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MIS 13 Customer Relationship Management
 

MIS 13 Customer Relationship Management

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The slides are created for 'Management Information System' subject of SEIT under University of Pune, INDIA....

The slides are created for 'Management Information System' subject of SEIT under University of Pune, INDIA.
Subject Teacher: Mr. Tushar B Kute,
Sandip Institute of Technology and Research Centre, Nashik.

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    MIS 13 Customer Relationship Management MIS 13 Customer Relationship Management Presentation Transcript

    • Management information system
      Third Year Information Technology
      Part 13
      Customer Relationship Management
      Tushar B Kute,
      Sandip Institute of Technology and Research Centre, Nashik
      http://www.tusharkute.com
    • CRM
      Of the people, by the people, and for the people.
    • Three Eras in the History of Marketing
      Production Era
      “A good product will sell itself.”
      Sales Era
      “Creative advertising and selling will overcome consumer resistance and convince them to buy.”
      Marketing Era
      “The consumer is king! Find a need and fill it.”
    • Profitability of Long-Life Customers
      According to a study conducted by the American Management Association, 65 percent of the average company’s business comes from its present, satisfied customers
      Costs a company 6x’s more to sell a product to a new customer than it does to an existing one
    • Profitability of Long-Life Customers
      A business that each day for one year loses one customer who customarily spends $50/week would suffer a sales decline of $1,000,000 the next year
      Reichheldfound that companies could boost profits by 100 percent by retaining just 5 percent more of their customers.
    • Relationship Marketing
      Relationship marketing involves long-term, value-added relationships developed over time with customers and suppliers.
      Relationship marketing recognizes the critical importance of internal marketing to the success of external marketing plans.
    • Relationship Marketing
      Morgan and Hunt (1994) proposed the following definition of relationship marketing:
      Relationship marketing refers to all marketing activities directed toward establishing, developing, and maintaining successful relationship exchanges
    • Customer Relationship Management
      “Process of creating and maintaining relationships with business customers or consumers”
      “A holistic process of identifying, attracting, differentiating, and retaining customers”
      “Integrating the firm’s value chain to create enhanced customer value at every step”
      “An integrated cross-functional focus on improving customer retention and profitability for the company.”
      “A view of the customer that asserts that he or she is a valuable asset to be managed.” –S. Thomas Foster.
      Deciding that “you want lifetime clients.” -Richard Buckingham.
    • Customer Relationship Management
      Bottom-line:
      The use of information-enabled systems for enhancing individual customer relationships to ensure long-term customer loyalty and retention
    • Crm configuration
      Front office operations
      Meetings, phone calls, emails, online services.
      Back office operations
      Billing, maintenance, planning, marketing, advertising, finance, manufacturing.
      Business relationships
      Interaction with companies and partners, suppliers, vendors and retail outlets, distributors.
    • Complaint Resolution
      Feedback
      Guarantees
      Corrective Action
      Four tools
    • Complaint resolution
      Three types of complaints: Regulatory, Employee, Customer
      Compensation
      Ease of Resolution
    • feedback
      Customer Data
      Customer Behavior
      Data-gathering
      Analyzing Data
    • guarantees
      Customer Rights
      Guarantee Design:
      Unconditional
      Meaningful
      Communicable
      Painless to invoke
    • The way a firm reacts to a problem so that the problem never reoccurs.
      Corrective action
    • Barne’s 4 r’s
    • A low-cost way to increase revenue. Retention is cheaper than acquisition.
      Must be voluntary.
      Must lead to long-term relationships.
      Customer retention
    • Relationships
      Attempting to know the customer.
      Commitment and Communication
      “Clients should call you only once. After that, you should proactively call them.” –Richard Buckingham.
    • Powerful tool that results from customer satisfaction or dissatisfaction.
      “Referral clients are already sold, before they even call you.” –Richard Buckingham
      referrals
    • Empower employees so that they may deal with mistakes as they occur.
      recovery
    • CUSTOMER RELATIONSHIP MANAGEMENT
      Time line of CRM evolution
      First Generation(before 1990)started with such functions like maintaining prospects data, generating leads, creating sales quotations & placing sales orders and other functions like after sales help desks, call centers etc
      Second Generation (1990-1996) consolidation of various activities into pre-sales through SFA transactions and post sales through CSS. Not much of an integration with back office operations
      Third Generation( After 2002) integration of the customer facing front end systems with the back end systems as well as with partners& suppliers helped by the growth of the Internet technology.
    • Types of CRM
      Operational CRM automation of Business processes involving customers. e.g. Sales Force Automation, Customer service automation, Customer Touchpoints- all sources by which the customers interact with the company
      Analytical CRM is the synthesis & interpretation of operational Data to identify opportunities, optimize customer interactions and manage business performance. e.g. Data warehousing and Data marts
      Collaborative CRM provide interactions between customers, staff and business partners through web technologies. e.g. interactive voice technology, computer telephony and web conferencing.
    • CHANGES WITH RESPECT TO CUSTOMERS
      Growing Customer Diversity
      Time Scarcity
      Value Consciousness & intolerance for Low Service Level
      Information Availability
      Decrease in Loyalty
      CHANGES WITH RESPECT TO MARKETPLACE
      Growing Competition
      CHANGES WITH RESPECT TO DATA STORAGE TECH.
      IT and ITES
      CHANGES WITH RESPECT TO MARKETING FUNCTION
      Media Dilution & Multiplication
      Decrease in Marketing Efficiency
      WHY IS CRM IMPORTANT TODAY?
    • CRM Objectives
      Lifetime Value (LTV)
      Refers to the net present value of the potential revenue stream for any particular customer over a number of years.
      Starts with current purchase activity then extrapolates to include potential additions from cross-selling, upgrades, total ownership, etc.
      Customer Ownership
      Attempts to “own” the lionshare of customer spending and/or “share of mind” in a particular product category
      Building brand equity, maintaining vigilant customer contact, keeping current with the market trends is critical
      5% points increase in customer retention=20-125% increase in profit
    • Is CRM New?
      No!
      Simply an extension of relationship marketing
      Builds on customer service and satisfaction concepts
      Just the latest buzzword for creating customer orientation
      Bottom-line is still the same
      Yes!
      A shift in corporate philosophy concerning the approach to value delivery
      Customer-centric approach to value chain
      New and technology-enhanced processes
      Focus is not just on bottom-line, but on top-line
      Goal is to create satisfying experiences across all customer contact points
    • Approaches to crm
      Data driven approach.
      Process driven approach.
    • Data driven approach
      It relies on the past data and information and customer intelligence for designing CRM strategies.
      Customer
      intelligence
      Customer
      Data
      Analysis and
      Processing
      Evolve CRM
      Strategies
      Implement
      Strategies
      Evaluate and
      Modify
    • process driven approach
      The CRM solution senses the behavior of the customer and act proactively to deliver the service.
      Initiation
      Of
      service
      Transition
      to
      service
      Preservice
      Service
      Post-
      Service
      Customer
      Knowledge
      Database
      Evaluate
      KMS
    • CRM-Related Terms
      eCRM
      CRM that is Web-based
      ECRM
      Enterprise CRM
      PRM
      Partner relationship management
      cCRM
      Collaborative CRM
    • CRM-Related Terms
      SRM
      Supplier relationship management
      mCRM
      Mobile CRM
      xCRM
      More hybrids to com
    • “You can learn a lot about our motorcycle company by understanding our customers. By valuing and responding to our customers, we have become the leader in the heavyweight motorcycle market.” –Harley-Davidson website
      “The customers’ first choice in casual dining.” –Chili’s Vision
      quotes
    • references
      WamanJawadekar, "Management Information Systems” , 4th Edition, Tata McGraw-Hill Publishing Company Limited.
      Tushar B Kute,
      Sandip Institute of Technology and Research Centre, Nashik
      http://www.tusharkute.com