QUESTION

CASE STUDY

The computer company, Compaq, needed to react to its competitors' success at selling on the web and do so quickly. A strategy was developed to undertake a Common Global Internet Program. Compaq decided to rapidly build three or four initial Wed-based applications within a six-month time frame, develop core expertise and infrastructure and prioritize and continue a long-term development program. The first step was to develop some guiding principles. These were to provide a customized, personalized view for customers into Compaq and provide consistent Internet-based functionality to support worldwide solutions and develop a true E-CRM organisation.

At Compaq, the internet now provides customers, major accounts and global accounts access to information, ordering capability and support services. It enables:

• On line information requests (responding to questions and request for literature immediately)
• Catalogs viewing (the ability to access color catalogs and spec sheets while on-line)
• Price quotation
• Provision of payment/shipping information
• Provision of order status and fulfillment information
• Completion of surveys/questionnaires
• Customer e-mail feedback
• Resellers and channel partners access to information, on-line ordering and support services.

The benefits to the customer are clear: sales support for customers and resellers; information available 24 hours a day, seven days a week (24x7); real-time order taking and order status; and a cost-effective customer feedback channel. It has now been rolled out to support Compaq's operations in 15 countries and has resulted in $40 million per month in orders.

Despite the obvious efforts required in this business solution, reducing the number of customer service representatives (CSRs) needed and significantly improving accuracy have been possible, resulting in savings of $1 million per year in the call center. In addition to the above capabilities, a configure-to-order (CTO) solution has been developed at retail outlets. These (CTO) applications allow retail customers at a store to configure and order products from Compaq through the Internet. This enables sales of higher-end systems in stores, allowing Compaq to make direct sales to customers while maintaining their relationships with retail outlets. Customers can do this through more than 5,000 retail stores, which have resulted in $5 million per month in sales.

Answer all the questions set

1. Describe how the different channel through which the customer interacts with Compaq influences the value of the product.

2. Discuss the challenges that Compaq had to face with in delivery e-CRM to its customers

3. Using the criteria that customers use to evaluate a company's channel, discuss how far Compaq has been able to fulfill the needs and expectations of its customers concerning the channel strategy