The document provides an overview of customer relationship management (CRM). It discusses the history and evolution of CRM from database marketing in the 1980s to relationship marketing in the 1990s to CRM in the early 2000s. It defines CRM as everything involved with managing the customer relationship. The goals of CRM are also outlined, such as providing better customer service and cross-selling products more effectively. Different types of relationship marketing are described, from basic transactions to partnership models. The document also discusses implementing a CRM program and the importance of an integrated approach.

1. UNIT – IV
Customer Relationship Management
Course: MBA-II
Subject: EWIS

2. CUSTOMER RELATIONSHIP
MANAGMENT

3. A BRIEF HISTORY
1980s: Database Marketing
– Speak individually to countless customers
– The reality: It's too costly, too difficult, and doesn't pay out
on the bottom line
– The compromise: A little database marketing goes a long way,
maybe plus an iota of demographics

4. A BRIEF HISTORY
1990s: Relationship Marketing
– Major phenomenon: Loyalty programs.
– Major promise: Loyalty!
– Major result:
Companies such as airlines now have an enormous incremental
layer of expenses, without much to show for it
Early 2000's: Customer Relationship Management
– Major phenomenon: Great promise
– Major reality: Promise unattained.

5. Evolution of Information Requirements
Materials Requirements Planning
(MRP)
Manufacturing Resource Planning
(MRP II)
Enterprise Resource Planning
(ERP)
Supply Chain Management
(SCM)
Customer Relationship Management (CRM)

6. Types of relationship marketing
Basic
Sale of product with no support and/or follow-up.
Reactive
Sale of product with minimal support.
Accountable
Following sale of the product, the salesperson follows
up and checks that all is going well. Customer
suggests improvements that are acted upon.
Proactive
Company contacts the existing customers finding out
if current product is meeting their needs. Defining
future needs and putting forward suggestions.
Partnership
Company continuously works with the customers to
discover ways to deliver better value.

7. Establishing a relationship-marketing programme
Identify the key customers meriting relationship
management
Assign a skilled manager to each key customer
Develop a clear job description for relationship
management
Have each relationship manager develop annual and long
range customer relationship plans
Appoint an overall manager to supervise the relationship
managers

8. What is CRM
Craig Conway ,CEO – People Soft
Customer approaches a business with an expectation.
On company reactions they form an experience that shapes their
behavior.
The ability to recognize this process & to actively manage it forms
basis of CRM
Scott Fletcher , President - e pipeline
Set of business process/policies that are designed to acquire retain
and service customers.

9. Ronni Marshak –Seybolds group
Every company’s game plan includes
Goals – Profitability
Strategy – Establish L.T customer relationships
Plans – Invest in CRM technology
Objectives –Achieve 60 % customer retention
Tactics – Implement 24/7 call centre
Robert Thompson , President , Front Line Solutions
CRM is a business strategy to select and manage customers to optimize
long term value.
CRM requires customer centric business philosophy & culture to support
effective marketing , sales & Service processes

10. Brent Frei , CEO Onyx Software
CRM is a comprehensive set of processes and technologies for
managing the relationships with potential and current customers
across marketing sales and service functions
Peter Keen ,Chairman Keen Innovations
CRM is the commitment of the company to place the customer
experience at the centre of its priorities& to ensure that incentive
systems , processes and information resources leverage the
relationship by enhancing the experience

11. Targeting Acquisition Retention Expansion
Customer Relationship Management can be simply defined as everything involved with
managing the customer relationship.
Customer Relationship Management can be simply defined as everything involved with
managing the customer relationship.
The Value of the Relationship
• Who Do we target
• What segments are most
profitable
• What segments match our Value
Proposition
• What is the best segmentation
strategy for us / our industry
• What is the best channel for
each segment
• What is the acquisition cost for
a channel / segment
• Do certain channels deliver
certain types of customers
• Cost effective acquisition
• How can we improve
retention
• What is our average
customer relationship length
• How can we hold customer
for as long as possible
• What is the most cost
effective method of retention
• How many products does our
average customer buy
• How can we induce our
current base to buy more
products
• Who are the prime targets for
expansion
• What is the cost of expansion
Customer Relationship Management Definition
Duration of Customer Relationship
Value($)

12. Why CRM?
 It costs six times more to sell to 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 by 85%
 Odds of selling to new customers = 15%, as compared to
those for existing customers (50%)
 70% of the complaining customers will remain loyal if
problem is solved
 90% of companies do not have the sales and service
integration to support e-commerce

13. Goals of CRM?
* Provide better customer service
* Make call centres more efficient
* Cross sell products more effectively
* Helps sales team close deals faster
* Simplify marketing and sales process
* Discover new customers
* Increase customer revenues

14. Marketing Selling Servicing
Customer Management Process Threads
Broadcast
Mail
Field Personnel
Agents/Distributors
Call Center
Retail
Internet
Back Office Process/Systems
CustomerInteractionChannels
Are we making the right level
and type of marketing, sales,
and service investments in
each of our customer
segments?
Customer RelationshipCustomer Relationship
StrategiesStrategies
Are we taking a holistic
approach to our customers
across processes and
channels?
Customer RelationshipCustomer Relationship
StructureStructure
Have we implemented best
practices and technology in
process/channel?
Customer RelationshipCustomer Relationship
PerformancePerformance
ScopeScope DepthDepth
Importance of CRM[1]

15. Capture Customer
Data and Measure
Results
The Customer
Capture Customer
Data and Measure
Results
Take Action to
Enrich the Customer
Relationship Capture Customer
Data and Measure
Results
Build and Manage
Customer Value
Capture Customer
Data and Measure
Results
Capture Customer
Data and Measure
Results
Capture
Customer Data
and Measure
Results
Store Data, Mine
and Make
Information
Accessible
The CRMThe CRM
DynamicDynamic
Customer Relationship Management is a ongoing, dynamic learning process for an organizationCustomer Relationship Management is a ongoing, dynamic learning process for an organization
Customer Relationship Management Process[2]
 The building blocks of CRM allow an organization to manage this cycle and use the
knowledge on customers to enhance the Life Time value of the customer portfolio.
 No organization has perfect information on its customers. Knowledge of customers is
continuously enhanced through the CRM dynamic.

16. Implementing CRM must be approached from an
Integrated Perspective[3]
All areas must be implemented, to some degree, to effectively manage the customer
relationship. When pieces are implemented in isolation, the benefits are less than
overwhelming.
All areas must be implemented, to some degree, to effectively manage the customer
relationship. When pieces are implemented in isolation, the benefits are less than
overwhelming.
Capture Customer
Data and Measure
Results
The Customer
Capture Customer
Data and Measure
Results
Take Action to
Enrich the Customer
Relationship Capture Customer
Data and Measure
Results
Build and Manage
Customer Value
Capture Customer
Data and Measure
Results
Capture Customer
Data and Measure
Results
Capture
Customer Data
and Measure
Results
Store Data, Mine
and Make
information
Accessible
CRMCRM
without anwithout an
IntegratedIntegrated
ApproachApproach
A data warehouse full of data without
the tools to extract knowledge is
nothing more than expensive
inventory.
Sophisticated mining tools only
produce results only as good as the
data they mine.
Developing insights on how to improve the value of the
customer relationship without having the infrastructure to
take action has no impact on the bottom line. In addition,
there is no opportunity to test the ‘theoretical’ analysis.
Implementing new technologies without
the knowledge on how to enrich the
relationship is likely to yield a return below
the cost of the capital expenditure.
Taking action to improve the
relationship without measuring the
results provides no evidence of
success or failure and limits the
opportunity for learning.
Capturing gigabytes of customer data
in disparate operational systems that
are next to impossible to access may
render the data useless.

17. Vendor CRM Market Position
• Acknowledge leader
• Very integrator focused
• Leader in their niches
• Not integrator focused
• Excellent product
• Number 2, but struggling
• Product continually delayed
• Intimidation capacity lessening
• Bold announcements
• Claim high strategic priority
®
TRILOGY
CRM Vendors

18. E-CRM

19. Business Processes
Profiles &
Preferences
Business PartnerBusiness Partner
Business to CustomerBusiness to Customer
Business to BusinessBusiness to Business
The ValueThe Value
PropositionProposition
ofof
ElectronicElectronic
BusinessBusiness
SolutionsSolutions
Integrating
more directly
with the
business
processes of
customers and
partners
Tailoring
products and
services to
customers
needs and
values
Business
Processes
Extending key business
applications to clients and
business partners
Business PartnerBusiness Partner
e-Business is all about integrating the internal and external processes between business partners and
customers.
e-Business is all about integrating the internal and external processes between business partners and
customers.
e-Business – Definition[4]

20. Internet technology can improve the level of customer care, while reducing the cost of
maintaining the customer base.
Internet technology can improve the level of customer care, while reducing the cost of
maintaining the customer base.
e-Business - Benefits
 On average, it costs about $5 - $50 per query to
support via phone
 On average, it costs about $1 - $3 per query to
support via E-mail
 On average, it cost less than $1 per query to
support via WWW

21. References
 The CRM Handbook by Jill Dyche
 Concepts in Enterprise Resource Planning by Brand, Monk and Wagner –
Thomson Learning
 http://www.block.si/block.php?
url=http://http://www.scribd.com/doc/37867210/CRM-PPT&category=401
 http://en.wikipedia.org/wiki/Customer Relationship Management
 www.Management Information System/management/Ebook/CRM.PDF
Images
1) http://en.wikipedia.org/wiki/Customer Relationship Management
2)www.Management Information System/management/Ebook/CRM.PDF
3) www.Management Information System/management/Ebook/CRM.PDF
4) www.Management Information System/management/Ebook/CRM.PDF

22. THANK YOU