The Broadway café is a coffee shop strategically located in City X and offers a variety of specific fast foods. The café offers teas, coffees, sandwiches, a full service bakery, and salads among other foods. The café opened for the first time in 1952 during which time it enjoyed the preference of numerous customers. However, in the last five years, business has been on the decline due to many factors.
The coffee shop’s services are currently out of date because there are no computers and customer service is carried out manually. The shop also lacks up-to-date customer tracking records because the previous owner used to memorize all his customers. In addition, the café lacks hard copies for recipes of the homemade foods, which earned it a name in the 1950s. Inventory tracking, marketing coupons and the customer payrolls are managed through a notepad in the coffee shop. Finally, the coffee shop lacks the services of a website and marketing is through word-of- mouth.
Therefore, this business requires an overhaul of most of its services in order to bring it into the 21st Century. In order for the business to regain a competitive merit, there is the need to introduce certain changes affecting its networking and telecommunication, customer relations management, and the customer tracking systems. The major changes proposed include introduction of mobile customer coupons as a marketing strategy in addition to a virtual customer relations management strategy on Second Life. In addition, there is the need to develop a system to help in customer and employee tracking. This essay aims at exploring the impact of the above changes on the business status of the coffee shop.
Networks and Telecommunications
Introduction of Mobile Customer Coupons
The modern technology has transformed business strategies in various aspects. For instance, the internet has transformed marketing strategies in that it enable many businesses to reach their customers and customers-to-be over a wide geographical area. Taking note of these changes, the coffee shop aims at adapting the services of mobile coupons, sent directly to numerous mobile customers. These coupons are stored in cell phones making them efficient in increasing redemption rates, triggering impulse purchases, and easy to carry. Moreover, the coupons have additional benefits in that they deliver offers to customers and different locations very fast, making it possible for the businesses to follow customer results and the precise time and place of purchase (Australian Competition and Consumer Commission, 2007, par. 3).
Since the Café’s customers are mobile, the business wishes to adapt mobile coupons that allow customers to redeem them instantly as they walk within a 25-foot radius of the cafe. The coupons will generate a 15% discount per order, which is then sent directly to the customers’ cell phone. The customers will then redeem their offers by presenting their phones to the café for coupon downloading. These coupons have more merits than the traditional paper coupons. Firstly, the coupons are available to customers at all times unlike the traditional ones, which may be lacking due to paper shortages. Secondly, they are easily stored and carried in cell phones everywhere thus making them available for redemption at any time. Thirdly, the mobile coupons allow businesses to increase customer constancy, awareness and sales volume. Fourthly, the m-coupons enhance communication between the business and its customers (Cohesion, 2007, par. 2).
However, since the m-coupons are internet/e-mail-based, they run the risk of being stolen or regarded as spam. On the other hand, sending the short messages cost money and due to their immediacy, they are bound to cause a terrible user experience when employed ineffectively because studies indicate that over 95% of short messages are read within a span of four minutes. Additionally, since e-marketing is relatively new to many businesses, its principles and protocols are not very clear and they may cause privacy issues with many customers. The privacy issues related to m-coupons include the ability of business organizations to access their individual customers’ personal details and information in addition to locating their specific locations during the specific time of purchase. Additionally, m-coupons may raise privacy issues due to the ability of business management to record all the website calls made by the customers (Cohesion, 2007, par. 4).
In order to generate analyzable data to provide information on the business and the number of customers it caters for, there is the need to amass and track customer response rates from m-coupons. This practice has a number of benefits on various businesses in that it allows them to carry out association analyses and detection, cluster analyses, and statistical analyses (Baltzan & Philips, 2007, p. 23). Cluster analysis achieves division of customer-based information into different clusters such that those customers with related preferences and tendencies assume one cluster and those with varied preferences and tendencies go into a different cluster. This enables the business to know the numbers of regular customers and their capacities in order to send them coupons within their purchasing powers. It also allows the business to avoid sending coupons to irregular customers. Analysis and detection of association entails assessing the relationship between two variables such as the response rate to adverts and placing an order. The two variables can provide valuable information on the customs and tendencies of customers. On the other hand, statistical analyses entails assessing customer-based information correlations and variations on a specific product and in so doing, the business gets the opportunity of making decisions on which stock to increase or which product to promote (Baltzan & Philips, 2007, p. 33).
Additionally, the coffee shop can benefit from analyzing the information generated from coupons forwarded to other cell phones in many aspects. These analyses allow the business to assess the number of customers who are willing to save on the services and products they require. Studies indicate that most customers rely on surfing the internet or newspapers all week long with the aim of finding discounts for the much-needed products. This method has proven to be more expensive than when a coupon is in their phones and all they need to do is to surf and retrieve coupons from the comfort of their homes. Thus, forwarding of coupons saves the customers’ time and money in addition to increasing the customer base for the sender.
Customer Relationship Management
Creating a Virtual Customer Relationship Management Strategy through Second Life
The customer relationship management entails an organization managing the connection between its activities and its customer base with the aim of maintaining customers, increasing their loyalty, and finally increasing the organization’s profitability. With the ever-increasing customer awareness due to a variety of readily available information on what they desire through websites and cell phones, there is the need for any business organization to maintain a close relationship with its customer base in order to avoid loosing them to potential competitors. Different strategies for managing customer relations are available for business managers to choose from; however, the use of Second Life as a CRM strategy has not gained the preference of many Companies (Elham & Lakshmi, 2007, p. 1).
Second Life is a computer 3-Dimensional space/environment whereby its inhabitants also known as residents are imaginary persons representing people in the real world. Millions of people are currently residents of Second Life thereby providing an appropriate business environment where business organizations wishing to expand can meet with their potential customers. However, some of the Companies having offices in the virtual world indicate that there is the need to coordinate the real life events with the activities taking place in the virtual world rather than the mere presence of avatars asking and answering questions through discussion groups. In addition, many organizations have realized that employing the website technology, as a medium of interaction with their customers is not good enough for the business (Elham & Lakshmi, 2007, p. 1).
Due to this realization, the Broadway Café wishes to develop a strategy for managing its customers through the Second Life. The virtual world can help the real business in different aspects. Since in Second Life, the residents interact, learn, collaborate, and undergo training sessions, there is a greater chance of sharing ideas between residents. In fact, in Second Life, the residents use all the tools employed in the real world such as whiteboards, marker pens, overhead projectors, PowerPoint presentations thereby making their discussions as lively as in real life situations. This further enhances the flow of information and ideas between the residents. Another advantage of Second Life to business is that it saves time in locating products and potential customers though there are no transactions being carried out as in real life. This is because, everything appears in 3-D within the same space and in order to reach a company or an individual, all one needs to do is to touch a mark on the Google Map which then displays all the information on that company ranging from its website, press releases, and news among other things.
This information is then shared between the residents (Elham & Lakshmi, 2007, p. 2). This can serve to expand the customer base of such an organization in real life. Studies indicate that most users of Second Life are the young generation who are potential buyers and through interacting with them in the virtual world, organizations deliver vital information to a wide range of potential customers. More importantly, the virtual world is accessible to the organization’s management, employees, shareholders, and customers over a wide geographical area. This enables such organizations to save on the cost of organizing boardroom meetings, developing products, staff training, and advertising. Finally, Second Life is important to real business in the sense that it allows the company to develop products and services co-created with their customers (Elham & Lakshmi, 2007, p. 3).
It is worth noting that the coffee shop can strategically manage customer relations in Second Life in a variety of ways. For instance, the virtual world can be used as a platform for reaching out to potential customers. This can be useful during the process of product development in which case the manager poses questions to customers on what their preferences are concerning certain types of food. The answers given by the customers can serve as crucial ideas for product development. This is possible in Second Life since one resident can ask another to make a cup of coffee or to fix a sandwich for other residents. Another important strategy is the introduction of real world services into the virtual world. In this way, the customers get to experience an organization’s services and the feedback of customers can be analyzed to allow for service improvement. Furthermore, it is much easier to manage customer relations in the virtual world than it is in real life.
It is worth noting that, in real life, CRM requires a manager who is supposed to manage customers and staff besides safeguarding the interests of the company. However, in Second Life, the customers, employees and other residents are treated as equal partners and their contributions are as important to the organization as the contributions of managers (Elham & Lakshmi, 2007, p. 3). Besides, in Second Life, it is all about experiences rather than making transactions. Studies indicate that, in SL, residents organize meetings, visualize ideas, and discuss complex issues as in real life situations. The residents (in real life) can memorize the ideas shared for long than when these people meet in the real world. It is also important to note that management of customers through Second Life differs from managing the same customers on the company websites. For instance, through websites, the organization assumes that it already knows what the customers will buy and products are developed internally and displayed on websites for customers to sample. However, in Second Life, the customers co-develop and co-produce the products with the company management in that it allows the organization to produce what the customer needs.
Many of the security issues related to Second Life are guided by misrepresentations and misconceptions. For instance, a person can create an avatar that resembles another real individual. Under such circumstances, the rights of personal identity protection are violated. Another problem concerning the security of Second Life involves protection of intellectual property rights. When a customer creates a product in SL and the company adapts his/her recipe, the IP rights of the customer are violated. Besides, there are no laws regarding intellectual protection in Second Life. Additionally, the activities in Second Life face a number of ethical issues. For instance, privacy issues arise in Second Life interaction in terms of what kind of information should be accessible to other residents. This is because, there are no provisions regarding how much information can be revealed and what part should be hidden. Additionally, the accurateness, reliability and authenticity of the information provided in Second Life are not known. Another issue is that there are no provisions stipulating what kind of information a company can get from its customers and for what purpose (Elham & Lakshmi, 2007, p. 4).
Developing/Purchasing/Outsourcing the COTS Time and Attendance System
The technological changes of the 21st Century offer many organizations a wide range of applications for managing a variety of tasks such as monitoring the time and attendance of employees, calculating the employees’ payrolls, and tracking movement of materials within the company among a host other things. Implementation of such systems enables the organizations to expand and increase profitability and efficiency. The Broadway Café aims at implementing new technologies that allow for the management of the time and attendance of employees and replace the manual system of accounting for labor expenses. The drive behind this initiative is that it will allow the coffee shop to determine the right number of employees to be posted at the right place in order to increase sales. Additionally, the importance of tracking the attendance and time for various employees enables the organization to account for labor expenses, which are part of the organization’s operating expenses.
The application can be built by an internal employee or be purchased from a trusted vendor. On the other hand, the custom services system can be outsourced from a service provider. Many organizations face the problem of making a decision on whether to develop, purchase or outsource the system (Reeves & Venture, 2010, par. 12). However, it is advisable to consider a number of pros and cons associated with these options before making a decision. The advantage of using an internal employee in building the custom application device is that this employee will produce the most customized product, which fits the preferences of the whole organization. This is because; the developer can consult other employees thereby obtaining useful ideas that can be incorporated into the development process. In addition, this process will enable the company to save money that would have been used to purchase the system. However, this requires that the employers have internal software developers. Additionally, the cost of maintaining and servicing the device will be an added expense on the company. The device is also bound to lack the vendors’ experience concerning the complexities of managing the employees’ time and attendance. Moreover, the management is not in full control of the system because the employee who built it can change certain settings to fit his/her preferences without the knowledge of the employer (Reeves & Venture, 2010, par. 14).
The other option available for the coffee shop is to purchase the whole package from a customs vendor. The advantage of employing this approach is that it ensures that every employee is treated equally before the system. Additionally, the vendor will be charged with the responsibility of providing additional services such as maintenance, upgrading, and servicing. The disadvantage with purchasing the package is that the vendor is bound to provide the same kind of device for all organizations making it impossible for an organization to be flexible in service delivery. Moreover, additional cash is required to purchase the system. The last option involves paying for the services of an outsider who liaises with the internal developer in building the system. This approach saves time because it is quicker than using the internal employee only. The down side of this option is that it is expensive (Reeves & Venture, 2010, par. 16).
Implementation of the system in the practices of the coffee shop will have far-reaching implications on the profitability and growth of the business. However, the older employees may be opposed to introduction of the new technology because they may not be conversant with technological changes in the contemporary society. To cater for the satisfaction of such employees, it is advisable to inform them first about the new system and its advantages and disadvantages before implementing it (Reeves & Venture, 2010, par. 20).
The paper highlights the business status of the Broadway Café, which is a coffee shop that came into existence in 1952. Since the owner of the shop failed to implement new technological changes as time went by, the shop lost its popularity leading to its present condition. The purpose of this project is to provide the possible technological and tactical changes that can be employed in the best way possible in order to bring the business into the 21st Century. From the discussions above, it is indicated that introduction of mobile coupons can enable the business grow besides expanding its customer base. Additionally, management of the customer relations in Second Life will be an important strategy in providing ideas on product development and customer preferences. Finally, introduction of the time and attendance tracking system for employees will enable the business to account for labor expenses besides allowing the shop to expand and increase profitability.
Australian Competition and Consumer Commission (2007). M-commerce. Web.
Baltzan, P., & Phillips, A. (2007). CIS 500 Information Systems for Decision Making (4th ed.). New York: McGraw-Hill.
Cohesion Case (2007). Networks, Telecommunications, and Wireless Computing. Web.
Elham, M. & Lakshmi, G. (2007). Virtual customer relationship management. Web.
Reeves, B. & Ventures, G. (2010). For entrepreneurs: small business technology. Web.