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Increase 4 Decision
Revenue Enhance Executive Support
Decision Making Initiatives
3
Enhance Products & Services Operational
Optimize Initiatives
2
Resources &
Minimize Leverage Investments
1 Financial
Costs Initiatives
Reduce Costs
Structure
People
Process
Systems
Core and Extended Customer Service
Core Customer Service. Mechanical elements including Quality, Cost and service
Delivery.
Extended (Caring) Customer Service. Human elements including: Friendliness,
Caring, Flexibility, Problem-solving, and Recovery.
Customer Grade
Perceived
Outstanding A
Value
Exceeds Expectations
B
Unsatisfactory D
Failing F
Core Service Caring Service
Satisfies Delights
Core service will never exceed a grade of C or satisfactory. Dont spend time and money
attempting to exceed expectations here. Caring service will allow the organization to
exceed customer expectations through perceived service delivery.
The Customers Perceived Value = The State in which the quality of a total
experience, perceived by the customer, exceeds its cost.
Customer Interactions
Channels
Customer Transactions
Channels
Transaction vs. Relationship
Marketing:
Transaction Relationship
Ongoing
One-time
Managing People
Managing Brands
Individual
Mass communication
communication
Market share
Customer share
Profitability of
Profitability of
transaction
longevity
Brand Equity
Customer share equity
CRM Definitions
Customer Relationship Management (CRM) is a business
strategy to select and manage customers to optimize long-
term value.
Customer Relationship Management is a comprehensive
strategy and process of acquiring, retaining and partnering
with selective customers to create superior value for the
company and the customer.
CRM is a complete system that: 1) provides a means and
method to enhance the experience of the individual
customers so that they will remain customers for life, 2)
provides both technological and functional means of
identifying, capturing, and retaining customers, and 3)
provides a cohesive view of the customer across the
enterprise.
CRM Definitions
CRM is a management approach, a model that puts a
customer at the core of a company processes and practices.
CRM leverages cutting edge technology integrated strategic
planning up-close and personal marketing techniques and
Organization development tools to build internal external
relationships that increase profit margins and productivity
within a company.
Product
dissatisfaction
14%
Perceived
indifference
69%
Economics of Customer Retention
With FAQs and the knowledge base you can help your
customers help themselves.
Benefits of CRM
Retention rate: CRM increases customer loyalty,
which increase revenue per customer and frequency of
purchases.
Referrals: CRM can turn customers into advocates.
Referrals typically have higher retention rates and
spending rates than other newly acquired customers.
Increased sales: CRM leads to increased cross-selling,
upgrades, or simply more products by existing
customers.
Reduced costs: CRM can lead to more cost effective
marketing; avoids expenses of mass marketing.
Benefits of CRM
Provide better customer service
Cross sell products more effectively
Help sales staff close deals faster
Simplify marketing and sales processes
Increase customer revenues
Reduced costs, because the right things are being done
Increased customer satisfaction, because they are getting exactly
what they want
Ensuring that the focus of the organisation is external
Growth in numbers of customers
Maximisation of opportunities
Increased access to a source of market and competitor
information
Long term profitability and sustainability
Customer Life Cycle Management
Customer Need Assessment and
Acquisition
Customer
Customer
development through
Retention and
Personalization and
Referrals for new
Customization
Customers
Customer Equity
Leverage through
Cross Selling, and
Up Selling,
RFM Data in CRM
Organizations can find their most valuable
customers through RFM
Recency - How recently a customer purchased
items.
Frequency - How frequently a customer
purchased items.
Monetary Value - How much a customer
spends on each purchase.
CRM evolution
Stage State Culture
Satisfaction Re-active Meet customer needs
Based Respond to complaints
Minimal evaluation of customer
service levels
Performance Pro-Active Evaluate customer perception
Based
Identify customer retention factors
Collaborative Analytical
Enhance
Company
Relationship
with Customer
Types of CRM
OPERATIONAL CRM
Gives support to Front Office business process (e.g. sales,
marketing etc)
Any interaction with customers is stored in customers contact
histories, which the staff can retrieve as necessary.
Gives staff access to important information about the customer.
Operational CRM possesses customer data for a variety of
purposes
Managing campaigns
Enterprise Marketing Automation
Sales Force Automation
Sales Management System
Components of Operational CRM
CUSTOMER SERVICE AND SUPPORT (CSS)
Is the part of a company's CRM department that interacts
with a customer for their immediate benefit, including
components such as the contact center.
20-25% of CRM
Provides information to support customer call center
activity
Build customer satisfaction & loyalty
Resolve customer issues after the sales responsively
It comprises two key functional areas:
Cases:- Track every interaction of customer service &
support teams with each customer.
Solutions:- Maintain a centralized database of solutions to
leverage knowledge across the enterprise.
SALES FORCE AUTOMATION (SFA):
People errors
Introducing CRM to hundreds of employees at
a time.
Changing the system, but not the people.