Introduction to CRM

What is a Customer ? Definition of CRM CRM technology components Customer life cycle Customer Interaction

Definition of Customer
A customer is someone who makes use of or receives the products or services of an individual or organization. The word historically derives from "custom," meaning "habit"; a customer was someone who frequented a particular shop, who made it a habit to purchase goods there, and with whom the shopkeeper had to maintain a relationship to keep his or her "custom," meaning expected purchases in the future(B2C) OR your paying client(B2B) OR your employee (internal) .

Types of customers
1. External Customers (Consumers) who pay you for your products 2. Internal customers are employees who give services and you pay them 3. Suppliers/Vendors 4. Channel Partners 5. Life on other planets or relationship with animal kingdom

Definition of CRM
Customer Relationship Management (CRM) is a business strategy to identify, cultivate, and maintain long-term profitable customer relationships. It requires developing a method to select your most profitable customer relationships (or those with the most potential) and working to provide those customers with service that exceeds their expectations giving revenue and increasing business efficiency.

Definition of CRM
CRM is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. For example, an enterprise might build a database about its customers that described relationships in sufficient detail so that management, salespeople, people providing service, and perhaps the customer directly could access information, match customer needs with product plans and offerings, remind customers of service requirements, know what other products a customer had purchased, and so forth.

Onyx View of building business that will use CRM

Business objectives
A. B.

Program Initiatives
PROGRAMS

METRICS

Departmental plans

Marketing SALES TECHNOLOGY

SERVICE

 Business Objectives outlining two-to five year strategic goals should be clearly defined Program initiatives are typically 1 to 11/2 yrs They are game plans or directives intended to move company towards long term objectives of company. They have metrics against which performance is measured

 Departmental plans are the actual implementation of processes and behavior that form the fabric of everyday work within organization There are dozens of processes within a department and many that cross departments Technology is used to automate and enable the processes and initiatives

 The four stages of the models can be classified as

Functional Departmental Partial CRM Full CRM A Company that operates as a Stage One organization is characterized by the compartmentalization of independently managed processes with no intra process communication (Large Fortune 500 Companies) Return on Investment is typically possible only in very large companies

A Company that operates as a Stage two organization is characterized by intra departmental synchronization by implementing coordinated processes across the department, however cross departmental coordination is sparse. ROI is 2 to 5 times the investment. A Company that operates as partial CRM . Beside intradepartmental, this level benefits from cross departmental process and technology, coordination ROI is 4 to 7 times the investment.

Tactics
Implement 24/7 call center

Objectives
Achieve 60% customer retention

G-SPOT

Plans

Invest in CRM Technologies Establish longterm customer relationships

Goals

Strategies

Profitability

CRM

Aspects of CRM
1-Operational CRM- automation or support of customer processes that include a companys sales or service representative 2-Collaborative CRM- direct communication with customers that does not include a companys sales or service representative (self service) 3- Analytical CRM- analysis of customer data for a broad range of purposes

 Operational CRM provides support to "front office" business processes, including sales, marketing and service. Each interaction with a customer is generally added to a customer's contact history, and staff can retrieve information on customers from the database as necessary. One of the main benefits of this contact history is that customers can interact with different people or different contact channels in a company over time without having to repeat the history of their interaction each time. Consequently, many call centers use some kind of CRM software to support their call centre agents.

 Collaborative CRM covers the direct interaction with customers. This can include a variety of channels, such as internet, email, automated phone/ Interactive Voice Response (IVR). It can generally be equated with self service. The objectives of Collaborative CRM can be broad, including cost reduction and service improvements

 Analytical CRM analyses customer data for a variety of purposes including design and execution of targeted marketing campaigns to optimize marketing effectiveness design and execution of specific customer campaigns, including customer acquisition, cross-selling, up-selling, retention analysis of customer behavior to aid product and service decision making (eg pricing, new product development, etc) management decisions, e.g. financial forecasting and customer profitability analysis risk assessment and fraud detection, in particular for credit card transactions Analytical CRM generally makes heavy use of Predictive analytics.

Technology Considerations
The technology requirements of a CRM strategy are very complex and far reaching. The basis building blocks include A database to store customer information. This can be a CRM specific database or an Enterprise Data warehouse. There are many vendors in this space including IBM, ORACLE, Teradata etc. Operational CRM requires customer agent support software such as Siebel Systems,Sage CRM (inc Saleslogix and CRM MME), etc. Collaborative CRM requires customer interaction systems, eg an interactive website, automated phone systems etc

Technology Considerations
Analytical CRM requires statistical analysis software such as Excel, SAS, etc, as well as software that manages any specific marketing campaigns such as Teradata Relationship Optimizer, Unica, etc

Customer Life Cycle

The lifecycle of a customer is the process the customer has been undergoing to be with you for all these year which includes
Customer Purchase History Advantage of special offers taken Customer marketing value to you

To find out revenue generated from a customer Customer Life Cycle and Customer Lifetime value is required

Customer Interaction
Customer needs may be defined as the goods or services a customer requires to achieve specific goals. Different needs are of varying importance to the customer. Customer expectations are influenced by cultural values, advertising, marketing, and other communications, both with the supplier and with other sources.

Customer Interaction
Both customer needs and expectations may be determined through interviews, surveys, conversations or other methods of collecting information. Customers at times do not have a clear understanding of their needs. Assisting in determining needs can be a valuable service to the customer. In the process, expectations may be set or adjusted to correspond to known product capabilities or service