Customer

Relationship Management
What Is Customer
Relationship Management?

Define customer
relationship
management
What Is Customer
Relationship Management?

Customer Relationship
Management (CRM) is…
a company-wide business strategy
designed to optimize profitability,
revenue, and customer satisfaction by
focusing on highly defined and precise
customer groups.
Customer Relationship
Management Strategy
Organize
Organizethe
thecompany
companyaround
aroundcustomer
customersegments
segments

Encourage
Encourageand
andtrack
trackcustomer
customerinteraction
interactionwith
withthe
thecompany
company

Foster
Fostercustomer-satisfying
customer-satisfyingbehaviors
behaviors

Link
Linkall
allprocesses
processesofofthe
thecompany
companyfrom
fromits
itscustomers
customers
through
throughits
itssuppliers
suppliers

Allows
Allowscompanies
companiesto
totightly
tightlyfocus
focusin
inon
ontheir
theirtarget
targetmarkets
markets
Exhibit 14.1
A Simple Flow Model of the Customer
Relationship Management System
Identify customer relationships

Leverage customer Understand interactions

information with current customer base

Capture customer data

Identify best customers
based on interactions

Store and integrate

customer data using IT
Implementing a CRM System

Key Points:

1. Customers take center stage

2. Business must manage the customer

relationship across all points of
customer contact
Identify Customer Relationships

Explain how to
identify customer
relationships with
the organization
Identify Customer
Relationships

Customer-centric is…
a philosophy under which the company
customizes its product and service
offering based on data generated
through interactions between the
customer and the company.
Identify Customer
Relationships

Learning is…
an informal process of collecting
customer data through customer
comments and feedback on product
or service performance.
Identify Customer
Relationships

Knowledge Management is…

the process by which learned
information from customers is
centralized and shared in order to
enhance the relationship between
customers and the organization.
Knowledge Management
Experiential
Experiential
observations
observations

Comments
Comments
Collected
Collected
Information
Information
Includes:
Includes: Customer
Customer actions
actions

Qualitative
Qualitative facts
facts
Empowerment

Empowerment is…
delegation of authority to solve
customers’ problems quickly—usually
by the first person the customer
notifies regarding the problem.
Successful CRM
Occurs when a customer and a
company representative exchange
information and develop learning
Interaction
Interaction relationships

• The success of CRM can be directly

measured by the effectiveness of the
interaction between the customer and the
organization.
Understand Interactions
of the Current Customer Base

Understand
interactions
with the current
customer base
Exhibit 14.2
Customer-Centric Approach for Managing Customer
Interactions

© Image Source/Jupiterimages
Interactions of the
Current Customer Base

All
Allpossible
possibleareas
areasof
ofaabusiness
business
Touch
TouchPoints
Points where
wherethe
thecustomers
customerscommunicate
communicate
with
withthat
thatbusiness.
business.

Communications
Communicationsbetween
between
Point-of-Sale
Point-of-Sale customers
customersandandorganizations
organizationsthat
that
Interactions occur
occuratatthe
thepoint
pointof
ofsale,
sale,normally
normally
Interactions in
inaastore
store