sCustomer relationship management (CRM) Term applied to processes implemented by a company to handle its contact with its customers CRM is a software-based approach to handling customer relationships Store information on current and prospective customers 1 s Control over buying process Information, comparison, selection, easy to find s Best possible price Delivery (free), quality s All payment options Secure s Communication designed to suit needs Computerized, complex, caring 2 s All forms of trading Direct Traditional Retail E-commerce Wholesale Combination 3 s New convergence Telephony & telemarketing Internet Mobile, SMS Digital TV Cable & satellite 4 s Control over buying process Information, comparison, selection, easy to find s Best possible price Delivery (free), quality s All payment options Secure s Communication designed to suit needs Computerized, complex, caring 5 s All forms of trading Direct Traditional Retail E-commerce Wholesale Combination 6 s New convergence Telephony & telemarketing Internet Mobile, SMS Digital TV Cable & satellite 7 s Customer relationship management (CRM) From the outside, customers interacting with a company perceive the business as a single entity, despite often interacting with a variety of employees in different roles and departments CRM is a combination of policies, processes, and strategies implemented by a company that unify its customer interaction and provides a mechanism for tracking customer information 8 s 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 9 s 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 10 s Many inter-related aspects Front office operation Back office operations Business relationships Analysis 11 s Direct interaction with customers Face to face meetings Phone calls E-mail Online services etc 12 s Operations that ultimately affect the activities of the front office Billing Maintenance Planning Marketing Advertising Finance Manufacturing 13 s Interaction with other companies and partners Suppliers/vendors Retail outlets/distributors Industry networks (lobbying groups, trade assn’) s This external network supports front and back office activities 14 s 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) 15 16 s CRM initiatives often fail Implementation was limited to software installation Inadequate motivations for employees to learn, provide input, and take full advantage of the information systems 17 s Three key phases 1. Customer Acquisition 2. Customer Retention 3. Customer Extension s Three contextual factors 4. Marketing Orientation 5. Value Creation 6. Innovative IT. 19 20 s Attracting our customer For the first purchase We have acquired our customer s Growth Market orientation, innovative IT & value creation Aim is to increase the number of customers that purchase from us for the FIRST TIME 21 s 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. s Growth Market orientation, innovative IT & value creation Aim is to increase the number of customers that purchase from us REGULARLY 22 s 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 s Growth Market orientation, innovative IT & value creation Aim is to increase the number of customers that purchase ADDITIONAL products 23 24 s 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 Product 26 s Generation of shareholder value Based upon the satisfaction of customer needs (as with marketing orientation) Delivery of a sustainable competitive advantage 27 28 29 30 s 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 31 32 s 1. Validation 2. Discovery 3. Action s s 33 s 1. Validation 2. Discovery 3. Action s s 35 s Correct data Ensuring that the data you have on your customers is not only correct Also, in a suitable state for targeting communications programs 36 s 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 37 s 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 38 s 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 39 s 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 40 2. Customer perspective s 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 41 s Staff performance To enable front office staff to perform sales, service and marketing tasks more efficiently as a team Increasing expertise and reducing costs 42 44 s Important Business starts with the acquisition of customers However, any successful CRM initiative is highly dependent on a solid understanding of customers 45 s Understand Demographics, purchase patterns & channels Segmentation to identify logical unique groups Primary research to capture needs and attitudes Customer valuation to understand profitability s Differentiate Based on the value customers are expected to deliver 46 s Develop Products, services, channels and media can be customized based on the needs of quantitative customer segments s Customize Based on the potential value delivered by customer segment 47 s Interact Not just through marketing, sales and media Distribution, shipping, customer service & online s Deliver Delivering value is a cornerstone Factors including quality, convenience, speed, ease of use, responsiveness and service excellence 48 s Acquire Learning about customers makes it easy to identify those producing the greatest value s Retain Maintain interaction; Deliver on value Customers change as they through differing life stages Modify the service 49 move 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