peelen, customer relationship management powerpoints on the web, 2 nd edition © pearson education...
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Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.1
Chapter 6
Customer Data management
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.2
consumer insight lies at the heart of all marketing and communication strategy,and that consumers are multi-faceted and complex creatures,and that true consumer insight comes only with
a 360° view.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.3
Targeting Acquisition Retention Expansion
Customer Relationship Management can be simply defined as everything involved with managing the customer relationship.
Customer Relationship Management can be simply defined as everything involved with managing the customer relationship.
The Value of the Relationship
• Who Do we target• What segments are most
profitable• What segments match our
Value Proposition• What is the best
segmentation strategy for us / our industry
• What is the best channel for each segment
• What is the acquisition cost for a channel / segment
• Do certain channels deliver certain types of customers
• Cost effective acquisition
• How can we improve retention
• What is our average customer relationship length
• How can we hold customer for as long as possible
• What is the most cost effective method of retention
• How many products does our average customer buy
• How can we induce our current base to buy more products
• Who are the prime targets for expansion
• What is the cost of expansion
Customer Relationship Management Definition
Duration of Customer Relationship
Va
lue
( $
)
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.4
Current
Current
Every Company’s Big Unknown ... Customer Value Full
Potential
Current Customer
Value
Relat
ions
hip
Profit
abili
ty
Nu
mb
er o
f R
elat
ion
ship
s
Relationship Duration
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.5
Why CRM? It costs six times more to sell to new customer than
to sell to an existing one. A typical dissatisfied customer will tell 8-10 people By increasing the customer retention rate by 5%,
profits could increase by by 85% Odds of selling to new customers = 15%, as
compared to those for existing customers (50%) 70% of the complaining customers will remain loyal
if problem is solved 90% of companies do not have the sales and service
integration to support e-commerce
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.6
Implementing CRM must be approached from an Integrated Perspective
All areas must be implemented, to some degree, to effectively manage the customer relationship. When pieces are implemented in isolation, the benefits are less than
overwhelming.
All areas must be implemented, to some degree, to effectively manage the customer relationship. When pieces are implemented in isolation, the benefits are less than
overwhelming.
Capture Customer Data and Measure
Results
The Customer
Capture Customer Data and Measure
Results
Take Action to Enrich the Customer
Relationship Capture Customer Data and Measure
Results
Build and Manage Customer Value
Capture Customer Data and Measure
Results
Capture Customer Data and Measure
Results
Capture Customer Data and Measure
Results
Store Data, Mine and Make
information Accessible
CRM CRM without an without an Integrated Integrated ApproachApproach
A data warehouse full of data without the tools to extract knowledge is nothing more than expensive inventory.Sophisticated mining tools only produce results only as good as the data they mine.
Developing insights on how to improve the value of the customer relationship without having the infrastructure to take action has no impact on the bottom line. In addition, there is no opportunity to test the ‘theoretical’ analysis.
Implementing new technologies without the knowledge on how to enrich the relationship is likely to yield a return below the cost of the capital expenditure.
Taking action to improve the relationship without measuring the results provides no evidence of success or failure and limits the opportunity for learning.
Capturing gigabytes of customer data in disparate operational systems that are next to impossible to access may render the data useless.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.7
Relationship data used to identify a customer include: * the basic data consisting of name,adress,
sex and company name; * supplementary data on the date of birth,
or incorporation date, nationality or industry, telephone number, legal form, company registration number.
data are input into the system from a reply slip that comes in as a result of a direct response advertisement, a mailing or a telephone call from a customer to the call centre or via the internet.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.8
Data quality Mergen defines (2003), “quality is
something which gives us a good feeling” however this feeling is difficult to define in
concrete terms, since it covers so many different aspects.
ın order to understand better we may define in terms of three perspective what it is:
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.9
Quality: A technical point of viewthe use of standards and norms which must
be satisfied by a production process and the product to be manufactured.
Quality: A customer point of viewValue perception and needs are criteria that
the customer applies to determine quality. a very basic need for anyone is to have
relationship data being used,written, and pronounced appropriately.
Quality: A supplier’s point of viewWhat is the commercial value of the name,adress,
city. Etc.?
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.10
Essential Quality Quality Customer Database= Current x Complete x Correct x Unique.
* Current: To what extent does the database represent current reality?
Complete: The availability of a value as well as completeness thereof. When the customer database is designed, each item of data must be examined to determine to what extent it is necessary, highly desirable, or just would be “nice to include”.
Correct:The data are correct, and if applicable, meet the standard or are valid within a collection of possible values.
Unique: In principle, each customer should only appear once in the customer database.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.11
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.12Duplication occurs: when there are several sources of customer data are recorded independently without being properly matched to current data.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.13
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.14
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.15
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.16
Expanding the size of customer database Response to external lists: the growth may come
from the responses to lists ( with names, adresses, cities, email adresses, telephone numbers) which have been rented or purchased from third parties. list brokers can create these external lists
)Response via own channel:The website is an easy source of costumer data if
it requires some from of registration social media : customers identify themselves on
the Facebook page of a brand community. The profile of the friend data is accessible to the brand.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.17
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.18
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.19
Deployment and Support
The Building Blocks of CRM
e-Business
Sales Process Automation
Call Centres
EnablingTechnologies
DataWarehousing
MetaData
Data Cleansing
OLAP
EIS
DataCapture
ExternalDatabases
MarketResearch
Customer Touch Point Integration
People
Organization
KnowledgeManagement
Statistical Modeling
Data Mining
Customer Profitability
Segmentation
The building blocks of CRM are the things that need to be in place for an effective Customer Relationship management program
The building blocks of CRM are the things that need to be in place for an effective Customer Relationship management program
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.20
Data Capture and Warehouse
Customer Behaviour
Product Portfolio Householding
Usa
ge P
rofil
e
Mig
ratio
n in
U
sage
Loya
lty /
Sw
itchi
ng
Customer Interactions
Acq
uisi
tion
Info
rmat
ion
Inbo
und
Con
tact
Out
boun
d C
onta
ct
Base Data
Segments Profitability Life Time Value
Customer Profile
Dem
ogra
phic
s /
Firm
grap
hics
Atti
tude
s
Pro
duct
/ S
ervi
ce
Pre
fere
nces
Intentions
External Data
Geo
-de
mog
raph
ics
Cam
paig
n H
isto
ry
Derived Data
The Customer Data Model
Cen
sus
What Data do we capture on Customers?
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.21
Sales Force AutomationC
all C
entr
e
Ele
ctro
nic
Bu
sin
ess• Automatic Call Distribution (ACD)
• Incoming Call Queuing• Performance Statistics• Integrated Voice Response (IVR)• Automated Inquiry & Transactions• Automated screen “pop” on agent’s
screen• Integration with company legacy
platforms• Billing & Meter Reading• Direct Access to Customer Data
CRMTechnologies
Techniques: ACD, IVR, CTI Techniques: WEB based application, e-mail processing
• Automated product and service information
• WEB based sales and support through standard menus and automated help screens.
• WEB based training • Reaching the global market
Techniques: Relationship marketing, automated packaging and pricing, knowledge-based selling• Increase revenue from your customer base • Customer satisfaction measure
• Consultative selling• Responsiveness to market conditions
The Enabling Technologies Call Centre Sales Force Automation e-Business
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.22
CRM Technologies on the Rise
““The overall use of technology for selling is The overall use of technology for selling is growing by more than 50% annually.”growing by more than 50% annually.”
– – Gartner GroupGartner Group
““Sales Force Automation is the fastest Sales Force Automation is the fastest growing segment of the high-growth growing segment of the high-growth Client/server market, estimated to represent Client/server market, estimated to represent $3 billion in revenues by 1997.”$3 billion in revenues by 1997.”
– – Market Intelligence Research Corp.Market Intelligence Research Corp.
““Sales Force Automation will become a major Sales Force Automation will become a major driver behind enterprise-wide BPR driver behind enterprise-wide BPR (inexorably linked to development of the (inexorably linked to development of the customer-focused organization)”customer-focused organization)”
– – META GroupMETA Group
““Customer Management is a major initiative at Customer Management is a major initiative at nearly 80% of Fortune 500 companies and nearly 80% of Fortune 500 companies and will grow to a $4.8 billion market by 1999.”will grow to a $4.8 billion market by 1999.”
– – Aberdeen Group, Aberdeen Group, Inc.Inc.
Source: IDC 1996
(Do
llars
In M
illio
ns)
CRM Revenue
The implementation of CRM technologies is projected to accelerate over the next few years
1996 1997 1998 1999
$1,000
$1,400
$1,960
$2,744
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
1996 1997 1998 1999
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.23
People Process
External customer Internal customer Sales Force Support team Back-office Technical staff
Data Warehouse
Marketing / up-selling Technical support Product support Service support 7 x 24 support
IVR ACD
CTI
• Customer history, billing, purchases, value, profile
• Product & service information, packages, prices
• Marketing hints, reports, promotions
• Customer data updates, purchase information
• Leads tracking update, customer tracking updates
• Call statistics, inquiries, etc.
Info
rmat
ion
Call Centres - DefinitionCall centres are a key enabling arm of Customer Relationship Management. A well designed call centre will integrate people, process, and technology to improve operational efficiency and maximize the value of the customer relationship for both inbound and outbound contact.
Call CentreTechnologies
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.24
• Customized Agent Desktop Applications by Customer & Call Type
• Automated Scripting of Call Handling & Wrap-up
• Flexibility to Add New Products, Services, and Customer Service Opportunities
• Scripted Cross-Selling• Legacy Integration• Billing & Meter Reading• Direct Access
Data Warehouse
Call Centres - Architecture
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.25
There is a major transition to integrated delivery channels and to provide “one face” to
the customer.Old RuleOld Rule New RuleNew Rule
Paradigm ShiftsParadigm Shifts
Minimal technologyMinimal technology Leading edge and integrated technology
Leading edge and integrated technology
Single productSingle product Multiple productsand cross selling
Multiple productsand cross selling
ReactiveReactive ProactiveProactive
Low skilled CSR’sLow skilled CSR’s Multi-skilled CSR’sMulti-skilled CSR’s
Backroom operationBackroom operation Front Office operationFront Office operation
Stand-alone operation& information
Stand-alone operation& information
Distribution channel & information integrationDistribution channel & information integration
TacticalTactical StrategicStrategic
Customer InquiriesCustomer InquiriesCost of BusinessCost of Business
Enhanced Customer Satisfaction Enhanced Customer Satisfaction and Retention Revenue Growthand Retention Revenue GrowthLower Cost DistributionLower Cost Distribution
Call Centre Call Centre of the Future
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.26
• Intranet - as an alternative sales channel • Electronic catalog - On-line self served service
ordering• Commission - Effective tracking of performances
and accurate commissioning• Opportunity Management - tools such as
automated customer data analysis and pop-up screens will assist in up-selling
• Competitor Data - effective analysis of competitive data and automated access for sales force
• Contact Management - Effective tracking and follow-up of leads
• Customer Data - Sales people will have a complete analysis of the customer before their eyes when attending to a customer. No wait, no repeated questions, no frustrated customers
• News Service - Optional news sorting and reporting will result in informed sales people
• Order Entry Quoting - On the spot quoting will not give the client a chance to shop around and be hunted
• Proposal Development - Automated document creation based on corporate standards
• Pricing - Automated on-line prices based on company rules
• Product - On-line and easily accessed • Just-in-Time Training - Automated training, WEB
based training, and self training through information sharing
• Electronic Kiosk - WEB page shopping.
Basic Features Basic Features
Sales Process Automation - Definition
Sales Process Automation (SPA) is the approach for helping organizations dramatically improve their sales and marketing effectiveness through the reengineering and automation of their sales and marketing processes, with the ultimate goal of increasing revenues. SPA combines a working knowledge of the market’s best ideas, technologies, and vendors with a practical, relentless focus on implementation to deliver outstanding shareholder and customer value.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.27
0% 10% 20% 30% 40% 50% 60% 70%
Current Information
Improve Forecasts
Increase Sell Time
Reduce Administration
Improve Margins
Decrease Costs
Team Selling
Improve Management Effectiveness
Improve Communications
Reduce Sell Cycle
Increase Revenues
Increase Customer Satisfaction
Improve Sales Effectiveness
Source: © Insight Technology Group
PERCEIVED BENEFITS OF SPA FIELD TECHNOLOGY
% of Survey Responses (N=295)
Sales Process Automation - Benefits
Improving sales force productivity and effectiveness by implementing field technology is a key goal for many organizations
Improving sales force productivity and effectiveness by implementing field technology is a key goal for many organizations
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.28
Business Processes
Profiles & Preferences
Business PartnerBusiness Partner
Business to CustomerBusiness to Customer
Business to BusinessBusiness to Business
The ValueThe ValueProposition Proposition
of of ElectronicElectronicBusinessBusinessSolutionsSolutions
Integrating more directly with the business processes of customers and partners
Tailoring products and services to customers needs and values
Business Processes
Extending key business applications to clients and business partners
Business PartnerBusiness Partner
e-Business is all about integrating the internal and external processes between business partners and
customers.
e-Business is all about integrating the internal and external processes between business partners and
customers.
e-Business - Definition
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.29
Internet technology can improve the level of customer care, while reducing the cost of maintaining the customer base.
Internet technology can improve the level of customer care, while reducing the cost of maintaining the customer base.
e-Business - Benefits On average, it costs about $5 - $50 per
query to support via phone On average, it costs about $1 - $3 per
query to support via E-mail On average, it cost less than $1 per query
to support via WWW
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.30
Internet and
World Wide Web
3. Payment Processing
5. Product Fulfillment
Order entry Tax calculation Validation Confirmation
Payment information
Security Link with
finance
Pick and pack Integration/configuration
of third party products Ship products or deliver services Inventory management Order tracking
Customer preferences Products and availability Pricing and promotions Adaptive selling Build/configure to order
1. AdaptiveProduct Offer
A B$X,XXX $X,XXX
Link with third parties Create pick list Consolidate orders
2. Order Capture and Validation 4. Order
Management
For both business-to-business and business-to-consumer sales, there are five key elements to e-Business — product offer, order capture and
validation, payment processing, ordermanagement, and product fulfillment.
For both business-to-business and business-to-consumer sales, there are five key elements to e-Business — product offer, order capture and
validation, payment processing, ordermanagement, and product fulfillment.
e-Business - Architecture
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.31
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.32
Figure 6.2 Social environments in EuropeSource: Motivaction. © Motivaction International B.V. 1999 www.motivaction.nl.
Peelen, Customer Relationship Management Powerpoints on the web, 2nd edition © Pearson Education Limited 2014
Slide 6.33