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1 Customer Relationship Management (CRM) Introduction.

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Presentation on theme: "1 Customer Relationship Management (CRM) Introduction."— Presentation transcript:

1 1 Customer Relationship Management (CRM) Introduction

2 2 Contents Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

3 3 A definition of marketing The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organization goals. American Marketing Association Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

4 4 How to define Customers? CONSUMER BUSINESS TO BUSINESS CHANNEL DISTRIBUTOR FRANCHISEE INTERNAL CUSTOMER Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

5 5 1.It costs 6x more to sell to a new customer than to sell to an existing 2.One dissatisfied customer will tell 8-10 others on his experience 3.By increasing the customer retention rate by 5%, profits could increase by by 85% 4.There is 50% chance of making a sale to an existing customer while only a 15% chance of selling to a new customer 5.70% of customers will do business with the company again if their complaint is successfully resolved 6. 90% of companies (in 2000) didnt have the necessary sales and service integration to support e-commerce Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

6 6 Customer Loyalty: Customer Loyalty is a deeply held commitment to rebuy or repatronize a preferred product or service consistently in the future, despite situational influences and marketing efforts having the potential to cause switching behavior. Source : « Satisfaction: A Behavioral Perspective On The Consumer Richard L. Oliver Mc Graw-Hill Editions Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

7 7 An integrated sales, marketing & service strategy An approach which effectively manages customer relationships A business strategy to select and manage the most valuable customer relationships. CRM requires a customer-centric business philosophy and culture to support effective marketing, sales, and service processes IT definition Methodologies, software and usually internet capabilities that help an organisation manage customer relationships in an organised manner Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution CRM Definition:

8 8 Customer Relationship Management is an enterprise approach to understanding and influencing customer behavior through meaningful communications in order to improve customer acquisition, customer retention, customer loyalty and customer profitability Source Accelerating Customer Relationships, Ronald S. Swift Prentice Hall Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

9 9 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution The concept of CRM in theory is simple: Listen to your customers and act on what they are saying to create a mutually beneficial relationship. Companies with current implementations of CRM technology can usually hear their customers; however, because they are only focusing on the operational and collaborative component of CRM, they cannot really understand them. They must also consider analytical CRM to optimize their customer relationships. CRM Functions

10 10 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

11 11 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution MARKETING AUTOMATION designed to get the right mix of the companys products and services in front of each customer at the right time SALES FORCE AUTOMATION Collaborative tools that enable all parties to the transaction to interact with one another CUSTOMER SERVICE AND SELF-SERVICE Serving existing customer base through problem resolution systems, workflow automation and field service dispatch systems Capabilities that can be directly invoked by the customer on the internet via PC and wireless devices Operational CRM

12 12 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution DATA WAREHOUSE A process of assembling disparate data from all over the company transforming it to a consistent state for business decision making and empowering users by providing them with access to this information from multiple applications DATA MINING The process of extracting and presenting new Knowledge, previously unpredictable, selected from databases for actionable decisions. The process of analyzing detailed data, to extract and present actionable, implicit and novel information to solve a business problem Analytical CRM

13 13 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution CRM - Stages 1.Customer Acquisition: Promotion of products – build a relationship – first date 2.Customer Extension: An established relationship – cross-selling & up-selling 3.Customer Retention: Adapt to customer requirements – requires a complex understanding of customer needs. Can an organisation pursue all 3 objectives ? extremely difficult

14 14 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution CRM Business Process with a Customer Focus Need to have consistent dependable and convenient interactions with customers in every interaction Need to efficiently create new delivery channels Need to capture & analyse large amounts of customer data Overall attempt to produce a unique/different business experience for the customer. CRM is all about changing processes and therefore change management What is the companys experience in change? Does it have a successful track record?

15 15 CRM and e-CRM CRM Technology e-CRM : extending CRM through the Web e-CRM is the customer-facing internet portion of CRM e-CRM is a real designation, but it is not a revolutionary new system or set of processes. e-CRM is CRM online CRM is a strategy, the web is a channel CRM is inherently a multi-channel strategy. Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

16 16 eCRM Traditional CRMeCRM Telemarketing Direct Mail B.R.C. Responses Trade Shows Inbound Calls Press releases Meetings Product Demos Referrals Blasts Web Registration Online Reply Instant Messaging Online Customer Service Web Demos Video Conference Online Prospect Database Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution

17 17 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution CRM Challenges Integrating customer content All interactions and knowledge about customers must be synthesised and stored in a way that anyone in the organization with a need to know can access that information in real-time and in a way that supports that current problem. Currently most organizations cannot do this or are even close to this Contact management The channels that customers use to contact an organization are increasing – Web, call centre, fax, , voice message etc. These technologies must be integrated so that staff can access the details regardless of channel. Consistent business rules need to be applied across all channels of contact End-to end business processes Business processes must be integrated and consistent eg. sales and service. The service staff must have access to sales details and commitments and apply consistent rules of dealing with the customers. This requires much more integration between processes than is current.

18 18 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution CRM Difficulties CRM requires major integration of systems which few companies have CRM requires turning round existing systems to store, record and retrieve on a customer-centric basis CRM requires people to stop thinking about departmental boundaries and to start thinking about how as a team the company can help the customer

19 19 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution CRM Architecture

20 20 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution Step 1 – Determining current abilities - Do we have a call/contact center? - What are the capacities of the call/contact center? - Are customers questions being answered? - - Why do we have customer complaints? How can - they be minimized? - What additional infrastructure do we need? - What are current costs?

21 21 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution Step 2 – Building capabilities - - What technologies are in the call/contact - centers and is more technology needed - Calls are routed based on incoming call information (e.g. incoming call phone number) - - Employees are empowered to make and keep - promises to customer

22 22 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution Step 3 – Information utilization - - Customer information and contact history is - tracked in a knowledge base and used in future - contacts - - Customer information can be linked to contact - history from all channels - Customer patterns (e.g. seasonal patterns) are discovered and used for marketing purposes

23 23 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution Step 4 – Determination of what we do - Shift from data collection and analysis to strategy - Enterprise goals revolve around customer relationships - Customers receive support based on their value to the company - All corporate divisions share the same information on the customer and focus on customers relationship with the company

24 24 Customer focus issues CRM Definitions CRM Functions CRM Stages CRM Business Process & Technology CRM challenges & Difficulties Building a CRM Solution Step 5 – CRM becomes a core competency - Maintaining customer relationships is a core competency of the business, ensuring a greater retention rate - The focus centers around redefining markets to position the company as the best of breed in the industry

25 25 The End


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