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100 Gibson
delivers 80 percent of the revenues. This is called the “80/20 Pareto Principle.” In
addition, the top 20 percent of the customers deliver most of the profits. Moreover,
the existing customers deliver up to 90 percent of revenues. All of these figures show
that customer satisfaction and loyalty should be of utmost importance to every
business (Curry, 2000).
The database technology enables the online customer agents to acquire
information about their customers in order to provide them a better and personalized
service. Any type of information gathering whether it is from a simple shopping
list for a collection of customer information is considered a customer database as
long as it is computerized. This technology stores the information about the
customers such as their transactions, interactions, profiles and purchase histories in
order to provide them personalized customer service on the net. Data Warehousing
and Data Mining are the two major technologies that are used in Customer
Relationship Management that enable the online customer service agents to provide
a better service to their customers (Coronel, 2000).
Data Warehouses were developed as data storage facilities. These data
warehouses receive data from the operational databases as well as other sources
in order to provide a comprehensive data pool from which information can be
selected. The most crucial aspect of data warehouses is that the data that is stored
in structures is able to generate specific information (Gardner, 1998).
Data mining is the process where the marketer tries to find trends and patterns
in huge amounts of data. The goal of this process is to search through large quantities
of data and discover new information that can be useful for the company. “The
benefit of data mining is to turn this newfound knowledge into actionable results,
such as increasing a customer’s likelihood to buy” (Groth, 2000). Data mining also
enables the company access to detailed knowledge of customer profiles, and the
ability to analyze customer satisfaction.
There are also some essential components of online customer service that have
to be in place regardless of the business. The website has to provide simple
navigation, fast image download times, and fast access to information. The human
aspect should also be of utmost importance such as quick e-mail responses, and
toll-free phone numbers for customer service. Furthermore, the product information
has to be detailed on the website, such as the descriptions, specifications,
pricing, FAQs, smart shopping carts, and cross-purchasing suggestions. Another
crucia1 component is the issue of incentives such as gift-wrapping, promotions,
money-back and on-time delivery guarantees, and offers of free shipping and
handling. Moreover, a trust has to be built between the site and the customer. This
can be achieved by placing the explanations regarding the secure transactions, and
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