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WHAT IS CRM?

Customer Relationship Management(CRM )-

 involves managing all aspects of a customer’s relationship with an
organization.
 involves customers, organizations, relationships and the
combination creates the need for management.
 is the establishment ,development ,maintenance and optimization
of long term mutually valuable relationships between customers
and organizations.

CRM is an integrated information system solution that allows

identification, acquisition, retention and expansion of
customers.
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 Web and e- Analytics
mail

Call centre

Customer
Customers Information Back office
Field

partners
Marketing

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 Predicting
Customer What will
prediction Happen?
Analyzing
Customer
Business segmentation Why
value
Happened?

Reporting
What
customer Happened?
identification

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REPORTING ANALYZING PREDICTING

“Asking What Happened” “Asking why it happened” “Asking what will happen”
What is the total revenue Why did sales not meet What customers are at risk
by customers? forecasts? of leaving?
How many units did we Why was production so What products will the
manufacture? low? customer buy?
Where did we sell the most Why did we not sell as Who are the best
products? many units as last year? candidates for a mailing?
What were total sales by Who are our customers? What is the best way to
product? reach the customers?
How many customers did Why was customer What is the lifetime
we serve? revenue so high? profitability of a customer?
What are our inventory Why are inventory level so What transactions might
levels? low? be fraudulent?

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 Areas of CRM Activity

 Sales Force Automation (SFA)

 Customer Service and Support (CSS)
 Help Desk
 Field Service
 Marketing Automation

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 Areas of CRM Activity
Sales Force Automation
 35-40% of all CRM activity
 Manages lead generation, tracks movement of leads
through the pipeline, allows better usage of customer
data, integrates activities across sales channels,
simplifies relationship management, forecasts for
opportunities (SWOT)
 Goldmine and SalesLogix are examples of prepackaged
SFA solutions.
 Ex. Staples used SFA to integrate catalog, online, in-
store sales efforts directed at its best customers
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 Areas of CRM Activity
Customer Service and Support (CSS)
 20-25% of CRM
 Assign, escalate, and track trouble tickets, inquiries,
solution attempts through resolution
 Provides information to support customer call center
activity
 Gleans customer data from those interactions and
records it in SFA for later use
 Remedy, Siebel, Vantive, and Clarify are major vendors

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 Areas of CRM Activity
Help Desk
 15-20% of all CRM
 Allows individuals to access network database to solve
their own problems or find information.
 Can be internal or external
 Human Click, Tivoli, LivePerson, are providers
 Ex., Land’s End Live allows customers browse FAQ’s but
also click a link to talk directly with live representative.

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 Areas of CRM Activity
Field Service CRM
 3-5% of all CRM activity
 Mobile service technicians can log information about
work orders and service calls, as well as access
information from the remote site.
 Can feed information from customer problems into SFA
for salesperson leads.
 Market information can be gathered and logged into
central database.
 Ensures appropriate resource allocation by matching
available resources to job requirements
 Major vendors are RTS, Metrix, edispatch

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 Areas of CRM Activity
Marketing Automation
 3-5% of CRM, but growing 5X faster than all others
 Interfaces with data warehouses and data mining
activities to tailor page views, products, and promotions,
so that the right offer goes to the right person at the
right time.
 Can interact with SFA to support field sales efforts
 Provides customized customer interactions critical to
segment of one marketing, mass customization,
customerization, etc.
 www.webgroove.com, Epiphany, Oracle, Siebel, and
Personify are leaders.
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 Applications of CRM
• Contact and account management
– Capture and track relevant data about every past and planned contact
– Stores the data in a common customer database
• Sales
– Provides the sales reps with the software tools and company data sources
they need
• Marketing and fulfillment
– Helps marketing professionals accomplish direct marketing campaign.
– Capture and manage customer response data.
– Scheduling sales contact and providing appropriate information.

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• Customer service and support
– provides service reps with software tools and real time access to the
common customer database
– manage customer service requests, call center, help desk, web based
self service
• Retention and loyalty programs
– try to help company identify, reward and market to their most loyal and
profitable customers.

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 Determinants of CRM
• Trust

• The willingness to rely on the ability, integrity, and motivation

of one company to serve the needs of the other company as
agreed upon implicitly and explicitly.

• Value

• The ability of a selling organisation to satisfy the needs of the

customer at a comparatively lower cost or higher benefit than
that offered by competitors and measured in monetary,
temporal, functional and psychological terms.

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Determinants of CRM

• In addition to trust and value, salespeople must:

• Understand customer needs and problems;
• Meet their commitments;
• Provide superior after sales support;
• Make sure that the customer is always told the truth
(must be honest); and
• Have a passionate interest in establishing and
retaining a long-term relationship (e.g., have long-
term perspective).
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Stages in the development of a Customer
Relationship

• The Pre-relationship Stage

The event that triggers a buyer to seek a new business partner.
• The Early Stage
Experience is accumulated between the buyer and seller although a great
degree of uncertainty and distance exists.
• The Development Stage
Increased levels of transactions lead to a higher degree of commitment
and the distance is reduced to a social exchange.
• The Long-term Stage
Characterised by the companies’ mutual importance to each other.
• The Final Stage
The interaction between the companies becomes institutionalized.

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 A Relationship Life Cycle Model

High cooperation
Low competition Pre- Development Maturity Decline
relationship stage stage stage
stage

Low cooperation
High competition

Time
(Wilkinson and Young, 1997)
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Functions of Customer Relationship Management

Direct functions (are the basic requirements of a company that are

necessary to survive in the competitive marketplace)
Profit;
Volume; and
Safeguard

Indirect functions (are the actions necessary to convince the

customer to participate in various marketing activities).
Innovation:
Market;
Scout: and
Access.

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The role of salespeople as relationship builders and promoters

Salespeople by:

identifying potential customers and their needs;

approaching key decision makers in the buying firm;
negotiating and advancing dialogue and mutual trust;
coordinating the cooperation between the customers and
their company;
encouraging the inter-organisational learning process;
contributing to constructive resolution of existing conflicts; and
leading the customer relationship development team

are the individuals in any organisation who act both as relationship

builders and as relationship promoters.

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 3 phases of CRM
• Acquire
• Enhance
• Retain

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 Managing Customer Relationships
The global salesperson must be involved in the following activities in order to
initiate, develop and enhance the process that is aimed at building trust and
commitment with the customer.

Initiating the relationship

Engage in strategic prospecting and qualifying;

Gather and study pre-call information;
Identify buying influences;
Plan the initial sales call;
Demonstrate an understanding of the customer’s needs;
Identify opportunities to build a relationship; and
Illustrate the value of a relationship with the customer

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 Managing Customer Relationships

The global salesperson must be involved in the following activities in order to

initiate, develop and enhance the process that is aimed at building trust and
commitment with the customer.

Developing the relationship

Select an appropriate offering;

Customise the relationship;
Link the solutions with the customer’s needs;
Discuss customer concerns;
Summarize the solution to confirm benefits; and
Secure commitment.

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 Managing Customer Relationships

The global salesperson must be involved in the following activities in order to

initiate, develop and enhance the process that is aimed at building trust and
commitment with the customer.

Enhancing the relationship

Assess customer satisfaction;

Take action to ensure satisfaction;
Maintain open, two-way communication; and
Work to add value and enhance mutual opportunities.

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Customer
Life cycle

Proactive
service
CRM
Functional
solutions
Customer
support

CRM Internet
integrated
solutions
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partner company 24
Processes & Systems

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 Processes & Systems

Important

 Business starts with the acquisition of customers

 However, any successful CRM initiative is highly dependent on

a solid understanding of customers

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1. Understand & differentiate
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

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 2. Develop & Customize

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

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 3. Interact & Deliver

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

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 4. Acquire & Retain

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

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Pizza example - Perspective

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 Pizza example
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 if all the above are met

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 Pizza example
 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

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 Pizza example
• Exceeded expectations
• Deliver on all expectations
• Give you a garlic bread FREE !

• You will tell everyone about it

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 CRM FOR RETAIL SECTOR
• Reduction in queuing time
• Provision of the items.
• Demand lower prices.
• Better quality, a broader selection.
• Instant service and
• Demand quick service, round-the-clock access.
 CRM With Respect To Recurring
Deposit Account of SBI & ICICI
• Aim of CRM is to produce Customer Equity.
1. Value Equity
2. Brand Equity
3. Relationship Equity
comparative analysis between the two Banks
•Dissatisfaction level of customer
• Reinforced customer
• Convenience
• Benefit and facility
• Increase in customer revenue
 Types of CRM
Operational CRM
Analytical CRM
Sales Intelligence CRM
Campaign Management
Collaborative CRM
Consumer Relationship CRM
Simple CRM
Social CRM

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 Operational CRM
• Operational CRM is related to typical business functions involving
customer services, order management, invoice/billing, and sales/marketing
automation and management.
• Operational CRM provides support to "front office" business processes, e.g. to
sales, marketing and service staff. Interactions with customers are generally
stored in customers' contact histories, and staff can retrieve customer
information as necessary.
• The contact history provides staff members with immediate access to important
information on the customer (products owned, prior support calls etc.),
eliminating the need to individually obtain this information directly from the
customer. Reaching to the customer at right time at right place is preferable.
• Operational CRM processes customer data for a variety of purposes:
Managing campaigns
Sales force automation
Sales force management system

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 Analytical CRM
• Analytical CRM involves activities that capture, store, extract, process, interpret,
and report customer data to a user, who then analyzes them as needed.
Analytical CRM analyzes customer data for a variety of purposes:
• Designing and executing targeted marketing campaigns
• Designing and executing campaigns, e.g. customer acquisition, cross-selling, up-
selling
• Analyzing customer behavior in order to make decisions relating to products and
services (e.g.pricing, product development)
• Management information system (e.g. financial forecasting and customer
profitability analysis)
• Analytical CRM generally makes heavy use of data mining and other techniques
to produce useful results for decision-making. It is at the analytical stage that
the importance of fully integrated CRM software becomes most apparent.
Logically speaking, the more information that the analytical software has
available for analysis, the better its predictions and recommendations will be.
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• Cross-selling is defined by the Oxford English Dictionary as
"the action or practice of selling among or between
established clients, markets, traders, etc." or "that of selling
an additional product or service to an existing customer".
• Up-selling is a sales technique whereby a salesperson
attempts to have the customer purchase more expensive
items, upgrades, or other add-ons in an attempt to make a
more profitable sale. Up-selling usually involves marketing
more profitable services or products, but up-selling can also
be simply exposing the customer to other options he or she
may not have considered previously. Up-selling implies selling
something that is more profitable or otherwise preferable for
the seller instead of the original sale. A different technique is
cross-selling in which a seller tries to sell something else in
addition to the original sale.

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 Collaborative CRM
• Collaborative CRM deals with all the necessary
communication, coordination, and collaboration
between vendors and customers.
• For example, feedback received by customer support
agents can provide other staff members with
information on the services and features requested by
customers.
• Collaborative CRM's ultimate goal is to use information
collected by all departments to improve the quality of
services provided by the company.
• CRM also plays a role of data distributor within
customers, producers and partners. Producers can use
CRM information to develop products or find new
market.
• CRM facilitates communication between customers,
suppliers and partner by using
HRM ITM new information system 43
such email, link and data bank
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 Sales Intelligence CRM
Sales Intelligence CRM is similar to Analytical
CRM, but is intended as a more direct sales tool.
Features include alerts sent to sales staff
regarding:
• Cross-selling/Up-selling opportunities
• Customer Drift
• Sales performance
• Customer trends
• Customer margins
• Customer alignment
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 Campaign Management
• Campaign Management combines elements of
Operational and Analytical CRM. Campaign
management functions include:
1) Target groups formed from the client base
according to selected criteria
2) Sending campaign-related material (e.g. on
special offers) to selected recipients using various
channels (e.g. e-mail, telephone, SMS, post)
3) Tracking, storing, and analyzing campaign
statistics, including tracking responses and
analyzing trends
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 Consumer Relationship CRM
• Consumer Relationship System (CRS) covers
aspects of a company's dealing with
customers handled by the Consumer Affairs
and Customer Relations contact centers
within a company. Representatives handle in-
bound contact from anonymous consumers
and customers. Early warnings can be issued
regarding product issues (e.g. item recalls) and
current consumer sentiment can be tracked
(voice of the customer).
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 Simple CRM
• Simple CRM systems breakdown the traditional
CRM system to focus on the core values--
managing contacts and activities with customers
and prospects. These systems are designed to
create the most value for the immediate end
user rather than the organization as a whole.
Many times they focus on satisfying the needs of
a particular marketplace niche, organizational
unit, or type of user rather than an entire
organization.

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 Social CRM
• Beginning in 2007, the rapid growth in social
media and social networking forced CRM
product companies to integrate "social"
features into their traditional CRM systems.
Some of the first features added are social
network monitoring feeds (ie Twitter
timeline), typically built into the system
dashboard. Other emerging capabilities
include messaging, sentiment analysis, and
other analytics.
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 e - CRM
• The term eCRM was coined in the mid-1990s, when customers
started using Web browsers, the Internet, and other electronic
touch points (e-mail, POS terminals,call centers, and direct sales).
• The use of these technologies made customer services, as well as
service to partners (PRM), much
• more effective and efficient than it was before the Internet.
• Through Internet technologies, data generated about customers
can be easily fed into marketing, sales, and customer service
applications and analysis.
• e-CRM also includes online process applications such as
segmentation and personalization.

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 In the world connected by the Internet, e-
CRM has become a requirement for survival,
not just a competitive advantage.
 e-CRM covers a broad range of topics, tools,
and methods, ranging from the proper design
of digital products and services to pricing and
loyalty programs.

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 According to Voss (2000), there are three levels of e-
CRM:
(1)Foundational services include the minimum
necessary services such as site responsiveness (e.g.,
how quickly and accurately the service is provided),
site effectiveness, and order fulfillment.
(2) Customer-centered services include order tracking,
configuration and customization, and security/trust.
These are the services that matter the most to
customers.
(3) Value-added services are extra services such as
dynamic brokering, online auctions, and online
training and education.HRM ITM
52
 CRM FAILURE
• Business benefits of CRM are not guaranteed.
• Research shows that 50% of CRM projects did
not produce the results that were promised.
• 20% report says that CRM implementations
had actually damaged long standing customer
relationships.
• For eg, the founder and CEO of Customer.com
estimated that 42 percent of the top 125 CRM
sites experienced failures
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 New convergence in CRM

 Telephony & telemarketing

 Internet

 Mobile, SMS
 Digital TV
 Cable & satellite

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 Reasons of failure of CRM
1. Lack of understanding and participation
2. Difficulty measuring and valuing intangible benefits. There
are few tangible benefits to CRM.
3. Failure to identify and focus on specific business problems.
4. Lack of active senior management (non-IT) sponsorship.
5. Poor user acceptance, which can occur for a variety of
reasons such as unclear benefits (i.e., CRM is a tool for
management, but doesn’t help a rep sell more effectively)
and usability issues.
6. Trying to automate a poorly defined processes.

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 Suggestions for implementing
CRM and avoiding CRM failure..
• Carefully consider the four components of CRM:
sales, service, marketing, and channel/partner
management.
• Survey how CRM accomplishments are measured;
use defined metrics. Make sure quality, not just
quantity, is addressed.
• Consider how CRM software can help vis-a-vis the
organization’s objectives.

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• Decide on a strategy: refining existing CRM processes, or
reengineering the CRM.
• Evaluate all levels in the organization, but particularly
frontline agents, field service, and salespeople.
• Prioritize the organization’s requirements as: must, desired,
and not important.
• Select an appropriate CRM software. There are more than 60
vendors.
Some (like Siebel) provide comprehensive packages,
others provide only certain functions. Decide whether to use
the best-of-breed approach or to go with one vendor.
ERP vendors, such as PeopleSoft and SAP, also offer CRM
products.

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Thank You….

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