CRM and Its Synergy with Marketing

www.skali.com www.skali.net© 2002 Skali. All rights reserved
Customer Relationship Management
and its Synergy with
Marketing
15th Jan 2002
Aimi Aizal Nasharuddin
Executive Director
aizal@skali.com

Table of Content
Facts of Sales and Marketing
CRM an Overview
CRM and Marketing
Information as Core for CRM
Lifetime Consumer value
Adding value to customer
Improving Service Standard
CRM challenges
Summary

• Times are “bad”…
• Market seems to shrink - less people spending
• Customers can’t pay
• Customers close down operation
• Competitors seem to cut pricing…”price war”?
• Not enough or no budget for advertising and marketing
The Current Scenario

• The customers always right?
– Or the right customers always right..
• If you don’t sell to them…someone else will
• Customers are complex
– they demand respect, friendliness, promptness etc….they
wanna feel special.
• Selling to Existing Customers is 70% cheaper than
acquiring new ones
About Customers

Why Customers Leave You
1%
3%
5%
9%
14%
68%
Death
Move Location
Support Family/Friend's Biz
Switch to Cheaper
Unsatisfied service/quality
Indifference
Source: Fabled Service by Betsy Sanders

Lesson Learn
• The need to implement tactical approach in
marketing and sales becoming more crucial than
before.
• Retaining the right customers….snowballing into
higher investment return
• More than 80% of factors why customers leave
you are within your control….

What is CRM?
CRM an Overview
• A systematic way that facilitates and records an interaction between a customer and a company with many may get the help of Modern Information Technology in the new era.
– Often involves change in operational processes. Especially in Sales and Marketing and Customer Services.
– An effort in enhancing organisation’s efficiency in providing services to customer.
– A form of knowledge management.
• …………… What do you think?

Customer Relation
• It is about Knowing and Understand Your Customer Better
– has been traditionally practiced on individual basis
CRM an Overview
• Company must own the Relation not the individual contact
point.
Management

Customer Relationship Management
Product and
Advertising
Strategies
Reach
CRM manages Customer lifecycle
by providing valuable inputs for
business strategies
Acquire
Sales
Strategies
Grow
Marketing
Strategies
Retain
Customer
loyalty
programme
Cross sell
Up sell
New
business
development
plus product
extension
and
innovation
CRM an Overview

Why Businesses Adopt CRM?
• Increase Sales Effectiveness
– Selling what your customer wants not what you
can offer
• Increase Revenue
– Happy customer buys more
• Improve Customer Loyalty
– Be sensitive to their ever changing needs
• Increase Market Share
– Competitive advantage over competitors on
buying behavior
• Improve Margin
– Customer place high value to service
excellence
• Reduce Sales Cycle
– Customer understand the process, company
understand the needs
CRM an Overview
Create world-
class
relationships
with
customers.

Why Businesses Adopt CRM?
• Reduce Admin Burden
– Most admin task taken care by technology and processes
• Improve Channel Effectiveness
– Knowing the best way or medium to reach customer
• Improve Communication
– 2 way communication. Involve customer in sales process
• Decrease Cost
– 80% investment in 20% most profitable customer
• Minimise Discounting
– Creating more use to a product and adding value to overall needs
CRM an Overview

Implementing CRM Project
• CRM is not only investment in IT infrastructure but recognisation of
business processes
• Business Driven rather than IT focused
• Dedicated independent Internal Project Team
• Need to be forward thinking, how would it affect culture , people,
business in the future
• Do it in phases. Learn from one phase before implementing the next
• Always implement User acceptance Test
• Make an effort to allow the project measurable especially ROI to the
Enterprise
CRM an Overview

Pull and Push Strategy
CRM
• CRM is a Pull strategy
• Understanding customer
needs , habits, expectation etc
to present customer with
ranges of products and
services that have been finely
tuned to meet their perceived
needs and desires.
Marketing
• Marketing is a Push Strategy
• Pushing products and brands
to customer via mass
marketing. Trying their luck of
matching the product with the
prospect customers.
• Nevertheless, more and more
are moving towards
Relationship Marketing which
takes integrate knowledge
from CRM before planning for
its marketing strategies
CRM and Marketing

Complementing Strategies
Research / Survey Data
• Demographic
• Market Development
• Economic statistic
• Trend
CRM
• How much they buy?
• When do they buy?
• Why do they buy?
• What do they buy?
• Who do they buy for?
Business Plan
• Market Expansion
• New Business Unit
• Listing
Marketing
• New pricing structure
• Reward and incentive scheme
• Cross sell and up sell
• Product Development
CRM and Marketing

Synergy of CRM and Marketing
Relationship Marketing
• One to one Interaction
• Elevating customer to be partner
• Adding value to personal needs
instead of product needs
• Joint Development of products
and processes
• Participate in both buying and
selling processes
• Promote products and services
extension
CRM and Marketing Overview
CRM Marketing

Gathering information
• Information must be collected, processed then to
propose next course of action
Call Centre Website Letters Shop Sales Personnel
Customer Relationship Management SystemCustomer Relationship Management System
Record Tabulate Analyse Forecast Suggest Others
Customer Contact PointsCustomer Contact Points

Managing Information
• Info must be easily accessible anytime , anyway e.g notebook,
palm, handphone etc
– Your customer treats your company as one entity . As such, He / she will expect
the person servicing him to know all about him despite information given to
different people in the organisation
• Info must not be outdated, if possible real time
– Outdated info will affect sales people competency. Customer might think that his
business is not being appreciated
• Transmission of info must be in a secured environment
– There might be Private and Confidential info given. Info falls to the wrong hands
might result in fraud thus weaken customer trust
• Only relevant info to be distributed to relevant person
– Sales people must not be overwhelmed with irrelevant info. They must maximise
their time is selling not organising info

Importance of 2 way communication
• Customer needs, wants and preferences changes with time
• Organisation’s products, process and people changes with time
• 2 way communication promotes association by knowledge not
familiarisation with products
• Essential element for customers to grow their needs and wants with
the comfort of company growing its products and services relevant
to the customer
• Promote lifetime partnership
• Setting interdependency through out buying and selling process
• Higher cost for customer to shift to competitors offering as customer
will need to educate their new supplier again.
Lifetime Customer Value

Value creation from 2 way communication
Customer
• Feedback on products in
used
• Stating their problems
• New idea suggestion
• Comparing competitor’s
products
• What are the
complementing products
• Enquiries on how to use
and who can use
Company
• Product Support and
Services
• Educate orgn’s
products, process,
people
• Needs exploration
• Objection Handling
• Suggestive selling
• Educate on features and
benefits
Lifetime Customer Value
Innovative products
Expectation management
Business / Product
Extension
Marketing Strategies
Cross / Up Selling
Communication strategies

Adding Value
• Help customer to make more use of a product.
• Advise customer not to over buy. Only get products and services
which will meet their immediate use. Scalable by demand
• Formulate payment method which lead to effective total cost of
ownership
• Recommend complement value added services solving their
concern in a proactive way. Less time for customer to source for
complementing products
• If it is a business customer, know their business, introduce
partners for potential business transaction
The information collected and processed by CRM system allow us to
tackle customer specific needs and thus able to strategise for a more
complete product to earn higher Return on Investment

Return on Investment
• Same product higher value
– By introducing more usage to the products, customer place higher value on it,
thus allow us to set a higher margin pricing
– Also, they will likely to buy more over competitors similar products which they
only knows the basic usage
• Buying more than one type of products
– Ability to show the increasing usage value by introducing complementary
products will likely encourage purchase of product range e.g. Nescafe and
Coffee Mate
– The more products a customer buys, the stronger is the brand association
– Customer lifetime value will increase with such loyalty
• Referrals value
– Satisfy customer never silence about their achievement in finding the right
product or company. Customer will tend to share their experience with peers
– Such ‘word of mouth’ promotion is proven most effective mode of selling thus
reduces company marketing cost leading to higher return on investment

• Managing Resistance from staff
• Identifying Process holes
• Data cleansing / Management
• Matching Technology to Process
• Getting users productive
• Customising software
• Managing Rollout
• Determining ROI
• Executive Support
• Evaluating Technology
• Adequate funding
• Managing Vendor Relation
CRM Challenges
What are the challenges ?
People is
the most
challengin
g aspect of
CRM

Involvement
• CRM implementation does not only involve the project
team but the whole organisation
• Having the most advance CRM system and well thought
business processes will not bring benefit to the
organisation without high service standard from
individuals within the industry……employees loyalty is more
important achieve before attempting customers’ loyalties program
• Each individual staff in the company is the owner of the
project
Improving service standards

Training
• All customer contact points assigned with permission
to operate the CRM system must have pilot testing
• Training must encompass personal and interactive
skill as well
• Other staff must be trained on how to provide valuable
, concise input
• Every staff should be trained as a sales and / or
customer service personnel to ensure consistency of
service standard rendered to customer

Executive Sponsorship
• CRM initiative project team must have the full support
from Top management
• Resistance to Change by other affect department will
affect service standards
• Need to design a program to intensify the association
of the project with the affected staff

In Summary
• The needs for tactical approach in securing sales and retaining
customers are more intense than before
• More than 80% of the needs of customers are within our control
• CRM focuses on managing information systematically and utilize
these information effectively throughout customers’ lifecycle for
corporations’ benefits
• CRM synergizes Marketing effort by creating values that benefits
both corporation and customers
• CRM implementation focuses on processes, not technology
• People is the most important elements in CRM implementation
So, if you haven’t started, starts now

Thank You
© 2000 Skali. All rights reserved.
Thank YouThank You
Info : http://mediacenter.skali.com
Discuss : http://forum.skali.com
Email : service@skali.com
Ph : 60-3-8656 8468
Fax : 60-3-8656 8458
Block C, UPM-MTDC Technology Centre 1, Universiti Putra Malaysia,
43409 Serdang, Selangor, Malaysia
© 2002 Skali. All rights reserved
www.skali.com
www.skali.net
snap.skali.net

Conclusion
• Back to Basic : Customer comes first, they are the reasons why your
business keeps on going!
• Know your customer then you will know your Marketing Strategies
• Marketing must be focused to most profitable customers
•Customer is your most valuable Asset
•Not managing your customers means not
managing your Assets
•Marketing Strategies should be generated from
understanding our customers
•Those who are successful in CRM will gain
Competitive Advantage. Those who don’t will
likely lose their market.

CRM and Its Synergy with Marketing

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