Customer Relationship

Management
Presented To
Sir Rana Shahid Yaqoub
 CRM
– Customer relationship
management (CRM) is a
multifaceted process, mediated by a
set of information technologies that
focuses on creating two-way
exchanges with customers so that
firms have an intimate knowledge of
their needs, wants, and buying
patterns.
 WHAT IS CUSTOMER
RELATIONSHIP
MANAGEMENT?
• DESCRIPTION

Customer Relationship Management

can be defined in a number of ways.
Some people stress the significance of
information technology in CRM, some
argue it means a customer-centric
organization, some believe CRM is a
functional (marketing) strategy, others
 HISTORY
• The 1980s saw the emergence of
Direct Marketing, heavily relying on
client databases. Christan Grönroos
and Evert Gummesson of the 'Nordic
School' and Theodore Levitt deserve a
special mentioning in this article.
They were the first to describe Relation
Marketing versus transaction
marketing. Also they defined the
characteristics of relation-centric
organizations and they provided the
corresponding marketing tools. In
1995, Treacy and Wiersema (1995)
described their three Value Disciplines.
• . Customer Intimacy was one of them.
As a result, CRM transformed in the
1990s from a web based contact
management and information tool, to a
customer oriented strategy.
 Overview

• There are many aspects of CRM which

were mistakenly thought to be capable
of being implemented in isolation from
each other.
• From the outside of the organization, a
customer experiences the business as
one entity operating over extended
periods of time.
Thus piecemeal CRM implementation
can come across to the customer as
unsynchronized where employees and
web sites and services are acting
independently of one another, yet
together represent a common entity.
• CRM is the philosophy, policy and
coordinating strategy connecting
different players within an organization
so as to coordinate their efforts in
creating an overall valuable series of
experiences, products and services for
the customer
• Customer Facing Operations - The
people and the technology support of
processes that affect a customer's
experience at the frontline interface
between the customer and the
organization.
 This can include face to face, phone,
IM, chat, email, web and combinations
of all media. Self-service kiosk and
web self-service are doing the job of
vocals and they belong here.
• Internal Collaborative Functional
Operations - The people and
technology support of processes at the
policy and back office which
ultimately affect the activities of the
Customer Facing Operations
concerning the building and
maintaining of customer relationships.
 Customer and Employee Surveyors
and Analysts - Customer Relationships
are both fact driven and impression
driven - the quality of an interaction is
as important as the information and
outcome achieved, in determining
whether the relationship is growing or
shrinking in value to the participants.
 The basic building blocks:
• A database for customer lifecycle (time
series) information about each
customer and prospect and their
interactions with the organization,
including order information, support
information, requests, complaints,
interviews and survey responses
• Customer Intelligence - Translating
customer needs and profitability projection
into game plans for different segments or
groups of customers, captured by customer
interactions (Human, automated or
combinations of both) into software that
tracks whether that game plan is followed or
not, and whether the desired outcomes are
obtained.
• Business Modeling Customer
Relationship Strategy, Goals and
outcomes: Numbers and description of
whether goals were met and models of
customer segments and game plans
worked as hypothesized.
 Learning and Competency
Management Systems
• Customer Capacity and Competency
Development - Training and improving
processes and technology that enable
the organization to get closer to
achieving the desired results. Complex
systems require practice in order to
achieve desired outcomes, especially
when humans and technology are
interacting.
 Types of CRM

• Operational CRM
• 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 when 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 describe the
history of their interaction each time.
• Consequently, many call centers use
some kind of CRM software to support
their call center agents.
• Operational CRM processes customer data
for a variety of purposes:
• Managing Campaigns
• Enterprise Marketing Automation
• Sales Force Automation
 Sales Force Automation (SFA)
• Sales Force Automation is a type of
Operational CRM that is designed to
automate sales-force-related activities,
such as lead tracking. Software
products perform such tasks as:
• Keeping lists of leads
• Assigning list segments to salespeople
• Allowing list contacts to be called or e-
mailed
• Tracking responses
 Analytical CRM

• Analytical CRM analyzes customer

data for a variety of purposes:
• 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
(e.g. pricing, new product
development etc.)
Management decisions, e.g. financial
forecasting and customer profitability
analysis
Prediction of the probability of
customer defection (churn analysis)
 Campaign Management

Campaign management software is

marketing-oriented CRM software that
combines elements of Operational and
Analytical CRM and allows campaigns
to be run on an existing client base.
Campaign Management is used when
you need to create personalized offers
when it is prohibitively expensive to
personally contact each client.
Campaign management software
functions include:
• Choosing campaign recipients from the
client base according to selected
criteria
• Development of a campaign offer (this
is often done "out-of-the-system" and
is not automated)
• Assigning specific campaign offers to
selected recipients
• Automatically sending offers to the
selected clients via selected channels
(either directly, via channels such as e-
mail, or indirectly, by creating lists for
use in channels such as direct mail)
 Collaborative CRM

The function of the Customer Interaction

System or Collaborative Customer
Relationship Management is to
coordinate the multi-channel service
and support given to the customer by
providing the infrastructure for
responsive and effective support to
customer issues, questions, complaints,
etc.
• Collaborative CRM aims to get various
departments within a business, such as
sales, technical support and marketing,
to share the useful information that
they collect from interactions with
customers. Feedback from a technical
support center, for example, could be
used to inform marketing staffers about
specific services and features requested
by customers.
 Geographic CRM
• Geographic CRM (GCRM) is a
customer relation management
information system which collaborates
geographic information system and
traditional CRM.
• gCRM combines data collected from
route of movement, types of residence,
ambient trading areas and other
customer and marketing information
which are matched with relevant road
conditions, building formations, and a
floating population.
 Strategy
Several commercial CRM software
packages are available which vary in
their approach to CRM. However, as
mentioned above, CRM is not just a
technology but rather a comprehensive
customer-centric approach to an
organization's philosophy in dealing
with its customers. This includes
policies and processes, front-of-house
customer service, employee training,
marketing, systems and information
management.
• The objectives of a CRM strategy must
consider a company’s specific situation and
its customers' needs and expectations.
Information gained through CRM initiatives
can support the development of marketing
strategy by developing the organization's
knowledge in areas such as identifying
customer segments, improving customer
retention, improving product offerings (by
better understanding customer needs), and
by identifying the organization's most
profitable customers
Usage of CRM Application
–Companies that want to realize a
customer intimacy strategy.
–Companies that want to
accomplish a customer friendly
image.
 Steps in CRM
• Strong customer-oriented leadership.
• The mission to be a relation-oriented
organization aimed at long-term
interaction.
• The corporate purpose is aimed at the
customer.
• The main strategy is to win by
customer intimacy.
• Company values and employee
values focus on caring for customers.
 Strenth of CRM
• Benefits
Strong relations with clients offer a degree of
protection against actions of competitors.
Loyal customers can be more profitable.
Winning new customers is expensive, satisfied
customers may buy more, happy customers
can bring additional customers, etc.
 Disadvantages of CRM
• Implementing CRM in a holistic way is
no sinecure.
• Making large CRM investments
profitable is difficult.
• Achieving a Sustainable Competitive
Advantage with CRM is even more
difficult.
 Assumptions of CRM
• If we are good to customers, they will
be good to us.
• Changing from the current strategic
discipline towards a customer intimate
discipline is possible.
 The “E” Customer
• Online customers are different from
those who are able to contact you and
deal with you directly. They have a
unique set of expectations. Generally,
they expect immediate service, either
by finding what they need on your site
themselves; or, they may expect that
the goods or services be delivered
without delay .
 CRM life cycle
• It takes ten times more effort and costs
ten times more money to attract a
newcustomer than to keep an existing
customer. This” statistic” alone should
be enough for companies to invest in
CRM. Finding customers is the first
step and the faster you get through the
sorting process of qualifying prospects
into customers, the faster will be the
returns.
 Finding the Customer
• The process starts with finding
customers. The Internet allows you to
attract customers in two ways: (1)
getting them to find you through search
engines, links, and alliances with other
sites; and (2), by proactively finding
them and sending material
electronically. The number one way
people find online businesses is
through search engines.
 Building Value for the Customer
• Now that you have found your
customer, it is important to find ways
to add value to the relationship. Keep
in mind that value is in the mind of the
customer. Find out what they perceive
to be valuable by surveying them either
online, by phone, or by regular mail.
Even though you are using online
techniques, do not forget the many
other ways to connect with customers.
 EVOLUTION OF CRM
• Although there are now many software
suppliers for CRM, it began back in 1993
when Tom Siebel founded Siebel Systems
Inc. Use of the term CRM is traced back to
that period. In the mid-1990s CRM was
originally sold as a guaranteed way to turn
customer data into increased sales
performance and higher profits by
delivering new insights into customer
behaviors and identifying hidden buying
patterns buried in customer databases.
 PROBLEMS WITH CRM
• One of the major problems with CRM
is the large investment to build and
maintain a customer database which
requires computer hardware, database
software, analytical programs,
communication links, and skilled
personnel. Also, there is the difficulty
of getting everyone in the organization
to be customer oriented and to get
everyone to actually use the customer
information that is available.
 HOW TO SUCCEED WITH
CRM
• CRM projects require careful planning and
implementation. To be successful, CRM
involves major cultural and organizational
changes that will meet with a lot of
resistance. CRM should be enterprise-wide
in scale and scope. However, it is usually
better to take an incremental approach
starting with a CRM pilot. Once the pilot
succeeds, then introducing one CRM
application at a time is recommended.