Lecture 11 Customer Metrics Customer Metrics Todays Objectives

Lecture 11 Customer Metrics

Customer Metrics — Today’s Objectives will be to: Understand the strengths and weaknesses of traditional offline metrics Understand the strengths and weaknesses of online metrics Discuss the need for an integrated set of metrics Examine e. Bay’s customer metrics

Customer Metrics Offline Customer Metrics Online Customer Metrics The Need for Integrated Customer Metrics EBay’s Customer Metrics Conclusion

Customer Metrics Offline Customer Metrics Online Customer Metrics The Need for Integrated Customer Metrics EBay’s Customer Metrics Conclusion

Traditional Hierarchy-of- Effects Model Awareness I am aware of Amazon Knowledge I know what products Amazon carries I know Amazon vs. BN. com Attitude I like Amazon I plan to buy from Amazon Next time I buy, it will be from Amazon Purchase Intent Exploration/ Expansion Purchase Postpurchase Behavior and Satisfaction Commitment Loyalty Frequency of purchase Amount of purchases Quality of customer service interactions Satisfaction with Amazon Frequency of repeat purchases Amount of repeat purchases “Share of wallet” vs. competition

Customer Metrics Offline Customer Metrics Online Customer Metrics The Need for Integrated Customer Metrics EBay’s Customer Metrics Conclusion

Stages of the Online Buying Process Search & shopping Exploration/ Expansion Online satisfaction surveys Frequency of repurchases Dollar amount of repurchases Purchase intervals “Share of wallet” in category Lifetime value metrics Loyalty Dissolution Attrition Number of visitors Requests for product information (e. g. , page views and patterns) Size of purchases Conversion rates Acquisition costs Purchase Postpurchase Commitment Interval since last purchase Percentage of returns

Customer Metrics Offline Customer Metrics Online Customer Metrics The Need for Integrated Customer Metrics EBay’s Customer Metrics Conclusion

An Integrated Model of Customer Metrics Awareness Knowledge Attitudes Purchase Intent Search & shopping Integrated Online Offline “Ask” Search & shopping “Observe” Purchase Post purchase Postpurchase “Ask and Observe” Loyalty Attrition “Observe”

Strengths & Weaknesses of Online & Offline Metrics Online Offline Prepurchase Attitude Knowledge Strong Weak Search and Actual Shopping Behavior Weak Strong Purchase and Loyalty Moderate Strong

The Power of Conversion Rates Note: Average transaction size = 100% Source: Gurley, J. William, “The Most Powerful Metric of All, ” CNet. News. com, 21 February 2000

Integrated Customer Metrics

Customer Metrics Offline Customer Metrics Online Customer Metrics The Need for Integrated Customer Metrics EBay’s Customer Metrics Conclusion

Online Tracking — EBay Customer Metrics

EBay Metrics – Unique Monthly Visitors

EBay Metrics – Unique Monthly and Daily Visitors (Mar 2002) Unique Visitors (in millions) Percent of Total Web Users (114 million) 80% 69% 26%

EBay’s Registered-User Evolution Number of Registered Users (in millions) Source: Company Reports

EBay Metrics – Average Minutes Spent per User per Day Average Minutes Spent by Customers per Day

Customer Metrics Offline Customer Metrics Online Customer Metrics The Need for Integrated Customer Metrics EBay’s Customer Metrics Conclusion

Customer Metrics — Conclusion Traditional offline customer metrics and online customer metrics can be brought together in an integrative approach to measuring and tracking customer experience. Although there can be metrics that illustrate the integration of physical and online stores, there a number of challenges to developing and deploying this integrative customer experience strategy. In order to understand the success and performance of marketing interventions, the link from customer metrics to the company’s financial metrics must be examined.