Professional Documents
Culture Documents
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Sales force management-
especially in B2b
marketing
Mail order
Business product
management-closely
related to technical
innovation models. 3
MODELS OF CUSTOMER
MANAGEMENT
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1. PARTNERSHIP CRM MODEL
What is it?
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GENERAL IDEAS BEHIND THE MODEL
1. If both supplier and intermediary (the
‘partners’) use CRM techniques on the final
customer, then both will gain.
2. For them to work together in this way, a
true partnership approach is needed
3. This approach normally also requires
business-to-business CRM techniques to be
used between the supplier and
intermediary.
4. Partners need to accept that customers will
decide which relationships, if any, they want
to have with which partners, and it is up to
the partners to decide which relationships
they would like to have and how to motivate 6
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It may have well-established parameters for
so doing, such as:
Customer research
Data requirements
Customer management strategies – acquisition,
retention and development; campaign planning
and implementation; media usage etc.
Success measures
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COMPLICATIONS OF THIS APPROACH
AT LATER STAGE
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HOW TO SUCCEED IN PARTNERSHIP
CRM
Making intermediated
CRM work does seem to
depend on resolving a
number of issues, such
as:
“Ownership” of
customers
Customer understanding
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In these cases, classic marketing
mix variables become more
important – particularly brand
image and customer service.
To avoid being drawn into this
situation, suppliers must seek to
differentiate their offer such that
the customer sees pure spot
buying as being risky.
Egs of Spot Selling via agent
and pure Spot selling
Good examples of this are
• purchases made in the newly
deregulated energy market
• Like in UK consumers directly get gas
and electricity supply from supplier that’s
pure spot selling
• In Spot selling via agent consumers puts
his/her specifications as he wants which
source of energy and price specification
4. ONE TO ONE MODEL OF CRM
GIVEN BY D PEPPERS AND ROGGER’S
According to this model, most aspects of
marketing mix are actively attuned to the
changing individuals based on information given
by them before or during contacts
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In fact in many cases this approach applies
to relationship between large suppliers and
large intermediaries
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Direct marketers often merge their response database
to the original database and with other public or private
databases (i.e., drivers' licenses, product warranty
cards, etc.). Then one or more target customer profiles
are developed by comparing the characteristics of those
who responded to those who did not respond to an offer.
Marketers subsequently use these profiles when
purchasing or renting prospect lists.
Table Two
Christmas Toy Catalogue -- Purchase Analysis
Addressee Handedness
Total Left Right
Purchase % 9.8% 6.0%
10.0%
No. Purchased (*) 1,960. 60.
1,900.
No Mailed (*) 20,000. 1,000.
19,000.
(*) in thousands 29
Table Three
Spring and Christmas Toy Catalogue
Combined Purchase Analysis
Addressee Handedness
Total Left
Right
Purchase % 15.2%
20.8% 14.5%
No. Purchased (*) 3,640. 540.
3,100.
No. Mailed (*) 24,000.
2,600. 21,400.
(*) in thousands
This case study demonstrated a well-known
statistical phenomenon called Simpson's paradox.
Simpson's paradox seems counterintuitive. We
expect the characteristics of the whole to correspond
in general to the characteristics of segments. The
preceding case study has shown that this is not
always true. Several philosophers have explained
how it is possible for the relationship between two
variables to be distorted by a third variable. [1, 5]
Simpson's paradox can occur in direct marketing
when the response databases from two or more
mailings or telephone campaigns are combined to
develop a target customer profile.
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Simpson's paradox can turn up in target customer profiling
when both of the following conditions are met:
The mailings or telemarketing campaigns have different
response characteristics (e.g., one with a 2 percent response
rate merged with one with a 10 percent response rate).
The lists have a different mix of descriptor characteristics
(e.g., mix of males to females or mix of New Yorkers to
Californians).
Different response characteristics can be a result of many
things. For example, a change in the cover letter or envelope
can change the percent who inquire about an offer. The
change in response rate does not have to be the result of a
change in the customer profile but the effects of Simpson's
paradox can make it appear that way.
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To avoid obtaining a distorted target customer profiles
look at the results of each offer separately, especially if
the above conditions are met. If more sophisticated
statistical analyses are used, add an "offer" variable into
the model. For example, in regression analysis, add a
dummy variable into the database identifying the offer
and include it among the independent variables. If a
third party processes the databases, make sure that
they are correcting for Simpson's paradox.
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CUSTOMER REQUIREMENTS OF
CRM
Customer relationship management (CRM) consists
of the processes a company uses to track and
organize its contacts with its current and
prospective customers.
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increased value from your existing
customers and reduced cost associated
with supporting and servicing them,
increasing your overall efficiency and
reducing total cost of sales
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COMPANY'S PERSPECTIVE OF
CRM
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The deep "organizational gap” caused by the
introduction of CRM, if not properly supported
by relevant change management interventions,
could potentially neutralize the system's
efficiency or worse irreversibly jeopardize the
relationship with not yet loyal customers.