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Linking Strategies and the Sales Role in the Era of Customer Relationship Management

Linking Strategies and the Sales Role in the Era of Customer Relationship Management. Sales and Distribution Management Marketing 3345. CRM is…. a comprehensive business model for increasing revenues and profits by focusing on customers.

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Linking Strategies and the Sales Role in the Era of Customer Relationship Management

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  1. Linking Strategies and the Sales Role in the Era of Customer Relationship Management Sales and Distribution Management Marketing 3345

  2. CRM is… • a comprehensive business model for increasing revenues and profits by focusing on customers. • both an overarching business philosophy and a process tool to facilitate a truly customer-driven enterprise.

  3. CRM is… • “…a journey of strategic, process, organizational and technical change whereby a company seeks to better manage its enterprise around customer behaviors. This entails acquiring knowledge about customers and deploying this information at each touchpoint to attain increased revenue and operational efficiencies.” PriceWaterhouse Coopers

  4. Customer-Centric Cultures Include… • Adopting a partnership business model with mutually shared risks and rewards • Defining selling as “customer business consultation” • Formalizing customer analysis processes and agreements • Being proactive in educating customers about value chain and cost reduction opportunities • Focusing on continuous improvement principles stressing customer satisfaction

  5. The Marketing Evolution

  6. Objectives of CRM • Customer Retention - retain loyal and profitable customers and channels • Customer Acquisition - acquire customer based on known characteristics which drive growth and increase margins • Customer Profitability - increase individual customer margins by offering the right product at the right time

  7. Advantages of CRM • Reduces advertising costs • Increases awareness of customer needs • Tracks the effectiveness of promotional campaigns • Allows competition for customers based on service, not prices • Prevents overspending on low-value clients and under spending on high-value ones • Speeds the time it takes to develop and market a product • Improves use of the customer channel

  8. The CRM Process Cycle

  9. 10 Critical Questions in CRM • Customers • Who are our customers? • What do our customers want and expect? • What is the value potential of our customers? • The Relationship • What kind of relationship do we want to build? • How do we foster exchange? • How do we work together and share control? • Managerial Decision Making • Who are we? • How do we organize to move value closer to our customers? • How do we measure and manage our performance? • How do we increase our capacity for change?

  10. The Importance of Market Orientation • Successful salespeople think beyond “selling” • Market-driven companies do better market sensing • Market-driven companies develop stronger relationships with customers and channels • Internal partnering is a critical component of market orientation

  11. Classifying Capabilities

  12. Process of Strategy Development • The mission statement answers the most basic questions about an organization’s reason for being. • Firms should define their mission in terms of broad human needs to be satisfied. • This approach makes it easier to identify attractive market opportunities.

  13. Process of Strategy Development • Goals – flow from the firm’s mission statement and represent specific targets the firm intends to hit. • Objectives – more specific than goals and should always be: • Specific and in writing • Measurable • Realistically attainable

  14. SBU Strategy • Business-level strategy involves how the business will compete in its industry to achieve a “sustainable competitive advantage (SCA)” • An SCA focuses on distinctive competencies • Porter’s Three Generic Strategies: • Low Cost • Differentiation • Niche

  15. Process of Strategy Development

  16. Personal Selling’s Role in Marketing Strategy

  17. Stages in Relationship Development • Stage I – Exploration • Determine value, build trust, set expectations, monitor • Stage II – Expansion • Generate repeat sales, full-line selling, cross-selling • Stage III – Commitment • Build loyalty, become a preferred supplier, engage in

  18. Role of Personal Selling in IMC • An Integrated Marketing Communications (IMC) strategy effectively integrates personal selling, advertising and other communications options • Advantages of Selling in IMC • Face-to-face contact • More persuasive • More demonstrative • Customization opportunities • Disadvantages of Selling in IMC • Limited ability to duplicate • More costly

  19. Sales Force Costs

  20. Advertising vs. Personal Selling

  21. Customer Loyalty ROI

  22. Customer Satisfaction and Feedback • Maintaining customer loyalty is one outcome of customer orientation. • Loyal customers. . . • Tend to concentrate their purchases. • Provide positive word-of-mouth and customer referrals. • May be willing to pay premium prices for the value they receive. • Satisfaction measures need to be supplemented with examinations of customer behavior, such as annual retention rate, frequency of purchases and percentage of the customer’s total purchases captured by the firm.

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