3.07 Understand the nature of customer relationship management to show its contributions to a company

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20 Νοε 2013 (πριν από 3 χρόνια και 8 μήνες)

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3.07 Understand the nature of
customer relationship management to
show its contributions to a company

Performance Indicator: Discuss the nature of customer
relationship management

Define the term customer relationship
management (CRM)


It is a strategic tool firms can use to leverage proprietary
information to identify cross
-
selling opportunities, new prospects,
and potential conflicts of interest or independence issues. By
developing a deeper understanding of your clients
--
their industries,
markets and relationships
--
through CRM, your firm can gain a
sustainable competitive advantage in challenging times

Source:
http://www.allbusiness.com/company
-
activities
-
management/operations/11477600
-
1.html#ixzz1c5DbnOf1



Strategies, processes, and policies used by businesses to build,
maintain, and maximize the long
-
term value of customer
relationships


Helps businesses to understand the respond to customers’ changing
needs


Emphasizes positive meaningful, and long
-
term communication and
interaction with customers.


Involves the collection of customer information to draw conclusions
about the customer’s needs and wants as well as predict the customer’s
loyalty and value in the future

Explain goals of CRM


To maximize the value and effectiveness of all customer

To provide outstanding service to customers


To maximize customer satisfaction


To attract and retain loyal customers


To cultivate and maintain positive, profitable relationships
with customers


To develop individualized relationships with customers

CRM Goals continued


To gather and tract information about customer for use
in business decision
-
making


To understand customers and their needs so that these
needs can be fulfilled in a manner satisfactory to
customers and businesses


To develop products that meet or exceed customer
expectations


To increase business profit


To develop a competitive advantage



Describe common CRM processes


Campaign management (usually conducted by the marketing
dept.)


Targeting prospective customers


Distributing promotional materials to targeted prospects


Tracking response to promotional materials


Generating leads for sales


Sales management (sometimes divided into lead management,
offer management, and contract management)


Recording lead information


Qualifying leads


Prioritizing leads


Contacting leads


Making sales

Common processes continued


Service management


Providing after
-
sales services, such as:


Maintenance and repair services


Warranties and guarantees


Retaining customers


Complaint management


Receiving customer complaints


Resolving customer problems


Communicating customer complaints to the organization


Retaining customers

Discuss the use of customer information in
CRM


By gathering and organizing customer information, a
business can better determine and fulfill its customers’
needs and wants





Customer information is also used to identify the most
profitable, loyal customers. After identifying these
customers, the business may provide higher, better
service to these customers to maintain their loyalty and
increase their profitability

Describe the nature of customer
relationships in today’s society


Because customers now have so many different choices in
the marketplace, they have become more selective about
them they do business with. When given the choice to do
business with one of two businesses that sell nearly
identical products at similar prices, customers often
choose to purchase from the business that offers better
customer service. As a result, customers’ expectations
for customer service are
highter

Describe the role of customer experience
management (CEM) in CRM


The business world has become increasingly focused on the
customer versus the product


Many businesses have adopted customer
-
centric attitudes and
strategies


An important component of CRM is customer experience
management (CEM)

Explain the impact of organizational
structure on CRM


The organization should be structured so that customers
have “seamless”, easy interactions with the company.


To ensure that customer have “seamless” interactions
with the company all customer information must be
available in one location to all employees who require it
(usually CRM technology)


Companies with superior CRM processes are much more
likely to be organized according to customer segment or
group.


Role of corporate culture in CRM


For CRM to be successful, it must be supported by the
corporate culture (i.e., the values, beliefs, and encouraged
behaviors in an organization)


Sr. Executives must believe and demonstrate that building
and maintaining customer relationships is a corporate
priority


Corporate values must be understood and embraced by
all employees


Employee incentives, such as prizes and bonuses, can help
ensure that employees embrace CRM strategies and
processes


Also, employees must be given leeway to do what is
necessary to satisfy customers

The importance of formulating a CRM
strategy prior to implementing CRM
processes and tools


Each company should design a unique CRM strategy that
directly addresses its needs, organization, and customers


An important step in developing a CRM strategy is identifying
the objectives/goals of the CRM program (e.g., to increase
customer retention, to improve product offerings, etc.)


Before implementing CRM processes and tools, each company
must determine which members of its organization will be
involved in CRM so that these individuals can be trained


CRM technology and tools should be selected
after
determining the company’s CRM strategy, objectives, and
program participants

The relationship of CRM and business
process management


CRM and business process management (BPM) work
together to satisfy customers


BPM: A type of management that focuses on the design
and improvement of business processes (including FRM
processes) to make them as efficient and effective as
possible; strives to align business processes with
customers’ needs and wants


BPM ensures that CRM processes meet the needs, wants,
and expectations of customers, while CRM processes can
gather customer information that can be used to ensure
that business processes are designed with the end user


the customer
-
in mind

Describe the relationship of CRM and
continuous improvement


Continuous improvement: The activity of regularly
updating one’s processes for better efficiency


After developing a CRM strategy and implementing CRM
processes, continuous improvement must occur to ensure
that:


Company values remain in line with the CRM strategy


CRM processes remain effective



Explain ways in which CRM can benefit a
business


Increased customer satisfaction and loyalty


More customers and customer referrals


Reduced costs


Fewer complaints


Lower employee stress levels


Increased access to customer information (for use in
business decision
-
making)


Long
-
term profitability

Performance Indicator: Explain the
role of ethics in CRM

Definitions


Consent: (v) to be of the same mind or opinion (n)
acceptance or approval of what is planned or done by
another; acquiescence


Integrity: the quality of following rules, even if no one is
around to enforce them. Integrity includes treating
people fairly, applying rules consistently, and being
unbiased
and unprejudiced.

Describe the importance of trust in
customer/business relationships


Building Trust is the Key to Avoiding Ethical Dilemmas


Aesops

Fables, two buddies (insurance salesperson and client) are
traveling together in the woods, when a bear rushes out in front of them.
On instinct, the salesperson grabs a tree branch and climbs a tree,
stranding the client. Ever resourceful, the client feigns death, knowing
the bear won’t eat dead meat. After the bear sniffs close to the clients
ear, it eventually leaves the area. As the sales person climbs down the
tree, he laughingly asks the client: What did that big bad bear whisper?
The client glares, then offers: He said, never trust a friend who deserts
you in a pinch.
http://ezinearticles.com/?Presenting
-
ETHICS
---
Elevating
-
Trust
-
Has
-
Inspired
-
Customer
-
Satisfaction&id=2307463


Discuss loyalty issues in
customer/business relationships


Developing and nurturing loyalty should be the marketer's
primary, day
-
to
-
day concern. Doing so increases the likelihood
their brand can withstand economic turmoil, competitive
threats, and reasonable price increases.


Through in
-
store temporary price reductions or couponing,
consumers are told "we'll reduce your risk if you give us a
try." The problem is that, just like the price relief itself, the
consumers' commitment to the brand is temporary.


Another popular strategy among marketers with significant
budgets is the development of catchy marketing phrases like
"Just Do It" or "
Oooops
, I could have had a V8". This
approach can be effective, until budgets are cut because
another brand in the division is underperforming.



See the rest of the article @
http://chiefmarketer.com/crm/0106
-
customer
-
loyalty/



Describe ethical issues related to the
collection of customer information


Read about ethics in CRM @
http://www.ehow.com/info_8384284_ethical
-
issues
-
crm.html



http://www.securitymagazine.com/articles/81720
-
consumer
-
loyalty
-
programs
-
what
-
are
-
your
-
real
-
statistics
-

Read the Role of Loss Prevention


Some areas of risk:


Employees scanning their own loyalty card


Cards activated at the Point of Sale and scanned more than 4 times a
day


Cards activated with no customer information


Situations in which employees/departments involved
in CRM may be reluctant to share customer
information


Ethical issues related to the sale of
customer information to 3
rd

parties


Data that can be purchased or rented from third party
vendors may include names, addresses, telephone
numbers, mailing addresses, social security numbers, age
information, health and medical data, and other personal
or proprietary information


information obtained for one purpose may be lawful, but if
utilized for another purpose, may be illegal.


Consumer advocates want to give consumers the option to
have to affirmatively "opt
-
in", i.e., sign a consent form, to permit
information to be conveyed to a third party



http://www.mmmlaw.com/media
-
room/publications/articles/legal
-
and
-
ethical
-
issues
-
in
-
obtaining
-
and
-
sharing
-
information1


FEDERAL TRADE COMMISSION FAIR
INFORMATION PRACTICE PRINCIPLES


TABLE 4
-
4


1. Notice/awareness (core principle).Web sites must disclose their information practices
before collecting data. Includes identification of collector;


uses of data; other recipients of data; nature of collection (active/inactive); voluntary
or required status; consequences of refusal; and steps taken to protect
confidentiality, integrity, and quality of the data.


2. Choice/consent (core principle). There must be a choice regime in place allowing
consumers to choose how their information will be used for


secondary purposes other than supporting the transaction, including internal use
and transfer to third parties.


3. Access/participation. Consumers should be able to review and contest the accuracy and
completeness of data collected about them in a timely,
inexpensive process.


4. Security. Data collectors must take responsible steps to assure that consumer
information is accurate and secure from unauthorized use.


5. Enforcement. There must be in place a mechanism to enforce FIP principles. This can
involve self
-
regulation, legislation giving consumers legal
remedies for violations, or
federal statutes and regulations.



http://www.prenhall.com/behindthebook/0132304619/pdf/laudon%20MIS10_CH
-
04%20FINAL.pdf


The impact of poor/unethical privacy
practices on customer relationships


Performance Indicator: Describe
the use of technology in CRM

Definitions


Client intelligence




Cross
-
selling


encouraging a customer who buys one
product to buy a related or complementary product


Up
-
selling


the seller will provide opportunities for the
customer to buy related products or services. For
example, “Would you like fries with that?” “How about a
nice apple pie?”


Relationship mapping
-

A mapping that describes how to
persist a relationship (association, aggregation, or
composition) between two or more objects.
http://www.agiledata.org/essays/mappingObjects.html


Definitions continued


Personalization


Creation of custom tailored
services(such as news pages on the web or specialized
newsletters) that meet the individual customer’s
particular needs or preferences


Segmentation


Subdivision of a population into segments
with similar characteristics, such as age, education, income


Clustering
-

A group of the same or similar elements
gathered or occurring closely together; a bunch


Difference between CRM technology and
CRM


CRM is a strategy (no, not software) to transform your
business to be customer, not product, focused. The CRM
software is just a tool that helps the company carry out
this strategy. Depending on its implementation, it can help
your business identify who your customers are, what they
need and anticipate what could want. It allows businesses
to tailor offers to their current customers, building closer
relationships that make them feel valuable.


Overall, CRM can make your company more efficient and
customer
-
friendly to capture greater market share,
increase customer loyalty, and attract more customers.


http://www.businessknowhow.com/marketing/crm.htm


Types of CRM tools


CRM Applications




Email focus


Infusionsoft


InTouch

CRM


Social and collaborative focus


Batchbook


Kickapps


Rapportive


Gist


Sales focus


Smartsheet

Sales Pipeline


SalesForce.com


Sugar CRM

http://smallbiztrends.com/2011/01/9
-
crm
-
apps
-
small
-
business.html


CRM tools continued

Databases

Data Warehouses


Uses


Customer information


Employee information


Create reports on buying
habits and trends


Track sales and create goals
for the sales team

http://www.avidian.com/crm/crm
-
database.aspx



Data warehouse serves as the
repository to collect and
integrate the breadth of
customer information found in
operation systems as well as in
external ones.


The data warehouse supports a
complete view of the
customers, including customer
data from typical sources such
as: transactional data,
interaction data (solicitations,
call centers), demographic and
behavioral data and self
-
provided profile data

Data commonly stored in a CRM system


Contact data


ability to
build stronger, longer lasting
relationships with
customers. Know what they
“Like” on
Facebook

and
who/what they’re following
on Twitter in addition to
their personal data


Demographic data


income,
zip code, etc.


Transactional data
-

what,
when, where, and how much
a customer bought


Relationship data
-

allows
customer facing employees
in such areas as sales,
customer support, and
marketing to make quick yet
informed decisions on
everything from cross
-
selling
and
upselling

opportunities
to target marketing
strategies to competitive
positioning tactics.

Types of CRM software approaches


Operation CRM
-

provide support to front office
business processes such as sales personnel, marketing and
service staff


Analytical CRM
-

Basically it evaluates the necessary
customer data for a wide variety of reasons and purposes
like:



Designing and accomplishing target marketing campaigns.



Designing and accomplish various campaigns i.e. cross selling, up selling
and customer acquisition.



Identifying customer behaviors regarding products and services i.e.
product development and pricing.



Management information system i.e. financial forecasting


Types of CRM software approaches
continued


Sales Intelligence CRM
-

It is known as a direct sales tool, which is
similar to Analytical CRM. Usually it has a variety of features like:



Cross
-
selling/Up
-
selling opportunities



Customer drift



Sales performance



Customer trends


Campaign Management


contains features of both Operational and
Analytical, includes tracking, storing and analyzing campaign statistics


Collaborative CRM
-

Collaborative data management tools make
company information available across the web

http://www.ehow.com/list_6707950_types
-
crm
-
tools.html#ixzz1c5lkeLYd


Other tools include


Customer Relationship CRM


identify the best current customers and
segments


Simple CRM


Social CRM


can create online ads and Twitter updates

http://www.crmscorecard.com/types
-
of
-
crm.htm



CRM technology

Benefits

Drawbacks


Data consolidation & analysis


allows sales and customer services
professionals comprehensive data


Customer identification & retention


providing personalized sales
offerings


Cross
-
selling opportunities
-

offer
personally tailored product offerings
during the service transaction


Portability
-

resolve customer issues
on site while using the information
provided by CRM technology


Improved Forecasting
-

can identify
both short
-

and long
-
term trends in
customer activity


http://www.ehow.com/list_6529278_crm
-
technology
-
benefits.html







Record loss
-

company does not
have control of the data. If there
is an outage, information will be
lost


Overhead


costs associated with
running the software application


Training


takes away time from
productivity


Increased vulnerability


if security
is breached


http://www.ehow.com/list_6178037_disadvantages
-
crm
-
systems.html




How CRM technology can be used to create
a “single view” of the customer


Importance of


Cleansing


removing discrepancies and inconsistencies in
client/customer data. Helps to improve CRM data


Standardizing
-

information about the customer by
recognizing, comparing, matching, and reconciling
customer data across disparate systems according to
predefined rules


Updating data


to view customer in “real
-
time”