Lecture Slides 11 05 08
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Lecture Slides 11 05 08 Lecture Slides 11 05 08 Presentation Transcript

  • ITM 309 Customer Relationship Management Dr. Frederick Rodammer Michigan State University Eli Broad College of Business [email_address] November 5, 2008
  • Today’s Learning Objectives
    • Understand the definition and the basic principles of Customer Relationship Management (CRM)
    • Discuss the Mini Customer First Case
    • Understand operational and analytical customer relationship management
  • OPENING CASE Mini Cooper – Customer First
    • How could Mini’s sales department and/or customer service department use CRM technology to improve its operations?
    • How could analytical CRM be applied to benefit companies like Mini ?
    • How might Mini’s business model change if it decreased its investments in CRM technologies?
    • What happens if our customers are not satisfied and relationships are poor ?
    • What happens if our customers are delighted and relationships are great ?
    • What ideas do you have to establish superior relationships with customers ?
  • Customer Relationship Management: Definition The use of information technology to create a cross-functional enterprise system that integrates and automates many of the customer-serving processes in sales, marketing, and customer services that interact with a company’s customers
  • Customer Relationship Management
    • Provides customer-facing employees with a single, complete view of every customer at every touch point
    • Provides customers with a single complete company view
    • Integrates and automates many customer processes
    • Creates an IT framework of Web-enabled software and databases that integrates front office with back office
    • Includes many software modules and tools
  • CRM Benefits
    • CRM allows a business to identify and target their best customers so they can be retained as lifelong customers for greater and more profitable services.
    • CRM makes possible real-time customization and personalization of products and services based on customer wants, needs, buying habits, and life cycles.
    • CRM can keep track of when a customer contacts the company, regardless of the contact point .
    • CRM systems can enable a company to provide a consistent customer experience and superior service and support across all the contact points a customer chooses.
    • CRM enables an organization to:
      • Provide better customer service
      • Make call centers more efficient
      • Cross sell products more effectively
      • Help sales staff close deals faster
      • Simplify marketing and sales processes
      • Discover new customers
      • Increase customer revenues
    • Organizations can find their most valuable customers through “RFM” - R ecency, F requency, and M onetary value
      • How recently a customer purchased items (Recency)
      • How frequently a customer purchased items (Frequency)
      • How much a customer spends on each purchase (Monetary Value)
  • The Evolution of CRM
    • Three phases in the evolution of CRM include reporting, analyzing, and predicting
  • The Evolution of CRM
    • CRM reporting technology – help organizations identify their customers across other applications
    • CRM analysis technologies – help organization segment their customers into categories such as best and worst customers
    • CRM predicting technologies – help organizations make predictions regarding customer behavior such as which customers are at risk of leaving
  • The Evolution of CRM
  • Operational and Analytical CRM
    • Operational CRM – supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers
    • Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers
    • Personalization – when a Web site knows enough about a persons likes and dislikes that it can fashion offers that are more likely to appeal to that person
    • 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
  • ITM 309 Homework
    • Do great with your Team Projects !
    • Check ANGEL for your grades
    • Assignment #5 due November 19-20