Topics CoveredOverview of RetailCRM Implementation Road Map & Steps of CRM ImplementationCRM Roadblocks (4P’s)Phased developmentLearning from customer defectionsEmerging trends in CRMEvaluating customer retention plan
“Rural or Urban, Old OR Young, Malls ORKirana Shops & So on— People from every Nook& Corner needs everything which is available @Retail Store.”
OVERVIEw5th Largest in the world.Entry of MNC—Walmart,Carrefour,CostcoMajor Players—Reliance, Tata, Aditya Birla Group,K Raheja Group.Accounts 12% of GDPOrganized retail (8%)Traditional to Shopping Malls
1995• Emerging2003• Growth2006• Retail Boom2007• Managing it’s NO.1 Position2008• High Retail GOLD Rush2010• Continued Growth
CustomerRetentionandLoyaltyBusinessPerformanceVisibilityDevelopment Storeas a BrandImprovedEmployeeProductivityCustomerSatisfactionHighCustomerProfitabilityReducedCost ofSalesLow costof retainingoldcustomers
Rank Company1 Wall mart2 Kroger3 Target4 Wal Green5 Costco6 The home depot7 CVS caremark8 Lowe’s9 Bestbuy10 Safeway
Rank Company1 REI2 IKEA3 Costco4 Nordstrom5 J Crew6 The Gap7 American Eagleoutfitter8 Anthropologies9 H & M10 DSW
Definition of Customer Retention• Customer Retention is the activity that aselling organization undertakes in order toreduce customer defections.
Facts about CRCost ofacquiringa newcustomerLeakyBucketTheoryCRM ispart ofCRCustomercomplaintCustomersatisfaction V/SCRWhyCustomerswitch?LesseningtheDefectionrate
Advantages of CRZeroCustomerDefectionCustomerchurnMinimisedCustomerdelightImproveprofitability
CustomerRetentionplansCustomer retention is increasinglybecoming more and more important .Most firms offer loyal customer rewards fortheir loyalty.Customer portfolio analysis, customerretaining mareting mix, reorganisation forCustomer retention.However many rewards program aremisunderstood and often wrongly applied.
Customer Portfolio AnalysisOptimalbalance incustomerportfolioReducedefector by10%Design of aportfolioPurchasinghistoryPortfoliosegment
Implementation Road MapA CRM Roadmap is a strategic plan that identifies how anorganization can meet and exceed its customers needs. Thisincludes, but is not limited to, assessing how the sales, marketingand service entities work together to:1. gain insight from their customers (e.g. purchase history, desiredproducts/services),2. produce valuable offerings/products (e.g. personalized product)and3. provide the ultimate customer experience (e.g. multipletouchpoints, 360 degree view of the customer).
•So how do organizations know which CRM capabilities they have,and which they need to realize their strategic goal?•Now we will see primary steps (which have been used cross-industry, including financial services, electronics and high-tech,consumer products, manufacturing, etc.) to follow when developinga CRM Roadmap.CRM Road Map…How?
•The “sponsor” for a CRM Roadmap effort must have a vested interestin the project and ideally has P&L responsibility for the group to beimpacted.•As with any project an organization undertakes that involvessignificant change to business processes, organizational structures, orroles and responsibilities, the lack of key, influential sponsorshipreduces the effectiveness of the project, since there is no driving forcefor implementation.`Step 1: Gain Senior Level Sponsorship
It is critical to gain insights of various key stakeholders anddecision-makers within the organization.Examples of questions that help gauge the health of the clientsCRM include:• How would you define CRM?• What types of customer information is captured/tracked(acquisition/retention costs, churn, cost to serve, etc.)?• What information would you like to know about yourcustomers that you currently do not?Done by interviewing Executives, Managers, Marketers, Frontline staff…Step 2: Gather Information
•Through these meetings, we gain an understanding of theclients current CRM capabilities and significant opportunitiesto improve their customer relationships, and map out findings.•Also important to understand companys future direction(usually between 6 months and 2 years).•Then comparison of current state of CRM against bestpractices within the companies respective industry.Step 3: Assess Current state and DefineFuture state Gaps
•Value opportunities represent the potential benefits delivered bybeing more customer-centric.•Identify and categorize value opportunities along the lines of people,process and technology.•Example of a "process" value opportunity is improving data capturefor all customer contacts across sales functions and touch points (e.g.phone, e-mail, etc.).•"People" value opportunities may involve additional training onservice procedures for capturing customer data.•"Technology" value opportunities might include developing a datawarehouse.Step 4: Identify Value Opportunities
•After determination of where the value opportunities lie.Identification of which strategic CRM capabilities are needed.•Below is a sample of link between a specific value opportunity andits corresponding strategic CRM capabilities:•Value Opportunity :• Improve customer understanding•Strategic CRM Capability:• Possess good knowledge of the customer• Leverage customer information from the service process• Understand customer profitability and cost-to-serve.Step 5: Link Value Opportunities tostrategic CRM Capabilities
•Once value opportunities are prioritized, specific CRM projectsneed to be developed. Defining and executing CRM projects willensure the company masters the relevant strategic CRM capabilities.•An effective way to define relevant projects is throughbrainstorming sessions with the client. Samples of the outcome of asession might include:• Understand customer profitability• Enhance call center operations by implementing sophisticatedtouch-point technologies• Establish a data warehouse• Improve sales force trainingStep 6: Define CRM Projects and Requirements
•Once the projects and requirements are defined, it is necessary todevelop the business case to support or refute the criticality of aspecific project. The business case seeks to justify the moneyinvestment needed and the ROI. Each business case should include:• Details and costs of required resources (people, technology,training, outsourced resources, etc.),• Projected duration of time of each project.• Potential benefits•For example, a typical CRM investment ranges from $10 to $25million (or more) over a three to five year period. The amount iswholly dependent upon how many initiatives have been identifiedand how extensive those initiatives are. Examples:• Marketing Insight initiativeStep 7: Develop Business Case
•Developing a roll-out strategy enables organizations to focus theirresources, money and time on the most important projects that helpthem become customer driven.•Prioritization and phasing of projects is conducted with theexecutive team, a process in which they evaluate the results of thebusiness cases, and consider for each projects financial results,duration, level of effort required, and technical impact.•Critical Success FactorsStep 8: Develop a Roll-out strategy
•Achieving success in developing intimate and enduringrelationships with customers begins with a holistic considerationof an organizations functions and abilities that affect itsconsumers objectives.•Developing a CRM Roadmap therefore, is a continuous processand not just a one-time exercise, because customers needs andpreferences change constantly.•The correct strategy can help your organization form deeperrelationships with its consumers, and also obtain a competitiveadvantage in the marketplace.A Final Thought...
Emerging Trends in CRM1. Near-field Communication2. Location-based Services3. Augmented Reality4. Social Media on Mobile & Social Media asCustomer Service Channel5. Next Generation Mobile Apps
4Ps of CRM Roadblocks• Process• Perception• Privacy• Politics
Process• Companies are slow/unwilling to modifybusiness process to support both customerrelationship comfort zone of staff OR customerold way of doing things, tentativeresponsibilities etc.--Sleepary Scope.
Perception• CRM must be viewed as job enabler not aslatest in the series of doctrine to beimplemented corporate policies.• People are made to believe that they should beable to accomplice the test in less time andpurpose new task as well.
Privacy• Understand the quid procque are more lokelyto share their personal informationwith thecompany if they