What is CRM?

An integrated approach to identifying, acquiring and

maintaining customers. siebel.com

Allows companies to coordinate their approach across

channels, departments and also geographically. siebel.com

Defining CRM

CRM is an integrated sales, marketing and

service strategy that is based on a timely and
accurate information infrastructure and that
depends on coordinated enterprise-wide
activities

Example: tracking customers interactions with the

firm
Customer tracking includes steps in the selling and
customer service cycles

CRM

CRM is a business strategy and not a product

Putting CRM into practice requires developing
a set of integrated applications to address all
aspects related to the front-office needs
CRM could be a major support platform for
small and medium-sized enterprises
Cost of the information and communication
technology applications and infrastructure
should be calculated as opposed to the
return-on-investment

Managing the customer life cycle

Acquiring

new customers

Enhancing

profitability of existing
customers

Retaining

profitable customers
for life

Acquiring new customers

Promoting the companys product and

service leadership
Redefine the companies competitive edge
and innovations
Offer a superior product backed by an
excellent service

Example: Browsing on the net, submitting a

request, receiving a phone call

Model for a sales and service strategy

Enhancing profitability of existing

customers

Encouraging cross-selling and up-selling

Cross selling is used by suggesting alternative products

or up-selling by rendering the customer more informed
with the new products and services.

Broadening the relationship between the company

and the customers
Providing a value proposition represented by
offering a greater convenience at low cost (onestop-shopping)

Example: Best Buy an electronic retailer with more

than 300 stores capitalizes on committed relationships
with customers

3000 calls a day with more than 50% having computer-based

answers and solutions

Retaining profitable customers for

life

Retention focused on service adaptability

Delivering not what the market wants but
what the customer wants
Providing a value proposition that offers a
proactive relationship that works on the
best interest of the customer

Example: customer retention is becoming a key

competitive strategy for many companies

What is Customer Relationship Management (CRM)?

CRM is the development and maintenance of mutually beneficial

long-term relationships with strategically significant customers
(Buttle, 2000)

CRM is an IT enhanced value process, which identifies, develops,

integrates and focuses the various competencies of the firm to the
voice of the customer in order to deliver long-term superior
customer value, at a profit to well identified existing and potential
customers.
(Plakoyiannaki and Tzokas, 2001)

Age of the never-satisfied

customer

CRM becomes a support tool in a time

characterized by:

Increased competition
Globalization
Growing cost of customer acquisition
High customer turnover

CRM is all about creating a better value

proposition to customers
Information and communication technology
is now acting as a catalyst for CRM

Extended enterprise
World wide web and the Internet

History of CRM

1980s: Database marketing emerges.

1980s: Database helped larger organizations rather then

small who only got survey type info. ezinearticles.com

1990s: CRM appears as a two-way communication device.

ezinearticles.com

ezinearticles.com

1990s: CRM leads to programs such as frequent flyer

miles and bonus points on credit cards. ezinearticles.com

2000s: Internet has helped expand from stagnant

database and allows off-site information storage. ezinearticles.com

2000s: Used most frequently in financial services, high

tech corporations and the telecommunications industry.
ezinearticles.com

Understanding Customer Relationship Management (CRM)?

CRM is a business philosophy based on upon individual customers
and customised products and services supported by open lines
of communication and feedback from the participating firms that
mutually benefit both buying and selling organisations.
The buying and selling firms enter into a learning relationship,
with the customer being willing to collaborate with the seller and
grow as a loyal customer. In return,, the seller works to maximize
the value of the relationship for the customers benefit.
In short, CRM provides selling organisations with the platform
to obtain a competitive advantage by embracing customer needs
and building value-driven long-term relationships.

Determinants of CRM
Trust
The willingness to rely on the ability, integrity, and motivation of
one company to serve the needs of the other company as agreed
upon implicitly and explicitly.
Value
The ability of a selling organisation to satisfy the needs of the
customer at a comparatively lower cost or higher benefit than
that offered by competitors and measured in monetary,
temporal, functional and psychological terms.

Determinants of CRM
In addition to trust and value, salespeople must:
Understand customer needs and problems;
Meet their commitments;
Provide superior after sales support;
Make sure that the customer is always told the truth
(must be honest); and
Have a passionate interest in establishing and retaining a longterm relationship (e.g., have long-term perspective).

Stages in the development of a Customer Relationship

The Pre-relationship Stage
The event that triggers a buyer to seek a new business partner.

The Early Stage

Experience is accumulated between the buyer and seller although a great
degree of uncertainty and distance exists.

The Development Stage

Increased levels of transactions lead to a higher degree of commitment and
the distance is reduced to a social exchange.

The Long-term Stage

Characterised by the companies mutual importance to each other.

The Final Stage

The interaction between the companies becomes institutionalized.

What it does...

Builds a database that describes the customers and the

relationship they hold with the company. whatis.com

Database: a collection of information that is organized in a way that

allows it to be easily accessed,managed and updated.

whatis.com

Provides enough detail so that the company can offer the

client the product/service that matches their need the best.
whatis.com

May contain information about their past purchases, who

is involved with the account and a summary of all
conversations.

Benefits of CRM

Research has shown that companies that create satisfied,

loyal customers have more repeat business, lower
customer-acquisition costs and stronger brand value.
Siebel.com

Which equals better financial performance.

Check this out...

Siebel.com

Satisfied customers pay off

siebel.com

CRM may...

Help marketing departments identify and target their best

customers, manage campaigns as well as discover
qualified leads. whatis.com

Qualified Leads: prospects who seem most likely to buy because of

some information known about them. Duncan, Tom

Improve sales and streamline existing processes.

whatis.com

Form individualized relationships with customers.

whatis.com

Give employees information needed to improve customer

service and also to better understand customer needs.
whatis.com

It also...

Is a fast way to identify and handle potential problems.

Wikipedia.org

Tracks all points of contact between a customer and the

company. Wikipedia.org

Provides all employees with product specs, product use

information and technical assistance. Wikipedia.org

CRM quickly manages the scheduling of follow-up sales

calls to assess the satisfaction of customers and their
repurchase probabilities (when and how much). Wikipedia.org

CRM leads to...

Identifying prospects and helps them become customers.

Brillianceweb.com

Closing sales more effectively and efficiently.

Allowing customers to perform business transactions

quickly and easily. Brillianceweb.com

Providing better service and support following a sale.

Brillianceweb.com

Which = Customer Service!!

Brillianceweb.com

Customer Service

Helps make call centers more efficient.

Aids in cross and up selling products.

Cross Selling: Provide additional products/services.

Up Selling: Upgrade existing products/services.

Helps sales staff close deals faster.

Simplifies marketing and sales processes.

Allows companies to discover new customers.

Darwinmag.com

Darwinmag.com

Chonko...

Chonko...

Darwinmag.com

Darwinmag.com

Darwinmag.com

Technical Functionality

Scalability: CRM may be used on a large scale while also

being able to be reliably contracted/expanded to whatever
scale is necessary. So.. the data is flexible and wont
distort when adjusted. Wikipedia.org

Multiple communication channels: the ability to interface

with users via many different devices (phone, WAP,
internet etc.) Basically, you can get what you want, when
you want wherever you are. Wikipedia.org

Main Points to CONSIDER

Know your customer!

CRM can lead to greater customer service greater

profitability!!

Remember that it is not enough to be nice to your

customer you must learn from them.