middle

Predict customer behavior. The CRM system records customer buying patterns. The MoneyBack Card will record the list of purchased products whenever the card reaches the reader. Hence, the purchased goods will be recorded by PARKnSHOP. This data is constantly under analysis in order to provide useful information. There are some parallels between different transactions. For example, if a housewife buys a packet of rice, she probably also buys a pack of toilet paper; if a man buys face wash, he probably also buys shaving cream. Using this type information, PARKnSHOP can estimate what customers are going to buy next. The managers could also design the layout of the store better. They might separate the relevant products apart, so those customers need to ramble through the whole store. This increases the chances for customers to spend money in PARKnSHOP. In contrast, the managers may put the most relevant items on the same shelf. This is friendly for customers to find what they want. Anyway, the CRM facilitates PARKnSHOP to estimate customers' buying behavior and setting up the store layout. 6. Maximize the efficiency of PARKnSHOP As we know, ABC analysis can be developed after having a customer buying record. PARKnSHOP can target the most profitable customers who are the most frequent purchasers in the store. Then, PARKnSHOP can put more effort into satisfying the most profitable customer and reduce the cost spent on the lower valued customers. Customers may receive from PARKnSHOP or from their affiliated companies from time to time telephone calls, e-mails and direct mailings containing promotional materials. After separating customers into different group, PARKnSHOP would only make telephone calls to the targeted customers. That's why we said the CRM system could enhance the efficiency of PARKnSHOP and improve the allocation of resources. If you read the Privacy Policy of PARKnSHOP, you can find the following content in the direct marketing. "If you have once given us your personally identifiable information, you may receive from us or from our affiliated companies from time to time telephone calls, email and direct mailings containing promotional materials. ...read more.

Conclusion

The article that the customer is going to buy should just be put into the wagon. At this time the shopping cart is scanning the article with the help of infrared scanning lines, which are scanning the products. On the products are bar codes or implemented chips such as RFIDs which has information about the price, weight, size, special offers and also background information and other useful things. The shopping cart has also a screen where the customers can see the given information. If the shopper has finished his buying he gets out of the shop and the whole shopping car will be scanned at the door. The amount of the products will be then withdrawn of his octopus card, which had been inserted by the buyer at the entering of the shop. This technology makes shopping simpler and helps to save costs for PARKnSHOP. But the ethical and social issue is that a lot of people will lose their jobs except the extra cashiers at the MoneyBack desk. These people could also be consultant for the customer and could accompany and advise the people while they are shopping. Instead of firing the people, the employees could be used for consultancy. This would also encourage and engage the customer's satisfaction and loyalty. Besides that, the people would be more involved into the shop and don't feel as just "normal" shoppers. If PARKnSHOP would implement this concept as a first mover it could gain advantages of a good reputation and also sales increases as a first market enterer in this kind of "shopping experience". Conclusion The MoneyBack Rewards Card records costumers' buying pattern. These records help to provide better customer service and enhance customers' loyalty. They also help PARKnSHOP setting market strategy. However, there are some potential problems that PARKnSHOP may have. We hope that PARKnSHOP can implement our recommendations and they could solve the potential problems. Electronic Customer Relationship Management seems to be playing a very important role in PARKnSHOP. It would be judicious to maintain and continuously improve the e-CRM. ...read more.

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