Concepts and Principles

Principles of 1 to 1 Marketing
 

• It is an approach that concentrates on selling services or products to one customer at a time but seeking over their lifetime to sell a range of services or products.
• It seeks lifetime relationships and lifetime customer profitability.
• Through dialogue it involves customer collaboration so that they become part of the product development process. As such it differentiates customers rather than just products.
• It requires proactively managing customer relationships, taking products and services to the customer, and over time gaining their trust.

The benefits of 1 to 1 Marketing are that it results in higher profits. It does this by delivering economies of scope, not economies of scale, and by identifying and concentrating on ones most profitable customers.

To achieve 1 to 1 Marketing requires the all parts of the organisation that deal with or support customer services to be truely customer focused, treating each as an individual. Traditionally this approach has been expensive and therefore restricted to luxury and niche markets. But to-day, the new interactive mediums like the Internet and Web-TV, and the techniques of Mass Customisation have made 1 to 1 Marketing affordable to many organisations.

Many of the concepts of 1 to 1 Marketing were developed by Don Peppers and Martha Rogers. For more details on 1 to 1 Marketing, including resources, follow this link.

Principles of Mass Customisation
 

• It is the marriage of mass production with individual customisation.
• It involves customers participating in the design of their product or service before it is manufactured.
    (Note that this it is more than mass personalisation which typically involves the customer at the end of the manufacturing process).
• It involves an ongoing customer relationship so that previous knowledge of the customer can be incorporated into individual marketing messages and into future products or services.

The benefits of Mass Customisation are ones customers obtaining products and services that truely meet their own particular needs, yet at a competitive price - thus providing exceptional value for money; a unique differentiator with other companies products and services, especially those of a commodity nature; and through building lifetime relationships having a constant rich source of new ideas from ones customers.

Mass Customisation is enabled through new technologies like the Internet and kiosk system that support dialogue with individual customers; advanced computer aided design and production systems. It also applies to services as well as products. It requires close linkages between suppliers, producers and distributors, and through building knowledge based organisations that collaborate with all participants in the value chain, including the customer, in a learning experience.

Many of the concepts of Mass Customisation were developed by B. Joseph Pine II. For more details on Mass Customisation, including resources, follow the link.

The New Interactive Mediums

These are technologies that facilitate, encourage, enhance and support dialogue. They allow the customer to collaborate in product and service development and then ongoing servicing. They include:

• The Internet
• Web-TV
• Networked PCs
• Kiosks
• Personal Data Assistants
• Mobile and fixed telephones
• Smartphones.
• User interfaces based on real life metaphors
• Speech recognition and voice response
• Software agents, autobots and push technologies
• Knowledge and rule based systems
• Data mining
• Call centre technologies
• High bandwidth, low cost networks
• Object and component based technology

For more details on these new interactive mediums, including resources, follow the link.

Developing Effective and Efficient Processes

In the implementation of SIM it is very unlikely to lead to a separate and stand-alone delivery channel for a number of reasons:
 

• Consumers are still influenced by other channels used by the company and its brands.
  • Whilst a company could create a new brand for SIM delivery, it would then lose forfeit the benefits of that brand. It would then become just another player in the ether, indistinguishable from fly-by-nights and similar.
• Practically, a company cannot implement SIM for the whole Customer Life Cycle in one go. Therefore customers will use the new interactive mediums for part of the Life Cycle and other existing channels for the remainder.
  • The Customer Life Cycle is explored in Managing Change's Strategic Interactive Marketing (SIM) framework.
• Again, practically, a company cannot implement all the appropriate mediums at once.
• A key principle of SIM is that customers should be given choice. Choice as to which medium and which part of the Life Cycle they conduct with the new interactive mediums.

It is therefore critical that the transition between interactive mediums, and from interactive medium to traditional and established channels and mediums, and back again, is seamless. An example in practical terms, is that a customer who completes a quotation form via the Internet should not have to repeat that information if he or she then telephones to complete the sale.

SIM is therefore based around the Customer Life Cycle Process and the mapping of Organisational processes onto those customer process. By taking this perspective, and by exploiting the new interactive mediums, SIM is therefore market driving, process enabling.

For more details on developing effective and efficient processes, including resources, follow the link.

Applying Relevant Organisational Change Techniques

Implementing new technology and business processes to support SIM will no doubt require organisational changes in areas such as:

• people skills
• staff recruitment and reward policies
• management style
• structures
• culture.

Change cannot happen overnight, rather it must be planned and executed in synchronisation with the changes to marketing, processes and technology. The degree of change and the techniques used depends on the current organisational culture and competencies. Culture change cannot be easily mandated. In some cases the most expedient action may be to establish a new green field site, or to outsource. However, this once again raises the issue of process interfaces.

For more details on organisational change techniques, including resources, follow the link.

External Resources
 

1. See the full list of resources for this web site for other related resources.

[Overview] [Concepts and Principles] [Distribution Issues]
[Behaviour Analysis and Behaviour Models]
[Business Rules Approach] [SIM Brochure]

[SIM Overview] [One to One Marketing] [Mass Customisation] [Interactive Mediums] [STEP Analysis]
 [SIM Executive Summary] [SIM Report] [SIM Project] [SIM Framework] [SIM Methodology] [SIM Illustrations] [SIM Links]

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