Page 175 - DMGT302_FUNDAMENTALS_OF_PROJECT_MANAGEMENT

Fundamentals of Project Management

Notes
Table 10.2: Measures for Customer Orientation
Customer satisfaction
score on online customer satisfaction surveys
# of customer complaints/resolution.
Customer retention
retention rates of clients who use the internet compared with those who do not
% customers placing repeat orders
Acquiring new customers
customer acquisition or new leads generated by the website
sales generated directly and indirectly by the website
Effective internet marketing
# of hits
# of page impressions
# of site visits
# of visitors
Customer satisfaction is the feeling that a product or service meets the customer expectations
and determines whether a customer will repeat his or her web purchases or not. Since service
quality is an antecedent of user satisfaction in web environments, customer satisfaction will be
enhanced by increasing customer service (Zeithaml, Berry and Parasuraman). Typical measures
for customer satisfaction are web site satisfaction scores calculated on the basis of offline or online
surveys, and the number of customers complaints eventually compared to the resolutions within a
reasonable time. Customer satisfaction is perceived by senior managers involved in E-business
projects as an important measure. All respondents of the Adams et al. survey said that they
measured customer satisfaction or that they should measure it. Besides measuring the customer
satisfaction, it is also crucial to know how to increase the customer retention rate – the degree to
which a customer will stay with a specific vendor or brand. After all, there is no point having
fairly satisfied customers who do not come back to buy again or who are not prepared to
recommend the product or service to others. Customers will be likely to return to the merchant’s
web site if they have had good repeat business happen when customers feel a connection to a site
and believe that the site is their best option for doing business. Connection to a site is a function
of web design, as customers see and interact with a company via the web interface. Belief in a site
or in a company’s ability to fulfill its commitments is a function of service design. Both are
required for relationships and repeat business. Furthermore, by retaining customers, a company
can increase its profits because customers will buy more and sales will grow. In the end, a
company’s market position is strengthened because customers are kept away from the
competitors. Beside this, it is important they have developed trust. Trust can be developed
through reputation, relationship and knowledge of the other party’s business (Stewart,
Measurements are retention rates of on line clients and loyalty measures such as percent of on line
customers placing repeating orders. Acquiring new customers is measured through the number of new
customers and/or new leads generated via the web site. A more general measure is the number of
sales generated by the web site eventually compared to the usual business. Internet marketing measures
indicate the effectiveness of internet marketing activities in meeting customer, business and
marketing objectives and can be collected online or offline. Although traditional offline metrics
are still important, online web metrics are more often used for the assessment of internet
marketing effectiveness.

Task Describe the measures for business contribution.

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