• Operational CRM – supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers (marketing, customer service, sales, billing, etc.)

• Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers (accounting, finance, human resources, data warehouses)

Types of CRM

OPERATIONAL CRM1. List generator – compiles customer information

from a variety of sources and then segments that information by filtering and sorting for different marketing campaigns

2. Cross-selling and up-selling– Cross-selling – selling additional products or services– Up-selling – increasing the value of the sale

3. Sales force automation software is used to automatically tracks all of the steps in the sales process– Sales reps had too much info to maintain and track– Needed to get info out of sales rep heads and into a

system that could be used by all.

OPERATIONAL CRM4. Sales reps can organize and coordinate accounts

so that one reps lead can become a sale by the organization (even if it means someone else makes the sale)

5. Contact management systems can be used to “remember” a customer and all prior dealings with that customer

6. After acquiring a customer, you need to keep the customer through excellent customer service– If you want to ensure customer loyalty and

satisfaction, you must build post-sale relationships• Answer questions Provide solutions to problems

OPERATIONAL CRM (Customer Service)1. Provide consistent answers to questions (database)

2. Make sure customers don’t have to explain their problems AGAIN (database, avoid customer frustration)

3. Emotion detection software to detect when someone is distressed and upset (determine baseline during first few seconds of contact and then looks for deviations)

4. Web-based self-service allows customers to find their own answers.– Federal Express, UPS and other sites with shipment tracking

5. Click-to-talk buttons on a web site

6. Call scripting systems automatically generate the next item or question.– Good way to be consistent

• Operational CRM supports front-office systemsthat deal directly with customers

• Analytical CRM doesn’t directly deal with customers. It is used to support decision making and data analysis by identifying patterns to help the organization understand its customers.

Types of CRM

Analytical CRM• Analytical CRM relies heavily on data warehousing technologies and

business intelligence to glean insights into customer behavior

• These systems quickly aggregate, analyze, and disseminate customer information throughout an organization

• Personalization – when a website knows enough about a person’s likes and dislikes that it can fashion offers that are more likely to appeal to that person

• Determine the value of an individual customer– Who should we invest in?– Who should we service at an average level?– Who should we not invest in at all?

– Since we can’t focus on all of our customers, who should be focus on ? Where can we get the biggest bang for the buck?

Information Technology and Customer Relationship Management

• Advances in information technology are making it possible to gain a greater understanding of the customers who are buying your products. If an organization understands the characteristics of its customers, it is then in a better position to meet customer needs, and therefore generate even more business.– How are we going to use all of this customer data that we have

collected?

• Information Technology is simply a TOOL that can be used to better serve the customer.– How can customer interactions be made easier?– If you understand customer characteristics, you are then

positioned to better serve customers (mine what you have to gain a clearer understanding).

• Result: increase customer loyalty and probably increase revenues