HOW CRM WORKS
Customer Relationship Management (CRM)
CRM enables an organization to:
v
Provide better customer service
v
Make call centers more efficient
v
Cross sell products more effectively
v
Help sales staff close deals faster
v
Simplify marketing and sales processes
v
Discover new customers
v
Increase customer revenues
Recency,
Frequency, and Monetary Value
Organizations
can find their most valuable customers through “RFM” - Recency, Frequency,
and Monetary value
v
How recently a customer purchased items
(Recency)
v
How frequently a customer purchased items
(Frequency)
v
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
The Ugly Side of CRM
Customer Relationship Management’s Explosive Growth
CRM Business Drivers
Customer Relationship Management’s Explosive Growth
Forecasts for CRM Spending (in billions)
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
CRM success factors include:
v
Clearly communicate the CRM strategy
v
Define information needs and flows
v
Build an integrated view of the customer
v
Implement in iterations
v
Scalability for organizational growth
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