B&S RM CIMS CRM e-CRM

Time
line
Late Early Mid 90’s 2002 -
80’s 90’s Future

B&S – Buying & Selling

RM – Relationship Marketing
CIMS – Customer Information Management Systems
CRM – Customer Relationship Management
e-CRM- A subset of CRM that focuses on enabling customer
interactions via e-channels (The web, email and wireless)
 Customer Relationship Management (CRM) is the process
of carefully managing detailed information about
individual customers and all customer “touch points” to
maximize customer loyalty.

 It costs a company dramatically less to retain and grow

an existing client, than it does to court new ones. It is
said that

“It is seven times more expensive to acquire a new

customer than to keep an existing one.”
 A Customer Database is an organised collection of
comprehensive information about individual
customers or prospects that is current, accessible,
and actionable for such marketing purposes as lead
generations, lead qualifications, sale of a product or
service, or maintenance of customer relationship.

 Database Marketing is the process of building,

maintaining, and using customer databases and
other databases (products, suppliers, resellers) to
contact, transact, and build customer relationship.
 Data mining is the principle of sorting
through large amounts of data and picking
out relevant information.

 Customer relationship Management form a

learning relationship with the customers by
noticing their needs and preferences with
the use of Data warehouses and learn how
to serve them with the use of Data mining.
 Demographics
 How do you get people to provide this?
 History of contacts
 Transaction history or summary
 Response to marketing communications
 How did you hear about us (this offer?)
 Platinum Heavy, reliable users, not price-
sensitive, try new products, loyal

 Gold Large users who push for price breaks,

shop around and not so loyal

 Iron Low volume or intermittent users; cost to

serve them is quite high

 Lead Demanding, want special attention but

don’t buy much and show no loyalty
 Attracting new customers
 Quicker and more efficient response to
customer leads and customer information
 Simplification of marketing and sales
processes
 Understanding customer needs
 Better customer service
 Building customer loyalty
 Organizational wise change of priority to
customers
 Significant investment of time and money
 Threatens management’s control/power
struggle
 Heightens people’s resistance to change
 Inappropriate integration leads to disaster
■ All forms of trading

 Direct
 Traditional
 Retail
 E-commerce
 Wholesale
 Combination

10
■ New convergence

 Telephony & telemarketing

 Internet
 Mobile, SMS
 Digital TV
 Cable & satellite

11
■ Information in the system can be accessed and
entered by employees in different departments)

 Sales
 Marketing
 Customer service
 Training
 Professional development
 Performance management
 Human resource development

12
■ Details on any customer contacts can also be
stored in the system

 The rationale behind this approach is to improve

services provided directly to customers

 To use the information in the system for targeted

marketing and sales purposes

13
■ Many inter-related aspects

 Front office operation

 Back office operations
 Business relationships
 Analysis

14
■ Direct interaction with customers

 Face to face meetings

 Phone calls
 E-mail
 Online services etc

15
■ Operations that ultimately affect the activities of
the front office

 Billing
 Maintenance
 Planning
 Marketing
 Advertising
 Finance
 Manufacturing

16
■ Interaction with other companies and partners

 Suppliers/vendors
 Retail outlets/distributors
 Industry networks (lobbying groups, trade assn’)

■ This external network supports front and back

office activities

17
■ Key CRM data can be analyzed in order to plan

 Target-marketing campaigns
 Conceive business strategies
 Judge the success of CRM activities (e.g., market
share, number and types of customers, revenue,
profitability)

18
■ Three key phases
 1. Customer Acquisition
 2. Customer Retention
 3. Customer Extension

■ Three contextual factors

 4. Marketing Orientation
 5. Value Creation
 6. Innovative IT.

20
21
■ Attracting our customer
 For the first purchase
 We have acquired our customer

■ Growth
 Market orientation, innovative IT & value creation
 Aim is to increase the number of customers that
purchase from us for the FIRST TIME

22
■ Re-purchase
 Our customer returns and buys for a second time
 This is most likely to be the purchase of a similar
product or service, or the next level of product or
service.

■ Growth
 Market orientation, innovative IT & value creation
 Aim is to increase the number of customers that
purchase from us REGULARLY

23
■ Additional, supplementary purchases
 Our customers are regularly purchasing
 We introduce products and services to our loyal
customers different from original purchase
 Once purchased, our goal is to retain them as
customers for the extended products or services

■ Growth
 Market orientation, innovative IT & value creation
 Aim is to increase the number of customers that
purchase ADDITIONAL products
24
■ Focused upon the three levels of needs of
customers

 Actual, tangible product

 Core product and its benefit
 Also the augmented product such as a warranty
and customer service

25
 Core
Benefit

Basic
Product
Expected
Product

Augmented
product
Potential
26
Product
■ Generation of shareholder value

 Based upon the satisfaction of customer needs (as

with marketing orientation)
 Delivery of a sustainable competitive advantage

27
■ Updated IT
 Efficient, speedy and focus upon customer needs
 Whilst IT and/or software are not the entire story
for CRM, it is vital to its success
 CRM software collects data on consumers and
their transactions
 Organizations will track individuals, and try to
market products and services to them based upon
similar buyer behavior seen in other individuals

28
■ 1. Validation

■ 2. Discovery

■ 3. Action

30
■ Correct data

 Ensuring that the data you have on your

customers is not only correct
 Also, in a suitable state for targeting
communications programs

31
■ Use of data mining techniques

 To find relationships that you did not know existed

 Sometimes conventional analysis is impaired by
your own natural assumptions and prejudices
 Discovery techniques help to solve these issues
by starting from ground zero
 They simply search for relationships in the
database against a set of objectives

32
■ Right communication

 Your customers and prospects need to have the

right messages communicated to them
 Quality Inter-Action drives quality Trans-Action
 This is done with a Campaign Management tool
that can automatically select the right targets and
the right messages via the right channels
 The responses are then fed back into the
Validation process for evaluation and refinement

33
■ CRM is corporate strategy composed of
applications, technology and products that fulfill
three essential requirements

 1. Organization perspective
 2. Customer perspective
 3. Front office staff perspective

34
■ 360° view of each customer

 For consistent and unified contact with that

customer whenever anyone anywhere in the
enterprise deals with that customer

 This knowledge increases the opportunities for

sales and the effectiveness of customer service

35
 2. Customer
perspective
■ Customers to have a consistent view

 To enable your customers to have a consistent

view of your enterprise, regardless of the way the
customer contacts you

 This improves customer satisfaction and customer

retention

36
■ Staff performance

 To enable front office staff to perform sales,

service and marketing tasks more efficiently as a
team

 Increasing expertise and reducing costs

37
39
■ Important

 Business starts with the acquisition of customers

 However, any successful CRM initiative is highly

dependent on a solid understanding of customers

40
■ Understand
 Demographics, purchase patterns & channels
 Segmentation to identify logical unique groups
 Primary research to capture needs and attitudes
 Customer valuation to understand profitability

■ Differentiate
 Based on the value customers
are expected to deliver

41
■ Develop
 Products, services, channels and media can be
customized based on the needs of quantitative
customer segments

■ Customize
 Based on the potential value
delivered by customer segment

42
■ Interact
 Not just through marketing, sales and media
 Distribution, shipping, customer service & online

■ Deliver
 Delivering value is a cornerstone
 Factors including quality,
convenience, speed,
ease of use, responsiveness
and service excellence

43
■ Acquire
 Learning about customers makes it easy to
identify those producing the greatest value

■ Retain
 Maintain interaction;
 Deliver on value
 Customers change as they move
through differing life stages
 Modify the service

44
 Subconscious Expectations
 Pizza with specified toppings
Take 10 minutes
Come in a packed box
Remain warm till you reach home
Charges – standard and acceptable price
Pizza will taste reasonably good

 You will come back is all the above are met

 If you go regularly
Rapport with employees
You forgive if they mess up with one or two
expectations

 Degree of confidence determines

tolerance
If using first time, and even one expectation is
not met
You will never go again
 Exceeded expectations
 Deliver on all expectations
 Give you a garlic bread FREE !

 You will tell everyone about it