SIA

1. CHAPTER 9
Information Systems, Management, and
Decision Making

2. CHAPTER OUTLINE
9.1 Defining Customer Relationship
Management
9.2 Operational Customer Relationship
Management
9.3 Analytical Customer Relationship
Management
9.4 Other Types of Customer Relationship
Management Applications

3. LEARNING OBJECTIVES
 Define customer relationship management
and discuss the objectives of CRM.
 Describe operational CRM and its major
components.
 Describe analytical CRM.
 Discuss mobile CRM, on-demand CRM, and
open-source CRM.

4. Chapter Opening Case

5. From Neighborhood Stores…….
Personal

6. To Today…..
Impersonal
Giant malls
The Web
Mobile population

7. Customer Intimacy?
Your
customer
You
Your
competition
Your problem

8. The Need for CRM
 It costs six times more to sell to a new
customer than to sell to an existing one.
 A typical dissatisfied customer will tell 8-10
people.
 By increasing the customer retention rate
by 5%, profits could increase by 85%.
 Odds of selling to new customers = 15%,
compared to the odds of selling to existing
customers (50%)
 70% of complaining customers will remain
loyal if their problem is solved

9. 9.1 Defining Customer Relationship Management

10. Tenets of CRM
 One-to-one relationship between a customer and a
seller.
 “Treat different customers differently.”
 Keep profitable customers and maximize
lifetime revenue from them.

12. Lifetime Customer Value

13. “Miracle on the Hudson”

14. Customer Touch Points
CUSTOMER
Smart
Phone
Web Computer
Physical
Store
Sales
Representative
Customer
Service
Service
Center
Email
Direct
Mail
Field
Service
Technician

15. 360-Degree View of Customers

16. Data Consolidation
Accounting
Finance
Marketing MIS
POM
HR
Customer

17. 9.2 Operational CRM
Two major components of operational CRM:
 Customer-facing applications
 Customer-touching applications

18. Customer-Facing Applications
Customer service and support
Sales force
automation
Marketing
Campaign management

19. Configurators

20. Marketing
Cross selling
Up selling
Bundling

21. Customer-Touching Applications
Search and comparison capabilities
Technical and other information and
services
Customized products and services
Loyalty programs

22. Fraud at Subway
Old stamp program New card program

23. 9.3 Analytical CRM
Analytical CRM systems analyze customer
behavior and perceptions in order to provide
actionable business intelligence.

24. The Relationship Between Operational
CRM and Analytical CRM
• Sales
• Marketing
• Customer Service and
Support
• Campaign Management
Customer-facing Applications
• Search and Comparison
• Customized Products
• Technical Information
• Personalized Web Pages
• FAQ
• E-mail / Auto Response
• Loyalty Programs
Customer-touching Applications
• Data Mining
• Decision Support
• Business Intelligence
• OLAP
Customer
Data
Warehouse

25. 9.4 Other Types of CRM
Open-source CRM
Mobile CRM: Pal Mickey
at Disneyworld
On-demand CRM

26. Chapter Closing Case