DMM aantekeningen – Danique Levering
THE CUSTOMER JOURNEY – LEMON & VERHOEF (2016)
Customer Journey
0. ZMOT (Google, 2011)
1. Pre-purchase Phase (Lemon & Verhoef, 2016)
2. Purchase Phase (Lemon & Verhoef, 2016)
PLA is important in this phase
3. Post-Purchase Phase (Lemon & Verhoef, 2016)
Confirmation you got a good deal, made the right choice
Customer experience as a holistic concept, based on firm-initiated and customer-initiated touch points
(Lemon & Verhoef, 2016; Anderl et al., 2016). Customer experiences the total experience, not separate
touchpoints.
- Firm-initiated touchpoints
Store (physical & online), website, social media, display advertisement, etc.
Essentially the 4 P’s: Price, Product, Place, Promotion
o Place: Distribution Breadth & Depth (Online + Offline)
o Promotion: Conversion Funnel
- Customer-initiated touchpoints
eWOM, IKEA hackers, Youtube tutorials
Customer-initiated touch points work better at the beginning of the customer journey, at the
beginning consumers are more influenced by their environment. When they are more sure of what
they want to buy, they are less influential.
Multichannel vs. Omnichannel
- Multichannel: the design, deployment, coordination and evaluation of the different channels
through which the marketer acquires, retains and develops customers (Neslin et al, 2006). All
channels are separate; you try to maximize every channel on its own.
- Omnichannel: the design, deployment, coordination and evaluation across the different channels
through which the marketer acquires, retains and develops customers. synergize between the
1
, DMM aantekeningen – Danique Levering
separate channels. You integrate the online and offline components together. Integrating activities
across channels to correspond to how consumers shop
Digital Marketing along the customer journey
- 43% of all shoppers search in one channel and purchase in another = research shoppers (Neslin et
al 2006)
- Showrooming & Webrooming (Lemon & Verhoef, 2016)
- It’s important to know that you are dealing with customers in different parts of the customer journey
Conversion Funnel
1. Impressions
CPM (Cost Per Mille) = Costs / Impressions * 1000
2. Clicks
CTR (Click Trough Rate) = Clicks / Impressions
3. Action
Start Application, Put Items in Shopping Cart
SCAR (Shopping Cart Abandonment Rate)
Ratio of abandoned shopping carts to the number of initiated transactions OR completed
transactions. Typically between 60-80%
4. Conversion
Actual Purchase
Conversion Rate = Application / Clicks
5. Retention Rate
Churn Rate is the opposite of Retention Rate.
Profit = Impressions * CTR * (CVR * M – CPC)
CLV
How to improve SCAR: great return policy, simple payment system, registration, reviews, e-mail marketing
(Bol.com ‘Vergeet je niet iets?’), remarketing advertisement.
Srinivasan et al. (2016) the P2P has 3 stages:
- Learning (cognitive) à measured by clicks on SEA
- Feeling (affective) à measured by Facebook Likes
- Behaviour (conative) à measured by conversions and likes
Srinivasan et al. (2016) capture the different types of online consumer activity (paid, owned and earned)
as follows:
- Paid media was measured by paid search click-through (on average, 8K clicks per week)
- Owned media by the number of weekly website visits by consumers (on average, 60K visits per
week( and
- Earned media as Facebook likes (on average, 36K per week) and unlikes (on average, 43 per week).
Online consumer activity translate into sales volume changes? (Srinivasan et al., 2016)
- Paid search clicks have the highest elasticity (0.81), followed by likes (0.16), site visits (0.14) and
unlikes (-0.01) = increase in sales as the # of clicks/likes/visits increase
- Low elasticity of visits; consumers have to buy it in the physical store (matrass).
2
, DMM aantekeningen – Danique Levering
DISTRIBUTION BREADTH & DEPTH – AILAWADI & FARRIS (2017)
Distribution: how easy is it to buy the brand? To find the store? Findability.
- Breadth: how many stores does the brand have? – not only own stores, also other distributors
o How many outlets? How important (in the category)?
o How important are their distribution outlets? Traffic (Reach & Frequency)
o How easy to find is the product?
- Depth: how many models of the products does a store have?
o How much of the product is in distribution?
o How prominently is it merchandised relative to competitors?
o How well is it supported along the path-to-purchase?
Google Ads Fees Click Through Targeting
PLA CPC * Merchant Site Individual Products and
Product Groups Coat X,
Coats, Coats over $40
Text (Adwords) CPC * Merchant Site Product Keywords
Mens Coat, Coat, Mens
Blue Coat
*This is moderated by what you choose to bid on keywords and what your daily budget is
Compliance:
- Are both partners executing desired strategy with logistics, assortment, product availability, pricing
and promotion policies?
- Is the supplier providing the needed marketing support?
- Is the retailer providing the appropriate distribution depth?
Metrics:
o % On-time reseller deliveries to consumers
o Incidence of Out of Stock (OOS)
o Return rate by retailer’s customers
At least 30% of product ordered online are returned vs. 8.89% in physical stores
o Bounce rate
Page is opened and exited without doing something on the page
o SCAR
Path-to-Purchase:
- Are both partners achieving satisfactory reviews and recommendations?
- Are they working to support the customer along the path-to-purchase across channels?
Metrics:
o Advocacy
# or % of positive brand reviews by brand or retailer’s customers
o Cross-Channel Conversions
# of visitors served by retailer and buys the brand elsewhere
o Cross-Channel Delivery or Cross-Channel Returns
# of purchases elsewhere delivered by, picked up at, or returned to retailer
3
THE CUSTOMER JOURNEY – LEMON & VERHOEF (2016)
Customer Journey
0. ZMOT (Google, 2011)
1. Pre-purchase Phase (Lemon & Verhoef, 2016)
2. Purchase Phase (Lemon & Verhoef, 2016)
PLA is important in this phase
3. Post-Purchase Phase (Lemon & Verhoef, 2016)
Confirmation you got a good deal, made the right choice
Customer experience as a holistic concept, based on firm-initiated and customer-initiated touch points
(Lemon & Verhoef, 2016; Anderl et al., 2016). Customer experiences the total experience, not separate
touchpoints.
- Firm-initiated touchpoints
Store (physical & online), website, social media, display advertisement, etc.
Essentially the 4 P’s: Price, Product, Place, Promotion
o Place: Distribution Breadth & Depth (Online + Offline)
o Promotion: Conversion Funnel
- Customer-initiated touchpoints
eWOM, IKEA hackers, Youtube tutorials
Customer-initiated touch points work better at the beginning of the customer journey, at the
beginning consumers are more influenced by their environment. When they are more sure of what
they want to buy, they are less influential.
Multichannel vs. Omnichannel
- Multichannel: the design, deployment, coordination and evaluation of the different channels
through which the marketer acquires, retains and develops customers (Neslin et al, 2006). All
channels are separate; you try to maximize every channel on its own.
- Omnichannel: the design, deployment, coordination and evaluation across the different channels
through which the marketer acquires, retains and develops customers. synergize between the
1
, DMM aantekeningen – Danique Levering
separate channels. You integrate the online and offline components together. Integrating activities
across channels to correspond to how consumers shop
Digital Marketing along the customer journey
- 43% of all shoppers search in one channel and purchase in another = research shoppers (Neslin et
al 2006)
- Showrooming & Webrooming (Lemon & Verhoef, 2016)
- It’s important to know that you are dealing with customers in different parts of the customer journey
Conversion Funnel
1. Impressions
CPM (Cost Per Mille) = Costs / Impressions * 1000
2. Clicks
CTR (Click Trough Rate) = Clicks / Impressions
3. Action
Start Application, Put Items in Shopping Cart
SCAR (Shopping Cart Abandonment Rate)
Ratio of abandoned shopping carts to the number of initiated transactions OR completed
transactions. Typically between 60-80%
4. Conversion
Actual Purchase
Conversion Rate = Application / Clicks
5. Retention Rate
Churn Rate is the opposite of Retention Rate.
Profit = Impressions * CTR * (CVR * M – CPC)
CLV
How to improve SCAR: great return policy, simple payment system, registration, reviews, e-mail marketing
(Bol.com ‘Vergeet je niet iets?’), remarketing advertisement.
Srinivasan et al. (2016) the P2P has 3 stages:
- Learning (cognitive) à measured by clicks on SEA
- Feeling (affective) à measured by Facebook Likes
- Behaviour (conative) à measured by conversions and likes
Srinivasan et al. (2016) capture the different types of online consumer activity (paid, owned and earned)
as follows:
- Paid media was measured by paid search click-through (on average, 8K clicks per week)
- Owned media by the number of weekly website visits by consumers (on average, 60K visits per
week( and
- Earned media as Facebook likes (on average, 36K per week) and unlikes (on average, 43 per week).
Online consumer activity translate into sales volume changes? (Srinivasan et al., 2016)
- Paid search clicks have the highest elasticity (0.81), followed by likes (0.16), site visits (0.14) and
unlikes (-0.01) = increase in sales as the # of clicks/likes/visits increase
- Low elasticity of visits; consumers have to buy it in the physical store (matrass).
2
, DMM aantekeningen – Danique Levering
DISTRIBUTION BREADTH & DEPTH – AILAWADI & FARRIS (2017)
Distribution: how easy is it to buy the brand? To find the store? Findability.
- Breadth: how many stores does the brand have? – not only own stores, also other distributors
o How many outlets? How important (in the category)?
o How important are their distribution outlets? Traffic (Reach & Frequency)
o How easy to find is the product?
- Depth: how many models of the products does a store have?
o How much of the product is in distribution?
o How prominently is it merchandised relative to competitors?
o How well is it supported along the path-to-purchase?
Google Ads Fees Click Through Targeting
PLA CPC * Merchant Site Individual Products and
Product Groups Coat X,
Coats, Coats over $40
Text (Adwords) CPC * Merchant Site Product Keywords
Mens Coat, Coat, Mens
Blue Coat
*This is moderated by what you choose to bid on keywords and what your daily budget is
Compliance:
- Are both partners executing desired strategy with logistics, assortment, product availability, pricing
and promotion policies?
- Is the supplier providing the needed marketing support?
- Is the retailer providing the appropriate distribution depth?
Metrics:
o % On-time reseller deliveries to consumers
o Incidence of Out of Stock (OOS)
o Return rate by retailer’s customers
At least 30% of product ordered online are returned vs. 8.89% in physical stores
o Bounce rate
Page is opened and exited without doing something on the page
o SCAR
Path-to-Purchase:
- Are both partners achieving satisfactory reviews and recommendations?
- Are they working to support the customer along the path-to-purchase across channels?
Metrics:
o Advocacy
# or % of positive brand reviews by brand or retailer’s customers
o Cross-Channel Conversions
# of visitors served by retailer and buys the brand elsewhere
o Cross-Channel Delivery or Cross-Channel Returns
# of purchases elsewhere delivered by, picked up at, or returned to retailer
3
