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  • 1. Introduction to CRM
    UNIT1
    9/15/2011
    1
    Prof. Sunitha Ratnakaram
  • 2. 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
  • 3. 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
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    Prof. Sunitha Ratnakaram
  • 4. Old paradigm
    Value creator
    4P’s
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    4
    Prof. Sunitha Ratnakaram
  • 5. New paradigm
    Customer
    Value creator
    Product
    Brand
    4P’s
    9/15/2011
    5
    Prof. Sunitha Ratnakaram
  • 6. Relevance of WoM
    9/15/2011
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    Prof. Sunitha Ratnakaram
  • 7. 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
  • 8. 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
  • 9. 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
  • 10. 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
  • 11. Few concepts
    The cost of acquiring customers
    From customer acquisition to customer loyalty
    …. To optimizing the customer experience
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    11
    Prof. Sunitha Ratnakaram
  • 12. Few more
    PRM (Partner RM)
    SRM (Supplier Relationship Management)
    mCRM (mobile CRM)
    xCRM (other letters preceding CRM)
    9/15/2011
    12
    Prof. Sunitha Ratnakaram
  • 13. 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
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    Prof. Sunitha Ratnakaram
  • 14. Elements of CRM
    The four cornerstones of CRM
    Customer knowledge
    Relationship strategy
    Communication
    The individual value proposition
    9/15/2011
    14
    Prof. Sunitha Ratnakaram
  • 15. 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
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    Prof. Sunitha Ratnakaram
  • 16. 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
  • 17. 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
  • 18. 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
  • 19. 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
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    Prof. Sunitha Ratnakaram
  • 20. 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
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    Prof. Sunitha Ratnakaram
  • 21. CRM Capabilities for marketing
    Need recognition
    New product development
    Marketing communications
    Segmentation, Targeting and Positioning
    9/15/2011
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    Prof. Sunitha Ratnakaram
  • 22. CRM capabilities for services
    After sales services
    Customer grievance handling
    Training customers on new products & periodic monitoring
    9/15/2011
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    Prof. Sunitha Ratnakaram
  • 23. 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
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    Prof. Sunitha Ratnakaram
  • 24. 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
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    Prof. Sunitha Ratnakaram
  • 25. 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
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    Prof. Sunitha Ratnakaram
  • 26. 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
  • 27. 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
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    Prof. Sunitha Ratnakaram
  • 28. 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
  • 29. 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
  • 30. 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.
  • 31. CRM process
    9/15/2011
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    Prof. Sunitha Ratnakaram
  • 32. 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.
  • 33. 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?
  • 34. 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
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    Prof. Sunitha Ratnakaram
  • 35. 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.
  • 36. 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.
  • 37. 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’