E-Commerce: Order Fulfillment, E-CRM, and Other Support Services

Module 03

Order Fulfillment, E-CRM, and Other Support Services:

Overview of Order Fulfillment:

Order fulfillment: All of the activities needed to provide customers with ordered goods and services, including related customer services.

Back-office operations: The activities that support fulfillment of sales, such as accounting and logistics.

Front-office operations: The business processes, such as sales and advertising, which are visible to customers.

E-Commerce Services:

EC Applications:

•         E-Infrastructure

•         E-Process

•         E-Market

•         E-Communities

•         E-Service

•         E-Content

Fig. E-Commerce Services:

Overview of Logistics:

Logistics: The operations involved in the efficient and effective flow and storage of goods, services, and related information from point of origin to point of consumption.

The EC Order Fulfillment Process:

–        Step 1: Making sure the customer will pay

–        Step 2:Checking for in-stock availability

–        Step 3:Arranging shipments

–        Step 4: Insurance

–        Step 5: Replenishment (to make full or complete again, as by supplying what is lacking, used up, etc.)

–        Step 6: In-house production

–        Step 7: Use suppliers

–        Step 8: Contacts with customers

–        Step 9: Returns

Reverse logistics: The movement of returns from customers to vendors.

E-logistics: The logistics of EC systems, typically involving small parcels sent to many customers’ homes (in B2C).

Traditional Versus EC Logistics:

-Traditional logistics deal with movement of large amounts of materials to a few destinations

-E-logistics shipments typically are small parcels sent to many customers’ homes.

Problems in Order Fulfillment:

Typical Supply Chain Problems:

–        The inability to deliver products on time

–        High inventory costs

–        Quality problems due to misunderstandings

–        Shipments of wrong products, materials, and parts

–        Cost to expedite operations or shipments is high.

Why Supply Chain Problems Exist:

Problems along the EC supply chain stem from uncertainties and from the need to coordinate several activities, internal units, and business partners.

Third-party logistics (3PL) suppliers:

External, rather than in-house, providers of logistics services.

Solutions to Order Fulfillment Problems:

•         Improvements in the Order-Taking Process

•         Improvements of Warehousing and Inventory Management

•         Speeding Deliveries

•         Partnering Efforts and Outsourcing Logistics

•         Handling Returns

•         Innovative E-Fulfillment Strategies.

Fig : B2B Buy and Ship Options:

CRM and Its Relationship with Electronic Commerce:

Customer Relationship Management (CRM): A customer service approach that focuses on building long-term and sustainable customer relationships that add VALUE both for the customer and the company.

Types of CRM Activities:

•         Operational

•         Analytical

•         Collaborative

Classification of CRM Programs:

•         Loyalty programs.

•         Prospecting.

•         Save or win back.

•         Cross-sell/up-sell.

eCRM: Customer relationship management conducted electronically.

The Scope of CRM:

The three levels of CRM:

1.      Foundation of service

2.      Customer-centered services

3.      Value-added services.

The Extent of Service:

1. Customer acquisition (pre-purchase support)
2. Customer support during purchase
3. Customer fulfillment (purchase dispatch)
4. Customer continuance support (post-purchase)

CRM Implementation Issues:

Five factors that are required to implement a CRM program effectively:

1. Customer-centric strategy
2. Commitments from people
3. Improved or redesigned processes
4. Software technology
5. Infrastructure

Metrics in Customer Service and CRM:

•         Response time

•         Site availability

•         Download time

•         Timeliness

•         Security and privacy

•         On-time order fulfillment

•         Return policy

•         Navigability

Fig: CRM Applications:

Delivering Customer Service in Cyberspace: CRM Applications and Tools:

Customer-Touching Applications

–        Personalized Web pages

–        E-commerce applications

–        Campaign management

Online Networking

•         Forums

•         Chat rooms

•         Usenet groups

•         E-mail newsletters

•         Discussion lists

E-Mail Newsletters

Discussion Lists

Why Outsource EC Services?

–        A desire to concentrate on the core business

–        The need to have services up and running rapidly

–        Lack of expertise (experience and resources) for many of the required support services

–        The inability to have the economy of scale enjoyed by outsourcers, which often results in high costs for in-house options

–        The inability to keep up with rapidly fluctuating demands if an in-house option is used

–        The number of required services, which usually are simply too many for one company to handle

Fig: E-Commerce Application Development Process: