Customer relationship management (CRM)
- CRM enables an organization to:
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Provide better customer service
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Make call centers more efficient
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Cross sell products more effectively
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Help sales staff close deals faster
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Simplify marketing and sales processes
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Discover new customers
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Increase customer revenues
Recency, Frequency, and Monetary Value
- Organizations can find their most valuable customers through “RFM” –Recency, Frequency, and Monetary value
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How recently a customer purchased items
(Recency)
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How frequently a customer purchased items
(Frequency)
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How much a customer spends on each purchase
(Monetary Value)
The Evolution of CRM
- CRM reporting technology – help organizations identify their customers across other applications
- CRM analysis technologies – help organization segment their customers into categories such as best and worst customers
- CRM predicting technologies – help organizations make predictions regarding customer behavior such as which customers are at risk of leaving
- Three phases in the evolution of CRM include reporting, analyzing, and predicting
Using Analytical CRM to Enhance Decisions
- Operational CRM – supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers
- Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers
- Operational CRM and analytical CRM
Customer Relationship Management Success Factors
- CRM success factors include:
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Clearly communicate the CRM strategy
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Define information needs and flows
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Build an integrated view of the customer
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Implement in iterations
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Scalability for organizational growth
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