CUSTOMER RELATIONSHIP MANAGEMENT (CRM)

CII Institute of Logistics

Session map
Session1 Session 2

Introduction The new focus on customer loyalty CRM and Business Intelligence CRM Marketing initiatives
Session 3

CRM in e-business Partner relationship management Planning CRM programme Preparing CRM business plan
Session 4

Understanding and integrating CRM with the business process Tools for CRM Choosing the CRM tool Putting the CRM to work

CRM through new product development Channel management and CRM Catalytic measures to improve CRM Best practices in outsourcing CRM

Session 3
1. 2. 3.
4.

Recap sessions1and 2
CRM implementation

8. 9. 10.

CRM Software - Demo Data mining CRM people

PFD overview (OMG BPMN)

Blue print Case study CRM implementation Technology

5.

6. 7.

CRM S/W modules

Session Summary

Customer relationship programmes should result in customer acquisition, retention and enhancement to retailers. Programme design, people, processes and automation are key components for successful customer outcomes. Multi-dimensional views and deeper insights into consumer data are critical for good programme design.

Session summary

To become customer centric, firms should shift focus from product to customer Customer segmentation helps in identifying profitable segments and deliver high value Enterprises can gradually move up in CRM maturity levels Customer satisfaction does not guarantee loyalty Continuous efforts a necessary to refocus on customer needs to be successful and profitable in competitive market

CRM implementation
Steps Define purpose Define processes Create blue print Use technology Identify and train people Execute customer centric programmes Areas to focus Customer acquisition, retention, enhancement Use process mapping tools (Ex. BPMN) Blue print provides simple view of integrated process and data flow across the enterprise Evaluate based on current industry standards (Process management,
workflow management, data warehousing and data mining)

Attitude towards customers and process orientation Design and redesign marketing programmes based on insights gained through customer data mining

Process flow diagram notations

For details refer OMG document circulated to you

Example: PFD

Its like your home A team work

Team A ERP Enterprise systems

Team C CRM

Enterprise Architect team

Team B SCM

Blue print reduces complexity

ERP
Suppliers

SCM
Customers

CRM

BI (DW/DM)

Cost Response

Product / Service / Cash / Information flows

Response Cost

The technology factor

-Web enabled -Workflow, integrated process management, role based views, dash boards and reports -Centralized database -Secured transactions -High speed processing Integrated enterprise systems (Open source Vs Proprietary) Enterprise resource planning for intra business efficiency

Supply chain management and Customer relationship management for inter business efficiency

Data warehousing and data mining for business intelligence, supplier intelligence and customer intelligence

CRM software modules overview

Customer management Prospect Management Loyalty management Call center management Service management Promotions management Marketing analytics and reports
Manage existing customer data Manage prospective customer data Manage rewards and cards Manage inbound / outbound voice and non-voice requests Manage customer service requests Plan and execute targeted promotions via SMS/Email/Phone/Post Customer data mining and reporting

Data mining
Five types of customer data analyses Determine purpose of data analysis Decide orientation Predictive or descriptive Use appropriate algorithm
Classification Regression

Link analysis

Segmentation

Deviation detection

Query examples

Database

Find all credit applicants with last name of Smith Identify customers who have purchased more than $10,000 in the last month.
Find all customers who have purchased milk

Data Mining
Find all credit applicants who are poor credit risks. (classification)

Identify customers with similar buying habits. (Clustering) Find all items which are frequently purchased with milk. (association rules)

Types of data analyses

Classification

Class A / B / C products, Low / Med / High spend customers

Regression analysis (Predict using dependent and independent variables Bi-variate / multivariate)

2009 Diwali sales INR 30Mn in Delhi because of TV promotions costing INR 3Mn, What would be 2010 Diwali sales?

Link analysis or Correlation analysis

Directly related or inversely related, strong connection or weak connection between variables to understand trends and patterns Market basket analysis customer buys product A, B, C may also buy D

Segmentation or Cluster analysis

Identify customers with similar buying habits (Monthly provisions and personal care items together)

Deviation detection

Sales volume Vs Stock outs 2008 Q3 2009 Q3

Data mining models

In simple terms

Data mining tools

Summarization (Tables and measures of dispersion) Visualization (Graphs) Modeling (Predictive and descriptive algorithms)

RFM, Association rules, Time series,

Regression, Decision trees, Case based reasoning, clustering

The CRM people characteristics

Corporate team

Focus on business objectives Focus on full customer experience Analyze data Plan marketing strategy Resolve escalated conflicts Evaluate performance of Field and Support teams Adapt to changing demand

Field team
Discipline Focus only on In store customer experience
Collect complete data

Support team
Proactive in understanding customer needs Focus only on Presales and Post sales Customer experience
Validate, enter and process data

Effective execution of offers Conflict resolution Coordination with support team

Plan and execute targeted promotions Preventive approach to conflict resolution Coordination with field team