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MKTG. Lamb, Hair, McDaniel 2007-2008. 19. Customer Relationship Management (CRM). CHAPTER. Designed by Amy McGuire, B-books, Ltd. Prepared by Deborah Baker, Texas Christian University. Learning Outcomes. Define customer relationship management

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Mktg

MKTG

Lamb, Hair, McDaniel 2007-2008

19

Customer Relationship Management (CRM)

CHAPTER

Designed by

Amy McGuire, B-books, Ltd.

Prepared by

Deborah Baker, Texas Christian University


Learning outcomes

Learning Outcomes

Define customer relationship management

Explain how to establish customer relationships within the organization

Understand interactions with the current customer base

Outline the process of capturing customer data

LO1

LO2

LO3

LO4


Learning outcomes1

Learning Outcomes

Describe the use of technology to

store and integrate customer data

Describe how to identify the best customers

Explain the process of leveraging customer information throughout the organization

LO5

LO6

LO7


What is customer relationship management

What Is Customer Relationship Management?

LO1

Define customer relationship management


Customer relationship management

A company-wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups.

Customer Relationship Management

CustomerRelationshipManagement

LO1


Customer relationship management strategy

Organize the company around customer segments

Encourage and track customer interaction with the company

Foster customer-satisfying behaviors

Link all processes of the company from its customers

through its suppliers

http://www.crmdownload.com

Online

Customer RelationshipManagement Strategy

LO1


Customer relationship management cycle

Leverage customerinformation

Understand interactions with current customer base

Identify best customers

Capture customer data based on interactions

Customer Relationship Management Cycle

Identify customer relationships

Store and integratecustomer data using IT

LO1


Implementing a crm system

  • Key Points:

Customers take center stage

Business must manage the customer relationship across all points of customer contact

Implementing a CRM System

LO1


Review learning outcome

REVIEW LEARNING OUTCOME

LO1

Customer Relationship Management


Identify customer relationships

Identify Customer Relationships

LO2

Explain how to establish customer relationships within the organization


Identify customer relationships1

The company customizes its product and service offering based on data generated through interactions between the customer and the company.

Identify Customer Relationships

Customer-Centric

LO2


Identify customer relationships2

An informal process of collecting customer data through customer comments and feedback on product or service performance.

Identify Customer Relationships

Learning

LO2


Identify customer relationships3

The process by which learned information from customers is centralized and shared in order to enhance the relationship between customers and the organization.

Identify Customer Relationships

KnowledgeManagement

LO2


Knowledge management

Experiential observations

CollectedInformation Includes:

Comments

Customer actions

Qualitative facts

Knowledge Management

LO2


Empowerment

Delegation of authority to solve customers’ problems quickly—usually by the first person that the customer notifies regarding the problem.

Empowerment

Empowerment

LO2


Review learning outcome1

REVIEW LEARNING OUTCOME

LO2

Identifying Customer Relationships


Interactions of the current customer base

Interactions of the Current Customer Base

LO3

Understand interactions with the current customer base


Interactions of the current customer base1

Interactions of the Current Customer Base

Current

Transaction

Channel

Past

Relationship

Requested

Service

LO3

Customer


Interactions of the current customer base2

Interactions of the Current Customer Base

Touch Points

All possible areas of a business where customers communicate with that business.

Point-of-Sale

Interactions

Communications between customers and organizations thatoccur at the point of sale, normally in a store.

http://www.bestbuy.com

Online

LO3


Review learning outcome2

Web

Point of Sale

Kiosk

Delivery, Installation

Survey

Product Registration

REVIEW LEARNING OUTCOME

LO3

Interactions with Current Customer Base

Customer


Capture customer data

Capture Customer Data

LO4

Outline the

process of capturing

customer data


Capture customer data1

Store visits

Conversations with salespeople

Interactions via the Web

Traditional phone conversations

Wireless communications

http://www.geico.com

Online

Capture Customer Data

LO4


Review learning outcome3

REVIEW LEARNING OUTCOME

LO4

Capturing Customer Data


Store and integrate customer data

Store and Integrate Customer Data

LO5

Describe the use of technology to store and integrate

customer data


Review learning outcome4

Response list

Compiled list

::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::

Database

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Data Warehouse

REVIEW LEARNING OUTCOME

LO5

Store and Integrate Customer Data


Identifying the best customers

Identifying the Best Customers

LO6

Describe how to identify the best customers


Identifying the best customers1

Data

Mining

Identifying the Best Customers

A data analysis procedure that identifies significant patterns of variables and characteristics that pertain to particular customers or customer groups.

LO6


Data mining

Data Mining

  • Identify and profile the best customers

  • Calculate their lifetime value

  • Predict purchasing behavior

LO6


Data analysis

Customer segmentation

Recency-frequency-monetary analysis

Lifetime value analysis

Predictive modeling

Data Analysis

LO6


Recency frequency monetary analysis

Recency-Frequency-Monetary Analysis

Identifies customers most likely to purchase again

Identifies and ranks “best customers”

Identifies most profitable customers

LO6


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Biz Flix

Casino

LO6


Data manipulation techniques

Lifetime Value Analysis

A data manipulation technique that projects the future value of the customer over a period of years.

PredictiveModeling

A data manipulation technique in which marketers try to determine what the odds are that some other occurrence will take place in the future.

Data Manipulation Techniques

LO6


Review learning outcome5

REVIEW LEARNING OUTCOME

LO6

Identify

the Best Customers


Leverage customer information

Leverage Customer Information

LO7

Explain the

process of leveraging customer information throughout the organization


Mktg

CRM Marketing

Database Applications

Reinforcing customerpurchase decisions

Campaign management

Inducing product trialby new customers

Retain loyalcustomers

Cross-selling other products and services

Increasing effectivenessof distribution channel marketing

Designing targetedmarketing communications

Improving customer service

LO7


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Campaign Management

Developing product or service offerings customized for the appropriate customer segment and then pricing and communicating these offerings for the purpose of enhancing customer relationships.

CampaignManagement

LO7


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Campaign Management

Developing customized offerings for appropriate segment

Pricing these offeringsattractively

Communicating offerings in a waythat enhances customer relationships

LO7


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Retaining Loyal Customers

Retaining an additional 5 percent of customers increases profits by as much as 25 percent

Improving customer retention by 2 percent candecrease costs by as much as 10 percent

Loyalty programs reward loyal customers for making multiple purchases

Loyalty programs provide information about

customers and trends

LO7


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Targeted Marketing

Communications

InfrequentUsers

  • Offer direct incentives, such as a price discount

  • Offer more reinforcement of past purchase decisions

ModerateUsers

  • Design around loyalty and reinforcement of purchase

HeavyUsers

LO7


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Increasing Effectiveness ofDistribution Channel Marketing

RFID technology

Multichannel Marketing

CRM Databases

http://www.kidsdadsmoms.com

Online

LO7


Review learning outcome6

REVIEW LEARNING OUTCOME

LO7

Leveraging Customer Information

Marketing Information

  • Campaign management

  • Retaining loyal customers

  • Cross-selling other products

  • Designing targeted marketingcommunications

  • Reinforcing purchase decisions

  • Inducing product trial by new customers

  • Increasing effectiveness of distribution channel marketing

  • Improving customer service

CRM Database

Applications


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