BUILDING AND DELIVERING A

CRM PROGRAM
 Implementing CRM
When introducing or developing CRM, a strategic review of the
organisation’s current position should be undertaken

Organisations need to address four issues -

1. What is our core business and how will it evolve in the
future?
2. What form of CRM is appropriate for our business now and
in the future?
3. What IT infrastructure do we have and what do we need to
support the future organisation needs?
4. What vendors and partners do we need to choose?
 This begins by learning about your TG
• Who are they?
– Young, old.
– Married, single.
– Male, female.
• Where do they stay?
• How much do they spend on us?
• How often do they buy us?
• What do they buy?
• What brings them back to us?
– Price, quality, range, fit or simply the offers we make?
• Using the knowledge to stay relevant to
them.
• By offering right product portfolio.
• By offering them information on products
things they are likely to appreciate
• By making them special or exclusive offers
on products and designs they desire.
 Sample Customer Clustering and
Engagement
Golden Pool
C1
High Avg Bill Value
Buy Premium SKUs
High Avg Basket Size
 Avg Vintage is 100 days
C2 Value Seekers
Low Avg Bill value
Buy Value Goods
Low Basket size
Full Price Buyers
Low Campaign Response
rate
C3 Discount warriors
High tendency to buy the
goods @ discounted prices
Higher Basket size
Lower Frequency of Visits
High Campaign response
rate

Aspirants C5 Discerning Customers

C4
Recently Acquired Low Avg Bill value
Customers Buy Premium SKUs
Mid Value Spenders Low Frequency of visits
Tendency to claim the price Full Price buyers
discounts Low campaign response rate

Objective: Segment customers to run different campaigns at different frequency

Aims of A Loyalty Program
Typical Strategies for Loyalty Benefits
 Personalizing Marketing
• All of these approaches are a means to create deeper, richer,
and more favorable brand associations.
• Relationship marketing has become a powerful brand-
building force.
– Can slip through consumer radar
– May creatively create unique associations
– May reinforce brand imagery and feelings
• Nevertheless, there is still a need for the control and
predictability of traditional marketing activities.
• Models of brand equity can help to provide direction and
focus to the marketing programs.

5.8
 Personalizing Marketing Concepts
• Experiential marketing
• One-to-one marketing
• Permission marketing

5.9
 Experiential Marketing
• Focuses on customer experience
• Focuses on the consumption situation
• Views customers as rational and emotional
elements
• Uses electronic methods and tools

5.10
 One-to-One Marketing:
Competitive Rationale
• Consumers help to add value by providing
information.
• Firm adds value by generating rewarding
experiences with consumers.
– Creates switching costs for consumers
– Reduces transaction costs for consumers
– Maximizes utility for consumers

5.11
One-to-One Marketing: Five Key Steps
• Identify consumers, individually and
addressably
• Differentiate them by value and needs
• Interact with them more cost-efficiently and
effectively
• Customize some aspect of the firm’s behavior
• Brand the relationship

5.12
 Permission Marketing (Seth Godin)
• “Encourages consumers to participate in a
long-term interactive marketing campaign in
which they are rewarded in some way for
paying attention to increasingly relevant
messages.”
– Anticipated
– Personal
– Relevant
• Permission marketing can be contrasted to
interruption marketing.
5.13
 Five Steps in Permission Marketing
1. Offer the prospect an incentive to volunteer.
2. Offer the interested prospect a curriculum over
time, teaching consumers about the product.
3. Reinforce the incentive to guarantee that prospect
maintains the permission.
4. Offer additional incentives to get more permission
from the consumer.
5. Over time, leverage the permission to change
consumer behavior toward profits.
 CRM Processes
• Firms use specific processes to move
customers through the customer care life
cycle.
Target

A c quire
P artners
Transa c t
Inte rne t Se rvic e Extra ne t

R e ta in
Grow

C ustomer
 CRM Processes, cont.
• CRM processes are used to:
– Identify customers.
– Differentiate customers.
– Customize the marketing mix.
– Interact with customers.
• Firms can identify high-value customers by mining
customer databases and profiling customers in terms of:
(RFM analysis)
– Recency of purchases.
– Frequency of purchases.
– Monetary value of purchases.
 CRM Information
• The more information a firm has, the better
value it can provide to each current or
prospective customer.
• Firms gain much information by tracking
behavior electronically.
– Bar code scanner data.
– Software that tracks online movement, time spent
per page, and purchase behavior.
 CRM Technology
• Technology greatly enhances CRM processes.
• Firms use company-side tools to push
customized information to users.
• Client-side tools allow the customer to pull
information that initiates the customized
response from the firm.
 Company-side Tools
Company-Side Tools
(push) Description
Cookies Cookies are small files written to the user’s hard drive after visiting a Web site.
When the user returns to the site, the company’s server looks for the
cookie file and uses it to personalize the site.
Web log analysis Every time a user accesses a Web site, the visit is recorded in the Web server’s
log file. This file keeps track of which pages the user visits, how long he
stays, and whether he purchases or not.
Data mining Data mining involves the extraction of hidden predictive information in large
databases through statistical analysis.
Real-time profiling Real-time profiling occurs when special software tracks a user’s movements
through a Web site, then compiles and reports on the data at a moment’s
notice.
Collaborative filtering Collaborative filtering software gathers opinions of like-minded users and
returns those opinions to the individual in real time.
Outgoing e-mail Distributed e- Marketers use e-mail databases to build relationships by keeping in touch with
mail useful and timely information. E-mail can be sent to individuals or sent en
masse using a distributed e-mail list.
Chats A firm may listen to users and build community by providing a space for user
Bulletin boards conversation on the Web site.
iPOS terminals Interactive point-of-sale terminals are located on a retailer’s counter and used
to capture data and present targeted communication.
 Client-side Tools
Client-Side Tools
(pull) Description
Agents Agents are programs that perform functions on behalf of the user,
such as search engines and shopping agents.

Individualized Web Personalized Web pages users easily configure at Web sites such as
portals MyYahoo! and many others.

Wireless data services Wireless Web portals send data to customer cell phones and PDAs,
such as the PalmPilot.

Web forms Web form (or HTML form) is the technical term for a form on a Web
page that has designated places for the user to type information
for submission.

Fax-on-demand With fax-on-demand, customers telephone a firm, listen to an

automated voice menu, and select options to request a fax be sent
on a particular topic.

Incoming e-mail E-mail queries, complaints, or compliments initiated by customers or

prospects comprise incoming e-mail, and is the fodder for
customer service.
Thanks