Session 1 & 2 introduction & evolution


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  • So what exactly in the customer will guide us?
  • THIS IS THE SCARY PART! So how do you make this guy more loyal? Through a relationship!
  • This is our official definition of CRM, To fully realize the benefits of CRM an organization must become truly customer focused.
  • 주제 : CRM 의 정의 및 CRM 에 포함된 업무 내용 , 무엇을 하는 일이다 . 1. CRM 의 정의는 한마디로 - 회사의 수입원이라 할 수 있는 우수 고객을 파악하고 유지하는 활동 . 이며 , 이 활동에는 영업 , 서비스 , 마케팅 업무프로세스가 포함되어 있습니다 . 2. 그러므로 CRM 은 고객관련 조직 , 활동에 대한 업무프로세스 및 IT 사항을 고객 위주로 재편성 하는 것 임 .
  • It is a combination of People (Culture), Process and then Technology. I have seen many companies attempt to apply new CRM technology to solve a customer service problem where the problem was not with the existing technology, but with the customer service processes. I have seen great sales force automation software placed on salespeople’s laptops in an attempt to help them become more efficient. Only to have them reject the software because it was perceived as a ‘Big Brother’ system. (they actually nicknamed it that!) “ If departments in your company do not believe that sharing information with other departments is going to improve customer service then NO technology solution will solve the problem.” HOW IS TECHNOLOGY VIEWED IN YOUR ORGANIZATION – IS IT VIEWED AS AN ENABLER?
  • How Are We Doing? Please let us know if this meets your needs, how you use it, what you would add, delete, or change, and other “training nugget” subjects you would like to have. Thanks! Suggestions and requests to: Commander, Navy Installations Command F&FR Training Branch, N947 5720 Integrity Drive Millington, TN 38055-6540 Com: (901) 874-6727 DSN: 882-6727 [email_address]
  • Session 1 & 2 introduction & evolution

    1. 1. CRM
    2. 2. Business Challenges Businesses in many industries may lose up 50% of their customers over a five year period. Studies have shown it’s 6 to 7 times more expensive to acquire a new customer than it is to retain a current customer. As little as a 5% increase in customer retention can increase profits by 25 to 95%. Yet many businesses are still focused only on customer acquisition and see customers from the fragmented view of individual transactions
    3. 3. Cost of new customer acquisition≈7-8 times of retaining currentcustomers Customer Relationship(Yankee Research – global connectivity Managementexperts)50% current customers do notcontribute to profit(AMR Research)Top 20% customers contribute 60%of revenue and 70% of profit 20 : 80 ruleFortune 500 companies will lose50% of customers in 5 years(Peppers & Rogers Group)Only 4% of unsatisfied customercomplain. 65~90% do not repurchase(Anderson Consulting) 82% of customers whose complaints resolved repurchased Customer is important 98% coupon are scrapped. Analysis on Customers essential
    4. 4. Customer is There is only one boss. The customer! He can fire everybody in the company, from the chairman on down, simply by spending his money somewhere else. Sam Walton, founder of Wal-Mart When products become so similar and technologies are commonly available , CUSTOMER EXPERIENCE is the only true differentiator
    5. 5. Today’s customer is …• Smarter• leaner• more price conscious• has lower morale• overwhelmed by competitors• more demanding• less forgiving• harder to satisfy• less loyal
    6. 6. Core Marketing Concepts
    7. 7. A fundamental paradigm shift is occurring in how company market to customers. Whats In Whats OutOne-to-One Marketing Mass MarketingCustomized Products Standardized ProductsShare of Wallet Market ShareLife Time Value Present ValueEvent Driven Marketing Program Driven MarketingKnow Your Customers Know Your ProductsManage Your Customers Manage Your ProductsDifferentiate Customers Differentiate ProductsCross-sell / Retention Acquisitionl0% of Market, l00% of 100% of Market, 10% ofCustomer Customer
    8. 8. What CRM means? Customer ? Relationship ? Channels of interaction, segmentations Management? organization of customer related information
    9. 9. Relationships with whom?All stakeholders including Customer Employees Suppliers Government CitizensI focus on Customers here.The Customer Relationship Management (CRM).
    10. 10. The Meaning of Relationships Continuity Mutuality Interdependence Understanding Trust
    11. 11. Three simple business goals of CRM Acquire the „right“ CustomerValue of customer relation customers with high potential Retention value Customer Development Cross- and up- Retain profitable Customer sell by offering customers and Acquisition the right products increase their at the right time long-term value Evolution of customer relation over time
    12. 12. The process of Targeting Acquiring Servicing Retaining and Building long-term relationships with customers
    13. 13. CRM Versus Mass Marketing Traditional Traditional Mass “Shotgun” Approach “Shotgun” Approach Mass Marketing Marketing CRM CRM “Rifle” Approach “Rifle” Approach
    14. 14. Define customerrelationship management
    15. 15. CRM is NOT…1. …a technology.” • “CRM is just a new system to install, new code to write.”2. …sales force automation (SFA).” • “CRM is just a business development process for our salespeople.”3. …customer loyalty.” • “CRM is a synonym for customer loyalty.”4. …database marketing.” • “CRM just allows us to leverage our customer data better.”5. …call center technology.” • “CRM is just a way to cut costs in the call center.”6. …a project.” • “We can install CRM in 30 days with this team of three!”7. …a producer of intangible benefits.” • “You just can’t measure relationship management concretely.”8. …a business panacea.” • “Just install the software … apparently it solves problems.”
    16. 16. CRM is a customer-focused business philosophy designed to effectively create experiences that attract, acquire and retain customers. To realize the benefits, enterprises must implement collaborative processesand technologies that support customer interactions throughout all channels.
    17. 17. CRM ? A company-wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups.
    18. 18. Customer Relationship Management“ enterprise approach to understandingand influencing communications in orderto improve customer acquisition, customerretention, customer loyalty, and customerprofitability.”
    19. 19. Customer-centric Under this philosophy, the company customizes its products and service offering based on data generated throughinteractions between the customer and the company
    20. 20. CRM Definitions An data-driven approach that An enterprise wide business enables companies to assess eachstrategy designed to optimizeprofitability, revenue and customer customer’s current needs and potential profitability and tailor sales offers andsatisfaction by organizing theenterprise around customer segments, service. It often involves using multiple channels to improve effectiveness andfostering customer-satisfying behaviors efficiency. (Goff et al. 1998 Mckinseyand linking processes from customersthrough supplies. (Gartner Group) Quarterly, No3) A management discipline utilizing An enterprise approach tospecialized tools, technologies, and understanding and influencingtechniques to facilitate the operation customer behavior throughand improvement of front-office continuous relevant communication tobusiness functions with the intent of improve customer acquisition,optimizing the total value derived customer retention, and customerthrough customer relationship. (Pivotal profitability. (NCR corps.,1999)software Inc. 1999)
    21. 21. What is CRM? Organizing Around Organizing Around Tracking Interactions Tracking Interactions Segments SegmentsFostering SatisfactionFostering Satisfaction Linking Processes Linking Processes Special Promotions Special Promotions Targeting Targeting Markets and Individuals Markets and Individuals
    22. 22. People - Belief that your customers and employees areyour most important asset and that long-term survivaldepends on these relationships.Process - Structuring your organization and businessprocesses to support the culture.Technology - Automating and integrating businessprocesses to capitalize on the culture.
    23. 23. CRM is a Management Tool, encompassing all functions, for focusing on the customer Sales Service Marketing Mfg Product Planning Purchasing Spares R&DCRM is a set of operating business processes built around the customer
    24. 24. CRM is the front end (customer facing) activity. It needs to be firmlysupported by all other back-end processes. CRM ERP FAST FWD SCM R&D MFG PURCHASING All improvement initiatives under the CRM Umbrella
    25. 25. Makes Four Marketing Dreams Come True1. Dream to target and serve customers on an individual basis ( prefer 1 to1 marketing to mass marketing.2. Dream to enjoy log term relationships with them, especially with the profitable customers (preferring commitment to flirting).3. Dream to get rid of barriers and distortions created by the non-value adding intermediaries (preferring disintermediarization and direct marketing)4. Dream to reduce marketing cost progressively.
    26. 26. Architecture of CRM There are three parts of application architecture of CRM: operational - automation to the basic business processes (marketing, sales, service) analytical - support to analyze customer behavior, implements business intelligence alike technology co-operational - ensures the contact with customers (phone, email, fax, web, sms, post, in person)
    27. 27. Operational CRM Operational CRM means supporting the so-called "front office" business processes, which include customer contact (sales, marketing and service) Operational part of CRM typically involves three general areas of business: Sales force automation (SFA) Customer service and support (CSS) Enterprise marketing automation (EMA)
    28. 28. Analytical CRM Data gathered within operational CRM are analyzed to segment customers or to identify cross- and up-selling potential.Collaborative CRM Collaborative CRM facilitates interactions with customers through all channels (personal, letter, fax, phone, web, e-mail) and supports co-ordination of employee teams and channel.
    29. 29. CRM Components Closed Loop Processing Operational CRM Analytical CRM Business Operation Management Planning/ Business Performance Management Analysis Action Marketing data Sales Data Customer DataMarketing Sales Service Analysis Analysis Analysis Feed Back Collaborative CRM Customer Interaction Management Web Call Center Web Sales Personalization Automation & Service
    30. 30. Add Customer Attrition to the P&L Sheet
    31. 31. Components of Operational and Analytical CRM Operational CRM: effective and efficient use and management of people, process and technology Analytical CRM: the measurement of people, process and technology
    32. 32. Value Value Segmentation Segmentation Conversion Member CustomerRetain Communication Communication Bridge the divide….
    33. 33. Customer is KING Understand him !!!Bottom-line !!!!
    34. 34. How to build Loyalty? Framework of building Loyalty Degree of Drivers Phased Elements Relationship Improving Customer Attitude, Core Products/Service Satisfaction not Action Innovation of Channel Mgmt. Reward Program Repurchase Action, not Affinity CustomerCRM /Continuing Campaign / Cross-selling (Artificial Loyalty) Loyalty Recognition Trust/ (CR Strategy) of Relationship, Intimacy Referral
    35. 35. A Brand-Infused Causal Model
    36. 36. Loyalty-the customer-facing tip of the CRM Iceberg Increase Cross-sell Encourage Loyalty Multi-channel Buying CRM Encourage Identify WOM Customers at(word of mouth) Customer Direct all Touchpoints CommunicationsIncrease Email (email, postcards, etc.) Click-thru and Increase Re-buy Open Rates Rates
    37. 37. OrganizationCustomers
    38. 38. Touchpoints Field Sales Website Email Call Center POS Traditional Mail Retail Fax PDA
    39. 39. Field Sales Sales Website Email MarketingCall Center POS ServiceTraditional Mail Retail Finance Fax Production PDA
    40. 40. Field Sales Sales Website Email MarketingCall Center POS ServiceTraditional Mail Retail Finance Fax Production PDA
    41. 41. Field Sales Sales Website Email MarketingCall Center POS CRM ServiceTraditional Mail Retail Finance Fax Production PDA
    42. 42. Process, Technology, People Field Sales Sales Website Selling Knowledge Product Knowledge Email Solutions Knowledge Customer Knowledge Marketing Call Center POS CRM Service Traditional Mail Retail Finance Fax Production PDA
    43. 43. That’s is the introduction and familiarization withCRM…