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ADMS 2511 (179)
Carl Lapp (29)

Chapter 9.docx

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York University
Administrative Studies
ADMS 2511
Carl Lapp

Chapter 9 – Customer Relationship Management 9.1 – Defining Customer Relationship Management *Customer has extreme power due to the internet and World Wide Web and competitors are often a click away  Customer relationship management returns to personal marketing  business markets to each customer individually rather than market to a mass group of people or a company  by targeting individuals you can use the information of each individual to create offers that customers are more likely to accept  designed to achieve customer intimacy (customer focused and driven) Positive traits of CRM - builds sustainable long term relationship with customers - helps company acquire new customers, and build relationship with existing customers - focus on repeating customers as they are the biggest form of revenue for a company *Getting a customer back after they have switched to competitors are more expensive than keeping them in the first place CRM Process 1) Marketing efforts, where the organization solicits prospects from a target population of potential customers (certain number of prospects will make purchases becoming customers, and some will be repeat customers; 1 being high and 2 being low level repeat customers) Customer Relationship Management – Marketing, Customer Acquisition, Support and Resell, Segment 2) Organizations will lose a certain percentage of customers (customer churn) Optimal result of an organization CRM effort is to maximize the number of high value repeat customers while minimizing customer churn by treating customers differently and to everyone’s needs Two Basic Elements of Successful CRM policies 1) Customer Touch Points a. Recognize interactions with customers b. Example telephones, mailing, physical interactions, smart phone, computer, service centre, email, call centre 2) Data Consolidation a. Interconnected systems built around a data warehouse now make all customer related data available to every unit of the business (finance, accounting, sales) b. Called a 360 degree view of the customer c. Creates a more productive and profitable decisions d. Leads to collaborative CRM, which is a system that provides effective and efficient communications between the organization and its customers in all aspects, and also allows customers to provide direct feedback to the organization CRM system in an organization contains two major components; operational CRM and analytical CRM 9.2 – Operational CRM  Component of CRM that supports the front office business process (directly interact with customers, sales, marketing)  1) Customer Facing Application 2) Customer Touching Application Customer Facing Applications - Applications where an organizations sales, field service, and customer interaction centre representatives actually interact with the customers - Example; customer service and support, sales force automation, marketing and campaign management etc Customer Service and Support - Automate service request, complaints, product returns etc - Customer interaction centres (CIC) Use multiple communication channels such as the web, telephone, fax, and face to face interactions to support the communication preferences of the customers - Organizations use the CIC to create a call list for the sales team, whose members contact sales prospects (outbound telesales) to discuss products and services that can satisfy customers needs - Inbound teleservice i
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