View the step-by-step solution to:

Prepare a paper 3 - 5 pages (1050 to 1750 words) describing the potential electronic commerce aspects related to the development of the Kudler Fine...

Prepare a paper 3 - 5 pages (1050 to 1750 words) describing the potential electronic commerce aspects related to the development of the Kudler Fine Foods Frequent Shopper Program. You will include the legal, ethical and security considerations for the development of this program. Additionally, provide a description of the financial analysis you recommend to justify the expenditures related to the development of the Frequent Shopper Program.
Kudler Fine Foods has experienced significant growth and is now focused on expanding the services, improving the efficiency of its operations and increasing the consumer purchase cycle as a means to increasing the loyalty and profitability of its consumers.

Sales & Marketing
HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Kudler
Home002.htm" Home | Marketing Overview | HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSM002.htm" Sales Plan - 2007 | HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSM003.htm" Market Surveys | HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSMComm.htm" Communications
Kudler Fine Foods has experienced significant growth and is now focused
on expanding the services, improving the efficiency of its operations
and increasing the consumer purchase cycle as a means to increasing the
loyalty and profitability of its consumers.
Strategic Objective: Increase Loyalty and Profitability of Consumers
Expanding Services (Revenue Increase) - Kudler is offering parties in
the store to show customers how to prepare specialty foods. The draw for
the consumers is to be trained by world-renowned chefs, local
celebrities, other food experts, and even Kathy Kudler herself, and to
be invited to exclusive, upscale events. The anticipated outcomes will
be to increase the customer purchase rate of high margin food and
beverage items and to get consumer to make an evening at Kudler Fine
Foods part of their social network. This increased time in the store
will increase the overall revenue per visit and increase the frequency
of visits to the store. Consumers will receive multiple entries in
high-ticket item contests by bringing a friend to the parties. While the
firm's preference is to have the events in-store, guests can have Kudler
cooking classes at their home for a price premium. Programs such as this
encourage consumer loyalty and word-of mouth marketing.
Frequent Shopper Program (Revenue Increase) - Kudler's new initiative is
tracking purchase behavior at the individual customer level and
providing high value incentives through a partnership with a loyalty
points program. The customer purchase behavior patters will help Kudler
refine its processes and offerings to best satisfy their valued
customers. Price is not the primary differentiating factor for Kudler
consumers; these consumers are focused on quality and finding
specialized items. Therefore, rather than providing everyday discounts
to the customers for their purchase frequency like lower end markets,
Kudler has partnered with a loyalty points program to provide customers
with points which can be redeemed for high end gift items, airline
first-class upgrades, or other specialty foods.
Increased Efficiency (Cost Reduction) - Kudler's is now in a position to
focus on internal (both front line and behind the scenes) processes, and
how those can be improved to deliver increased value to the customer.
From a service perspective, Kudler is benchmarking Nordstrom department
stores. In addition, the firm is developing employee training programs
and integrating new software systems to facilitate the effort. Marketing
has encouraged the purchasing department to find ways to reduce costs of
ordering foods and minimize the amount of food to be stored, while also
having a zero stock out policy. In response, purchasing has developed a
supplier relations program and has solicited the help of marketing to
help roll out the program.
Historical Sales Data and Financials
Historically, Kudler Fine Foods has tracked information such as dollar
value and profit margin per transaction, dollar sales and profit levels
by day, and dollar sales and profit margins by item. However, in an
effort to leverage the information to create a more intimate
relationship with their customers, the firm is integrating a system to
track customer purchase behavior over time. The firm is in the process
of developing this system now.
Marketing Budget
The marketing budget is primarily comprised of new initiatives,
marketing communications, and marketing research.
New Initiatives
Research, development, and rollout of new programs
Cooking Classes
Frequent buyer points program
Supplier relations program
Marketing Communications activities include:
Radio, Newspaper and Television advertising
Public relations, events, and sponsorships
Marketing Research expenditures include:
Market size / opportunity studies
Food marketing trends studies
Services benchmarking study
Growth Strategy
Within the next 12 months, Kudler plans to increase customer loyalty by
offering added high-margin services, leveraging the firm's better
understanding of customer purchase patterns, and providing more
efficient operations. Profitability will also be increased by cost
reductions accomplished through supplier partnering programs. New
customers will be acquired through social network marketing and word of
mouth.
Sales & Marketing
HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Kudler
Home002.htm" Home | HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSM001.htm" Marketing Overview | Sales Plan - 2007 | HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSM003.htm" Market Surveys | HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSMComm.htm" Communications HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
Kudler-SalesPlan.pdf" t "_blank" Download PDF Version
Sales Plan
2007
The purpose of this sales plan is to help Kudler's managers prioritize
and focus resources in a way that reaches the organization's objectives.
During 2007, Kudler plans to increase customer loyalty by offering added
high-margin services, leveraging the firm's better understanding of
customer purchase patterns, and providing more efficient operations. New
customers will be acquired through social network marketing and word of
mouth. The selling function will support the expansion of services and
programs to increase loyalty and profitability of existing customers and
to gain new high-margin customers. The theme for this year is outlined
below. Let's make it a great year!
Kudler Sales Plan 2007
Theme: Delight Our New and Existing Customers Through -
New Customer Focused Programs
Better Information Management
Targeted Awareness Building
Sales Plan Contents
HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSM002.htm" l "001" Part 1: Strategic sales objectives with
corresponding financial goals and roll-out schedules
New Customer Focused Programs
Better Information Management
Targeted Awareness Building
Increased Behind the Scenes Efficiency
HYPERLINK
"https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Sales/
KudlerSM002.htm" l "002" Part 2: Tactics by marketing mix, timing, and
relationship to strategic sales objectives
Product (existing products and new offerings)
Pricing (pricing, promotions, and discounts)
Promotions (customer and sales)
Place (expansion, emphasis on locations or customer regions)
Part 1: Strategic sales objectives with corresponding financial goals
and roll-out schedules
Strategic Sales Objectives
The objective of the sales organization is to successfully implement
programs designed to increase revenue and decrease costs. The sales
group will support the rollout of new customer focused Programs,
leverage customer information to support sales growth of existing
customers, initiate targeted activities to recruit high-profit new
customers, and support operational cost-cutting efforts taking place
company-wide.
This section will review the following strategic initiatives:
New Customer Focused Programs
Better Information Management
Targeted Awareness Building
Increased Behind the Scenes Efficiency
New Customer Focused Programs: Cooking Class Socials
We will initiate specialty cooking classes as a way to increase the
consumption of high-margin items among existing customers and to build
awareness, trial, and regular shopping among new customers.
Kudler is offering parties in the store to show customers how to prepare
specialty foods. The draw for the consumers is to be trained by
world-renowned chefs, local celebrities, other food experts, and even
Kathy Kudler herself, and to be invited to exclusive, upscale events.
The anticipated outcomes will be to increase the customer purchase rate
of high margin food and beverage items and to get consumer to make an
evening at Kudler Fine Foods part of their social network. This
increased time in the store will increase the overall revenue per visit
and increase the frequency of visits to the store. Consumers will
receive multiple entries in high-ticket item contests by bringing a
friend to the parties. While the firm's preference is to have the events
in-store, guests can have Kudler cooking classes at their home for a
price premium. Programs such as this encourage consumer loyalty and
word-of mouth marketing.
Role of the sales group: The sales group will actively promote these
programs to the existing customers and targeted potential new customers
in key high-income zip codes. We anticipate that initially, the majority
of participants will be existing customers, however, over time, new
customers will participate in the programs. The projected mix of
existing and new customers is outlined in the table below, along with
the projected lift in revenue resulting from the programs.
Cooking Class Socials
Existing Customers
New Customers
Projected Revenue Lift
Q1
Direct mail re: classes.
18 Specialty Cooking Classes
90%
10%
.75%
Q2

24 Specialty Cooking Classes
75%
25%
1.25%
Q3

Direct mail re: classes.
12 Barbeque Buster Classes
18 Specialty Cooking Classes
65%
35%
1.75%
Q4

12 Customer In-Home Parties
24 Specialty Cooking Classes
50%
50%
3.75%
Total
7.50%
Better Information Management: Frequent Shopper Program
Our new initiative is tracking purchase behavior at the individual
customer level and providing high value incentives through a partnership
with a loyalty points program. The customer purchase behavior patterns
will help us refine its processes and offerings to best satisfy their
valued customers. Price is not the primary differentiating factor for
Kudler consumers; these consumers are focused on quality and finding
specialized items. Therefore, rather than providing discounts to the
customers for their purchase frequency like lower end markets, Kudler
has partnered with a loyalty points program to provide customers with
points which can be redeemed for high end gift items, airline
first-class upgrades, or other specialty foods.
Role of the sales group: Sales will be trained on these programs,
including in-depth training on data analysis. This is an important facet
of our quest to delight the customer.
Frequent Shopper Program
Projected Revenue Lift
Q1
Employee-wide training session
Frequent shopper program rollout
.25%
Q2
Assessment and refinement of program
Frequent shopper promotion, increased customer satisfaction
.50%
Q3
Frequent shopper promotion, increased customer satisfaction
1.75%
Q4
Frequent shopper promotion, increased customer satisfaction
2.25%
Total
4.75%
Targeted Awareness Building: Direct Marketing and Word of Mouth
Direct mail promotional literature will be sent to high-income zip codes
to solicit customers. These pieces will contain information about the
array of products and services offered by Kudler. Kudler will be
positioned as a place to interact with others interested in exceptional
quality foods for entertaining and everyday use.
Role of the sales group: Provide input during the development stages.
Participate in the training sessions. Support the roll out of the direct
mail piece.
Increased Behind the Scenes Efficiency: Cost Cutting Initiatives
Kudler is now in a position to focus on internal (both front line and
behind the scenes) processes, and how those can be improved to deliver
increased value to the customer. From a service perspective, we are
benchmarking Nordstrom department stores. In addition, an employee
training program and new software systems will facilitate the effort.
Marketing has encouraged the purchasing department to find ways to
reduce costs of ordering foods and minimize the amount of food to be
stored, while also having a zero stock out policy. In response,
purchasing has developed a supplier relations program and has solicited
the help of marketing to help roll out the program.
Part 2: Tactics by marketing mix, timing, and relationship to strategic
sales objectives
Product
The frequent purchase program will give us valuable data on customer
purchase patterns. Beginning in Q1, sales will work with purchasing to
adjust the product offerings on shelf to reflect the needs of our
customers. This analysis will evaluate frequently purchased items with
their corresponding profit margin and fit within the product mix.
Pricing
The promotions introduced during Q1 such as the frequent purchaser and
the cooking classes are designed to be self-funding. We are using a
cost-plus minimum pricing strategy to hit our minimum 5% margin
threshold, combined with a market-based strategy to build in additional
margin around what the market is willing to bear. Rather than offer
discounts to our customer, we offer value added services.
Promotions
For the sales department, our bonus is contingent, in part, on the
successful implementation of the customer promotion programs discussed
in this plan. If we meet 100% of the targeted revenue each quarter for
the cooking class socials and the frequent purchaser program, then we
receive a 1.25% bonus above our base salary and standard commission. If
we meet our targets for every quarter, we will earn an additional 2%
bonus. This means we have the potential to earn a bonus of up to 7% of
our base salary.
Place
Part 3: Customer Relationship Management Strategies and Tactics
Our emphasis this year is delighting our new and existing customers. As
a sales organization, this means we must actively analyze our customer
data to provide products and services that exceed customer needs. Every
person influencing the sales organization will be expected to complete
the course ``Using Customer Data to Create Happy, Profitable Customers''
within the first quarter of 2007.
.
Memo
To: Coupons Project Manager
From: Yvonne Reynolds
Date: August 24, 2004
Re: Coupons Project Status
As of today, the project has only been completed through step 8 of the
project plan: Determine Coupon Requirements. It would appear to me that
the plan was not detailed enough. Please explain how you plan to get
back on track, and provide me with an updated project plan with more
details.
Service Request SR-kf-013
Develop Requirements for Kudler Fine Foods Frequent Shopper Program
Organization: Kudler Fine Foods
Locations: All
Requester: Manager
Description of Request:
Kudler Fine Foods is interested in developing a system to track customer
purchases through a Frequent Shopper Program to award loyalty points for
redemption.
Background of Request:
The objective of this project request is to track purchases of
individual customer's. The customer purchases will be tracked and
accumulated as loyalty points for redemption by the customer for gift
items, specialty foods and other products or services as made available
through partnerships with other external companies. The strategic
purpose of the Frequent Shopper Program is described on the Sales &
Marketing page of the Kudler Fine Foods Intranet site.
Expected Results/Impact when completed:
Create a business/systems requirements document for the development of
the Frequent Shopper Program system to meet the objective of this
request.

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question