CRM: A customer-focused and customer-driven organizational strategy that
concentrates on satisfying customers by addressing their requirements for products
and services, and then by providing high-quality responsive service.
Builds sustainable long-term customer relationships that create value for the
company as well as for the customer.
Helps companies acquire new customers, retain existing customers and grow
the relationships with existing customers.
Starts with marketing efforts that solicit prospectsbecome
customersbecome repeat customersget segmented into low-value and
high-value repeat customers
Customer churn: certain % of lost customers
Optimal result of CRM is to max the number of high-value repeat customers
while min customer churn.
In essence, treat different customers differently, because their needs differ
and their value to the company also may differ.
1%increase in customer satisfaction can lead to as much as a 300% increase
in a company’s market cap
Successful CRM policies share two basic elements: a) company must identify
the many types of customer touch points b) needs to consolidate data about
Customer Touch Points: any interaction between a customer and an organization.
Traditional: telephone, direct mailings, and actual physical interactions
CRM managed: e-mails, websites, and communication via smart phones.
Data consolidation is critically important to an organizations CRM efforts
Interconnected systems built around a data warehouse allow all customer-
related data available to every unit of business360-degree view of a
Collaborative CRM systems: Provide effective and efficient interactive
communication with the customer throughout the entire organization.
Integrates communication b/w the organization and its customers in all
aspects of marketing, sales and customer support processes
Enables customers to provide direct feedback to the organizationblogs and
Contains two major components: a) operational CRM and b) Analytical CRM
Operational CRM: component of CRM that supports the front office business
process; processes that directly interact with the customer, like:
1. Customer-facing CRM applications: those applications where an
organizations sales, field service and customer interaction centre reps actually interact with customers.
-Customer interaction centres (CIC): organizational representatives use
multiple communication channels such as the web, phones, fax and face-to-
face interactions to support the communication preferences of customers.
-creates call lists for the sales team to contact prospectsoutbound telesales
-customers interact directly with CIC to initiate sales order, inquire about
products and services before ordering or obtaining info about
-Also provides Information Help Deskassist customers with their questions
concerning products and services and also process customer complaints,
which generate follow-up activities such as quality control checks, product
returns and delivery of replacement
-companies must place great deal of emphasis on the CRM process.
-Sales force automation (SFA): The component of an operational CRM
system that automatically records all the aspects in a sales transaction
-Include contact management systemstrack all contact that has been made
with a customer, the purpose of the contact, and any follow-up that might be
necessary. It eliminates duplicated contacts and redundancy
-Also sales tracking systemlist potential customers or customers who have
purchased related products
-sales forecasting systemsmathematical technique