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MKTG

MKTG. Lamb, Hair, McDaniel 2008-2009. 19. Customer Relationship Management (CRM). CHAPTER. Designed by Amy McGuire, B-books, Ltd. Prepared by Deborah Baker, Texas Christian University. Learning Outcomes. Define customer relationship management

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MKTG

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  1. MKTG Lamb, Hair, McDaniel 2008-2009 19 Customer Relationship Management (CRM) CHAPTER Designed by Amy McGuire, B-books, Ltd. Prepared by Deborah Baker, Texas Christian University

  2. Learning Outcomes Define customer relationship management Explain how to establish customer relationships within the organization Understand interactions with the current customer base Outline the process of capturing customer data LO1 LO2 LO3 LO4

  3. Learning Outcomes Describe the use of technology to store and integrate customer data Describe how to identify the best customers Explain the process of leveraging customer information throughout the organization LO5 LO6 LO7

  4. What Is Customer Relationship Management? LO1 Define customer relationship management

  5. 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 CustomerRelationshipManagement LO1

  6. Organize the company around customer segments Encourage and track customer interaction with the company Foster customer-satisfying behaviors Link all processes of the company from its customers through its suppliers http://www.crmdownload.com Online Customer RelationshipManagement Strategy LO1

  7. Leverage customerinformation Understand interactions with current customer base Identify best customers Capture customer data based on interactions Customer Relationship Management Cycle Identify customer relationships Store and integratecustomer data using IT LO1

  8. Key Points: Customers take center stage Business must manage the customer relationship across all points of customer contact Implementing a CRM System LO1

  9. REVIEW LEARNING OUTCOME LO1 Customer Relationship Management

  10. Identify Customer Relationships LO2 Explain how to establish customer relationships within the organization

  11. The company customizes its product and service offering based on data generated through interactions between the customer and the company. Identify Customer Relationships Customer-Centric LO2

  12. An informal process of collecting customer data through customer comments and feedback on product or service performance. Identify Customer Relationships Learning LO2

  13. Unilever and Stop & Shop teamed up to create a customer-centric promotion that was so successful, they won an award for their innovation and creativity. Stop & Shop’s goal – get customers to make more stock-up trips, the store’s most profitable type Unilever’s goal – get customers to buy more Unilever products per trip When asked, the customers said they’d stock up more if it were simpler to find things. So, the team built signs and made rip-off shopping lists, distributed store maps, and centrally stocked a breadth of customers’ favorite items. The result, the biggest sales spike in two years. And better yet, the team has been able to replicate the results in other stores. Centered on Customers LO2 Beyond the Book SOURCE: Julie Gallagher, “Stop & Shop and Unilever Share Customer-centric Plan,” Supermarket News, October 22, 2007.

  14. The process by which learned information from customers is centralized and shared in order to enhance the relationship between customers and the organization. Identify Customer Relationships KnowledgeManagement LO2

  15. Experiential observations CollectedInformation Includes: Comments Customer actions Qualitative facts Knowledge Management LO2

  16. Delegation of authority to solve customers’ problems quickly—usually by the first person that the customer notifies regarding the problem. Empowerment Empowerment LO2

  17. Training and Skill Development Communication Development Recognition and Rewards Employee Growth Strategy Compensation and Benefits Reviews Resource and Workload Planning Performance Appraisals Career Planning Empowering Employees LO2 Beyond the Book SOURCE: Society for Human Resource Management and CRM Today

  18. REVIEW LEARNING OUTCOME LO2 Identifying Customer Relationships

  19. Interactions of the Current Customer Base LO3 Understand interactions with the current customer base

  20. Interactions of the Current Customer Base Current Transaction Channel Past Relationship Requested Service LO3 Customer

  21. Interactions of the Current Customer Base Touch Points All possible areas of a business where customers communicate with that business. Point-of-Sale Interactions Communications between customers and organizations thatoccur at the point of sale, normally in a store. http://www.bestbuy.com Online LO3

  22. Web Point of Sale Kiosk Delivery, Installation Survey Product Registration REVIEW LEARNING OUTCOME LO3 Interactions with Current Customer Base Customer

  23. Capture Customer Data LO4 Outline the process of capturing customer data

  24. Store visits Conversations with salespeople Interactions via the Web Traditional phone conversations Wireless communications http://www.geico.com Online Capture Customer Data LO4

  25. REVIEW LEARNING OUTCOME LO4 Capturing Customer Data

  26. Store and Integrate Customer Data LO5 Describe the use of technology to store and integrate customer data

  27. Response list Compiled list :::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: Database \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\ /////////////////////////////////////////////////////////// ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Data Warehouse REVIEW LEARNING OUTCOME LO5 Store and Integrate Customer Data

  28. Identifying the Best Customers LO6 Describe how to identify the best customers

  29. A data analysis procedure that identifies significant patterns of variables and characteristics that pertain to particular customers or customer groups. Identifying the Best Customers Data Mining LO6

  30. Data Mining • Identify and profile the best customers • Calculate their lifetime value • Predict purchasing behavior LO6

  31. Customer segmentation Recency-frequency-monetary analysis Lifetime value analysis Predictive modeling Data Analysis LO6

  32. Recency-Frequency-Monetary Analysis Identifies customers most likely to purchase again Identifies and ranks “best customers” Identifies most profitable customers LO6

  33. Biz Flix Casino LO6

  34. Lifetime Value Analysis A data manipulation technique that projects the future value of the customer over a period of years. PredictiveModeling A data manipulation technique in which marketers try to determine what the odds are that some other occurrence will take place in the future. Data Manipulation Techniques LO6

  35. REVIEW LEARNING OUTCOME LO6 Identify the Best Customers

  36. Leverage Customer Information LO7 Explain the process of leveraging customer information throughout the organization

  37. CRM Marketing Database Applications Reinforcing customerpurchase decisions Campaign management Inducing product trialby new customers Retain loyalcustomers Cross-selling other products and services Increasing effectivenessof distribution channel marketing Designing targetedmarketing communications Improving customer service LO7

  38. Campaign Management Developing product or service offerings customized for the appropriate customer segment and then pricing and communicating these offerings for the purpose of enhancing customer relationships. CampaignManagement LO7

  39. Campaign Management Developing customized offerings for appropriate segment Pricing these offeringsattractively Communicating offerings in a waythat enhances customer relationships LO7

  40. Retaining Loyal Customers Retaining an additional 5 percent of customers increases profits by as much as 25 percent Improving customer retention by 2 percent candecrease costs by as much as 10 percent Loyalty programs reward loyal customers for making multiple purchases Loyalty programs provide information about customers and trends LO7

  41. Targeted Marketing Communications InfrequentUsers ModerateUsers HeavyUsers • Offer direct incentives, such as a price discount • Offer more reinforcement of past purchase decisions • Design around loyalty and reinforcement of purchase LO7

  42. Increasing Effectiveness ofDistribution Channel Marketing RFID technology Multichannel Marketing CRM Databases http://www.kidsdadsmoms.com Online LO7

  43. REVIEW LEARNING OUTCOME LO7 Leveraging Customer Information Marketing Information • Campaign management • Retaining loyal customers • Cross-selling other products • Designing targeted marketingcommunications • Reinforcing purchase decisions • Inducing product trial by new customers • Increasing effectiveness of distribution channel marketing • Improving customer service CRM Database Applications

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