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    Unit 1 Unit 1 Presentation Transcript

    • Introduction to CRM
      UNIT1
      9/15/2011
      1
      Prof. Sunitha Ratnakaram
    • Emerging trends in marketing
      Innovative marketing styles
      Green
      Cause
      Buzz
      Mobile
      Network
      Sports
      Social media
      Paid search ads
      Permission Marketing
      9/15/2011
      2
      Prof. Sunitha Ratnakaram
    • Emerging issues
      It’s not about product it’s about social behavior
      It’s not about a cheaper product or your idea. Try to change customer behavior.
      It’s not about better coffee – it’s about the place
      I am not looking for a ¼” drill bit – I need to make a hole
      It’s not about the sound – it’s about how it makes me feel
      It’s about my space
      It’s about my video
      It’s about my opinion
      It’s about the experience
      It’s about your choices, places, and time
      Examples
      Apple, Starbucks, MySpace, Harley-Davidson
      9/15/2011
      3
      Prof. Sunitha Ratnakaram
    • Old paradigm
      Value creator
      4P’s
      9/15/2011
      4
      Prof. Sunitha Ratnakaram
    • New paradigm
      Customer
      Value creator
      Product
      Brand
      4P’s
      9/15/2011
      5
      Prof. Sunitha Ratnakaram
    • Relevance of WoM
      9/15/2011
      6
      Prof. Sunitha Ratnakaram
    • Few Marketing Trends for 2011
      Marketing Trend #1: Increased use of digital media and a decrease in television, radio, and print media.
      Marketing Trend #2: Increased use of quality, targeted content (textual and video) that tells a company's story well and engages the prospective customer.
      Marketing Trend #3: Increased use of e-mail to reach out to prospects and customers more frequently at a very low cost.
      9/15/2011
      7
      Prof. Sunitha Ratnakaram
    • Continued…..
      Marketing Trend #4: Increased use of blogs, social networking, and other social media to create dialog and relationships with prospects and customers.
      Marketing Trend #5: Increased use of search engine marketing (SEM) techniques, such as pay-per-click and other trackable paid marketing techniques.
      Marketing Trend #6: Increased use of online webinars and decreased use of large trade shows.
      Marketing Trend #7: Increased use of outsourced marketing functions to experienced professionals
      9/15/2011
      8
      Prof. Sunitha Ratnakaram
    • CRM Marketing initiatives
      Cross selling and up-selling
      Customer retention
      Behavior prediction
      Customer profitability and value modeling
      Channel optimization
      Personalization
      Event based marketing
      9/15/2011
      9
      Prof. Sunitha Ratnakaram
    • Definition
      The automation of horizontally integrated business processes involving front office customer contact points (marketing, sales, service and support) via multiple, interconnected delivery channels.
      Metagroep
      The infrastructure that enables the description of and increase in customer value, and the correct means by which to motivate valuable customers to remain loyal – indeed, to buy again.
      9/15/2011
      10
      Prof. Sunitha Ratnakaram
    • Few concepts
      The cost of acquiring customers
      From customer acquisition to customer loyalty
      …. To optimizing the customer experience
      9/15/2011
      11
      Prof. Sunitha Ratnakaram
    • Few more
      PRM (Partner RM)
      SRM (Supplier Relationship Management)
      mCRM (mobile CRM)
      xCRM (other letters preceding CRM)
      9/15/2011
      12
      Prof. Sunitha Ratnakaram
    • General properties of relationships, networks and interaction
      Collaboration – suppliers, customers, competitors and govt. agencies
      Longevity
      Commitment, dependency and importance
      Trust, risk and uncertainty
      Power
      Frequency, regularity and intensity
      Adaptation
      Attraction
      9/15/2011
      13
      Prof. Sunitha Ratnakaram
    • Elements of CRM
      The four cornerstones of CRM
      Customer knowledge
      Relationship strategy
      Communication
      The individual value proposition
      9/15/2011
      14
      Prof. Sunitha Ratnakaram
    • Customer knowledge
      Who is the customer?
      Customer profile
      What they purchased?
      How they want to be communicated?
      Current and correct data bases
      Objective is to help customer better, timely and with appropriate solutions
      9/15/2011
      15
      Prof. Sunitha Ratnakaram
    • Relationship strategy
      Tell and listen more than you sell
      Have broader and deeper interest in the right customers
      Completion of transaction is not the end of relationship
      Trust and commitment must grow
      9/15/2011
      16
      Prof. Sunitha Ratnakaram
    • Communication
      Each customer feels that their communication experience was basic with supplier
      Repetition of information
      Strict procedures which become obstacle in problem solving even for simple problems
      Generally conversations are not spontaneous
      Communication problem becomes obvious in multichannel communication system.
      E.g. A customer using mobile, internet, customer care and personal interaction for completing a transaction
      9/15/2011
      17
      Prof. Sunitha Ratnakaram
    • The individual value proposition
      Know individual customer
      Develop a relationship with him/her
      Carry on dialogue
      Do not avoid individual proposition to each customer
      Firm may work on producing standard modules on large scale but assembling in flexible way
      Customized propositions increases complexity, as firm never likes to loose economies of scale
      But sometimes this may not give results
      E.g. A retailer’s complex route planning for delivery vans
      9/15/2011
      18
      Prof. Sunitha Ratnakaram
    • How to make it effective?
      Grow in all aspects step by step
      All are equally important
      One should not move ahead of others
      Expected yield will not materialize
      This may make top mgt. feel contrary of CRM and they may withdrew from implementation
      9/15/2011
      19
      Prof. Sunitha Ratnakaram
    • CRM Capabilities for sales, marketing and service
      CRM Capabilities for sales
      In personal selling process
      Prospecting
      Pre approach
      Approach
      Presentation
      Handling objections
      Closing
      Follow up
      In general selling
      Create customized solutions
      Create unique feel for the customer
      9/15/2011
      20
      Prof. Sunitha Ratnakaram
    • CRM Capabilities for marketing
      Need recognition
      New product development
      Marketing communications
      Segmentation, Targeting and Positioning
      9/15/2011
      21
      Prof. Sunitha Ratnakaram
    • CRM capabilities for services
      After sales services
      Customer grievance handling
      Training customers on new products & periodic monitoring
      9/15/2011
      22
      Prof. Sunitha Ratnakaram
    • Satisfy customers, shareholders, and deliver a measurable ROI
      Customers
      Personalized solutions
      Effective grievance handling
      Services
      Improved service quality
      Reduction of customer stress
      Increased value for money
      Customer empowerment
      Share holders
      Increased EPS due to increase in customer loyalty, cross selling and up selling
      9/15/2011
      23
      Prof. Sunitha Ratnakaram
    • Deliver a measurable ROI
      ROI could be tracked with customers and groups of customers to rework on relations if required
      Case of Royal Bank of Canada
      It’s CRM journey began 6 years ago
      CRM is no longer a program for them but “It is the core strategy”
      Goal is to make each relationship profitable
      Before CRM revenues were growing at 10% and profits 10 – 15% annually
      After implementation of CRM revenue growth touched 15%, and profit growth near 25%
      For them CRM is a journey
      Every new investment is subject to the company’s standard, capital allocation procedures
      Micro measurements like deposit rates, credit limits, direct mail response rates are closely watched
      Every new initiative is tested using a test group and control group before launching
      “Top of the house” metrics like revenue growth, profit growth, cost control etc. also are keenly focused on.
      If you are to succeed with CRM see it as strategy not as a tool.
      9/15/2011
      24
      Prof. Sunitha Ratnakaram
    • Front and Back office
      Tasks in CRM systems
      Primary task – consists in supporting or performing the activities involved in customer contact processes
      E.g. exchange of information, placement of orders, invoicing, payment and provision of service etc.
      Secondary task – is related to facilitating the primary task
      E.g. providing customer information and management information
      A variety of sub systems work for the completion of the said tasks
      9/15/2011
      25
      Prof. Sunitha Ratnakaram
    • Characteristics of front office and back office
      Front office
      Customer data must be easily retrieved and modified
      E.g. within seconds insight may be gained into who the person is on the other end of the telephone line
      Back office
      Which products customer has bought earlier
      Due to it’s difficulty a middleware also works to coordinate front office and back office.
      9/15/2011
      26
      Prof. Sunitha Ratnakaram
    • Front office
      The sales force automation or the sales information system that supports sales person or account manager during face-to-face contact
      The partner management system which is geared towards providing support to intermediaries in the joint approach to the end user market
      The call or contact centre, where incoming and out going traffic by telephone, fax and the Internet takes place
      The website
      The kiosks (points of information)
      9/15/2011
      27
      Prof. Sunitha Ratnakaram
    • Middleware
      The data warehouse or data mart, in which data originating from different sources are compiled to obtain a clear and better customer profile
      The campaign management system that produces the analysis, planning, execution and management of marketing communication campaigns
      The content management system which ensures that data from different sources may be published through different channels using a consistent design.
      9/15/2011
      28
      Prof. Sunitha Ratnakaram
    • Back office
      This usually involves the legacy systems which are generally older and have a longer life span.
      These systems are designed for the management of transactions or products
      E.g. separate systems where different insurances like health, motor and life insurances are maintained by companies
      Here batch processing of large quantities of similar orders only is intended
      Not suitable for real time processing of a large quantity of varied small orders
      9/15/2011
      29
      Prof. Sunitha Ratnakaram
    • CRM process
      9/15/2011
      Prof. Sunitha Ratnakaram
      30
      CRM process is defined as any group of action that is instrumental in the achievement of the output of an operating system, in accordance with a specified measure of effectiveness.
    • CRM process
      9/15/2011
      31
      Prof. Sunitha Ratnakaram
    • Benefits
      9/15/2011
      Prof. Sunitha Ratnakaram
      32
      Ability to retain loyal and profitable customers and channels for rapid growth of the business project
      Acquiring the right customers, based on known characteristics, which drives growth and increased profit margins
      Increasing individual customer margins, while offering the right products at the right time.
    • Identify the goals of CRM
      9/15/2011
      Prof. Sunitha Ratnakaram
      33
      Increase in Customer Service
      Increasing Efficiency
      Aiding the Marketing Department
      Questions to ask while establishing CRM goals:
      What are your main goals/objectives?
      Who is your audience?
      What is the best way to achieve CRM goals?
      How will you accomplish your CRM goals?
      How will you measure success?
    • Benefits of identifying goals of CRM
      Establishing clear CRM goals is vital to any organization.
      After a clear view of this has been obtained going ahead with the CRM implementation will be infinitely easier and will result in reduced costs, efforts, time and no wastage of organization resources.
      Overall success is possible as the end objective is clearly defined and can be worked towards easily with employee cooperation.
      9/15/2011
      34
      Prof. Sunitha Ratnakaram
    • Customer-centric business strategy and CRM process
      9/15/2011
      Prof. Sunitha Ratnakaram
      35
      CRM is a business strategy, so it’s more than a functional strategy.
      It affects organization as a whole
      Marketing
      IT
      Service
      Logistics
      Finance
      Production and development
      HRM etc.
    • Continued….
      9/15/2011
      Prof. Sunitha Ratnakaram
      36
      The CRM strategy will have to provide direction to each department or employee that maintains contact with customers
      Customer-oriented approach of employees and managers should improve
      In practice, when it comes to CRM, many companies focus on increasing efficiency and reliability
      Self – service grants to customers like, tax filing, IRCTC, other travel and tourism bookings
      For these services to be more efficient perfect definition and control of all activities involved is required.
    • Continued …..
      9/15/2011
      Prof. Sunitha Ratnakaram
      37
      Focusing only on operational excellence would not make CRM as a strategic approach
      Goal of CRM is the development of long-term, mutually profitable customer-supplier relationships, where customer is given central position
      CRM’s goal as business strategy is to increase ‘customer intimacy’