Increasing Customer Loyalty via Mobile Customer Relationship Management


Diploma Thesis, 2002

87 Pages, Grade: 1


Excerpt

DIPLOMARBEIT
Zur Erlangung
des Grades einer Diplom-Betriebswirtin
an der Fachhochschule Wiesbaden
Fachbereich Wirtschaft
Thema:
"Increasing Customer Loyalty
via
Mobile Customer Relationship Management"
Referent:
Prof. Dr. Stefan Jugel
Korreferent: Prof. Dr.-Ing. Klaus North
Eingereicht von: Silke Freitag
Frankenstrasse 13
65183 Wiesbaden
Matrikel-Nr.: 532078
Wiesbaden, den 24. April 2002

Table of contents
I
Abbreviations
III
Figures
IV
1. Introduction
1
1.1 Problem
statement
2
1.2
Limitation of research topic
3
1.3 Research
procedure
4
2. M-Business: "Anywhere Anytime Access"
5
2.1
Definition of M-Business
5
2.2
Mobile network technology
6
2.2.1
GSM
6
2.2.2 GPRS
7
2.2.3 HSCSD
8
2.2.4 UMTS
8
2.3 Service
technology
9
2.3.1
WAP
9
2.3.2
Bluetooth
10
2.3.3 Short Messaging Service (SMS)
11
2.4
iMode as an alternative to WAP
11
2.5
Mobile payment solutions
14
2.5.1
Paybox
14
2.5.2
Mobilpay
16
2.5.3 Payitmobile solution
17
3. Mobile Customer Relationship Management ­
Key Functions and Definitions
18
3.1
Definition of Customer Relationship Management
18
3.2
CRM ­ A customer-oriented organizational process
19
3.3
Benefit of CRM
22
3.3.1 Improvement of image
23
3.3.2 Improvement of efficiency
24
3.3.3 Acquisition of new customers
24
3.3.4 Customer
bonding
25
3.4
Customer Lifetime Value ­ A means to measure the success of CRM 26
3.5
CRM in the wireless world
29

Table of contents
II
3.6
Fields of application
31
3.7
Objectives of Mobile Customer Relationship Management
32
4. M-CRM as a means to increase customer loyalty
34
4.1
What is the meaning of customer loyalty?
34
4.2
Mobile Services: What do customers expect?
36
4.2.1 Survey: "What do you think about Mobile Marketing?"
36
4.2.2 Analysis
37
4.2.3 Comment
41
4.3
The "EMF" principle
42
4.4
Advantages of M-CRM for the customer and the provider
44
5. SMS-Advertising under the aspect of Permission Marketing
45
5.1 Permission
Marketing:
License to advertise
46
5.2
SMS: a two-way medium
47
5.3
Loyalty-based SMS operations
48
5.3.1 Push services or pull services?
48
5.3.2 Personalized
messaging
49
5.3.3 Location Based Services
50
5.3.4 Value adding services
52
5.4
Worldwide SMS traffic
52
5.5
SMS Couponing ­ Example of a mobile business model
54
6. Future prospects for mobile customer relationships
56
6.1
Possible future mobile business fields
56
6.2 Multi-media
messaging
57
6.3 Market
forecast
58
6.4 FAQ`s
59
7. Conclusion
61
Appendix
V
Bibliography
XIV
Ehrenwörtliche Erklärung
XXIV

Abbreviations III
3G Third
Generation
CLV
Customer Lifetime Value
CRM Customer
Relationship
Management
CSD
Circuit Switched Data
DOS Disc-Operating
System
E-commerce
Electronic commerce
EFM Easier-Faster-More
FCC
Federal Communications Commission
GPRS
General Packet Radio Service
GPS
Global Positioning System
GSM
Global System for Mobile Communications
GZS
Gesellschaft für Zahlungssysteme
HSCDS
High Speed Circuit Switched Data
kbit/s kilobits
per
second
mb/s
megabytes per second
M-business
Mobile business
M-commerce
Mobile commerce
LAN Local
Area
Network
M-CRM
Mobile Customer Relationship Management
MMS Multi-Media
Messaging
PDA
Personal Digital Assistant
PIN Personal
Identification
Number
SIM
Subscriber Identification Module
SMS
Short Messaging Service
UMTS
Universal Mobile Telecommunications System
UPS
Unique Selling Proposition
WAP
Wireless Application Protocol

Table of figures
IV
Figure 1:
Potential electronic services for mobile portals
5
Figure 2:
Comparison WAP ­ iMode
12
Figure 3:
Payment procedure of Paybox
15
Figure 4:
The CRM lifecycle
19
Figure 5:
Data Warehousing
20
Figure 6:
Contributory factors to the benefit of CRM
23
Figure 7:
Criteria for the determination of Customer Lifetime Value
27
Figure 8:
Increase of customer profitability in the course of time
29
Figure 9:
Elements of successful mobile CRM
33
Figure 10:
Future use of the mobile Internet
37
Figure 11:
Future use of mobile services and acquisition of products
38
Figure 12
SMS ­ A medium to increase customer loyalty?
39
Figure 13
Acceptance of wireless services
40
Figure 14:
Worldwide SMS Traffic Growth
53

Introduction
1
1. Introduction
In times of computerization and mass consumption, one vital element has long been left
behind. So far the customer rather tended to be treated as a trash dump for all those
mailings that completely missed his interest, while he actually longed for companies to
guess his needs, requirements and wishes and send him personalized offers especially
tailored to those. With the beginning of the new century, technological advances and
innovations in the field of data mining and data management have already made this
dream come true for many customers. This new way of building relationships is called
Customer Relationship Management (CRM) and comprises all aspects of interaction a
company has with its customers. "It's a business strategy that aims to understand,
anticipate and manage the need's of a company's current and potential customers."
1
Along with the fast proliferation of mobile devices, consumer's behavior has changed
considerably. Customers do no longer constraint their activities to one communication
channel, but take advantage of new technological opportunities such as mobile
commerce. In this fast-moving technological environment creating and intensifying
customer loyalty has become indispensable for the business world. This change in
consumers' behavior gave way to the development of mobile CRM solutions enabling
companies to serve every customer individually at any time and anywhere and create
services and offers specifically corresponding to their needs.
With every mobile phone user being able to send and receive short messages, wireless
marketing offers great potential in the field of Customer Relationship Management.
Nevertheless, if the Short Message Service (SMS) is applied to send offers and
advertisements it should be an end-to-end service
2
. Customers are to be given the
opportunity to directly respond to an offer and finish the transaction over their phone.
This requires secure mobile payment solutions. Just recently, the German subsidiary of
the international Mobile Market Association has been founded in Munich while Hewlett
Packard, Lucent, Oracle, Siemens and Sun Microssystems have formed a consortium to
standardize mobile payment an foster mobile business.
3
Various companies already
1
See http://fbox.vt.edu/users/qhe/Paper/Definition.html 2002-02-04
2
See http://www.Internetworld.co.uk/mcomm/.../AEE517F53546A060 2002-01-20
3
See http://www.manager-magazin.de/ebusiness/artikel/0,2828,178821,00.html 2002-01-24

Introduction 2
offer secure mobile payment models, a few of which will be illustrated in the following
thesis.
Future prospects for SMS-marketing as a tool of Customer Relationship Management
look quite prosperous and will be further supported by new technologies (GPRS,
UMTS), which will offer faster, high-level access to the mobile Internet and thus
convince more and more people of its benefits.
1.1 Problem
statement
"With the growing convergence of the Internet and the mobile phone, we believe that by
2003 more people will be accessing the web by mobile devices than by fixed pc" (Ian
Germer, Executive, New Products ­ Vodafone).
4
Since mobile-commerce will be
continually growing, competition between companies is becoming increasingly harsh.
In order to further keep their position in the market, companies are forced to improve
the relations to their customers by using new business technologies enabling them to
differentiate themselves from the competition in offering personalized services that are
especially tailored to their customers' needs.
As a result of the constantly growing number of mobile phone owners, mobile
Customer Relationship Management has become a new way of building and
intensifying customer relationships. At present there are approximately 50 million
people in Germany owning a cell phone.
5
According to polls, in 2003 there will be 102
cell phones per 100 inhabitants. With the help of mobile CRM systems companies are in
the position to create well-structured databases in which they store all important
information about their customers, that can easily be retrieved at any time in any place
by all employees, who are in direct or indirect contact with customers. Using this
customer data, individual offers can be created for specific customers and sent directly
to their mobile phone. Since mobile devices provide the possibility of perpetual contact,
the recipient can instantly react to services and offers appearing on his mobile phone.
6
4
See Diederich/Lerner/Lindemann, 2001, p.21
5
See acquisa 2002, No.1, p.26-28
6
See Brown/Green/Harper (Eds), 2002, p.27

1. Introduction
3
However, prior to launching any wireless marketing actions, it is imperative to receive
the customer's explicit permission to offer such services in order to avoid annoyance
and to achieve maximum satisfaction on the customer's side. Only within a climate of
trust, where the customer has confidence in the respect of his privacy, will mobile
marketing be successful and increase his loyalty. Moreover, the customer has to get the
feeling that he is the center of attention and that the offer corresponds exactly to his
needs or interests. Unsolicited messages will increase the risk of annoying the recipient
and thus losing him to a competitive company that is just a click away
7
. Therefore, it is
of vital importance to constantly update customer data.
1.2
Limitation of research topic
Customer Relationship Management is not only about implementing a new software, it
is more about changing or improving a company's philosophy. The technological
aspects may not be neglected, as they are the basis of successful Customer Relationship
Management. There is no universal CRM-solution, each company has to decide on its
own, what its weak points are and what kind of software is suitable in order to achieve
maximum outcome.
However, in my thesis I will treat the technological part rather superficially and will
concentrate more on the opportunities that Customer Relationship Management offers
in the wireless world. I will point out mobile applications and instruments that enable
companies to create more loyalty among their customers. Special focus will be laid on
SMS-marketing in showing how companies can manage to increase the loyalty of their
existing customers by sending them personalized offers via SMS with the help of the
data they have gathered through their CRM solutions. To underline this, I will present a
few examples of companies, who have been successfully applying wireless marketing.
7
See Duffner/Henn, 2001, p.15

1. Introduction
4
1.3 Research
procedure
The main objective of this research is to find out and demonstrate how companies can
manage to maintain and increase their customer's loyalty with the help of Customer
Relationship Management in today's wireless world.
To begin with, I will give an overview of the latest developments in the mobile
business, which constitutes the basis of the research to follow. With the upcoming new
technologies, as UMTS for example, the mobile business will further grow immensely
with regard to the number of mobile phone owners and their willingness to accept
mobile services. In the course of my thesis I will point out how important it is to dispose
of a well-integrated and organized Customer Relationship Management solution and
how it can be combined with the mobile technology. In this context, mobile Customer
Relationship Management is another step towards customer satisfaction and loyalty. It
will be shown why it has become so important for the long-term success of companies
and how it can be realized via mobile applications.
Part of my research was to carry out an online survey during which I interviewed a
number of people about their use of mobile devices, their opinion, and experience
concerning mobile services and their willingness to accept wireless marketing. The
survey results provided a basis upon which the acceptance of possible marketing
strategies, designed to increase customer loyalty, could be judged. Importance was
attached to mobile applications and services under the aspect of gaining the customer's
permission prior to offering him such services.
Towards the end of my thesis a few examples of companies, which have already
successfully implemented mobile marketing services, will provide inspiration to
consider new mobile business fields.

2. M-Business: "Anywhere Anytime Access"
5
2.
M-Business: "Anywhere Anytime Access"
Since UMTS (Universal Mobile Telecommunications System) licenses were put up for
auction in 2000, the M-words have been hitting the headlines of many papers, journals
and business magazines when talking about wireless technology. Some talk about M-
Commerce as opposed to E-Commerce others talk about M-Business or Mobile E-
Commerce. They all refer to wireless transactions over mobile electronic networks.
8
Most significantly, mobile business is characterized by its "anywhere anytime access"
feature, which offers multiple opportunities in the field of mobile customer bonding,
supported by new mobile network and service technologies.
2.1
Definition of M-Business
Mobile business generally comprises all services, commodities and transactions that
have been exchanged over mobile devices as shown in the following graph.
9
Figure 1: Potential electronic services for mobile portals
Mobile
Secure
Portals
· Car Rental
· Flight Booking
· Rail Booking
· Hotel Booking
· Maps
· Traffic Info
· Schedules
Media & Entertainment
Retail
Financial Services
Corporate Services
Travel Services
Communications/Enabling
· Music
· Games
· Video
· Online Books / Magazines
· Sport News
· General News
· Entertainment News
· Betting / Lottery
· Dictionary
· Translation Services
· City Guides
· Restaurant guide / order
· Public Information Services
· Local Time
·
Banking
· Broking
· Insurance / Microinsurance
· Mobile Cash
· Mobile Payment
· Account Information
· Market Data
· Shopping
· Auctions
· Tickets
· Enterprise Intranet / Database
Access
· Application Hosting Services
· Application Access Services
· Collaboration Services
· Short Messaging
· Instant Messaging
· E-Mail / Voice Mail /
Dictating
· Fax
· Unified Messaging
· Remote Control
· Chat
· Videotelephony
· Postcard
· Business Card
· Child Tracking
· Secure Container
Source: Link, 2001, p. 181
8
See Nicolai/Petersmann (Eds.), 2001, p.64-65
9
See Zobel, 2001, p.3

2. M-Business: "Anywhere Anytime Access"
6
To be precise m-commerce is part of the m-business activities of a company. In its
Mobile Commerce Report, Durlacher Research Ltd. refers to m-commerce as ,,any
transaction with a monetary value that is conducted via a mobile telecommunications
network."
10
In accordance with this definition, SMS messages from one person to
another are not part of m-commerce, while messages sent by an information service
provider, who is paid for his services, is covered by the definition. In the Report mobile
applications without a financial transaction are defined as m-business. However, in most
cases no clear differentiation is made between mobile commerce and mobile business.
Both terms are used interchangeably.
M-business has more or less evolved from e-commerce and will substitute a
considerable amount of e-commerce applications in the long run.
11
Nevertheless, m-
business is still in its initial stage due to insufficient technology that does not yet
support the required speed of transmission that would make mobile applications
attractive to the public. Existing and future mobile network technology will be
explained in the following subchapters.
2.2
Mobile network technology
2.2.1 GSM
GSM is the most popular and furthest spread technology for mobile data transmission in
the second generation of digital cellular networks.
12
Until the early 90s, it was not
possible to make a phone call with a mobile phone beyond the country's border.
13
Due
to the increasing demand for mobile communication, the GSM work group was founded
in 1982 in order to develop a pan-European mobile network, which was able to cope
with the millions of potential mobile customers to come in the years to follow. GSM,
which used to stand for "Groupe Speciale Mobile", now corresponds to "Global System
for Mobile Communications".
10
See Durlacher Mobile Commerce Report 1999, p.7
11
See Zobel, 2001, p.3-4
12
See Schreiber, 2001, p.44
13
See Diederich/Lerner/Lindemann/Vehlen, 2001, p.64-66

2. M-Business: "Anywhere Anytime Access"
7
The first phase of GSM networks was launched in 1990. However, it wasn't until 1993
that big European cities disposed of GSM services. At the time, a total of 60 countries
decided to adopt GSM as their standard network. Today, the world's leading and fastest
growing mobile standard is comprising more than 174 countries, providing high quality
and secure mobile voice and data services (such as SMS text messaging) with full
roaming capabilities across the world.
14
Most importantly, GSM can be used anytime
and anywhere.
2.2.2 GPRS
With the beginning of 2001 mobile network providers have started to introduce the
General Packet Radio Service (GPRS).
15
With transmission rates between 64 and 115,2
kilobits per second (kbit/s), this new technology enables the realization of a
considerable amount of new applications compared to GSM standards. This becomes
extremely important with regard to accessing the Internet via a mobile device.
Insufficient speed of transmission is one of the main reasons why people have not used
the mobile Internet so far.
16
Unlike GSM, the General Packet Radio Service (GPRS) is
characterized by its multi-slot technique and packet transmission.
17
The data transmitted
is divided into small packets, which can use different channels together with other
packets, in order to get to the recipient.
18
Upon arriving at their destination, they are put
back in order again. Thus, the network capacity can be used more efficiently and the
mobile devices are constantly connected.
With GPRS the mobile Internet has become a lot more attractive as downloads for
instance are about ten times faster than with the current GSM networks.
19
Furthermore,
charges only arise for the transmitted data volume. Consequently, there is no need to
rush anymore when filling in a bank transfer order via the mobile phone, as no longer
the time is being charged but the amount of data sent. Therefore, especially WAP-
services and mobile commerce transactions benefit from this new technology due to
14
See http://www.gsmworld.com/technology/gsm.shtml 2002-03-08
15
See Schreiber, 2001, p.55-56
16
See analysis of questionnaire in chapter 4.2.2
17
See Schreiber, 2001, p.55-56
18
See Zobel, 2001, p.258-260
19
See http://www.gsmworld.com/technology/gprs/intro.shtml 2002-02-27

2. M-Business: "Anywhere Anytime Access"
8
smaller charges and less time pressure.
20
However, GPRS is not a revolution, it is just
filling the gap until UMTS will hit the mobile market.
2.2.3 HSCDS
Alternatively, HSCSD, which stands for High Speed Circuit Switched Data, is another
technology designed to improve the transmission of data services within GSM
networks.
21
By using multiple channels, bandwidths of up to 57,6 kbit/s can be
achieved, which makes this technology particularly interesting for customers who
intend to access the mobile Internet, their email or their company's intranet in order to
access their files.
Since all HSCSD operators agreed on the implementation of International Roaming,
mobile phoning has become quite attractive. HSCSD is presently available to 90 million
subscribers in 25 countries worldwide.
22
However, this new technology also requires
new mobile devices and the use of several channels cause additional costs for the end
user. Therefore, HSCDS, just like GPRS, is merely considered an interim technology
until technologies that are more efficient will become available.
2.2.4 UMTS
The Universal Mobile Telecommunications System, known as UMTS, is a hot topic that
has been widely hyped in the mobile industry and outside of it. Opinions differ
extremely whether UMTS will turn out to be a flop or whether it will be the key to great
economic success. While Vodafone, the worldwide market leader in
telecommunications, already announced the commercial start of UMTS in Germany for
this year's fall, other providers still remain skeptical as a result of low proliferation of
UMTS phones and insufficient quality of contents.
23
According to the Germany-based
T-Mobile it will not be until 2003 that UMTS technology will be marketable. Presently
the new technology is only available in Japan, where the first video mobile phones with
integrated camera were put on the market in October 2001.
24
20
See Silberer/Wohlfahrt/Wilhelm (Eds.), 2002, p.193-194
21
See Schreiber, 2001, p.54-55
22
See Mobile Solutions, 2002, No.2, p.76-77
23
See "Süddeutsche Zeitung", 2002, No. 20, p.27
24
See "Der Spiegel", 2001, No.42, p.148

2. M-Business: "Anywhere Anytime Access"
9
UMTS ­ Universal Mobile Telecommunications System ­ is a third generation (3G)
digital packet switching technology, offering similar benefits as GPRS.
25
However, the
speed and quality of transmissions will be higher and more consistent with UMTS. Its
packet based data transmission of up to 2 mb/s allows pictures, graphics, video
communications as well as voice and data to be delivered directly to people on the
move, independent of their location worldwide. With the help of this new technology,
users can permanently be attached to the Internet and due to higher bandwidths, new
services such as video conferencing, watching movies, sending pictures etc., can be
realized.
Nevertheless, UMTS will only be available in conurbations at the beginning. Mobilcom,
for example, will first offer its service in 20 big cities.
26
Furthermore, the service will be
launched with a transmission speed of 128 to 144 kbit/s per second, which is about 14
times the transmission rate that is currently available. Most providers will offer an
extended version of short messages enabling the attachment pictures or music files.
Besides users will have access to databases and can carry out their bank transactions via
their mobile phone. It will also be possible to provide new services, such as alternative
billing methods (pay-per-bit, pay-per-session, flat rate, and others). In Germany UMTS
providers will decide between pay-per-minute or pay-per-bit.
However, the success of the new technologies described in this chapter will largely
depend on the quality of applications and content that can be realized, which will have
to pay off customers' investment into new mobile phones that support these
technologies.
2.3 Service
technology
2.3.1 WAP
Important manufacturers in the field of mobile services, such as Motorola, Nokia,
Ericsson and the US Software Company have joined together in 1997 to develop and
25
See Durlacher UMTS Report 2001, p.10
26
See "netmanager", 2002, No.1, p. 110-113

2. M-Business: "Anywhere Anytime Access"
10
deploy the Wireless Application Protocol (WAP) and define standards for future
multimedia applications in mobile technology.
27
WAP is simply a standardized way for
a mobile device to communicate with a server that is connected to a mobile network. It
is designed for usage with any mobile phone and any wireless service such as the Short
Messaging Service (SMS), Circuit Switched Data (CSD) and General Packet Radio
Service (GPRS). According to a representative of the WAP Forum, "the philosophy
behind Wireless Application Protocol's approach is to utilize as few resources as
possible on the handheld device and compensate for the constraints of the device by
enriching the functionality of the network".
WAP pages are text-based and thus allow fast data transmission in spite of the low
bandwidths that are currently available.
28
Moreover, documents to be sent over WAP
are not limited in length as were former services based on SMS. However, this
technology is still marked by insufficient applications and hence has not yet enjoyed
great popularity. On the contrary, iMode, a competitive technology from Japan is now
challenging its position on the market.
2.3.2 Bluetooth
Named after a Danish King, "Bluetooth" is a low-power technology that was developed
for short-range transmission within a distance of 10 meters.
29
Bluetooth devices dispose
of a transmitting and receiving unit within a frequency of 12 gigahertz. Via an adapter,
Bluetooth can be connected to a wired computer and allows data to be transmitted to the
corresponding applications. This technology enables the connection of up to eight
communication devices or appliances in one household or an office in a short-range
wireless network. Examples of Bluetooth applications are transferring data between
mobile phones, pagers, personal digital assistants (PDA), video, notebook computers,
cameras, audio players, and local area networks (LAN). Ericsson for example offers
Bluetooth mobile phones with cordless headsets that allow leaving the phone in any
place in the room while having a conversation. Future applications shall be extended so
that all kinds of devices, including household devices that can be controlled via infrared
technology, can be connected to each other within the range of a whole house.
27
See http://www.gsmworld.com/technology/wap/intro.shtml 2002-02-27
28
See Schreiber, 2001, p.66-68
29
See Schreiber, 2001, p.64-66

2. M-Business: "Anywhere Anytime Access"
11
During last year's CeBit, the Hannover (Germany) based computer fair, lesswire, an IT
service provider, introduced a mobile fair guide that was capable of informing visitors
about exhibiting companies and offers via a mobile device and Bluetooth technology.
30
Future developments shall even offer personalized fair routes and enable visitors to take
home virtual fair brochures.
2.3.3 Short Messaging Service (SMS)
First introduced in 1992, the Short Messaging Service (SMS) was originally just a
"technical waste product"
31
, which was inadvertently offered and never meant for mass
communication. It refers to a technology that allows data to be sent and received via
mobile phones and was created as part of the GSM Phase 1 Standard.
32
Despite being
around for 10 years now, SMS has only really experienced an unprecedented success in
the past two years, especially among young people, the most promising target group for
marketing activities. 50 billion short messages were sent worldwide in the first quarter
of 2001.
33
In Germany alone, more than one billion SMS are sent on a monthly scale.
This development is due to several reasons: the potential market for SMS is extremely
large as all GSM phones can send and receive SMS. Even though the SMS service is
still mainly used as a person-to-person communication by young people, it has
meanwhile started to represent a growing and potentially lucrative market for business
use. The service is becoming an increasingly attractive tool for Customer Relationship
Management and brand extension, which will be illustrated in the following chapters.
2.4
iMode as an alternative to WAP
iMode is Japan's mobile Internet access service and was introduced in 1999 by the
Japanese market leader NTT DoCoMo, who runs his own network applying this
technology.
34
Thus, Japanese mobile phone users can surf the Web and communicate
via email. With over 26 million subscribers and 40,000 more signing up every day,
iMode is one of the world's most successful mobile data service today. For most
Japanese iMode constitutes their first choice of accessing the Internet, as the
30
See Nicolai/Petersmann (Eds.), 2001, p.23-24
31
See Zobel, 2001, p.16
32
See Schreiber, 2001, p.163-166
33
See Silberer/Wohlfahrt/Wilhelm (Eds.), 2002, p.190
34
See Schreiber, 2001, p.69-71

2. M-Business: "Anywhere Anytime Access"
12
proliferation of available Internet computer is quite small compared to other industrial
nations.
Why is iMode enjoying such a great success while WAP is rather considered a
flop?
A real comparison can only be made with regard to the use of wireless Internet in
general and the services offered, for WAP is a transmission protocol while iMode is a
brand or rather a service.
35
The following graph shows the most important differences.
Figure 2: Comparison WAP - iMode
WAP (in Europe)
iMode
transmission speed
9,6 kbp/s
9,6 kbp/s
standard display
only text
text, graphics, animation
3-5 lines, black and white
> 10 lines, 256 colors
transmission
Circuit switched (GSM)
packet switched
transmission duration
30s - 2min
1-3s
(display)
(with GPRS 1-3s)
users
2,5 million (2001)
20 million (2001)
programming
WML based on XML
cHTML (compact HTML)
storage capacity
up to 1 MB
up to 32 MB
Source: Adcore AB Deutschland 2001
One of WAP's main drawbacks is the small display, which does not support the
illustration of graphics and is only text-based without any color display. With iMode
phones, animated colored features can be realized on a much larger display which gives
every wireless Internet application a less static character and makes its usage more
attractive.
iMode service is particularly attractive, as users only pay for the data that has been
transmitted and not for the time. Hence, people can permanently be on line, while only
paying when they actually effect a transaction on the mobile Internet. With 9,6 kbp/s the
transmission rate is equal to that of GSM, but mobile services in Japan are used more
efficiently due to data-packet transmission.
35
See http://www.competence-site.de/mbusiness.nsf/.../OpenDocument&Highlight=2,i-mode 2002-03-28

2. M-Business: "Anywhere Anytime Access"
13
Nevertheless, one of the main reasons why iMode has become such an extraordinary
success is because of the huge number (more than 600 services) and immense variety of
services it has to offer such as email, weather forecasts, games, online banking,
brokerage, purchase of flight tickets and many more. NTT DoCoMo disposes of more
than 20,000 Web sites especially designed for its iMode service with more being added
each day.
36
Especially news and entertainment enjoy great publicity in Japan and a lot
of these services are free of charge. In bigger Japanese cities such as Tokyo or Osaka, a
special service even helps finding a free parking space. European mobile phones that
support WAP still lack interesting and attractive content resulting in only small usage
rates and unsatisfied customers.
However, NTT DoCoMo together with Dutch-owned KPN Mobile and its German
subsidiary E-Plus have recently introduced iMode to Europe.
37
E-Plus gathered
approximately 60 content providers among which are banks, news magazines and the
federal railway and since the 16
th
of March 2002 has provided more than 80 services
ranging from news, shopping guides to weather forecasts and horoscopes. According to
Uwe Bergheim, managing director of E-Plus, this is "the first major step into the mobile
telecommunication era of UMTS" and the end of the black and white mobile phone
applications. Several 100.000 customers shall be attracted by IMode services until the
end of this year. Almost half the services are free of charge, while costs for the
remaining services vary between 0,25 and 2 Euros.
38
Sending out an iMode-mail
amounts to 22 cent for example, while a subscription of a route guide calls for 50 cents
per month excluding data transmission costs. Along with the introduction of iMode a
new payment procedure has been established. It's no longer the duration of a call that
will be charged, but the volume of data transmitted, with one kilobyte corresponding to
0,01. Depending on the number of services subscribed, costs can amount to 40-60
Euros without having made a single phone call. Therefore, iMode will probably not
experience the same success as it did in Japan.
36
See Lamont, 2001, p.83
37
See http://www.eplus-imode.de/1/de/html/pub/marketing/index_fset.html 2002-03-29
38
See Focus, 2002, No.15, p.170-171
Excerpt out of 87 pages

Details

Title
Increasing Customer Loyalty via Mobile Customer Relationship Management
College
Wiesbaden University of Applied Sciences
Grade
1
Author
Year
2002
Pages
87
Catalog Number
V185776
ISBN (eBook)
9783656990758
ISBN (Book)
9783867466585
File size
1080 KB
Language
English
Tags
increasing, customer, loyalty, mobile, relationship, management
Quote paper
Silke Freitag (Author), 2002, Increasing Customer Loyalty via Mobile Customer Relationship Management, Munich, GRIN Verlag, https://www.grin.com/document/185776

Comments

  • No comments yet.
Read the ebook
Title: Increasing Customer Loyalty via Mobile Customer Relationship Management



Upload papers

Your term paper / thesis:

- Publication as eBook and book
- High royalties for the sales
- Completely free - with ISBN
- It only takes five minutes
- Every paper finds readers

Publish now - it's free