Crm

CRM

Shivani Parikh

Customer is the king

Customer relationship management (CRM)

• CRM concerns the relationship between the organization and its customers

• A customer-centric focus

– Customer relationships have become a company’s most valued asset

– Every company’s strategy should be to find and retain the most profitable

customers possible (Pareto's Law - 20% of customers account for 80% of

your turnover / profits)

• CRM focuses on fact that not all customers are equally important

• Therefore, relationships should be built with customers that are likely to

provide value for services

• Building relationships with customers that will provide little value could

result in a loss of time, staff and financial resources

CRM – Examples

- Casinos - Jewelry Shops

- Banks (flags on large amounts) - Buying book on the internet

(Amazon.com)

CRM

• The three phases in which CRM help to support the relationship between a business

and its customers are:

• Acquire: a CRM can help a business in acquiring new customers through excellent

contact management, direct marketing, selling and fulfillment (e.g. people call Just

Dial for numbers)

• Enhance: a web-enabled CRM combined with customer service tools offers

customers excellent service from a team of trained and skilled sales and service

specialists, which offers customers the convenience of one-stop shopping (cell

phone service providers like Vodaphone offering schemes for movies every Tuesday,

movie theaters offering tickets, first citizens get first preview of the sale goods)

• Retain: CRM software and databases enable a business to identify and reward its

loyal customers and further develop its targeted marketing and relationship

marketing initiatives (e.g. Hyper city / food bazar – discuss retail industry, Airlines

have FFP)

What is CRM?

• Managing the full range of the customer relationship involves

– Providing customer-facing employees with a single, complete view of every

customer at every touch point and across all channels

– Providing the customer with a single, complete view of the company and its

extended channels

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 a more informed sales and

support team.

E.g. if user has bought a house using home loan the same bank shall share this data

with its insurance agents for home insurance, life insurance, selling petro cards to car

loan customers

Application Clusters in CRM

Contact and Account Management

• CRM helps sales, marketing, and service professionals capture and track

relevant data about

– Every past and planned contact with prospects and customers

– Other business and life cycle events of customers

• Data are captured through customer touch points

– Telephone, fax, e-mail

– Websites, retail stores (give example of diapers), kiosks

– Personal contact

Example: Property exhibition collects phone no's of people who visit it

Sales

• A CRM system provides sales reps with the tools and data resources they

need to

– Support and manage their sales activities (e.g. Onida)

– Optimize cross- and up-selling

Cross Selling: An Wholesale mobile retailer suggesting a customer to choose

a network/carrier after one purchases a mobile, mobile and mobile cover

Up-selling: selling an extended service contract for an appliance, suggesting

a customer purchase more RAM or a larger hard drive when servicing his or

her computer, selling luxury finishing on a vehicle

• CRM also provides the means to check on a customer’s account status and

history before scheduling a sales call (e.g. ICICI direct calls customers having

shares more than 10 lakhs worth in their account for portfolio management)

Marketing and Fulfillment

• CRM systems help with direct marketing campaigns by automatic such tasks as

– Qualifying leads for targeted marketing

– Scheduling and tracking mailings

– Capturing and managing responses

– Analyzing the business value of the campaign

– Fulfilling responses and requests

• 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.

Customer Service and Support

• A CRM system gives service reps real-time access to the same database used

by sales and marketing

– Requests for service are created, assigned, and managed

– Call center software routes calls to agents (e.g. IVR shall route call to the

right agent e.g. Hilton)

– Help desk software provides service data and suggestions for solving

problems (e.g. bank IVR provides certain details like account balance after

user authorization)

• Web-based self-service enables customers to access personalized support

information

Retention and Loyalty Programs

• It costs 6 times more to sell to a new customer

• An unhappy customer will tell 8-10 others (e.g. Dominos – 30 mins)

• Boosting customer retention by 5 percent can boost profits by 85 percent

• The odds of selling to an existing customer are 50 percent; a new one 15

percent

• About 70 percent of customers will do business with the company again if a

problem is quickly taken care of

• Enhancing and optimizing customer retention and loyalty is a primary

objective of CRM

• Identify, reward, and market to the most loyal and profitable customers

• Evaluate targeted marketing and relationship programs

• Examples: Shoppers Stop, Hypercity, Jet Airways, Tesco

Benefits of CRM

• Benefits of CRM

– Identify and target the best customers

– Real-time customization and personalization of products and services

– Track when and how a customer contacts the company

– Provide a consistent customer experience

– Provide superior service and support across all customer contact points

CRM Failures

• Business benefits of CRM are not guaranteed

– 50 percent of CRM projects did not produce promised results

– 20 percent damaged customer relationships

• Reasons for failure

– Lack of understanding and preparation

– Not solving business process problems first

– No participation on part of business stakeholders involved (e.g. Gevity HR

installed Oracle CRM software which helped users solve problems online

without an operator. Employees felt threatened and discouraged

customers from using the system)

– Example: Monster.com installed a CRM software that was very slow in

getting customers data so employees stopped using the same

Trends in CRM

• Operational CRM

– Supports customer interaction with greater convenience through a variety

of channels like phone, fax, e-mail and mobile (e.g. mobile banking, ICICI

bank has online chat, Jaslok hospital)

– Synchronizes customer interactions consistently across all channels

– Makes the company easier to do business with

Trends in CRM

• Analytical CRM

– Extracts in-depth customer history, preferences, and profitability from

databases

– Allows prediction of customer value and behavior

– Allows forecast of demand

– Helps tailor information and offers to customer needs

Example: women aged 55-65 is the fastest growing segment on facebook

Trends in CRM

• Collaborative CRM

– Easy collaboration with customers, suppliers, and partners

– Improves efficiency and integration throughout supply chain

– Greater responsiveness to customer needs through outside sourcing of

products and services

– use technology to build bridges between departments

For example, feedback from a technical support center can enlighten

marketers about specific services and product features clients are asking for.

Reps, in their turn, want to be able to pursue these opportunities without the

burden of re-entering records and contact data into a separate SFA system.

Trends in CRM

• Portal-based CRM

– Provides users with tools and information that fit their needs

– Empowers employees to respond to customer demands more quickly

– Helps reps become truly customer-faced

– Provides instant access to all internal and external customer information

Harrah's CRM Strategy

• This case gives a detailed account of customer relationship management (CRM)

initiatives pursued by Harrah's Entertainment Incorporated, a leading casino

entertainment company in the US.

• It explains the various elements of Harrah's CRM strategy and how each element

contributed to the overall success of the strategy.

• The late 1990s witnessed a rapid expansion of casinos, especially in Las Vegas and

Atlantic City, New Jersey due to relaxations in the US State and Federal gaming laws.

• New laws had legalized gaming on riverboats and this led to intense rivalry between

casino operators who started spending millions of dollars in opening new

extravagant properties that featured shopping malls and hotels in order to attract

customers.

• Harrah’s is the World’s largest provider of branded casino entertainment, it had

business interests in casinos, food & beverages and hotel rooms, there were 4

million square feet of casino space, 40,000 hotel rooms, 100,000 employees , and

Operated 21 casinos across the country.

• Harrah's decided to follow a different approach as it realized that about 90 percent

of its revenues came from its casino business and not from associated ventures.

Harrah's 1

• Instead of opening lavish properties, Harrah's initiated a customer relationship

management (CRM) program that aimed at developing long-term relationships with

its customers that would enable the company to capture a bigger market share in

the gaming business.

• Harrah's discovered that its customers spent only 36% of their annual gaming

budget at the company. It realized that increasing customer spends would

translate into significant increase in revenues.

• At the heart of Harrah's CRM program was a loyalty program called Total Rewards

that rewarded customers in order to stimulate loyalty.

• The Total Rewards program was aimed at gathering information about customers

and using it to customize the company's marketing programs for each customer.

• Customers who enrolled in the Total Rewards program were given an electronic

card, which they inserted into the machines they played on.

• Customers who agreed to join the Total Gold program had to fill a membership

form through which Harrah's obtained data such as their name, address and

telephone number, games they played while in their casino, total amount spent on

gaming and on which games

Harrah's 2

• Total Rewards lets customer earn Reward Credits every time they play with their Total

Rewards card at participating casinos

• Total rewards program members receive points on based on amount they spend at

Harrah’s facilities

• Reward Credit balance can be used towards hotel stays, dinner comps, spa visits, and

more!

• Customer can earn Reward Credits when playing slots, table games, and other games at

nearly 40 casinos across the United States and Canada.

• He can also earn Reward Credits for his entertainment purchases at participating outlets

and participating locations.

• He needs to keep his card inserted at the slot machines the entire time he plays, hand it

to the cashier when making entertainment purchases, or hand it to the dealer when

playing table games.

• Every time customer uses the card points are added and more these points more the

benefits customer gets

• From the moment a customer checks in to the hotel or registers with the casino's loyalty

scheme data relating to that individual becomes gold dust and is analyzed and

segmented in countless ways

Harrah's 2

• Total rewards form basis for 2 part CRM process. First the company uses Total

rewards to collect information about its customers. This makes it important to

identify its most valuable customers and fine tune its market offerings to its

most important customers.

• Casino gambling has become one of the most popular forms of entertainment

today and this industry still continues to grow even now

• With the appearance of online casino gambling, this kind of entertainment

grew even more in popularity since it also offers casino free gambling in its

online form.

• Some of the benefits given by Harrah’s to its premium members are 10%

discount at participating gift shops, Discount when you book a cruise vacation,

Special Birthday Offer, Exclusive gift every year, Free tournament entry and

hotel stay, Tickets to shows in Las Vegas, Complimentary Room Guarantee

with 48 hours notice, Annual Celebration Dinner, 15% discount on all regularly

priced merchandise in the Total Rewards Merchandise Catalog and so on

Harrah's 3

• 250,000 customers come through our doors every day and to give each of

them the sense of a personalized experience relies heavily upon technology

• So complex is the technological back end to the loyalty card schemes there's

hardly an industry which hasn't come to Harrah's to find out how they do it

• Three years ago less than 60 per cent of visitors used their loyalty scheme,

now it is well over 80 per cent.

• Effective mailshots, marketing, hospitality and the tailoring of special offers all

hinges on the data which is stored within the CRM systems.

• Harrah's CRM has delivered 389 % ROI, year-on-year.

• Effective CRM at Harrah’s creates an environment in which customers feel

valued and believe they are getting a tailored experience

• Casinos are all alike. Most customers can’t distinguish in terms of slot

machines, game tables, restaurants, and hotel rooms in different casinos

• Customers might go to the Mirage to see the Volcano erupting or go to Steve

Wynn's new place to see the flowers. They may even throw a few quarters

into a machine while they are there but they will come back to Harrah's

Harrah's Mobile Initiative

• Their new mobile initiative is fairly straightforward.

• Total Rewards guests staying at a Harrah’s property are invited to opt-in through

on site promotional collateral.

• Once opted into the program, Harrah’s can begin texting offers to the customer

• The offers vary, from free parking offers to entertainment tickets. Once the user

receives an offer he can redeem the offer via an on-site self service SMS scanner

–that authenticates the text message and provides the reward.

• One of the examples used to describe the program, was an initiative to get rid

of unsold seats for a show. When excess seats are available, a text message is

sent to Total Rewards customers. The offers are based on location (meaning the

customer is currently staying in the vicinity of the resort and time, therefore the

customer is reached when and where it is relevant-when the member is at a

casino property. The participant is already fully engaged in the brand

experience (visiting a Harrah’s property) so, by adding a mobile Harrah’s is able

to add a “real-time” reward dimension to their existing rewards platform.

Harrah's Mobile Initiative 1

• What makes the mobile CRM program novel is also what makes it intelligent–

not forcing the customer to open themselves up to a barrage of marketing

messages, but instead preventing unused inventory from going to waste by

giving something of value to its most important customers

Thank You