Customer Relationship
Management
Content
Introduction
What Is CRM?
History of CRM
Why CRM?
Goals and Objectives
Benefits of CRM
How CRM Works!
CRM Applications
Key Elements of CRM
CRM and its Components – Why are they essential?
Advantages of CRM
Disadvantages of CRM
INTRODUCTION
Customer Relationship Management (CRM) is growing in
importance due to the challenging business environment faced by
organizations throughout the world today.
If customer relationships are the heart of business success, then
CRM is the valve the pumps a company's life blood.
What Is CRM?
CRM, or Customer Relationship Management, is a company-
wide business strategy designed to reduce costs and increase
profitability by solidifying customer satisfaction, loyalty, and
advocacy.
History of CRM
1980s: Database marketing emerges.
1980s: Database helped larger organizations rather then
small who only got survey type info.
1990s: CRM appears as a two-way communication device.
1990s: CRM leads to programs such as frequent flyer miles
and bonus points on credit cards.
2000s: Internet has helped expand from stagnant database
and allows off-site information storage.
Customer Relationship Management (CRM): the
business elements of the system
CRM: steps to success
Successful organizations use three steps to build
customer relationships:
determine mutually satisfying goals between
organization and customers
establish and maintain customer rapport
produce positive “feelings” in the organization and
the customers
Customer Relationship Management (CRM)
Information Systems
• Capture, consolidate, analyze customer data and distribute results to
various systems and customer touch points (contact points) across
enterprise
• Provide single enterprise view of customers
• Provide analytical tools for determining value, loyalty,
profitability of customers
• Assist in acquiring new customers, providing better service
and support to customers, customize offerings to customer
preferences, provide ongoing value to retain profitable
customers
• Provide customers with a single view of the enterprise at
touch points (web-site ): What would you consider
important in the design of this points of contact
CRM I.T. software
• Ranges from niche tools to large-scale enterprise
applications
• Typically include tools for sales, customer service, and
marketing
• CRM I.T. system should include:
• Partner relationship management (PRM) modules
• Enhances collaboration between company and selling partners
• Employee relationship management (ERM) modules
• Deals with employee issues closely related to CRM, e.g. setting
objectives, employee performance management
Sales force automation (SFA) modules
• Enable focusing efforts on most profitable customers
• Enables sharing customer and prospective customer
information (what other type of application/technology may
be used in conjunction with this)
• Helps reduce cost per sale and cost of acquiring, and retaining
customers
Customer service modules
• Assigning and managing customer service requests
• E.g. managing advice phone lines, Web site support
Marketing modules
• Capturing prospect and customer data,
• Providing product and service information
• Qualifying (determining) leads for targeted marketing
• Scheduling and tracking direct-marketing mailings or e-mail
Analysing customer and marketing data
Identifying profitable and unprofitable customers
Designing products and services to satisfy specific
customer needs and interests (niche products)
Identifying opportunities for cross-dressing
Customer Loyalty Management Process Map
Business value of CRM
• Increased customer satisfaction
• Reduced direct marketing costs
• More effective marketing
• Lower costs for customer acquisition and retention
• Increased sales revenue
• By identifying profitable customers and segments for focused
marketing and cross-selling
• Reduced churn rate (number of customers who stop using or
purchasing products or services): indication of customer
dissatisfaction
Evolution of CRM
Cont..
Goals and Objectives
1. Customer Satisfaction
2. Run an Efficient Business
3. Produce Better Marketing Campaigns
4. Gaining New Customers
5. Boost Sales
Benefits of CRM
Increased customer satisfaction
Identify new selling opportunities
Increased market share and profit margin
Increased revenues
More effective reach and marketing
Improved customer service and support
Improved response time to customer requests for
information
Enhanced customer loyalty
Improved ability to meet customer requirements
Improved quality communication and networking
How CRM Works!
To make sure that all of your customers receive the most personal
attention possible, we at Straight Marketing make the process and
implementation of CRM easy and professional.
Suppose you were bombarded with a customer’s telephone calls
every day, wanting to know the status and progress of the
services you are providing.
CRM Applications
Three Types of CRM
Operational CRM
Collaborative CRM
Analytical CRM
Purpose
providing services and products that are exactly what your customers want
offering better customer service
cross selling products more effectively
helping sales staff close deals faster
retaining existing customers and discovering new ones
make call centers more efficient
simplify marketing and sales processes.
CRM and its Components
People Management
Lead Management
Sales Force Automation
Customer Service
Marketing
Workflow Automation
Business Reporting
Analytics
Advantages of CRM
While company is quickly growing, customers are more satisfied
as well
Service provided in a better way, and a quicker way
Sales force automated
Integrated customer information
Certain processes eliminated
Operation cost cut, and time efficient
Brand names more quickly established
Lets you pick and choose the functionality that you want
Disadvantages of CRM
-Organizational wise change of priority to customers.
- Significant investment of time and money
- Threatens management’s control/power struggle
- Heightens people’s resistance to change
- Inappropriate integration leads to disaster
27
Types of CRM
Chapter 3 – Types of CRM
Introduction to Types of CRM
28
• Broadly there are three types of CRM
• Operational CRM
• Collaborative CRM
• Analytical CRM
Chapter 3 – Types of CRM
Two main categories of CRM
Operational CRM
Customer-facing applications, e.g. tools for sales force
automation, call centre and customer service support,
marketing automation
Analytical CRM
Applications that analyse (OLAP, data mining, etc.) customer
data
Based on data warehouses consolidating data from operational
CRM systems and customer touch points
One important output: Customer lifetime value (CLTV)
Value based on revenue produced by a customer, expenses
incurred in acquiring and servicing customer, and expected life
of relationship between customer and company
Analytical CRM data warehouse
Operational CRM
31
• Part of CRM that supports daily sales, marketing or service
tasks
• Involves creating target groups based on criteria
revealed by the data analysis or managing event
attendance e.g. in seminars
• Mostly involves areas where there is a direct
customer contact
• Deals with customer touch points e.g. a call to a
customer support helpline
Chapter 3 – Types of CRM
Components of Operational CRM
32
• Sales Force Automation
• Enterprise Marketing Automation
• Activity Management
• Campaign Management
Chapter 3 – Types of CRM
Collaborative CRM
33
• Collaborative CRM broadly consist of two major
aspects
• Interaction Management
• Channel Management
Chapter 3 – Types of CRM
Analytical CRM
34
• Analytical CRM supports back office operations and
analysis, It deals with all the operations and
processes that do not directly deal with customers
• Primary Goal of Analytical CRM is to develop, support
and enhance the work and decision making capability
of an organisation
Chapter 3 – Types of CRM
Features of Analytical CRM
35
• Seizing all the relevant and essential information of
customers for creation of knowledge repository
• Determining, developing and analysing inclusive set
of rules and analytical methods to scale and optimise
relationship with customers
• Implementing or deploying the results to enhance the
efficiency of CRM system and processes
Chapter 3 – Types of CRM
Features of Analytical CRM
36
• Combine and integrate the values of customers with
strategic business objectives
• Analytical CRM is a solid and consistent platform
which provide analytical applications to help predict,
scale and optimise customer relations
Chapter 3 – Types of CRM
Advantages of Analytical CRM
37
• Leads in making more profitable customer base by
providing high value services
• Helps in retaining profitable customers through
sophisticated analysis and making new customers
that clones best customers
• Helps in addressing individual customer’s needs and
efficiently improving the relationships with new and
existing customers
• Chapter
Improves
3 – Types of CRM
customer satisfaction and loyalty
Analytics has following role in the Customer
life Cycle Management
38
• Customer analytics
• Marketing analytics
• Sales Analytics
• Service Analytics
• Channel Analytics
Chapter 3 – Types of CRM
Future CRM Trends
Summary
CONCLUSION
For higher level customers that require personal assistance in the
CRM process (like the relationship with a major client), keep in
touch on a personal basis.
Don’t rely solely on an email newsletter as a means of engaging
with these types of customers.
Personal & professional attention is more than likely what they
pay for, and that’s what these customers should get.
