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Customer Relationship Management
- 1. Chapter 5: Quantifying the Impact
- 2. How much difference does good CRM make? It depends on CRM Customers’ reaction to CRM initiatives The effect of good CRM can be identified by research
- 3. Good CRM A positive outcome leads to an improved CRM Well-handled customer complains may reinforce purchasing behavior Satisfaction leads to recommendation to others Satisfaction AFTER good problem-resolution may lead to stronger recommendations
- 4. Competitive Superiority Alternative Sales Channels Barriers to Market Entry New Products and Services Quantifying CRM APPLICATION OF CRM
- 5. COST OF SALES REVENUE & CUSTOMER SATISFACTION Measure of your improved CRM
- 6. Some customers will resist being managed over the phone, but some will welcome it
- 7. Changes in CRM Not necessarily revolutionary Can be as simple as more training or shuffling of workstations and deliverables
- 8. Chapter 6: Identifying Customers’ Relationship Needs
- 10. Researching Competitive Requirements Distinguish between What CRM competitors are delivering What customers perceive them to be delivering
- 12. CRM policies cannot be completely tailored to the needs of individual customers Making Sense of Customer Data
- 13. It is HARD to meet all your customers’ needs all the time
- 15. Chapter 7: The Role of Market Research
- 16. “If you can’t measure it, you can’t manage it”
- 17. Desk research Qualitative groups Quantitative research Web and e-mail questionnaires Telephone questionnaires Mystery shopping RESEARCH TECHNIQUES
- 18. Competitive research Internal audit User groups Customer feedback Staff research RESEARCH TECHNIQUES
- 19. Chapter 8: Customer Retention and Loyalty
- 20. Managing Loyalty Not only managing behavior, but also managing a state of mind “I trust you more than I trust your competitors” “I understand you better than I understand your competitors” “You understand me better than your competitors”
- 21. 1. WELCOME CYCLE 2. UP-SELLING 3. CROSS-SELLING 4. RENEWAL 5. LAPSED CUSTOMERS 6. INACTIVE CUSTOMERS Relationship Planning
Editor's Notes
- Measuring the impact
- Research such as contact audit (knowing how much contact or attempted contact your customers are with your company).
- The key here is not for 100% accuracy, but for a broad understanding of the longer-term profit implications of successful relationships. If the customers are satisfied, this translates into profit.
- Asking for information about customers’ needs – especially your competitors’ customers. Can also be established by means of lower costs Telemarketing, mail order, enquiry management, etc When you have customers who hold a high-quality customer database & USE IT EFFECTIVELY Banks, car manufacturers, financial service companies, and publishers are planning new joint venture businesses, pooling the data that each possesses to build a comprehensive picture of their customers Cost reduction and revenue development
- The measure of your improved CRM will not be based only on cost of sales, but also on revenue and customer satisfaction
- The key is to identify which ones are which. This is when having a good and comprehensive customer database comes is useful
- Two things you need
- First, you must know who you competition is Customers have their own basis for comparison, so it is enough to ask them
- Of the customers regarding the relationship Supplier-Customer relationship Questions like what areas that they think need improvement, possible changes in company policy, etc
- Once you have gathered the data that you need, you must put them into use Even in business, you cannot please everyone. Segmenting the market will give you a better basis for understanding the whole market. Once you have segmented the market, you will then choose a segment whose needs you will meet.
- What businesses need are: Competitive survival is achieved by meeting the most important needs of your most important customers Competitive advantage is by doing ^ and meeting the needs of the customers whose needs are not being met by competion
- What are you trying to measure? Whether or not your customers are happy with their relationship with you. Loyal customers are often the most difficult to manage, because they have higher expectations of the relationship than those new to the company – also, because they have been contributing profit to the company longer
- 1. Desk research – previous studies on a variety of customers’ needs & what sorts of policies have been used to meet them 2. Qualitative groups – focus group discussion. Discussing specific relationship issues and responding to pre-defined statements (situations that are likely to occur) 3. Quantitative research – detailed questionnaires on many respondents Mystery shopping – a person goes undercover and experiences the service of the company himself
- Competitive research – research on competition and their CRM Internal audit – determine whether or not standards are being met – time taken to answer the telephone, percentages of calls connected, time to finish a transaction, etc User groups - get the big users to pitch in ideas for products and services Customer feedback – separate the complaint from the complainer & satisfy the complainer while recording the complaint and dealing with the root cause Staff research – 360 feedback
- There will definitely be times when you will lose customers, and you will need to acquire new ones, which is more expensive than retention strategies, because loyal customers not only repurchase, but they also advocate products and services to their family and friends. Retention is achieved by developing the relationship. Make it worthwhile for your customers to stay with you.
- Loyal state of mind is different from loyal behaviors - Buying from you, buying exclusively from you, joining your membership/loyalty clubs, checking product availability FIRST with you, etc
- To be cost-effective, relationship strategies have to be planned Welcome cycle – welcoming new customers Upselling – selling in bundles; promoting higher-value products – boxed set, buy 1, get the second item 50% off, etc Cross-selling – giving incentives to remain loyal Renewal – rewarding loyal customers for their continued patronage Lapsed customers – reawakening these customers is more cost-effective than recruiting new ones Inactive customers – people who have not bought or responded to a promotion for longer than lapsed customers