Customer Relationship Management
Content
1. Customer Relationship Management The new decade of the 21st century is in the midst of explosive change witnessing rapidly changing market conditions,volatile equity markets, reconstructed value chains and new global competitors. And Customers themselves arechanging ± natural customer loyalty is a thing of past. Little wonder then, the concept of customer relationshipmanagement (CRM) has taken center stage in the business world for sustainable business advantage. Long-term success requires a great Customer Relationship Management strategy. A technology-enabled CRM strategy to meet Customer-focused objectives involves the vast majority of any organization¶s activity.No doubt about that Customer relationship management (CRM) has become a top priority for companies seeking to gain competitive advantage in today¶s stormy economy. However, confusion reigns about exactly what CRM is, how to best implement it, or even what role it should play in enhancing customer interaction. Eric Krell in his paper ³6 most over looked customer touch points´ has defined CRM as a process of carefully managing detailed information about individual customer and all customer µtouch point¶ to maximize customer loyalty. A customer touch point is any occasion on which a customer encounters the brand and product- from actual experience to personal or mass communications to checkouts, frequent-stay programs, room service, business service, exercise facility, restaurants and bars. CRM is a business strategy directed to understand, anticipate and respond to the needs of an enterprise's current and potential customers in order to grow the relationship value.
2. What is Customer Relationship Management?
Customer
Relationship
Management
(CRM)
is
a
process
by
which
a
company
maximizescustomer information in an effort to increase loyalty and retain customers¶ business overtheirlifetimes.The primary goals of CRM are to y y y Build long term and profitable relationships with chosen customers Get closer to those customers at every point of contact Maximize your company¶s share of the customer¶s wallet
3. CRM Business Cycle As shown in the diagram below, any organization starts with the acquisition ofcustomers.
3.1 Acquisition and Retaining Acquisition is a vital stage in building customer relationship. For purpose of customeracquisition an organization is likely to focus its attention the suspects, enquiries, lapsedcustomers, former customers, competitor¶s customers referrals, and the existing buyers.From these the organizations need to acquire customers and prospective customers andretain valuable customers.
3.2 Understand and Differentiate Organizations cannot have a relationship with customers unless they understandthem - what they value, what types of service are important to them, how and when theylike to interact and what they want to buy. True understanding is based on a combinationof detailed analysis and interaction.Several activities are important: y y Profiling to understand demographics, purchase patterns and channel preference Segmentation to identify logical unique groups of customers that tend to lookalike and behave in a similar fashion. While the promise of one-one marketingsounds good, we have not seen many organizations that have mastered the art oftreating each customer uniquely. Identification of actionable segments is apractical place to start. y y Primary research to capture needs and attitudes. Customer valuation to understand profitability, as well as lifetime value or longterm potential. Valuemay also be based on the customer¶s ability or inclination torefer other profitable customers.
Customers need to see that the company is tailoring service and communications basedon what they have learned independently and on what the customers have told them.
3.3 Develop and Customize In the product world of yesterday, companies developed products and services andexpected customers to buy them. In a customer ± focused world, product and channeldevelopment has to follow the customer¶s lead. Organizations are increasinglydeveloping products and services, and even new channels based on customer needs andservice expectations.
3.4 Interact and Deliver Interaction is also a critical component of a successful CRM initiative. It is important toremember that interaction doesn¶t just occur through marketing and sales channels andmedia; customers interact in many different ways with many different areas of theorganization, including distribution and shipping, customer service and online.With access to information and appropriate training, organizations will be prepared to steadily increase the value they deliver to customers.
4. Six Markets Framework The broadened view of relationship marketing addresses a total of six key marketdomains, not just the traditional customer market. The Six markets are
1.Customer Markets ± Existing and prospective customers as well as intermediaries. 2. Referral Markets ± Existing Customers who recommend to other prospects, andreferral sources or multipliers such as doctors who refer patients to a hospital 3. Influence Markets ± Government, consumer groups, business press and financial analysts. 4. Recruitment Markets ± For attracting the right employees to the organization 5. Supplier Markets ± Suppliers of raw materials, components, services etc. 6. Internal Markets ± The organization including internal departments and staff.
5. Use of technology in CRM
The application of technology is the most exciting, fastest growing and changing the waycustomers get information about products and services. Technology includes all theequipment, software, and communication links that organizations use to enable orimprove their processes. The mostly used tools are explained below:
5.1 Sales Force Automation
These systems help in automating and optimizing sales processes to shorten the salescycle and increases sales productivity. They enable the company to track and manage allqualified leads, contactand opportunities throughout the sales cycle including customersupport. They improve the effectiveness of marketing communications programs forgenerating quality leads as well as greater accuracy in sales forecasting. The Internet canbe used by the company in imparting proper training to its sales force. In depth product Information, specialized databases of solutions, sales force support queries, and a set ofinternal information on the Internet can improve the productivity of the sales force.
5.2 Call Centers Call Centre helps in automating the operations of inbound and outbound calls generatedbetween company and its customers. These solutions integrate the voice switch ofautomated telephone systems with an agent host software allowing for automatic callrouting to agents, auto display of relevant customer data, predictive dialing, self ±serviceInteractive Voice Response systems, etc. These Systems are useful in high volumesegments like banking, telecom and hospitality. Today, more innovative channels ofinteracting with customers are emerging as a result of new technology, such as globaltelephone based call centers and the Internet. Companies are now focusing to offersolutions that leverage the internet in building comprehensive CRM systems allowingthem to handle customer interactions in all forms.
5.3 Data Warehousing A data warehouse is an implementation of an informational database used to storeshareable data that originates in an operational database-of-record and in external marketdata sources. It is typically a subject database that allows users to tap into a company¶svast store of operational data to track and respond to business trends and facilitatesforecasting and planning efforts.
5.4 Data Mining and OLAP Data mining involves specialized software tools that allow users to sift through largeamounts of data to uncover data content relationships and build models to predictcustomer behavior. Data mining uses well-established statistical and machine learningtechniques to build models that predict customer behavior. OLAP (Online Analytical Processing), also known as multi-dimensional data analysis,offers advanced capabilities in querying and analyzing the information in a datawarehouse. In some CRM initiatives, OLAP plays a major role in the secondary analysisthat takes place after initial customer segmentation has occurred. For example, in CRM ±based campaign management systems, OLAP is an excellent tool for analyzing thesuccess or failure of the promotional campaigns.
5.5 Decision Support and Reporting Tools Web enabled reporting tools and executive information systems are used to deploy thebusiness information that has been discovered. This enhanced customer knowledge isdistributed to executive decision- makers as well as to the operational customer contactpoints. Applications equipped with some of the same sophisticated modeling routinesdeveloped in the data-mining phase are applied to individual contacts in real time.
5.6 Electronic point of Sale (EPOS) The main benefit of EPOS and retail scanner systems is the amount of timely andaccurate information they deliver. Advances in the technology have significantly aidedthe scope for data analysis. In addition to the original scanner-related data on sales rate,stock levels, stock turn, price and margin, retailers now have information about thedemographics, socio-economic and lifestyle characteristics of consumers.
6. Six E¶s of eCRM
The ³e´ in eCRM not only stands for ³electronic´ but also can be perceived to have manyother connotations. Though the core of eCRM remains to be cross channel integrationand organization; the six ³e: in eCRM can be used to frame alternative decisions ofeCRM based upon the channels which eCRM utilizes, the issues which it impacts andother factors; the six µe¶s of eCRM are briefly explained as follows:
1. Electronic channels: New electronic channels such as the web and personalizede-messaging have become the medium for fast, interactive and economiccommunication, challenging companies to keep pace with this increased velocity.eCRM thrives on these electronic channels.
2. Enterprise: Through eCRM a company gains the means to touch and shape acustomer¶s experience through sales, services and corner offices-whose occupantsneed to understand and assess customer behavior.
3. Empowerment: eCRM strategies must be structured to accommodate consumerswho now have the power to decide when and how to communicate with thecompany through which channel, at what frequency. An eCRM solution must bestructured to deliver timely pertinent, valuable information that a consumeraccepts in exchange for his or her attention.
4. Economics: An eCRM strategy ideally should concentrate on customereconomics, which delivers smart asset-allocation decisions, directing efforts atindividuals likely to provide the greatest return on customer ±communicationinitiatives.
5. Evaluation: Understanding customer economics relies on a company¶s ability toattribute customer behavior to market programs, evaluate customer interactionsalong various customer touch point channels, and compare anticipated ROIagainst actual returns through customer analytic reporting.
One to one marketing
One-to-one B2B a book by Don Peppers and Martha Rogers has outlined a four step frame work for one-to-one marketing that can be adapted to CRM marketing as follows:
1. Identify your prospects and customers ± Don¶t go after everyone. Build maintain, and mine a rich customer data base with information derived from all the channels and customer touch points. 2. Differentiate customer in terms of their need and their value of your company- Spend proportionately more effort on the most valuable customers. Apply ABC and calculate CLV. Estimate net present value of all future profits coming from purchases, margin level, and referrals, less customer-specific serving costs. 3. Interact with individual customers to improve your knowledge about their individual needs and to build strong relationships- formulate customized offerings that you can communicate in personalized way. 4. Customize products, services, and messages to each customer- Facilitate customercompany interaction through the company contact centers and web sites.
Increasing Value of the customer base
A key driver of shareholder value is the aggregate value of the customer base. Winning companies improve the value of their customer base by excelling at strategies such as the following:
y
Reducing the rate of customer deflection. Selecting and training employees to be knowledgeable and friendly increases the likelihood that the inevitable shopping questions from customers will be answered satisfactorily.
y
Increasing the longevity of the customer relationship. The more involved a customer is with the company, the more likely he is to stick around. Some companies treat their
customers as partners- especially in business-to-business markets-soliciting their help in the design of new products or improving their customer service. y Enhancing the growth potential of each customer through ³share-of-wallet¶, cross selling, and up-selling. New offering and opportunities increase sales from existing customers y Making low-profile customers more profitable or terminate them. To avoid the direct need for termination, marketers can encourage unprofitable customers to buy more or in larger quantities, forgo certain features or services, or pay higher amounts or fees. y Focusing disproportionate effort on high-value customers- The MVCs can be treated in s special way. Thoughtful gestures such as birthday greetings, smallgifts, or invitations to special sports or arts events can send a strong positive signal to the customer.
A good customer relationship management system will store the following information:
y
customer data such as name, address, contact, company, phone numbers, email address, corporate structure, job titles, employees
y y y y y y
lead and source all inbound and outbound communication with tracking of those conversations sales process tracking follow up information detail on services provided integration with other systems, like Microsoft Outlook, Calendar etc.
5 examples of great CRM
Customer relationship management (CRM) software has become an essential element of the IT arsenal of businesses of all shapes and sizes. Different businesses follow different CRM implementations. The following are a few examples of the way in which CRM has solved an important business issue.
Telemarketing teams
CRM software can be particularly valuable for businesses that sell over the phone. A specialist business magazine has found that its current practice of keeping leads in different central databases makes it difficult for sales people to systematically call prospective subscribers. The publisher implemented a CRM solution with a single, central database connected to a telesales software package. Now the publisher's sales force has an automated system that brings up the details of a lead whilst dialing the number at the same time.
Multi-division businesses Large businesses with multiple product divisions sometimes have single clients that buy products across the company. However with separate sales and support teams for each division, client data is entered over and over by different teams and one particular sales team may have no idea as to what other purchases the client may have made. A CRM solution with a centralized database allows everyone in the company to access all available data on a particular customer which enhances cross-selling opportunities, reduces repetition and allows for more informed sales and support team.
Workflow optimization Firms that sell products with an extensive order and delivery workflow, such as an aircraft manufacturer, frequently need access to client data at different points in the fulfillment process. If the client's data is in a number of discreet places, considerable time will be wasted trying to find details on different aspects of the order. A centralized CRM solution focused on workflow optimization gives everyone access to the complete order details such as seating specification which reduces any errors or delays in the fulfillment process.
Marketing automation Perhaps the quintessential role of CRM software is to make it easier to market to existing and prospective customers. A pet supplies company that sells via mail order found that sending out catalogues to their internal Excel contact list is unprofitable and does not reach all of the firm's previous and prospective customers. The CRM solution the company installed made it easier for all staff members to enter the details and preferences of every single customer including those
who have enquired but not as yet ordered. This has enabled the pet supplies company to send a vastly more targeted catalogue maillot to a broader set of contacts.
Management reporting Adding up monthly sales figures and analyzing which products are best sellers can be tricky when the source data consists of a mountain of invoices and order forms. A supplier of computer components has found it difficult to determine which of its products lines best sellers are and what type of customer is, in fact, the most profitable. This company decided to implement a CRM solution focused on the order process and now has the ability to extract detailed management reports using a variety of criteria.
Article Source: http://business.ezinemark.com/5-examples-of-great-crm-16823070f64.html
A common misconception is believing that CRM consists of software or that procuring CRM software will in and of itself achieve CRM objectives. This is not the case and it must be recognised that CRM is not equated to just application software but rather a comprehensive and holistic customer focus which evolves with every customer touch point and activity. While CRM is not software or technology, CRM software is a necessary enabler to achieve most CRM strategies and objectives. From an information technology perspective, CRM business systems deliver customer information combined with operational, analytical and support tools which empower knowledge workers and provide customers a consistently superior customer experience.
CRM is not Sales Force Automation (SFA) software, although SFA software is a component of CRM. By most business analyst standards, the minimum suite of software components to achieve a credible and enterprise wide CRM business system includes SFA, Marketing Management and Customer Service.
CRM is also not an implementation or an event; it is a process sponsored from the highest levels of an organization, embedded into the corporate culture and pervasive throughout the organisation. CRM is not a destination, it is a journey of continuous learning, process improvement and customer relationship evolution.
CRM is not confined to business processes within an information technology system. In fact, CRM can consist of virtually any front office or customer facing process designed to improve the company's relationship with customers. As an example of a CRM business process that doesn't require any technology, think of the old adage 'service with a smile' or 'the customer is always right'. These are examples of CRM processes made popular long before the introduction of CRM software technology. CRM 2.0 | The Evolution Continues
CRM strategies and CRM software solutions have already migrated from managing and streamlining customer-facing transactional processes to harnessing customer information in order to better interact and collaborative with customers. While there is clearly a maturation process which will continue to improve customer data aggregation, customer analysis, and customer learning, the next CRM wave is clearly focused on CRM 2.0.
CRM 2.0 was born of Web 2.0 and the social media phenomenon characterized by usergenerated content manifested through social networking sites, blogs, wikis, community forums and RSS syndication. CRM thought leaders are experimenting with new methods to communicate in the way the customer wants, to elevate the communication to bi-directional exchange, and to engage the customer in a way that delivers useful knowledge and content to both parties. For companies on the leading edge of CRM, this strategy goes well beyond just making the customer feel important and in fact, makes the customer an extension of the R&D team, the marketing team, the advertising team, or any other line of business that can benefit from direct contribution by the ultimate recipient.
CRM 2.0 requires new thinking and recognition that the customer relationship balance with the 'social customer' has shifted from the company believing it controls the relationship with its
product and service directed activities to one where the customer is proactive, part of a much larger virtual community and more intent on being heard and recognized as part of the solution.
Some organisations view CRM 2.0 and Web 2.0 as a corporate threat rather than knowledge to be harnessed, leveraged and incorporated into the development of products and services for improved market acceptance and market share growth. It is true that the Internet can put companies under a microscope of increased scrutiny, buyers can review independent evaluations of products and services never before available and social communities can impose their wrath on obstinate or uncooperative businesses. However, corporate transparency can also be used as a sustainable strategic benefit. It's hard to imagine the product or service that couldn't profit from the candid or passionate input of the customer.
CRM 2.0 need not be viewed as a threat as customer relationships will always continue to strive for a win-win result. In fact, when companies realize that social customers have a new avenue to get what they want, when the want it and how they want it, these companies also recognize they have an ideal opportunity to reduce market demand guess work, clearly architect higher fit products and services, achieve go to market solutions in reduced cycle times, deliver solutions which will achieve far greater market acceptance and secure more meaningful and more profitable client relationships
7. Conclusion
In summary, to implement CRM successfully, you'll have to reorganize your customer and change your organizational mindset. When CRM works, it helps to solve this problem by meshing everyone together and focusing the entire organization on the customer. Like all strategic initiatives, CRM requires commitment and understanding throughout the company, not just in marketing. In all, it adds to a sense of expectation and loyalty being instilled within the consumer and the development of a relationship between company and customer that competitors find hard to break. Business decisions based on complete and reliable information
about your customers are very difficult for your competitors to replicate and represent a key and sustainable competitive advantage.
2. What is Customer Relationship Management?
Customer
Relationship
Management
(CRM)
is
a
process
by
which
a
company
maximizescustomer information in an effort to increase loyalty and retain customers¶ business overtheirlifetimes.The primary goals of CRM are to y y y Build long term and profitable relationships with chosen customers Get closer to those customers at every point of contact Maximize your company¶s share of the customer¶s wallet
3. CRM Business Cycle As shown in the diagram below, any organization starts with the acquisition ofcustomers.
3.1 Acquisition and Retaining Acquisition is a vital stage in building customer relationship. For purpose of customeracquisition an organization is likely to focus its attention the suspects, enquiries, lapsedcustomers, former customers, competitor¶s customers referrals, and the existing buyers.From these the organizations need to acquire customers and prospective customers andretain valuable customers.
3.2 Understand and Differentiate Organizations cannot have a relationship with customers unless they understandthem - what they value, what types of service are important to them, how and when theylike to interact and what they want to buy. True understanding is based on a combinationof detailed analysis and interaction.Several activities are important: y y Profiling to understand demographics, purchase patterns and channel preference Segmentation to identify logical unique groups of customers that tend to lookalike and behave in a similar fashion. While the promise of one-one marketingsounds good, we have not seen many organizations that have mastered the art oftreating each customer uniquely. Identification of actionable segments is apractical place to start. y y Primary research to capture needs and attitudes. Customer valuation to understand profitability, as well as lifetime value or longterm potential. Valuemay also be based on the customer¶s ability or inclination torefer other profitable customers.
Customers need to see that the company is tailoring service and communications basedon what they have learned independently and on what the customers have told them.
3.3 Develop and Customize In the product world of yesterday, companies developed products and services andexpected customers to buy them. In a customer ± focused world, product and channeldevelopment has to follow the customer¶s lead. Organizations are increasinglydeveloping products and services, and even new channels based on customer needs andservice expectations.
3.4 Interact and Deliver Interaction is also a critical component of a successful CRM initiative. It is important toremember that interaction doesn¶t just occur through marketing and sales channels andmedia; customers interact in many different ways with many different areas of theorganization, including distribution and shipping, customer service and online.With access to information and appropriate training, organizations will be prepared to steadily increase the value they deliver to customers.
4. Six Markets Framework The broadened view of relationship marketing addresses a total of six key marketdomains, not just the traditional customer market. The Six markets are
1.Customer Markets ± Existing and prospective customers as well as intermediaries. 2. Referral Markets ± Existing Customers who recommend to other prospects, andreferral sources or multipliers such as doctors who refer patients to a hospital 3. Influence Markets ± Government, consumer groups, business press and financial analysts. 4. Recruitment Markets ± For attracting the right employees to the organization 5. Supplier Markets ± Suppliers of raw materials, components, services etc. 6. Internal Markets ± The organization including internal departments and staff.
5. Use of technology in CRM
The application of technology is the most exciting, fastest growing and changing the waycustomers get information about products and services. Technology includes all theequipment, software, and communication links that organizations use to enable orimprove their processes. The mostly used tools are explained below:
5.1 Sales Force Automation
These systems help in automating and optimizing sales processes to shorten the salescycle and increases sales productivity. They enable the company to track and manage allqualified leads, contactand opportunities throughout the sales cycle including customersupport. They improve the effectiveness of marketing communications programs forgenerating quality leads as well as greater accuracy in sales forecasting. The Internet canbe used by the company in imparting proper training to its sales force. In depth product Information, specialized databases of solutions, sales force support queries, and a set ofinternal information on the Internet can improve the productivity of the sales force.
5.2 Call Centers Call Centre helps in automating the operations of inbound and outbound calls generatedbetween company and its customers. These solutions integrate the voice switch ofautomated telephone systems with an agent host software allowing for automatic callrouting to agents, auto display of relevant customer data, predictive dialing, self ±serviceInteractive Voice Response systems, etc. These Systems are useful in high volumesegments like banking, telecom and hospitality. Today, more innovative channels ofinteracting with customers are emerging as a result of new technology, such as globaltelephone based call centers and the Internet. Companies are now focusing to offersolutions that leverage the internet in building comprehensive CRM systems allowingthem to handle customer interactions in all forms.
5.3 Data Warehousing A data warehouse is an implementation of an informational database used to storeshareable data that originates in an operational database-of-record and in external marketdata sources. It is typically a subject database that allows users to tap into a company¶svast store of operational data to track and respond to business trends and facilitatesforecasting and planning efforts.
5.4 Data Mining and OLAP Data mining involves specialized software tools that allow users to sift through largeamounts of data to uncover data content relationships and build models to predictcustomer behavior. Data mining uses well-established statistical and machine learningtechniques to build models that predict customer behavior. OLAP (Online Analytical Processing), also known as multi-dimensional data analysis,offers advanced capabilities in querying and analyzing the information in a datawarehouse. In some CRM initiatives, OLAP plays a major role in the secondary analysisthat takes place after initial customer segmentation has occurred. For example, in CRM ±based campaign management systems, OLAP is an excellent tool for analyzing thesuccess or failure of the promotional campaigns.
5.5 Decision Support and Reporting Tools Web enabled reporting tools and executive information systems are used to deploy thebusiness information that has been discovered. This enhanced customer knowledge isdistributed to executive decision- makers as well as to the operational customer contactpoints. Applications equipped with some of the same sophisticated modeling routinesdeveloped in the data-mining phase are applied to individual contacts in real time.
5.6 Electronic point of Sale (EPOS) The main benefit of EPOS and retail scanner systems is the amount of timely andaccurate information they deliver. Advances in the technology have significantly aidedthe scope for data analysis. In addition to the original scanner-related data on sales rate,stock levels, stock turn, price and margin, retailers now have information about thedemographics, socio-economic and lifestyle characteristics of consumers.
6. Six E¶s of eCRM
The ³e´ in eCRM not only stands for ³electronic´ but also can be perceived to have manyother connotations. Though the core of eCRM remains to be cross channel integrationand organization; the six ³e: in eCRM can be used to frame alternative decisions ofeCRM based upon the channels which eCRM utilizes, the issues which it impacts andother factors; the six µe¶s of eCRM are briefly explained as follows:
1. Electronic channels: New electronic channels such as the web and personalizede-messaging have become the medium for fast, interactive and economiccommunication, challenging companies to keep pace with this increased velocity.eCRM thrives on these electronic channels.
2. Enterprise: Through eCRM a company gains the means to touch and shape acustomer¶s experience through sales, services and corner offices-whose occupantsneed to understand and assess customer behavior.
3. Empowerment: eCRM strategies must be structured to accommodate consumerswho now have the power to decide when and how to communicate with thecompany through which channel, at what frequency. An eCRM solution must bestructured to deliver timely pertinent, valuable information that a consumeraccepts in exchange for his or her attention.
4. Economics: An eCRM strategy ideally should concentrate on customereconomics, which delivers smart asset-allocation decisions, directing efforts atindividuals likely to provide the greatest return on customer ±communicationinitiatives.
5. Evaluation: Understanding customer economics relies on a company¶s ability toattribute customer behavior to market programs, evaluate customer interactionsalong various customer touch point channels, and compare anticipated ROIagainst actual returns through customer analytic reporting.
One to one marketing
One-to-one B2B a book by Don Peppers and Martha Rogers has outlined a four step frame work for one-to-one marketing that can be adapted to CRM marketing as follows:
1. Identify your prospects and customers ± Don¶t go after everyone. Build maintain, and mine a rich customer data base with information derived from all the channels and customer touch points. 2. Differentiate customer in terms of their need and their value of your company- Spend proportionately more effort on the most valuable customers. Apply ABC and calculate CLV. Estimate net present value of all future profits coming from purchases, margin level, and referrals, less customer-specific serving costs. 3. Interact with individual customers to improve your knowledge about their individual needs and to build strong relationships- formulate customized offerings that you can communicate in personalized way. 4. Customize products, services, and messages to each customer- Facilitate customercompany interaction through the company contact centers and web sites.
Increasing Value of the customer base
A key driver of shareholder value is the aggregate value of the customer base. Winning companies improve the value of their customer base by excelling at strategies such as the following:
y
Reducing the rate of customer deflection. Selecting and training employees to be knowledgeable and friendly increases the likelihood that the inevitable shopping questions from customers will be answered satisfactorily.
y
Increasing the longevity of the customer relationship. The more involved a customer is with the company, the more likely he is to stick around. Some companies treat their
customers as partners- especially in business-to-business markets-soliciting their help in the design of new products or improving their customer service. y Enhancing the growth potential of each customer through ³share-of-wallet¶, cross selling, and up-selling. New offering and opportunities increase sales from existing customers y Making low-profile customers more profitable or terminate them. To avoid the direct need for termination, marketers can encourage unprofitable customers to buy more or in larger quantities, forgo certain features or services, or pay higher amounts or fees. y Focusing disproportionate effort on high-value customers- The MVCs can be treated in s special way. Thoughtful gestures such as birthday greetings, smallgifts, or invitations to special sports or arts events can send a strong positive signal to the customer.
A good customer relationship management system will store the following information:
y
customer data such as name, address, contact, company, phone numbers, email address, corporate structure, job titles, employees
y y y y y y
lead and source all inbound and outbound communication with tracking of those conversations sales process tracking follow up information detail on services provided integration with other systems, like Microsoft Outlook, Calendar etc.
5 examples of great CRM
Customer relationship management (CRM) software has become an essential element of the IT arsenal of businesses of all shapes and sizes. Different businesses follow different CRM implementations. The following are a few examples of the way in which CRM has solved an important business issue.
Telemarketing teams
CRM software can be particularly valuable for businesses that sell over the phone. A specialist business magazine has found that its current practice of keeping leads in different central databases makes it difficult for sales people to systematically call prospective subscribers. The publisher implemented a CRM solution with a single, central database connected to a telesales software package. Now the publisher's sales force has an automated system that brings up the details of a lead whilst dialing the number at the same time.
Multi-division businesses Large businesses with multiple product divisions sometimes have single clients that buy products across the company. However with separate sales and support teams for each division, client data is entered over and over by different teams and one particular sales team may have no idea as to what other purchases the client may have made. A CRM solution with a centralized database allows everyone in the company to access all available data on a particular customer which enhances cross-selling opportunities, reduces repetition and allows for more informed sales and support team.
Workflow optimization Firms that sell products with an extensive order and delivery workflow, such as an aircraft manufacturer, frequently need access to client data at different points in the fulfillment process. If the client's data is in a number of discreet places, considerable time will be wasted trying to find details on different aspects of the order. A centralized CRM solution focused on workflow optimization gives everyone access to the complete order details such as seating specification which reduces any errors or delays in the fulfillment process.
Marketing automation Perhaps the quintessential role of CRM software is to make it easier to market to existing and prospective customers. A pet supplies company that sells via mail order found that sending out catalogues to their internal Excel contact list is unprofitable and does not reach all of the firm's previous and prospective customers. The CRM solution the company installed made it easier for all staff members to enter the details and preferences of every single customer including those
who have enquired but not as yet ordered. This has enabled the pet supplies company to send a vastly more targeted catalogue maillot to a broader set of contacts.
Management reporting Adding up monthly sales figures and analyzing which products are best sellers can be tricky when the source data consists of a mountain of invoices and order forms. A supplier of computer components has found it difficult to determine which of its products lines best sellers are and what type of customer is, in fact, the most profitable. This company decided to implement a CRM solution focused on the order process and now has the ability to extract detailed management reports using a variety of criteria.
Article Source: http://business.ezinemark.com/5-examples-of-great-crm-16823070f64.html
A common misconception is believing that CRM consists of software or that procuring CRM software will in and of itself achieve CRM objectives. This is not the case and it must be recognised that CRM is not equated to just application software but rather a comprehensive and holistic customer focus which evolves with every customer touch point and activity. While CRM is not software or technology, CRM software is a necessary enabler to achieve most CRM strategies and objectives. From an information technology perspective, CRM business systems deliver customer information combined with operational, analytical and support tools which empower knowledge workers and provide customers a consistently superior customer experience.
CRM is not Sales Force Automation (SFA) software, although SFA software is a component of CRM. By most business analyst standards, the minimum suite of software components to achieve a credible and enterprise wide CRM business system includes SFA, Marketing Management and Customer Service.
CRM is also not an implementation or an event; it is a process sponsored from the highest levels of an organization, embedded into the corporate culture and pervasive throughout the organisation. CRM is not a destination, it is a journey of continuous learning, process improvement and customer relationship evolution.
CRM is not confined to business processes within an information technology system. In fact, CRM can consist of virtually any front office or customer facing process designed to improve the company's relationship with customers. As an example of a CRM business process that doesn't require any technology, think of the old adage 'service with a smile' or 'the customer is always right'. These are examples of CRM processes made popular long before the introduction of CRM software technology. CRM 2.0 | The Evolution Continues
CRM strategies and CRM software solutions have already migrated from managing and streamlining customer-facing transactional processes to harnessing customer information in order to better interact and collaborative with customers. While there is clearly a maturation process which will continue to improve customer data aggregation, customer analysis, and customer learning, the next CRM wave is clearly focused on CRM 2.0.
CRM 2.0 was born of Web 2.0 and the social media phenomenon characterized by usergenerated content manifested through social networking sites, blogs, wikis, community forums and RSS syndication. CRM thought leaders are experimenting with new methods to communicate in the way the customer wants, to elevate the communication to bi-directional exchange, and to engage the customer in a way that delivers useful knowledge and content to both parties. For companies on the leading edge of CRM, this strategy goes well beyond just making the customer feel important and in fact, makes the customer an extension of the R&D team, the marketing team, the advertising team, or any other line of business that can benefit from direct contribution by the ultimate recipient.
CRM 2.0 requires new thinking and recognition that the customer relationship balance with the 'social customer' has shifted from the company believing it controls the relationship with its
product and service directed activities to one where the customer is proactive, part of a much larger virtual community and more intent on being heard and recognized as part of the solution.
Some organisations view CRM 2.0 and Web 2.0 as a corporate threat rather than knowledge to be harnessed, leveraged and incorporated into the development of products and services for improved market acceptance and market share growth. It is true that the Internet can put companies under a microscope of increased scrutiny, buyers can review independent evaluations of products and services never before available and social communities can impose their wrath on obstinate or uncooperative businesses. However, corporate transparency can also be used as a sustainable strategic benefit. It's hard to imagine the product or service that couldn't profit from the candid or passionate input of the customer.
CRM 2.0 need not be viewed as a threat as customer relationships will always continue to strive for a win-win result. In fact, when companies realize that social customers have a new avenue to get what they want, when the want it and how they want it, these companies also recognize they have an ideal opportunity to reduce market demand guess work, clearly architect higher fit products and services, achieve go to market solutions in reduced cycle times, deliver solutions which will achieve far greater market acceptance and secure more meaningful and more profitable client relationships
7. Conclusion
In summary, to implement CRM successfully, you'll have to reorganize your customer and change your organizational mindset. When CRM works, it helps to solve this problem by meshing everyone together and focusing the entire organization on the customer. Like all strategic initiatives, CRM requires commitment and understanding throughout the company, not just in marketing. In all, it adds to a sense of expectation and loyalty being instilled within the consumer and the development of a relationship between company and customer that competitors find hard to break. Business decisions based on complete and reliable information
about your customers are very difficult for your competitors to replicate and represent a key and sustainable competitive advantage.
