CRM and Marketing Strategy
CRM Marketing initiatives
Sales Force Automation
Campaign Management, Call Centers
Practice of CRM: CRM in Consumer Markets
CRM in Services Sector, CRM in Mass Markets
CRM in Manufacturing Sector
Customer Relationship Management Unit-4 IMBA Osmania University
3. Unit – IV: CRM and
Marketing Strategy
CRM Marketing initiatives
Sales Force Automation
Campaign Management, Call Centers
Practice of CRM: CRM in Consumer
Markets
CRM in Services Sector, CRM in Mass
Markets
CRM in Manufacturing Sector
4. CRM Marketing Initiatives
a)Behavior Prediction
b)Customer Profitability and Value
Modeling
c)Customer Privacy
d)Cross-Selling and Up-Selling
e)Customer Retention
f)Channel Optimization
g)Personalization
h)Event Based Marketing
5. Behavior Prediction
Behavior Prediction helps marketing
departments determine what customers are
likely to do in future.
Behavior Prediction extrapolates historical
customer behavior to foresee future behaviors.
6. Customer Profitability and Value Modeling
Calculating overall customer profitability is a
difficult task.
This requires extensive processing and detailed data,
combined with the high cost of specialized
quantifiable profitability-model.
Price sensitive customers can never recoup their
value, irrespective of their purchase volume, yet
certain low-volume customers were nevertheless
highly profitable.
7. Life Time Value of Customer
Hindustan Thomson Associates, research shows that the lifetime
value of a one cigarette smoker is Rs. 1.10 lakh over a 10 year
period, which is roughly 7,000 times the value of a single pack of
cigarettes.
Calculation for a customer’s lifetime value
Profit margin: the annual revenue that customers generate
minus the costs a company incurs in serving them
Retention Rate: the percentage of total customers expected to
repeat purchase
Discounting Rate: the current cost of capital
Time: the expected duration of the relationship
8. Customer Privacy
Indiscriminate use of consumer information is at the heart of the
privacy debate.
Example Pizza Consumers are feeling harassed.
CRM initiative in this is “the customer doesn’t care about the
company’s intent – it’s the behavior that counts.”
Up-Selling and Cross-Selling
The outcome of effective CRM system is
Up-selling and Cross Selling
9. 1. Bundling is one way of Cross-Selling or Upselling, in which a
combination of products is sold as a bundle at a price lower than
the total of the individual prices.
2. Cross-Selling is the act of selling a product or service to a
customer as a result of another purchase.
Customer Retention
Companies are now analyzing customer attrition to understand
why customers were leaving for competitors.
10. Analyzing Customer Attrition operates on
the established understanding that keeping an
existing customer is far more cost effective
than acquiring a new one.
More the customer leave, the greater loss of
revenue, loss of the initial acquisition
investment, loss of stable market base for
selling new products.
11. Channel Optimization
The Goal of Marketing (Automation) is to offer
the right message to the right customer at the right
time “Through the Right Channel”.
Understanding the Channels through which
specific customers prefer to interact with your
company is important. The company also must
decide how to communicate with the customers.
12. Personalization
You just logged on to your favorite music web site
“musicahead.com.” the site greets you with” Hi,
Nag, welcome back! We have some new picks for
you ….”.
It is the capability to customize customer
communication based on knowledge preferences and
behaviors at the time of interaction.
Learning and understanding the customer makes
personalization give good results.
13. Event Based Marketing
It is time-sensitive marketing or sales
communication reacting to a customer specific
event.
It is also called “Event Driven Marketing”.
It can apply to a segment of a customers or to
individual customers.
It is to be able to react to customer events in
near real-time, soon after the actual event
occurs.
14. Sales Force Automation
Automation is essential in CRM considering the requirement of handling
a huge size of customer base and the level of complexity in each
sales force related or marketing related tasks.
CRM makes use of three types of automation: Sales Force Automation
(SFA), Marketing Automation (MA), and Services Automation (SA).
Sales force automation helps by making all business actions
pertaining to sales, automatic.
These actions include:
Keeping a track of orders.
Meting out of orders.
Contact management.
Sharing sales information and statistics.
Screening and control of inventory.
Analyzing future sales patterns and behavior.
Evaluating performance of employees in sales.
SFA technology helps a business to collect, store, modify, analyze, and
transport the sales related data.
15. The CRM solution providers also come up
with configurators, the software engines that allows
the customers to customize their products.
For example, Dell computers allows its customers to
interact with the configurator. The customers can
select devices of their own choice and specifications,
and build their own computers.
SFA puts account information directly in the hands
of field sales staff, making them responsible for
maintaining it and thus helps them to be more
productive.
Now, as part of CRM, SFA is also focused on
cultivating customer relationships and improving
customer satisfaction.
16. An SFA software can provide the following
functionalities
Account management − Under this, the salespersons and
managers get a complete overview of customer relationship. It
includes customer’s personal details, contact, past contacts,
past orders delivered, current orders, transactions, etc.
Contact management − It refers customers’ contact numbers,
Email ID, address, contact preferences, etc., for maintaining
contacts by creation, updating, tracking appointments and
contacts, etc.
Contract management − It helps users to manage contracts
with the customers by offering the functions of tracking,
monitoring, progressing, and terminating the contracts.
Document management − It helps the users maintain product
lists, brochures, product specification manuals, price lists, and
quotation templates.
Event management − It enables to plan the events such as
17. Incentives management − The sales managers use
this function to appraise and reward the salesperson’s
efforts. It can be linked to payroll application for
automatic payment.
Lead management − It enables the business to
create, assign leads to various salespersons for equal
task distribution, and track sales leads.
Opportunities management − It enables users to
create opportunity, administer its progress, and
estimate users’ bonus.
Order management − Once the customers agree to
purchase a product, this facility turns quotation into
accurately priced orders. It is composed of price lists
and product configurator.
Pipeline management − It helps to maintain entire
18. Product Encyclopedia − It is an electronic
encyclopedia of products with their names, model
numbers, picture, and specifications. It is made
accessible to the customer online.
Product Configuration − It enables users or
customers to design and price the product by
selecting the specifications of their choice.
Product Visualization − It enables the users or
customers to create a realistic 3D model of the
product. It is created by referring to the technical
diagrams.
Quotation management − It allows the
salespersons and managers to create, edit, and
deliver customized proposal.
19. Benefits of Sales Force Automation
Vendors, salespersons, and managers claim myriad
benefits of implementing and using SFA. Some important
benefits are as listed −
Vendor’s perspective − Improved customer
relationship, staff productivity, and business revenue.
Salesperson’s perspective − More closing
opportunities, short sale cycles, ease of tracking sales
cycle.
Manager’s perspective − Increase in salesforce
productivity and accurate reporting.
Business perspective − Improved customer
relationships, Increase in sales revenue, improved
market share, increase in profitability.
Some Popular Sales force Automation Software Systems
20. Benefits of Sales Force Automation Software
1. Personalized Software: You can get sales force automation
solutions that are customized according to your specific
business. These solutions are completely configurable to meet
your individual business and sales automation needs.
2. Complete Sales Solutions for Executives and Employees:
Sales force automation software can help executives to
define and set individual sales goals, share sales and
advertising information, analyze results and reports, and predict
future courses.
3. Sales employees can benefit as the solutions make it easy for
them to obtain leads, supervise their databases, set
reminders for schedules and appointments, and save numerous
notes, orders, and applications.
4. Swift Launch and Incorporation: Most sales force
automation software can easily be incorporated into your
unique sales programs and can be configured according to your
21. 5. Provides Control: By using sales force
automation software, managers can find out how
their sales team is doing at any given time and also
take care of any possible problems before they get out
of hand. Sales representatives can quickly be brought
up to date by providing all the necessary sales
information in one common place.
6. Safeguards Data: All sales force automation
systems have built-in security tools that help to
safeguard all your data, statistics, and solutions.
Advanced technology in security enables complete
protection of client and company data. Along with this,
these systems have data encryption and user
authentication facilities that help to back up the saved
data and also prevent unauthorized use of your sales
22. Disadvantages of Sales Force
Automation
Detractors claim that sales force management
systems are:
difficult to work with
require additional work inputting data
dehumanize a process that should be personal
require continuous maintenance, information
updating, and system upgrading
costly
difficult to integrate with other management
information systems
23. Campaign Management
Campaign management is the planning, execution,
tracking, and analysis of a marketing initiative.
This might be a marketing campaign to launch a new
product launch or an event but could equally be a small
promotion.
Campaign management software helps businesses
manage the various aspects of a marketing campaign.
The objective is to optimize sales and profitability by
keeping track of the campaign spend versus the campaign
success rate.
Campaign management means identifying the strategies
you will use to support your business goals, then
designing, planning, testing and monitoring the campaign,
and analyzing the results along the way.
24. A marketing campaign is a concentrated
marketing plan that involves the organizing and
strategizing of efforts to attain a specific
company goal. The goal may be to:
Raise brand awareness
Attract new customers
Generate more leads and sales
Promote new products or services
Build brand loyalty
25. Steps to effective marketing campaign
management
1. Define your goals and how to measure them
2. Define how you will measure the success of
your campaign
3. Define your audience
4. Decide on your resources
5. Make a marketing budget
6. Create content
7. Create and monitor your workflow and
timetable
8. Test and evaluate all the elements of your
campaign
26. Benefits of Campaign Management:
Simplified campaign planning
Facilitated management of simple to complex multi-
stage campaigns
A wide range of communication channels for
customer engagement
Automation of personalized campaigns
Creating personalized offers resulting in better
sales
Instant access to customer data
Real-time campaign performance analysis
A quick insight into marketing costs and the budget
A simplified, efficient campaign preparation process
27. How to Choose the Best Marketing Campaign Tools
For Your Organization
Ask yourself these questions before deciding:
How often do you conduct marketing campaigns and how
many people are you targeting?
How complex are your campaigns? How many marketing
channels are you using and how are you tracking your
goals?
How many people need access to your marketing
campaign software?
What platforms are you currently using? Can you upgrade
your existing tools? What expertise do you have in-house
to develop the programs you need?
What other systems need to be integrated with your
marketing software? Do you need a content management
system? How will the system work with your customer
28. CRM in Services Sector
SERVICE SECTOR
For the last 30 years there has been a substantial shift.
The tertiary sector is now the largest sector of the economy.
The service sector consists of the “soft” parts of the economy,
where people offer their knowledge and time to improve
productivity, performance, potential.
The basic characteristic of this sector is the production of
services instead of end products.
It differs from traditional businesses in the way that your services
are recurring in nature rather than a one time purchase.
Your customers want personalized service, contact-on-demand,
quick solutions, and direct communication with their field agents.
29. Major Challenges in Service Industry
:
How to manage customer escalations &
complain?
How to manage Service Level Agreement
(SLA)?
Can we count the after sales support &
service Earnings and expenditures?
How to do prior scheduling for service
Engineer’s work (Installations, product
services)?
30. CRM IN SERVICE SECTOR
The service sector is receiving much deserved
attention resulting from its inevitable role in a
country’s economic development, where it is mainly
focusing on developing an inbound relationship with
the customer.
Because service is an “intangible good” include
attention, advice, experience, discussion.
The scope of CRM in service sector is vast where it
includes Government, health care /hospitality,
education, banking, insurance, financial, legal,
consulting, news media, hospitality(restaurants,
hotels, casinos ), tourism, retail sales etc.,
31. Hospitality opts for CRM :-
Developing CRM strategies
Information and Communication
Technologies(ICT)
CRM based market research
Health Care Industry opts for CRM
Communication Services
Data base Construction
CRM for Physicians (Ex: Practo)
Consulting Services
32. Telecom sector opts for CRM
Customer service is Key to sales and loyalty
Customer service become the differentiator
Information Technology opts for CRM
Customer touch points
Application server
Data stores
33. Customer Relationship Management entails all
aspects of interaction a company has with its
customer, whether it is sales or service related; it
starts with the foundation of relationship marketing.
CRM is a systematic approach towards using
information and ongoing dialogue to built long
lasting mutually beneficial relationship.
34. Benefits of CRM in Service Industry
Contact Management
Organizations can deliver robust service to customers with the help of real
time & centric databases; which can be operated from a single point.
Automated Support Scheduler
CRM enables organizations to automate intimations about their job such as
installation, warranty expires and PMS (Property Management System) visits;
so that you never miss any opportunity to improve their SLA (Service Level
Agreement).
Maximizes Engineer’s Productivity
CRM enables service managers to view status of all the service activities, in
terms of PMS, and after sales support.
It also helps you to increase Support Engineer’s Productivity.
One can manage long term customer relations by giving them good customer
service.
Increase Customer Satisfaction
CRM helps you to enhance customer satisfaction, and to gather feedback
from customers, analyzing and evaluating the responses to create customer
35. Features of CRM for Service-based Industries
Unify Customer Interaction
Get quick access to contact information across numerous channels like
telephone, email, live chat, and social media.
Simplify Billing and Payments with Invoices
Create invoices on the go and easily send them directly to customers with the
Invoice integration.
Replace pen and paper with digital invoices. Create invoices directly from
CRM and mark all the payment statuses to stay on top of your bills.
Maintain Service Catalogs
Build a catalog of your services inside CRM.
Define each service, set dates and times for the availability of each and
everyone, and assign staff to handle and deliver them.
Assign and Track Jobs
Jobs can be allocated to one or more members of the team.
All the notifications are sent to the team members, alerting them of their
newly allocated job.
Customized sheets will guide the team to record all the required information
36. CRM in Manufacturing Sector
Any product you see has been manufactured somewhere
in the world.
There is a complex yet magical process involved in
transforming mere raw material into unique products.
Between a long chain of distributors/retailers and
complex sales cycles, you and your sales and marketing
teams must understand the distributors’ and consumer
requirements, forecast demand accurately, and
manufacture products accordingly.
it doesn’t give you the clarity needed for smart decision-
making and results in a disconnected customer
experience.
Ultimately, it doesn’t give you the clarity needed for smart
decision-making and results in a disconnected customer
experience.
37. CRM in the manufacturing sector can give
useful insights about operations, inventory
management, order processing, warehousing
and distribution chains.
Having an intelligent supply chain can deliver
phenomenal results as it empowers firms to
manage production schedules.
Companies are leveraging CRM for
Manufacturing Industry to streamline their
business processes and deliver unparalleled
customer service.
38. Need/Importance of CRM to Manufacturing
sector
1. Better Close Rates & Sales Performance
A CRM lets you centralize all your sales conversations in
one place.
2. Increased Customer Satisfaction & Loyalty
A CRM isn’t a valuable tool just for potential customers,
it’s also a valuable tool for managing the relationship you
have with your current customers.
3. Better Demand Forecasting
A CRM will also help your sales team forecast future sales
growth based on their pipeline of potential deals. A bettear
understanding of all of your potential deals, means you
know what jobs your shop has now, but also what jobs will
39. 4. Greater Supply Chain Visibility
A manufacturing CRM can also help you better understand
and manage your supply chain.
Coupling the sales forecast data from your CRM with
detailed and useful insights about operations, inventory
management, order processing, warehousing, and
distribution chains from your ERP allows for better
production planning and supply chain management.
This level of enhanced visibility, catalyzed by the presence
of a CRM, is often referred to as an “intelligent supply
chain”.
5. Product Quality Improvements
A CRM can also give you insights into what your customers
think about your products, and how you can improve quality
and consistency.
40. Reasons for CRM in manufacturing sector
Accurate Demand Forecasting.
Improved Product Quality.
Intelligent Supply Chain.
Enrichment of Customer Relationships.
Expansion of business by word of mouth
Creating brand value and image
41. CRM in consumer markets
One of the common uses of customer relationship management
(CRM) in consumer markets is to rank customers on profitability
or lifetime value measures.
Given the commoditized nature of many markets today, does
customer relationship management—and its associated focus
on quality, value, and satisfaction.
To develop an effective theory of relationship marketing, it is
necessary to understand what motivates consumers to reduce
their available market choices and engage in a relational market
behavior by patronizing the same marketer in subsequent
choice situations.
consumers engage in relational market behavior due to
personal influences, social influences, and institutional
influences. Consumers reduce their available choice and
engage in relational market behavior because they want to
simplify their buying and consuming tasks, simplify information
42. The willingness and ability of both consumers and marketers
to engage in relational marketing will lead to greater
marketing productivity, unless either consumers or marketers
abuse the mutual interdependence and cooperation.
The greater the expectation for future positive reinforcements,
the greater will be the consumer propensity to engage in
relational market behavior.
The greater the need for information, knowledge and
expertise in making choices, the greater will be the consumer
propensity to engage in relational market behavior.
The greater the potential of a market choice to fulfill social
aspirations or reduce social risks, the greater will be
consumer propensity to adopt relational market behavior.
Consumers are more likely to maintain relationships with
those market choices that are mandated by the government,
especially if those choices also serve the consumers' self
interests – regulating – punishment fear - markets / products
43. Consequences of CRM in consumer markets
Improvement in market productivity
Achieving market effectiveness
Individual marketing
Consumer Involvement
Minimization of the negative image of
marketing
Achieving market efficiency :
Consumer retention
Making resources more productive
Asking consumers to do marketers' work
44. CRM in Mass market
The implementation of CRM in a Mass marketing
concept is always a challenge because the CRM tries to
provide customization and individualization where as the
Mass marketing depends on the approach of One
product for all.
CRM-in mass market is a term referring to the strategies
and tactics, as well as to the technologies supporting the
execution of said strategies and tactics, marketers use
this for managing the relationship with their customers
throughout the customer lifecycle.
Relationship develops between a customer & an
organization, when there are benefits to both.
CRM in mass markets requires that the market consist of
different benefit segments that can be served. Other
45. CRM involve one or more exchanges over time.
Key features of CRM is its explicit recognition that exchanges
between organization & customer extend beyond strict
economic boundaries.
In mass markets, CRM can facilitate customer intimacy by
invoking emotions in a variety of contexts.
Two way interactions
An exchange relationship between the organization & the customer
requires a two way interaction.
To practice CRM in mass markets, managers must ask, can
customers contact the organization ?
Many organizations keep the address & no. of customer on file to
respond
Two way interactions can reduce the tendency of customer to
switch to new suppliers.
In mass markets, products are frequently delivered by service
employees.
46. Important Questions
1. Explain CRM Marketing initiatives?
2. Elaborate Sales Force Automation?
3. Explain how CRM is practiced in Consumer
Markets, Services Sector and Mass Markets?