Customer Relationship Management (CRM): Strategies and Technologies
Customer Relationship Management (CRM)
Phase 5: Evaluating CRM Performance
The final phase of a CRM project involves evaluating its performance, focusing on both project outcomes (e.g., on-time and within budget delivery) and business outcomes (e.g., achieving desired results and CRM success).
Developing, Managing, and Using Customer-Related Databases
Strategic CRM, aimed at acquiring and retaining profitable customers, relies on customer data to identify target customers. Operational CRM, focused on automating customer-facing processes, requires customer data for excellent service, successful marketing campaigns, and sales opportunity tracking.
Defining Database Functions
Strategic CRM needs data on markets, offerings, customers, channels, competitors, performance, and potential to identify target customers for acquisition, retention, and development.
Stages in Building Databases
- Define information requirements (e.g., contact data, history, transactions, opportunities, products, communication preferences).
- Identify information sources.
- Enhance the data.
Selecting Database Technology and Hardware Platform
- Consider relational databases and Relational Database Management Systems (RDBMS).
- Populate and maintain the database.
- Ensure desirable data attributes like integration, warehousing, access, interrogation, mining, and privacy.
Customer Portfolio Management
Customer portfolio management involves grouping customers based on strategic variables. Strategic CRM emphasizes that not all customers should be managed identically. Customers have varying needs, preferences, expectations, revenue, and cost profiles, requiring different management approaches.
Basic Disciplines for Client Portfolio Management
- Market segmentation
- Sales forecasting
- Activity-based costing
- Lifetime value estimation
- Data mining (clustering, decision trees, neural networks)
- CPM in the business-to-business context
Strategically Significant Customers
- High future lifetime value customers
- High volume customers
- Benchmark customers
- Inspirations
- Door openers
Seven Core Customer Management Strategies
- Protect the relationship
- Re-engineer the relationship
- Enhance the relationship
- Harvest the relationship
- End the relationship
- Win back the customer
- Start a relationship
Customer Relationship Management and Customer Experience
Companies are increasingly focused on managing and improving customer experience, which is the cognitive and affective outcome of a customer’s interaction with a company’s people, processes, technologies, products, and services.
From Service to Experience
- The planned customer experience
- Understanding customer experience through mystery shopping, experience mapping, and process mapping
Experiential Marketing Strategies and Tactics
- Communications
- Visual identity
- Product presence
- Co-branding
- Spatial environments
- Websites and electronic media
- People
Customer Experience and the Role of CRM
Strategic CRM aims to win and keep profitable customers through a customer-centric culture, focusing on meeting the requirements of defined customer groups. Customer experience should satisfy targeted customer expectations, with differentiated experiences across the customer portfolio. Operational CRM applies technology to sales, marketing, and service functions.
Features of CRM Software Applications that Influence Customer Experience
- Usability
- Flexibility
- High performance
- Scalability
Managing the Customer Lifecycle: Customer Acquisition
Core customer lifecycle management processes include customer acquisition, development, and retention. These processes determine how companies identify and acquire new customers, grow their value, and retain them long-term. New customer acquisition is crucial for business growth and to replace lost customers due to attrition.