1_CRM (1)

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Customer Relationship

Management

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Rather than use CRM to transform entire

businesses, companies using CRM successfully

have directed their investments toward solvingclearly defined problems within their customer

relationship base

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CRM today result in highly focused projects that

are relatively narrow in their scope and modest

in their goals.

There is also an understanding that highly accurateand timely data are not required everywhere

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Achieving success with CRM is more difficult than

expected and it is not just a matter of marketing

and IT.

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Introduction

The philosophy of Customer RelationshipManagement:

CRM is about Keeping the old-time spirit ofcustomer connection even when you can not

shake every hand .

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Introduction

The philosophy of CRM is:

It is a comprehensive approach for creating,

maintaining and expanding customerrelationships.

CRM is a way of thinking about and dealing

with customer relationships

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Introduction

The focus is on:

What will the customers buy, when, why and

for how much?

What creates value for them?What does create a structural bond?

What service can we provide that does create a

premium?

What about market segmentation?

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Introduction

What CRM systems do!

The primary taskof a CRM system consists in

supporting or performing the activities involvedin customer contact processes

The secondary taskis related to providing

customer and management information

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Introduction

The concept of CRM is:

Customer relationship management (CRM) is a

business strategyto select and manage the mostvaluable customer relationships.

CRM requires a customer-centric business

philosophy and culture to support effective

marketing, sales, and service processes.

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Introduction

The concept of CRM is:

CRM applications can enable effective

customer relationship management, providedthat an enterprise has the right leadership,

strategy, and culture

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CRM should the end of the road

CRM is a great concept BUT you might wonder

if it is worth the effort relative to your customer

base and expenses involved?

It is the ultimate phase AFTER a solid market

research and a strategic planning process!

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Introduction

Is the issue we analyse strategic?

Where could we make more money?

Do we need perfect data? What is the next step?

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Introduction

Is it strategic?

A large and comprehensive CRM program

involves complicated business and technology

issues and requires investments of time and

money.

Before spending money, key marketing

questions need to be addressed

What are your key marketing questions?

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Introduction

Is it strategic?

An example: A well trained and proactive

sales force is a strategic necessity; this requires

the right information!

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Introduction

Where could we make more money?

It is possible to use CRM to manage the entire

relationship cycle: that is usually a bad idea!

Large systems usually do not pay back. The focus of CRM should be the weak points

that undermine performance

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Introduction

Where can we make more money?

Focusing on weak pointscan not only be an

effective way to build a successful CRM

program but can also put it back on track in case

you started one.

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Introduction

Do we need perfect data? Perfect real time information comes at a very

high cost

The requirements for real time and good data arequite different

Example: Outstandings on a current account

(real time) versus portfolio management data

(good data)

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Introduction

What is the next step? Narrowly focused CRM system often reveal

additional opportunities for business

improvements.

All the small improvements taken together, can

amount to a broad CRM application that extends

across the bank.

The key is to make sure the step by stepapproach fits into a defined strategic plan

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Introduction

What is the next step? In most cases, the opportunities for development

lie in the activities adjacent to the customer

relationship cycle.

Ultimately, CRM can be the glue that binds

together all activities related to a customer.

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Introduction

Customer relationship cycle.

Development

Sales

ExperienceRetention

Targeting

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Introduction

Business before technology We should look at what CRM should do, not

so much on what it can do

CRM depends more on strategy than on theamount spent on technology

Strategyis about the way you allocate your

resources to create a competitive advantage

and superior performance

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Introduction

Implementing CRM before creating a customerstrategy = like building a house without an

architectural plan

Effective CRM is based on segmentation

analysis

Customer strategy is designed to achieve some

specific marketing goals

Technology is not a marketing strategy

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Introduction

Introducing CRM before changing yourorganisation into a customer focused

organisation = like painting without sanding

CRM will succeed only AFTER the organisation

and its processesjob descriptions, performance

measures, compensation systems, training

programs, and so on- have been structure to

provide superior customer value

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Introduction

Assume that more technology is better = is likebuilding without foundation

To start, see what lower-techalternatives offer;

there may be no need for more in the very near

future

In the future as sequence of individual software

solutions may lead to each step reinforcing the

next step

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Introduction

Define the right customers you want to establisha relationship with = a two way street

Just because managers can contact customers,

does not mean they should by all means and for

whatever reason.

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Introduction

How do consumers define us in terms ofcompetition?

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Introduction

How do consumers define us in terms ofcompetition?

Cost

Time

Quality

Opportunity

Information

Knowledge Choice

Culture

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Introduction

Why might you consider CRM?

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Introduction

Why might you consider CRM?1. Gather customer information quickly

2. Identify the most valuable customers

3. Obtain loyalty by providing customized products4. Possibly reduce cost of serving these customers

5. Making it easier to acquire similar customers

6. Retention of existing profitable customers7. Getting the maximum out of existing customers

8. It can function as an early warning system

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Introduction

The ultimate goal of CRM :The goal is to encourage the customer to make

its future purchases from you and reduce the

share of purchases being made from the

competition DUE TO THE FACT customer

knowledge has been accumulatedand

therefore it will be more difficult for the

competition to offer a similar package

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Introduction

CRM is only a part of the sales performance!

How would you assess your overall sales

performance?

Please rate the questions hereafter as follows

Not effective Extremely effective

1 2 3 4 5 6 7 8 9 10

(Source HBR 08/06)

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Introduction

Salespeoples capabilitiesFinding customersidentifying sales

opportunities

Winning customersconverting opportunitiesinto business

Keeping customerscementing customer

relationships - CRM

Not effective Extremely effective

1 2 3 4 5 6 7 8 9 10

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Introduction

Sales Managers' skillsPlanning for growing business

Coachinggiving clear direction, expectations

and feedbackMotivatingrecognition and rewards

Not effective Extremely effective

1 2 3 4 5 6 7 8 9 10

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Introduction

Support systemsRecruiting and hiring capabilities

Performance management systems

Opportunities management systemsStrategic account management systems

CRM systems

Training and development systems

Not effective Extremely effective

1 2 3 4 5 6 7 8 9 10

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Introduction

Sales organisation climateClarity of goals and expectations

Staff dedication to achieve challenging goals

Staff initiativeAcknowledgment of good work

Not effective Extremely effective

1 2 3 4 5 6 7 8 9 10

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Introduction

The total score for your sales organisation is:..

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Introduction

Average for high-performing organisations 123

Average for low-performing organisations 109

We shall put the spot on CRM, but it is only a part

of a bigger picture

( US based companies)

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1_Elements of CRM

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1_Elements of CRM

The four cornerstones of theelements of CRM are:

1. Customer knowledge

2. Relationship strategy3. Communication

4. The individual value proposition

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1_Elements of CRM

1. Customer knowledge Segmentation

Awareness, Attitude

Usage Concept

Customer satisfaction

Customer loyalty

Brand Image

Brand equity Pricing

Advertising

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1_Elements of CRM

2. Relationship strategy

A long lasting customersupplier relationship

The key is not only the stimulation of a transaction

Success is not measured by market share

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1_Elements of CRM

3. Communication

The issue is to carry on a dialogue with

individual customersShifts should be possible between distribution

channels

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1_Elements of CRM

4. The individual value proposition

The product, service and price are adapted to the

individual circumstances

The organisation has to build up the capacity to

supply customisation in one form or another

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1_Elements of CRM

Systems

If a relationship must be maintained with a large

group of customers, a portion of which

represents a low value to the supplier, the use ofIT becomes inevitable.

Integration is therefore a must between front-

mid-back office