Sage - CRM & Customer Equity_May 2012

Back to Basics CRM

- the magic of seven

Communicate, Collaborate, Compete

#TFM2012

David Beard

Sage CRM Evangelist

What’s the evangelist stuff then?

2

Sage Overview

• Over £1B in revenue

• 14,500 employees

• Over 6 million customers

• Global distribution network

– 30,000 reseller partners

• Presence in 26 countries

• 3rd largest business

management software provider

worldwide

3

About Sage CRM

Sage CRM offers customers

a rapid route to success

and value

4

What The Analysts Say

Source: Gartner Magic

Quadrant for Sales Force

Automation 28 July 2010

Gartner on Sage CRM

Strengths include:

End-user usability

Core opportunity management

End-to-end business process support, such as "opportunity to cash"

Forrester on Sage CRM The solution’s primary strengths include a low price tag, strong usability,

and quick time-to-value. The solution offers an intuitive admin UI, strong

performance capabilities, and strong product help functionality. In

addition, the product integrates well with other Sage back-office

software products. Source: The Forrester Wave™: CRM Suites For Midsized Organizations, Q2 2010 , Forrester Research,

Inc

Source: Gartner Magic Quadrant for Sales Force Automation 28 July

2010

5

What’s the problem ?

The case for

Customer Relationship Management

6

Common Business Issues

Faced by Companies Today “I need a quick

and easy way for

me to see how

the business is

performing”

“I want to

maximise the

productivity of

all my

employees”

“I need to be able

to calculate the

cost per member

easily and

accurately” “Acquisition

campaigns are

difficult to manage

and information

can go missing”

“We don’t have an up

to date log of all

communications with

members” “Our

processes

are not

automated

so issues

sometimes

fall through

the cracks”

“I want to have

access to the

same member

information the

customer team

has so I

understand any

issues”

“I don’t want

to be

wasting time

re-entering

the same

information

into multiple

places”

“forecasts are

difficult to

create and

time-

consuming”

“I sometimes

spend my

whole

morning

trying to

figure out who

I’m meant to

follow-up with

and when”

“I need to

know what

the revenue

flow looks

like quickly

and easily”

“It take me

ages to roll up

all the line-of-

business

forecasts”

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Why Do Companies

Experience These Difficulties?

CRM Brings it All Together

Information in Disparate Locations Throughout the Company

User

8

What is CRM ?

Customer Relationship Management

So, what is CRM ?

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“A business strategy whose outcomes optimise

profitability, revenue and customer satisfaction…

CRM technologies should enable greater customer

insight, increased customer access, more effective

customer interactions, and integration throughout all

customer channels and back-office enterprise

functions”.

-Gartner

Time to define …

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a means by which to achieve

strategic goals

CRM is …

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CRM for Marketers

The “magic of seven” value drivers

for success

Finding the value drivers:

- the challenges

• Big investment with little measurable feedback

• Cross company thinking often means a series of stumbling blocks

• BUT ….

• Successful implementations share common characteristics

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Finding the value drivers:

- reset your beliefs

• CRM is not an over-arching business salvo

• It’s an enabler to achieve improved customer relationships

• Measuring the outputs of investments in CRM

measures the CRM strategy

• A measured CRM strategy, with customers in mind

= Happy Customers

= Profits

14

Finding the value drivers:

- some thoughts

• What is your CRM initiative - strategic or operational?

• Strategic:

• How your organisation relates to its customers

• Integration of marketing, sales and service to

achieve greater effectiveness and efficiency

• Operational:

• gather customer data quickly

• identify most valuable customers

• increase loyalty through customised offers

Across three stages of customer relationships

- acquisition, maintenance & termination

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Finding the value drivers:

- focus on the unique characteristics

• CRM has a number of unique characteristics.

• It’s about

• One to one relationships

• Interactive processes not simple transactions

• Value-added activity based on mutual interdependence

• Collaboration between suppliers and customers

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Finding the value drivers:

- measuring CRM success

• Let’s harden up on what success means

• Profitability ? Satisfaction ? Retention ? Share of wallet ?

• Customer Equity (CE)

• Identifies the value of a customer to a selling firm

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Finding the value drivers:

- let’s make sense of Customer Equity

Relating CRM to Customer Equity (CE), provides

• a common basis on which to measure different customer

impacting initiatives

• Customer Equity (CE) is

• Concerned with identifying value of customer to the business

• Provides an indication that margin generated is above &

beyond product and selling costs

• Focuses on two important concerns for marketers

• Customer relationships

• Financial accountability

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Finding the value drivers:

- the dimensions of Customer Equity

CE has three subcomponents

Value equity – based on the utility of the brand

to the customer

Brand equity - more concerned with the meaning

of the brand to the customer

Relationship equity – the relationship above and

beyond the other two elements

Value

Brand

Relationship Customer

Equity

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Finding the value:

- core benefits of CRM that drive CE

These do not vary greatly across industries or countries

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading to cost savings

and consistency

3. Improved sales force efficiency and effectiveness

4. Individualised pricing messages

5. Customised products and services

6. Improved customer services efficiency and effectiveness

7. Improved pricing

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Finding the value:

- let’s look at each for CE drivers

For each of the seven core CRM

components that drive

Customer Equity

Value

Brand

Relationship

U

21

Finding the value:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

Improvements here are positively related to value equity

in the customer acquisition stage

22

Finding the value:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading

to cost savings and consistency

Improvements here are positively related to value equity

& brand equity in the maintenance stage

U

23

Finding the value:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading

to cost savings and consistency

3. Improved sales force efficiency and effectiveness

Improvements here are positively related to value &

brand equity in the acquisition and maintenance stages

as well as relationship equity in maintenance stages

U

24

Finding the value drivers:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading

to cost savings and consistency

3. Improved sales force efficiency and effectiveness

4. Individualised marketing messages

Improvements here are positively related to value &

brand equity in acquisition and maintenance stages.

U

25

Finding the value drivers:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading

to cost savings and consistency

3. Improved sales force efficiency and effectiveness

4. Individualised marketing messages

5. Customised products and services

Improvements here are positively related to brand &

relationship equity in the maintenance stage.

U

26

Finding the value drivers:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading

to cost savings and consistency

3. Improved sales force efficiency and effectiveness

4. Individualised marketing messages

5. Customised products and services

6. Improved customer services efficiency and

effectiveness

Improvements here are positively related to value &

brand equity in acquisition and maintenance stages

& relationship equity in the maintenance stage.

U

27

Finding the value drivers:

- let’s look at each for CE drivers

Seven core CRM components that drive CE

1. Improved ability to target profitable customers

2. Integrated offerings across channels leading to

cost savings and consistency

3. Improved sales force efficiency and effectiveness

4. Individualised marketing messages

5. Customised products and services

6. Improved customer services efficiency and effectiveness

7. Improved pricing

Improvements here are positively related to value equity

during acquisition and maintenance stages

28

The value drivers story

- the benefits in using CE with CRM

Whether you are considering operational or strategic CRM

• Focuses CRM initiatives on 7 core components

• Provides a broader view of measurement for process &

technology change

• Provides financial accountability for CRM investments

• Measuring changes in customer’s perception of value,

brand and relationship equity gives on-going accountability

U

29

Back to Basics CRM

- the magic of seven

Communicate, Collaborate, Compete

#TFM2012

David Beard

Sage CRM Evangelist