5 Buzzword AlertCRM: Often used to describe any business or marketing approach that claims to target customers, not transactions. Sometimes confused with Customer service, account management, sales force automation, e-commerce, predictive modeling, data mining, data warehousing, database management, database marketing, direct marketing, and wide variety of marketing activity. Used here to describe a systematic business approach using information and on-going dialogue to build long lasting mutually beneficial customer relationships.Customer centric: Sometimes used to refer to any awareness that a business has of its customers. Used here to describe an approach to business that uses the customer (not the transaction) as the building block of data management, reporting, goal setting and measurement as well as business and marketing strategy organization and technical infrastructure, and corporate culture and values over time and across sales, marketing, IT, analysis, service, management and support business units.
6 CRM working definition CRM is theSystematic use of informationTo attract and keep customersThrough on-going dialogueTo build long lasting mutually beneficial relationships
7 Systematic Use of Information Database of customer informationThe customer is the base level of data for storage,reporting,analysis and measurementAnalysis of customer data to predict likely future behaviorModeling uses past behavior to predict future behavior and identifies other predictors as well.Identifying and evaluating each relationshipCR are identified, evaluated reevaluated and continually managed according to current information
8 To attract and keep customers Cost efficient customer acquisitionProfiles used to select likely new customers and offers for specific customer segmentsRetention efforts focused on most profitable and at risk customersContinuous process of solidifying relationship with profitable customers, converting less profitable customers to more profitable and attempting to convert at risk customers before they are lost.Shared information across channels for consistent communicationsCustomer receives consistent offers, service and messages across sales and service channels
9 With or Without Without CRM CRM in practice Customer re-enters information about music preferences every time at log-inCustomer re-identifies CI every time at CSCall center and stores have different pricing from web siteCustomer must return defective CD through the delivery channel-cannot switch between electronic channels and stores.CRM in practiceCustomer logs onto the Internet and finds information on favorite music group, advertisements featuring specials on new CDs and dates with ticket offers to next concerts in local area, plus s telling them about new groups with a similar style or from the same record company.Customer reads about CD’s on the Internet, orders through the CS,exchanges at a local record store if CD is defective.
10 Through on-going dialogue Continuous interaction with customers based on analysisInteractions,offers and messages are planned,personalized and delivered according to analytic insightsReal time response on the InternetImmediate changes in advertising, information, recommendations, product features and even pricing based on web or behaviorListening to create a sense of intimacy with the customer1:1 dialogue through appropriate responses delivered real time
13 To build long-lasting mutually beneficial relationships Success measured in customers and customer valueGoals, results even incentives measured in terms of customers and customer value,not transactionsContinual reevaluation of customer relationshipsOn-going measurement to identify profitable, at risk and underserved customersContinual learning about customer needsSatisfied customers make good business sense
14 Customer Strategy should be defined and driven by Customer needs ShoppingBuyingUsingRepeatPurchasingEvangelizingComplainingIs it easy tofind what I amlooking for?Do I want tocome backhere?Did I learnanythingnew?Do I trust thisCompany?What madethemdifferent fromeveryoneelse?Was the offerjust right forMe?Did they addvalue to theproduct withinformation?Did theyfollow up?What should Iexpect afterthis sale?Is it safe tobuy here?If I tell themabout myselfwill theymake theirproductbetter?Was theinformation Igave themlast time usedwith integrity?Did it add value?Was it easy tobuy?Do theyrememberme?Did I have toanswer the samequestionsagain?Did they useinformationmade duringthe sale tomake theafter-saleexperiencepleasant?Can I trustthem toprovide aconsistentexperience?Do they knowwhen I havemade areferral?Do they care?Was mycomplaintsatisfied?that Icomplainedwhen I callednext?annoy mewithadditionalmarketingafter Icomplained?
15 At its simplestCRM refers to the use of information about a customer to make decisions about how to treat the customer.
16 Personalized Campaign The Learning LoopCustomer StrategyCollect and DistributeCIAnalyze and mineDialogue andPersonalized CampaignTrack and LearnMaking the Business CaseBuilding the CRM Organization
17 At it is most complex CRM comprises an interconnected web of sophisticated, high tech hardware software, strategies and processes designed to help business quickly, efficiently and voluminously determine how to treat each customer in order to create a valued experience for both the business and the customer.
18 Analytics Operations Distribution Partner Sales Force Automation CallbehavioranalysisCampaignManagementCustomerValuationMonitoringIntegratedCustomer ViewQuality ofServiceAnalysisSegmentationAnd profilingCustomerServiceRiskAnalysisBehavioralModelingProfitabilityanalysisWebIntelligenceNeedsanalysisSalesanalysisCall CenterE-commerceWeb
19 A data warehouse builds a strong foundation for CRM infrastructure
20 Example of warehouse processes architected for CRM Sales ForceAutomationWebApplicationsCall CenterProfitabilityLegacySystemsProspect ListsData transformed and loaded in MDInformation from legacy sources normalizedInto member and household tables.Time series information kept for historical analysisProfiling/SegmentationOpportunity IdentificationCampaign managementPerformance measurementPredictive modelingAdhoc and DSS reportingMarketingDatabaseReal time data feedsReal-timeDatabaseBusinessIntelligenceResults from P, SDM, M loaded into MD and RT DBTo enable real time personalizationand decisioning. Single repository forContact HistoryStaging area for dataDaily batch reportingReal time campaign managementNewslettersPersonalization&DecisioningCampaignManagementReal time data feedsSiteTrackingReportingLogFilesData MiningExample of warehouse processes architected for CRM
21 Extract, Transfer, Load (ETL) Customer data should be moved into the warehouse in an consistent and efficient mannerExtract, Transfer, Load (ETL)Extract data from legacysystems, other sourcesSources: Surveys,responsehistory,online behaviorTransform data into consistent,clean, customer-level,knowledge according to pre-setdata definitionsData dictionary designed duringwarehouse design throughenterprise-wide participation andmade available enterprise-wideLoad and manage dataefficientlyBatch processing during off-hours,predefined queriesExamples: Standardize addressesset aside an untouchable control groupCondition Data
22 What Customers Want Treat me as an individual (not a number) Demonstrate that you can use information about me in a way that makes working with you valuable( don’t abuse my information)Show me that you really know me no matter where I talk to you.Care about my needs/try to anticipate them.
24 Buzzword Alert Politics Change Management Organizational design The result of opposing business priorities across different units that compete for a finite pool of resourcesChange ManagementGuiding an organization and its members through significant alterations in organizational direction and individual responsibilities as quickly and effectively possibleOrganizational designManaging human systems and hierarchies, with supporting technical and process infrastructure, in order to most effectively deliver on the mission of the enterprise
25 Organizing around the Customer Who thinks about the customer?Who advocates the customer?Who doesn’t think about the customer?CompetingDistributionCompetingProductsCompetingSales TerritoriesCompetingChannelsCompetingBusiness Units
26 Everyone in an organization needs to think about the customer Everyone in an organization needs to think about the customer. To achieve this, an organization must encourage change by providing the tools to make the changes steadily and surelyChanging how an organization thinksCustomer centric metricsChanging organizational processesPilots,business rules and business caseChanging organizational structureEvolutionary not revolutionaryChanging cultureShort term and long term success
27 Customer Centric Metrics Volume MetricsCustomer Centric MetricsCall DurationEncourages TSRs to make calls as short as possible, keep costs lowCreates dissatisfactionCustomer RetentionEncourages TSRs to satisfy customersCreates loyaltySales VolumeEncourages cannibalizationEncourages short term product pushes instead of long term CRCustomer Value ImpactIncreases customer value following interactionIncludes additional information gathered which is useful for future campaignsTo persuade managers to think about customers, it helps to start with something they value – Customer profitabilty
28 Changing ProcessesThere are several ways to change processes without creating fear within an organizationPilot projects: Enable teams to test processes in an atmosphere that fosters innovation and resourcefulness.Business rules:Privacy: Do not share names with third partiesFatigue: Do not call customers more frequently than “n” times.Channel preference: Do not force a customer to a channelDialogue: Record every question that a customer answers and do not ask the same question more than once every two yearsThe business caseThrough questions and expectations, it is possible to drive existing organizational units to use customer data in decision makingShould you close unprofiateble stores?Should you market to selected customers?
29 Evolutionary Not Revolutionary Why not just reorganize everyone from Marketing, IT and other teams contributing resources to the CRM effort?Why the evolutionary small step approach?Why not revolution?Power may continue to reside in areas without the data, without the metrics or even without the CFocus on bureaucratic issues detracts from C focus
30 Tools that make data easy to access Gives time to build infrastructure for:Centralized dataTools that make data easy to accessSkilled analysts who can mine the dataMetrics that validate C centric programsTraining to bring staff up to speedSetting senior management expectations and educating themWinning kudos for early successesCreating external enthusiasm rather than resistance.
31 Changing Structure To maintain the momentum of a CRM initiative: Continually demonstrate value to all stakeholdersCreate a hunger among senior managers for customer centric and customer value informationUse input from anyone thinking about the customer.
32 Forms follows Function Let structure experts worry about structure which CRM specialists focus on cross functional initiatives.Constructing data centers from pilot databases to an enterprise-wide data warehouseThe data warehouse is accessible and easy to use across organizationFielding campaigns that includes tests and data miningSharing results across channels,units and levels of managementCreating more and more complex campaigns involving more and more areas of the enterprise.Monitoring and reporting results all along the way.
33 E-channels Complicate Simplify E-channels both complicate and simplify CRM execution:ComplicateSimplify- Stability- Maintenance- Real time- Personalization- Collaborative filtering- B&M to the web- Branding- E-strategy- Competing channels- Privacy- Security- Loyalty- Information- Real time- Cost saving- Interactive- Profit driver- Convenience- Customer tracking- Services- Transaction/sales tracking
34 Are we there yet? You know you have a CRM culture when: Everyone in the organization thinks about the CEveryone in the organization listens to the customerReliable service is delivered to C consistently across all channelsSuccess is measured in terms of C relationships ( Value, duration, acquisition )
35 Where Are You on the Road to CRM? Short term goalsLong term goalsThink like a customerBe a customerBuild infrastructure to centralize dataAnalyze customer dataDetermine C centric program goals and strategiesEducate senior management and set expectationsIdentify bottlenecksHave owners over customersHave centralized customer centric business rulesListen to the customerTrack C behavior across all channelsShow consistent reliable service across all channelsAssign value to each customerCreate loyalty programsHave established C centric incentivesOrganizationsTransitioning toCRM cultureThink like a CListen to the CProvide consistent reliable service across all channelsTrack C behavior across all channelsAssign value to each C relationshipCreate loyalty programsReduce bottlenecksHave owners over customersReal-time personalized dialogue with customersAnticipate customer needsMeasure success of each relationshipShare C information with all areas of the enterpriseBuild and maintain long term profitable relationships with COrganizationsWith existingCRM culture
36 SummaryOrganizational change is an evolutionary process, not a revolution.Choose the parts of the organization that can be changed to focus on first.Implementing CRM program also means changing thinking, processes, structure and engraining a customer centric culture in an organization.Depending on where your organization stands, there are short and long term steps to take to transition to a CRM company.
37 Long Term PlanningDevelop a two year plan for making your company more customer centric.Include measurable deliverables every three to six months.Change from product centric to customer centric metrics.Create cross functional teams to develop and manage customer strategy.Implement tools that allow people from all areas to access the same CI.
38 Obstacles Getting participation from all areas Technical problems centralizing data in a data warehouseInter-unit conflict (Marketing-IT)Managing anxiety and resistance in an environment changeFocusing resources on new developments and existing responsibilities.