25
Customer Relationship Management (CRM) Introduction

1 Customer Relationship Management (CRM) Introduction

Embed Size (px)

Citation preview

Page 1: 1 Customer Relationship Management (CRM) Introduction

1

Customer Relationship Management (CRM)

Introduction

Page 2: 1 Customer Relationship Management (CRM) Introduction

2

Contents

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

Page 3: 1 Customer Relationship Management (CRM) Introduction

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

Page 4: 1 Customer Relationship Management (CRM) Introduction

4

How to define Customers?

CONSUMERBUSINESS

TOBUSINESS

CHANNELDISTRIBUTORFRANCHISEE

INTERNALCUSTOMER

• Customer focus issues• CRM Definitions• CRM Functions• CRM Stages• CRM Business Process

& Technology• CRM challenges &

Difficulties• Building a CRM

Solution

Page 5: 1 Customer Relationship Management (CRM) Introduction

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) didn’t 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

Page 6: 1 Customer Relationship Management (CRM) Introduction

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

Page 7: 1 Customer Relationship Management (CRM) Introduction

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:

Page 8: 1 Customer Relationship Management (CRM) Introduction

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 profitabilitySource“Accelerating Customer Relationships”, Ronald S. Swift Prentice Hall - 2001

• Customer focus issues• CRM Definitions• CRM Functions• CRM Stages• CRM Business Process

& Technology• CRM challenges &

Difficulties• Building a CRM

Solution

Page 9: 1 Customer Relationship Management (CRM) Introduction

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

Page 10: 1 Customer Relationship Management (CRM) Introduction

10

• Customer focus issues• CRM Definitions• CRM Functions• CRM Stages• CRM Business Process

& Technology• CRM challenges &

Difficulties• Building a CRM

Solution

Page 11: 1 Customer Relationship Management (CRM) Introduction

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 company’s 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

CUSTOMERSERVICE

ANDSELF-SERVICE

Serving existing customer base through problem resolution systems, workflow automation and field service dispatch systemsCapabilities that can be directly invoked by the customer on the internet via PC and wireless devices

Operational CRM

Page 12: 1 Customer Relationship Management (CRM) Introduction

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

DATAMINING

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

Page 13: 1 Customer Relationship Management (CRM) Introduction

13

• Customer focus issues• CRM Definitions• CRM Functions• CRM Stages• CRM Business Process

& Technology• CRM challenges &

Difficulties• Building a CRM

Solution

CRM - Stages1. 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

Page 14: 1 Customer Relationship Management (CRM) Introduction

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 company’s experience in change? Does it have a successful track record?

Page 15: 1 Customer Relationship Management (CRM) Introduction

15

CRM and e-CRMCRM 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

Page 16: 1 Customer Relationship Management (CRM) Introduction

16

eCRMeCRM

Traditional CRM eCRM

Telemarketing

Direct Mail

B.R.C. Responses

Trade Shows

Inbound Calls

Press releases

Meetings

Product Demo’s

Referrals

E-Mail Blasts

Web Registration

Online Reply

Instant Messaging

Online Customer Service

Web Demo’s

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

Page 17: 1 Customer Relationship Management (CRM) Introduction

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, email, 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.

Page 18: 1 Customer Relationship Management (CRM) Introduction

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

Page 19: 1 Customer Relationship Management (CRM) Introduction

19

• Customer focus issues• CRM Definitions• CRM Functions• CRM Stages• CRM Business Process

& Technology• CRM challenges &

Difficulties• Building a CRM

Solution

CRM Architecture

Page 20: 1 Customer Relationship Management (CRM) Introduction

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?

Page 21: 1 Customer Relationship Management (CRM) Introduction

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

Page 22: 1 Customer Relationship Management (CRM) Introduction

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

Page 23: 1 Customer Relationship Management (CRM) Introduction

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 customer’s relationship with the company

Page 24: 1 Customer Relationship Management (CRM) Introduction

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

Page 25: 1 Customer Relationship Management (CRM) Introduction

25

The End