Customer Relationship Management CRM

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Customer Relationship Management (CRM)
CHAPTER 19
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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.
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Customer Relationship Management Cycle
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Implementing a CRM System

• Customers take center stage
• Business must manage the customer relationship
  across all points of customer contact

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Knowledge About Our Customers
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Empowerment
Empowerment

• Delegation of authority to solve customers
  problems quicklyusually by the first person that
  the customer notifies regarding the problem.

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Interactions of the Current Customer Base
Customer
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Interactions of the Current Customer Base
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REVIEW LEARNING OUTCOMEInteractions with Current
Customer Base
Customer
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Capture Customer Data
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REVIEW LEARNING OUTCOMECapturing Customer Data
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Identifying the Best Customers
A data analysis procedure that identifies
significant patterns of variables and
characteristics that pertain to particular
customers or customer groups.
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Data Mining

• Identify and profile the best customers
• Calculate their lifetime value
• Predict purchasing behavior

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Data Analysis
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Recency-Frequency-Monetary Analysis

• Identifies customers mostly like to purchase
  again
• Identifies and ranks best customers
• Identifies most profitable customers

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Data Manipulation Techniques
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CRM Marketing Database Applications
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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
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Targeted Marketing Communications
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Increasing Effectiveness ofDistribution Channel
Marketing
Multichannel Marketing